SOURCE: Firepond, Inc.

May 20, 2008 09:00 ET

Firepond Implementing Changes to Improve the Customer Experience and Financial Performance

MANKATO, MN--(Marketwire - May 20, 2008) - Firepond, Inc. (OTCBB: FPND) announced today that the company is implementing significant changes with a focus on the customer experience and financial performance.

In conjunction with the recently completed financial restructuring, the Board of Directors spent three days with management at Firepond's Corporate Headquarters in Mankato reviewing and assessing the sales, service, engineering and support organizations. Management, with input from the Board, is focused on execution of an operating plan that will ensure continued customer acquisition and satisfaction, while providing the greatest returns for all stakeholders.

The operating plan calls for greater leverage of Firepond's core assets, which include:

--  Our people at Firepond and our long tenured employee base. These
    industry-respected employees have on average more than 12 years experience
    and define the best Configuration-Price-Quoting team on the planet.
    
--  Firepond's global "Blue Chip" customer base continues dramatic growth
    in terms of both users and usage on our premier SaaS (Software as a
    Service) solution.
    
--  Our leading Firepond CPQ™ OnDemand, multi-tenant solution.
    

The Board of Directors has tasked the new management team with addressing three critical needs.

--  Customer On-Boarding: The Mankato-based team will continue to focus on
    providing "Best in Class" on-boarding, reducing the time from customer
    contract execution to the time these customers are up and operating on the
    Firepond system. Recent operational changes are already showing
    improvement. For example, we again exceeded customer expectations in our
    most recent customer on-boarding, Kelvin Hughes in England. Our on-boarding
    process is clearly a competitive differentiator.
    
--  Customer Relationships: Firepond will expand its efforts to attract
    new customers and expand relationships with existing customers. Firepond
    deftly executed its transition from an enterprise software provider to a
    SaaS provider. In a little over a year, Firepond has added 25 high-value
    customers that leverage a single sign-on comprehensive integration with
    salesforce.com's sales force automation (SFA) simplifying and automating
    the sales process. Our OnDemand customers include some of the world's most
    respected names in business such as CommVault, Hino Truck (Toyota), Bell
    Helicopter, Symantec and other Fortune 500 companies. While this is a
    tremendous achievement and speaks to the value of the product offering,
    Firepond will accelerate its efforts to expand new and existing customer
    relationships.
    
--  Financial Performance: The Board and management are also addressing
    Firepond's financial results. Changes have been implemented that will
    reduce annual operating expenses by approximately $2.0 million, the
    majority of which relate to reduced compensation expenses and relocation of
    the Company's headquarters to Mankato, Minnesota, where the bulk of
    Firepond employees are located. Improvement in our financial health
    enhances our reputation with our shareholders, employees and customers. The
    recent financial restructuring is a first step in this regard. Continued
    concentration on operational excellence with regards to our on-boarding
    process and customer acquisition efforts will be a critical step forward.
    

After concluding a three day meeting in Mankato with the Firepond Board of Directors and employees, Brad Sheafe, President, stated, "Everything is in place for this company to be successful, including a tenured and very loyal employee base, a state-of-the-art product offering with proven customer demand and a significant customer base. It is now about execution and implementation. The Board of Directors has helped management define the key objectives and metrics by which we will measure the company's progress. There are certainly significant challenges ahead, but with the core assets in place and the recognized strength of the Mankato team, we will overcome those challenges and reach our potential for significant improvement in Firepond's operating and financial metrics."

About Firepond, Inc.

Firepond (OTCBB: FPND) is the leading provider of multi-tenant, on-demand Configure-Price-Quote™ software that automates and simplifies product pricing and configuration for companies and helps these enterprises improve order accuracy while reducing their cost of sales. Firepond's sales solutions help companies to optimize their sales processes whether their need is to solve complex product or pricing configuration, create product catalogs or provide an interactive selling system and dramatically improve response time. Firepond solutions provide a rapid ROI through improved order accuracy (100% of submitted orders have accurate specifications and pricing), improved proposal generation time and high user acceptance. For additional information about Firepond, visit www.firepond.com or call 1-866-UCONFIG (826-6344).

Forward-Looking Statement

This press release may contain forward looking statements that involve risks and uncertainties, including statements regarding our business strategy and development plans, plans for entering into new businesses, anticipated sources and uses of funds and other statements regarding our plans, objectives, expectations and intentions that are not historical facts. Because these forward-looking statements involve risks and uncertainties, actual results could differ materially from those discussed in this press release. These risks and uncertainties are described in greater detail in the reports that we file with the Securities and Exchange Commission. Our actual results, performance or achievements may vary materially from those expressed or implied in any forward-looking statements. All forward-looking statements reflect our beliefs and expectations as of the date of this press release and should not be relied upon as representing our views as of any subsequent date. While we may elect to update these forward-looking statements publicly at some point in the future, we specifically disclaim any obligation to do so, whether as a result of new information, future events or otherwise.

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