California Software Announces Q-1 Results, Grows Revenues by 179%, Net Income by 85% From Year Prior Period.

Business Editors & High-Tech Writers

IRVINE, Calif.--(BUSINESS WIRE)--May 7, 2001

California Software Corp. (OTCBB:CAWC), a leader in IBM Midrange migration products and developer of the award-winning BABY, Unibol and MLPS product lines, today announced its first quarter 2001 results.

The company announced revenue increases from $448,840 in Q-1 2000 to $1,250,496 in Q-1 2001 and a reduction in net loss to $86,246 or ($.01) per share, compared with a net loss in Q-1 2000 of $586,080.

"With the announcement of new contracts from customers that include Unisys, IBM and Marriott we have begun to enjoy the market acceptance our products deserve," said Bruce Acacio, CEO, California Software.

"A recent note from a new customer sums up the quality of our products and the professionalism of our team: ` ... Initially, I was very skeptical about your products, having had a 24-month nightmare with (competitor not named) ... which we have nothing to show for, except a large expenditure and a feeling of failure. However the products and services your staff have delivered are top notch and they are everything they said they would be!

"`The fact that we were able to load your software and immediately see the benefits is still hard to believe. We have over 17,000 screens and did not have to make a change to our software in any way! Now, we can spend our time improving the looks and functionality of screens, instead of trying to convert and modify every screen!'

"The goal for 2001 is to achieve profitability by growing revenues and decreasing costs. These results suggest we are on the right path," continued Acacio.

California Software recently announced the resolution of its dispute with Unicomp.

About California Software Corp.

With headquarters in Irvine and offices in Richmond, Va., Belfast, Ireland, and Brussels, Belgium, California Software is the worldwide leader in IBM Midrange migration software solutions and a leader in Financial Services Software.

The company's products, marketed under the brand name BABY, Unibol and MLPS, support the migration of IBM AS/400 screens and applications to Windows, Unix, Linux and the Web and loan processing applications for financial institutions.

California Software enjoys more than 100,000 installations in 56 countries and is in use by such customers as Caterpillar, Volvo, DHL Worldwide, BMW Motors, IBM and Unisys.

This news release contains forward-looking statements relating to future events or future financial performance that involve risks and uncertainties. Such statements can usually, but not always, be identified by terminology such as "may," "will," "should," "expects," "plans," "anticipates," "believes," "estimates," "predicts," "potential," "intends" or the negative of such terms or comparable terms. These statements are only predictions and actual results could differ materially from those anticipated in these statements based upon a number of factors including those identified in the company's filings with the SEC. Investors are cautioned that all forward-looking statements involve risks and uncertainties of the industry in which the company operates and/or proposes to operate, including without limitation, uncertainties of product sales and product development, market acceptance of the company's products, the impact of competitive products and technological innovation, product returns and defects, product obsolescence, availability of qualified personnel, dependence on third-party suppliers, success or failure of strategic business alliances, acquisitions or other business combinations, new or amended laws and regulations applicable to the company, general market conditions and other risks. These forward-looking statements are made in reliance on the "safe-harbor" provisions of the Private Securities Litigation Reform Act of 1995, as amended.