CapOneSource Incorporates as a Limited Liability Company.

Business Editors

FREMONT, Calif.--(BUSINESS WIRE)--Jan. 14, 2004

CapOneSource, an innovative new purchasing alliance established to provide small and mid-sized companies the buying power of much larger firms, today announced that it has been incorporated as a limited liability company. This legal distinction improves CapOneSource's ability to negotiate volume discounts for member companies on a wide variety of financial, general, operational and information services.

"Some service providers require that alliances such as CapOneSource be incorporated before they will extend the same volume purchasing advantages available to other organizations," said Bob Rudy, CapOneSource advisory board chairman and vice president and chief information officer of Lam Research Corp. "By organizing in this way, CapOneSource can more effectively work toward our goal of saving member companies as much as 50 percent on volume-purchased services."

CapOneSource is a member-owned, not-for-profit entity guided by the philosophy that companies can improve efficiency through pooling demand for basic services and outsourcing other functions that fall outside of their core competencies. By aggregating common demand from a large pool of buyers, the alliance is able to secure volume pricing from a small group of pre-approved, sole-source providers. CapOneSource will manage user groups that meet monthly to coordinate, review, select and evaluate service providers. Each user group is focused on one of four service areas: finance & accounting, general services, operations and information systems.

CapOneSource has grown rapidly since it was formed in July by four founding companies: Lam Research Corp., Credence Systems, Mattson Technology and Varian Semiconductor. Membership now includes 26 companies, 11 of which comprise the organization's advisory board. CapOneSource's goal is to increase its membership to create an alliance of companies with the aggregated buying power of a corporation with more than $20 billion in annual revenues. Membership consists primarily of companies involved in the semiconductor capital equipment industry. However, companies involved in similarly structured industries, such as medical systems and commercial avionics, are being actively recruited.

CapOneSource is structured to benefit companies with annual revenues in excess of $100 million. To join, new members are required to sign a membership agreement, purchase services from one or more CapOneSource solution providers and participate in alliance user groups. Membership is open to all companies that fit the profile, subject to approval by a simple majority of existing members.

There are currently 17 service providers affiliated with CapOneSource: Ceridian, EMCOR, ESIS, IBM, InfoPlus International, Menlo Worldwide, NTT, Premiere Conferencing, PricewaterhouseCoopers, Qwest Communications, Siemens Procurement & Logistics Services, Skytel, Strategic Security Services, The Steele Foundation, and TSC.

About CapOneSource LLC 

CapOneSource LLC is a purchasing alliance established to provide small to mid-sized companies the buying power of much larger firms. The alliance's goal is to aggregate common demand from a large pool of buyers for a small group of sole-sourced providers who have all committed to offer volume pricing to each buyer. It is the intent of the alliance to extend the benefits of outsourcing to a broad range of other capital equipment companies in order to reduce outsourcing/out-tasking costs and leverage common, standardized business processes within the solution providers' capabilities.

For more information, visit the alliance website at: www.caponesource.com.