Softchoice/PlanetGov team wins US IRS contract

EDP Weekly's IT Monitor, Jan 13, 2003

Softchoice Corporation (TSX: SO), a company that helps North American organizations select, acquire and manage their technology resources, has announced that it will fulfill a contract with the Internal Revenue Service (IRS) held by PlanetGov Inc. The five year agreement will see Softchoice supply Microsoft software on behalf of PlanetGov for approximately 120,000 desktop computers in use by the IRS.

The agreement, which covers licenses for Microsoft desktop and server products, is the largest U.S. federal government order fulfilled by Softchoice since the Company increased its commitment to the government market through the acquisition of Beyond.com's government business in August 2002. PlanetGov will serve as the primary contractor in the deal and Softchoice has been sub-contracted to deliver the Microsoft software.

"We are pleased to partner with PlanetGov in servicing and supporting the Internal Revenue Service with their Microsoft software and other technology needs. The IRS team was outstanding during the negotiation process and through PlanetGov, we look forward to bringing them our exceptional service levels and expertise around software licensing and asset management," said David MacDonald, President, Softchoice Corporation. "This deal is a great win for Softchoice and it validates our strategy to expand our presence in the U.S. government market through the acquisition of Beyond.com's government business," MacDonald said.

Due to its size, the margin on this contract is significantly lower than the Company's usual revenue stream. While this contract is expected to positively impact the Company's results for 2002, Softchoice management continues to believe that the advanced purchasing decisions made by customers in response to the July 31 deadline for the purchase of Microsoft Upgrade Advantage products has caused sales in the second and third quarter of 2002 to grow at the expense of expected sales in the current fourth quarter.

PlanetGov is an information technology professional services company that assists government customers in leveraging the power of the Internet and other advanced technologies to improve productivity. PlanetGov specializes in E-Government by supplying, designing, building, and managing information technology solutions that enhance government organizational performance and improves the delivery of services to citizens. PlanetGov is a privately held corporation based in Chantilly, VA with annual revenues approaching US$300 Million.

Softchoice helps North American businesses and organizations of all sizes select, acquire and manage their software and hardware technology needs. Softchoice is a single source for a vast selection of industry leading technology brands including: Microsoft, Symantec, IBM, Hewlett Packard, Compaq, Computer Associates, Cisco, Novell, McAfee, Adobe, Samsung, and Toshiba. Softchoice delivers exceptional service through a network of highly trained outbound sales and customer service representatives, technical product specialists, licensing experts, eBusiness tools and strategic partnerships with leading technology manufacturers.