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Commerce One, Covisint announce partnership

Pleasanton, Calif.  December 12, 2000  Commerce One announced today that it has reached a definitive agreement to provide the core e-marketplace procurement infrastructure for Covisint, the automotive e-marketplace. Covisint has licensed and is using Commerce One MarketSite, the company's e-marketplace infrastructure solution, as the procurement transaction engine for the trading of all kinds of goods and services, including indirect and direct (planned) materials.

Covisint has licensed and is hosting the Enterprise Buyer Desktop Edition e-procurement application for use by participants in the e-marketplace. Covisint will also use Commerce One auction and catalog content solutions. Commerce One Global Services is providing Covisint with both strategic and technical consulting resources.
Commerce One has powered more than $1.5 billion to date in transactions for Covisint and its trading partners General Motors and DaimlerChrysler.

Under the terms of the agreement, Commerce One will receive consideration in keeping with its typical e-marketplace customer relationships, including cash compensation, a share of the e-marketplace revenue and an equity interest in Covisint. Commerce One is the only technology partner with revenue share in Covisint.

We look forward to continuing our efforts with Covisint to deliver a global e-marketplace platform for the automotive industry, said Mark Hoffman, chairman and CEO of Commerce One. Covisint is an excellent example of Commerce One's business model and reflects our commitment to moving the world's business commerce onto the Web.

Commerce One is a key partner in making Covisint a cornerstone for e-commerce in the automotive industry, said Rico Digirolamo, Covisint interim CEO. Commerce One's technology and experience are a vital asset in our efforts, and we look forward to continuing our success together.

Details of the Definitive Agreement
Commerce One will be entitled to share in the revenues generated by the Covisint exchange for an anticipated 10-year term. Commerce One also received a two percent equity interest in Covisint. This equity interest will be held in escrow and released to Commerce One only upon the successful completion of its restructuring into a holding company as described below. Commerce One will also receive cash compensation for the consulting services that it will provide to Covisint.

In connection with the Covisint transactions, Commerce One will undergo a corporate restructuring into a holding company. Once the restructuring occurs, all of Commerce One's outstanding shares of common stock will automatically be converted into shares of the holding company common stock at a one-for-one conversion rate. As a result, Commerce One Inc. will become a wholly owned subsidiary of the new holding company. The holding company will continue the business of Commerce One and will become the new Commerce One.

Upon the signing of the Covisint agreements on Friday, Dec. 8th, the Commerce One holding company issued 14.4 million shares of its common stock to Ford and 14.4 million shares of its common stock to GM. Half of each of Ford's and GM's shares will be held in escrow and will be released to Ford and GM in December 2002 upon the satisfaction of certain conditions under the Covisint agreement. Otherwise, the shares will not be released to these companies until June 2004.

All of the shares of stock issued to Ford and GM will be subject to transfer restrictions for three years and will be entitled to registration rights beginning after three years, subject in each case to limited exceptions. Ford and GM have also agreed to certain standstill restrictions that will limit their ability to acquire additional shares of Commerce One's outstanding stock.

The proposed corporate restructuring is subject to the approval of Commerce One's existing stockholders and is expected to take place in the spring or summer of 2001. In the event this approval is not obtained, the Covisint agreements will remain in place. Commerce One will in that case issue a total 28.8 million shares of its stock directly to Ford and GM in exchange for the 28.8 million shares of holding company stock currently held by them. In either event, these shares of Commerce One common stock will be subject to similar escrow, standstill and transfer provisions, and will be entitled to the same registration rights described above whether or not the corporate restructuring takes place.