Acquisition Will Expand Fidelity Suite of HR Outsourcing Services

BOSTON, October 30, 2003 -- As its human resources and benefits services continue to expand, Fidelity Investments announced today that it has entered into a non-binding letter of intent to acquire TEDS, a software development and consulting company that provides learning management systems (LMS), performance management and workforce management products and services. The parties are negotiating definitive agreements relating to the acquisition. If the transaction proceeds according to plan, it is expected to close by the end of the year.

"Fidelity's focus is to drive HR effectiveness through an integrated portfolio of HR solutions. This acquisition would allow us to deliver learning and training administration services that are integrated with our existing portfolio," said Teresa Hassara, executive vice president of Fidelity Employer Services Company's HR/Payroll Services. "As the learning segment continues to evolve rapidly, we were very deliberate in our acquisition choice and we believe TEDS would accelerate the expansion of our learning and training administration capabilities."

Fidelity would operate TEDS as an independent business unit and is committed to providing the company with the resources and focus necessary for continued growth. TEDS would continue to operate from its Virginia offices, offering its suite of learning management and human capital development software products directly to new and existing clients. The company would continue to leverage its broad service model flexibility, offering premise deployed software solutions and a variety of hosting options as well as complete outsourcing alternatives. Additionally, TEDS products and services would provide a critical step toward enhancing Fidelity's integrated HR outsourcing suite of services.

Extending the Outsourcing Model to Training and Administration

Through its Workplace Services offering, Fidelity Investments provides human resources administration and employee benefits solutions to more than 16 million employees in more than 11,600 retirement, pension, health and welfare, payroll and stock programs. The purchase of TEDS would enable Fidelity to extend its model of broad, integrated HR outsourcing services into the emerging market of outsourced learning and training administration.

"Applying business process outsourcing strategies to learning and training administration is a logical evolution of the HR outsourcing trend," said Joseph F. Ellis, Jr., president and founder of TEDS. "As a leader in the corporate training and human capital management space, TEDS sees tremendous opportunities to benefit from the strength of Fidelity's brand, vast technology infrastructure and distribution channels. With Fidelity's backing, we would have the resources necessary to continue to grow our outsourcing business and our hosting and premises deployed solutions as well." Following the acquisition, Ellis would remain with TEDS as president and chief executive officer.

Specific advantages for outsourcing human capital development and learning management processes include reductions in the time devoted to administering learning and upfront capital expenditures for training-related technology, and cost-effective changes in process improvement and supply chain management.

"This acquisition would be an excellent strategic fit for Fidelity and will benefit the clients of both firms," explained Hassara. "With a market-leading 98% customer retention rate, TEDS has an impressive base of long term clients and a demonstrated expertise in implementation. We believe that we can continue to build on that success. At the same time, we will leverage the TEDS expertise to enhance the services we provide to clients looking for an integrated, outsourced alternative."

About TEDS

Founded in 1991, TEDS offers automated software systems and services for corporate learning and human capital development and management. Credited with having created the first learning management system (LMS), TEDS offers customer-oriented technology solutions aimed at continuous workforce improvement on behalf of business objectives. Now installed in over 100 countries with more than a million users, its Fortune 500 and world-class customers include ATK Thiokol, BellSouth, Citizens Communications, DaimlerChrysler North America, Dominion, Eastman Chemical, Ericsson, Owens & Minor, Norfolk Southern, Nortel Networks, Philips Medical Systems, Qwest, Roche Diagnostics, Sandia National Labs, Steelcase, Telcordia Technologies, and Verizon.

About Fidelity Investments

Fidelity Investments is one of the world's largest providers of financial services, with custodied assets of $1.6 trillion, including managed assets of $905.6 billion as of September 30, 2003. Fidelity offers investment management, retirement planning, brokerage, human resources and benefits outsourcing services to 18 million individuals and institutions as well as through 5,500 financial intermediaries. The firm is the largest mutual fund company in the United States, the No. 1 provider of workplace retirement savings plans, one of the largest mutual fund supermarkets and a leading online brokerage firm. For more information about Fidelity Investments, visit www.Fidelity.com.

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Fidelity Employer Services Company, a division of Fidelity Investments
Institutional Services Company, Inc.,
82 Devonshire Street, Boston, MA 02109.