DALLAS and PHOENIX, Nov. 1 / Pegasus Solutions, Inc. PEGS announced today it has entered into an agreement to acquire all or part ownership of Global Enterprise Technology Solutions LLC ("GETS"), a provider of hotel property systems to nearly 3,000 hotels worldwide. Under the terms of the agreement, Pegasus will initiate the acquisition by acquiring a 20% interest for a combination of Pegasus common stock and cash totaling $5 million. Pegasus has the right to acquire full ownership of Phoenix-based GETS within the next 24 months for Pegasus stock and cash.

As part of the transaction, Pegasus also obtained an exclusive license for the marketing and sale of a new Internet-based ASP (application service provider) property system currently under development by GETS. Pegasus is currently directing the development of the system, which will be the industry's first Web-based, property management system, and expects to begin testing next month with a targeted commercial release in second quarter, 2001. Pegasus is currently working with a major hotel chain on a pilot test that is expected to begin next month.

"We expect this acquisition to catapult Pegasus into the final step of the hotel reservations process, which is the processing of the reservations on site at the property through a property management system. We will soon be able to offer via the Internet the system that manages 100% of a hotel property's reservations," said John F. Davis, III, president and chief executive officer of Pegasus Solutions. "This investment further enhances our total systems integration strategy for hotels. With this new technology, we will provide the hotel industry with the first Web-based property management system to be available on an ASP basis."

Pegasus' plans are to provide a "turn-key" property management solution to hotels. On a per occupied room transaction-fee basis, Pegasus plans to provide a property with all the necessary equipment (PC terminals or thin- client computer), online training, network access, and support. Rather than making large capital expenditures for their own application servers, technical support, system licenses, and recurring maintenance and training fees, as is traditionally required for property management systems, hotels will only pay a per-transaction fee for system usage.

Pegasus' new Property Systems and Services business unit will manage the development and deployment of the new technology. This unit is lead by Robert (Bob) Bennett, who was recently named to the Hospitality Financial and Technology Professionals (HFTP) International Hospitality Hall of Fame, the hotel industry's highest level of recognition in the area of technology.

"After extensive functional review and benchmarking, we identified GETS as the furthest along in development of an ASP-based property management system," said Bob Bennett, senior vice president, Property Systems & Services, Pegasus Solutions. "GETS has had an impressive track record since 1989 in developing property technology solutions for the lodging industry. We are particularly impressed with their current Web-based property system development efforts, and their focus on meeting the Internet information processing needs of moderately priced hotel chains, a large market that we feel has been under- served to date."

"We are thrilled to have been chosen by the industry's technology leader to be their partner in development of this revolutionary new system," said Christian Rivadalla, chief executive officer, GETS. "For 10 years, Pegasus has been providing ASP services to the hotel industry. They know how to run a transaction-fee business, and have the data center and the expertise to maintain a 24x7x365 operation. They have led the hotel industry in high- volume Internet transaction processing. They are the perfect company to Web- enable one of a hotel's most critical systems: the PMS.

"By joining with Pegasus, we expect to bring this system to market much faster than we would have been able to on our own. Pegasus' powerful reputation in the industry will undoubtedly accelerate the worldwide penetration of this next-generation property system," Rivadalla said.

Company Information

Global Enterprise Technology Solutions (GETS), formerly known as Enterprise Hospitality Solutions (EHS), is a premier supplier of client/server and Internet-based hospitality automation applications. Headquartered in Phoenix, Arizona, GETS specializes in the development and promotion of technical solutions and services for all facets of the hospitality industry, including private-label booking engines, hospitality portals, and private- label Internet-based applications. GETS' products are currently installed at more than 3,000 hotels in 30 countries, and its applications have been translated into 17 different languages. For more information, visit www.igets.net.

Dallas-based Pegasus Solutions, Inc. (www.pegs.com) is a leading provider of end-to-end reservation distribution solutions to the hotel industry worldwide. Its services include central reservation systems; third- party marketing and reservation representation services, including Utell, Summit Hotels & Resorts, Golden Tulip Worldwide, and Sterling Hotels & Resorts; electronic distribution services that connect more than 36,000 hotels to the Internet and to the global distribution systems (GDS); commission processing and payment services; the consumer travel Web site TravelWeb.com (www.travelweb.com); and data warehousing and database marketing and consulting services. Pegasus' customers comprise more than 100,000 travel agencies around the world, including nine of the 10 largest U.S.-based travel agencies(1); approximately 38,000 hotel properties around the globe, including 18 of the 20 largest hotel companies in the world based on revenues and total number of guest rooms(2); and more than 180 Web sites/services have contracted to have their hotel reservations Powered by Pegasus(TM). In addition to its corporate headquarters in Dallas, Pegasus has 39 offices in 25 countries, including regional hubs in Phoenix, London and Singapore. The company's stock is traded on the Nasdaq National Market under the symbol PEGS.

This statement contains references to future events and projected results, including anticipated transactions involving the Company and its service offerings. There can be no assurance that the referenced future events or projected results will actually occur or that the future financial performance of the Company will be as projected. Actual occurrences, results and performance may differ substantially and materially from those projected as a result of risks and uncertainties mentioned in this statement or detailed in the Company's periodic reports and registration statements filed with the Securities and Exchange Commission including its Form 10-K for the year ended December 31, 1999, and its Forms S-4 (File No. 333-92683) that was declared effective March 31, 2000.

1 Travel Weekly, June 26, 2000, "Top 50 Travel Agencies"

2 Business Travel News, May 29, 2000, "The Top Hotel Companies"

Michael Brophy
(214) 234 4400