Sharp and IBM to Jointly Form Solutions Company

Sharp Corp. and IBM Japan Ltd. have agreed to form a jointly-held company that will develop enterprise resource planning (ERP) and supply chain management (SCM) solutions, and for Sharp to outsource its information technology needs to IBM Japan.

The key components of the basic agreement are:

The joint company:

* Sharp and IBM will found a new company, yet to be named, with joint investment of startup capital.

* The new company will develop both ERP and SCM solutions.

* Plans call for the new company to be founded in April 2001 with headquarters in Osaka.

* Employees will be seconded from the information systems departments of both parent companies.

* The number of start-up employees is expected to be approximately 320 (Sharp: 300, IBM Japan: 20).

The outsourcing agreement:

* Sharp will enter into a full-scope outsourcing contract with IBM Japan for all aspects of its information systems processes, including system development, maintenance, and operation, but excluding planning and other strategic sections.

* The new company will execute the outsourcing contract.

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