Bluestone Software to Power SGI'S Mission-critical Manufacturing Systems; Bluestone Selected by SGI as the Only Application Server Vendor that Allows SGI to Realize the Full Promise of Java TM through Adherence with J2EE TM Standards.

Business Editors

PHILADELPHIA--(BUSINESS WIRE)--August 7, 2000

Bluestone(R) Software, Inc. (NASDAQ: BLSW), a leader in business-to-Web and wireless technologies, announced that SGI (NYSE: SGI), provider of high-performance computing and advanced graphics solutions, has selected Bluestone Total-e-Server(TM), the Application Server edition of Bluestone's comprehensive, J2EE(TM)- and XML-based Total-e-Business(TM) platform, as the e-business infrastructure to power its mission-critical manufacturing systems.

Selected from a group of nearly a dozen candidates, Bluestone's Total-e-Server will replace an aging legacy shop floor management system that facilitates manufacturing of mid-range to high-performance computer systems in two locations and supports more than $2 billion in annual revenue. The Bluestone platform will tie together various desktops, database servers and enterprise resource planning (ERP) systems. This is the first of several SGI manufacturing applications to be converted to a three-tier, Web-based architecture using Total-e-Server.

The Bluestone system provides complete compliance with industry standards, ensuring platform independence for SGI and avoiding the technological obsolescence associated with proprietary solutions. Total-e-Server also meets SGI's demanding performance requirement, which at peak times, requires SGI's existing shop floor application to handle hundreds of thousands of transactions per day. To sustain maximum manufacturing productivity, each transaction must occur in less than a second. Total-e-Server also enables SGI to interchange data in real-time over the Internet with other business partners--a more timely and cost-effective means of data exchange than using traditional Electronic Data Interchange (EDI).

"Bluestone's flexibility, `can do' attitude, and high level of commitment to demonstrating the extensive capabilities of its software led us to trust them with the conversion of our mission-critical manufacturing applications to a Web-based architecture," said David Fairbanks, information systems director for SGI. "In addition to Bluestone offering an exceptional product, the company's pricing model is easy to comprehend and very fair. This combination gives us a solid foundation for re-deploying our manufacturing systems to a more cost-effective, scalable computing model."

Added John H. Capobianco, executive vice president of strategic planning for Bluestone Software, "Like SGI, many leading manufacturers today are faced with replacing mission-critical legacy applications with those based on a flexible, scalable, Web-based architecture. At the same time, they must meet exacting standards for performance and high availability. Bluestone offers a proven, standards-based infrastructure, optimized for performance and fault tolerance. In a mission-critical environment like manufacturing, that's key."

100% Pure Java(TM) Architecture Ensures Platform Independence

Faced with re-deploying its legacy shop floor application based on a thick-client architecture, SGI began their search with nearly a dozen vendors, including Bluestone. The primary objective was to tie together a heterogeneous desktop environment with various database servers and the company's ERP system, while meeting the peak performance needs of SGI's manufacturing environment. To succeed, SGI needed a high-performance foundation offering total platform independence.

"Java promises freedom from legacy dependence on any one application, operating system or hardware platform. That's why we asked vendors to demonstrate their complete compliance with J2EE standards," said Fairbanks. "We found that while most vendors follow Java standards to one degree or another, Bluestone is the only vendor that allows us to realize the full promise of Java through total adherence with J2EE standards."

After narrowing the field, three vendors were selected to demonstrate the capabilities of their systems to SGI management. Bluestone was selected for the open, robust, 100% Pure Java architecture of Total-e-Server, as well as its high performance under heavy transaction loads, proven scalability, fault tolerance, and track record for stability. As a Java-based, Web Application Server framework, Total-e-Server runs on all Java Virtual Machines and natively supports all SGI platforms and systems, including SGI IRIX, without the need for porting. Bluestone also demonstrated comprehensive support for XML (eXtensible Markup Language), enabling SGI to interchange data with its manufacturing partners in real-time, which is believed to be more efficient and cost-effective than using EDI.

Once SGI's shop floor application is successfully deployed, the company plans to convert other manufacturing applications using the Bluestone foundation. These include discrepant material tracking and Engineering Change Order (ECO) routing and approvals.

About Bluestone Software

Bluestone(R) Software, Inc., provider of Enterprise Interaction Management software, is a leader in business-to-Web and wireless technologies. Companies deploying e-business applications, like Avnet, CDNow, Food.com, MCI WorldCom, Planalytics, Reliance National, and Time Inc., rely on Bluestone's Total-e-Business(TM) platform to provide comprehensive e-business platforms, Internet-class infrastructures, and robust integration services that e-business success demands. Bluestone is headquartered at 300 Stevens Drive, Philadelphia, Pennsylvania, 19113-1597. For more information, please call 888-Bluestone or 610-915-5000, email [e-mail], or visit http://www.bluestone.com

Bluestone is a registered trademark, and Total-e-Server and Total-e-Business are trademarks of Bluestone Software, Inc. Java and J2EE are trademarks of Sun Microsystems, Inc. in the United States and other countries. All other names, brands or products may be trademarks or registered trademarks of their respective owners.

Certain statements in this press release constitute forward-looking statements as such term is defined in the Private Securities Litigation Reform Act of 1995. Forward looking statements involve known and unknown risks, uncertainties and other factors, including those contained in Bluestone's publicly filed reports with the Securities and Exchange Commission, which may cause Bluestone's actual results, performance, or achievements or those of its customers or its industry to be materially different from the future results, performance or achievements expressed or implied by these forward looking statements. Specifically, the Company's beliefs with respect to the business opportunities presented by e-business and the Company's ability to profitably market and deploy its product solutions may prove to be inaccurate. In light of the significant uncertainties inherent in these forward looking statements, the information in this press release should not be considered a representation by the Company or any other person that Bluestone's objectives and plans will be achieved.