Dataware Provides Business Update and Announces Growth Strategy.

Business/Technology Editors

CAMBRIDGE, Mass.--(BUSINESS WIRE)--Sept. 22, 2000

Dataware Technologies, Inc. (NASDAQ: DWTI), a leading provider of e-business solutions, today announced significant progress in the execution of its business plan for continued growth in the marketplace.

"The past nine months have been an exciting and challenging time for Dataware," said David Mahoney, president and chief executive officer of Dataware. "Early this year, we announced that Dataware would be shifting to an e-business solutions model and would no longer develop and market packaged software products. This transition has taken longer than originally planned, but we feel strongly that the additional time has benefited us."

Business Update

During recent months, Dataware has:

--Successfully aligned its business to an e-business solutions strategy,

--Completed its recruitment of a new management team,

--Begun to fully leverage its services skills,

--De-emphasized its legacy product business, and

--Raised $3.7 million in additional financing to support the growth of its services business.

"I am pleased that Dataware has taken substantial strides toward profitable growth. We are experiencing significant growth in our sales pipeline and in the average size of our engagements during the third quarter. We continue to close significant engagements -- ranging from $200,000 to more than $2 million -- with major clients around the world, and work with them to build innovative solutions to solve complex business problems. We anticipate that these positive trends will translate into continued sequential growth in revenues through the remainder of 2000," Mahoney continued.

Business Strategy

Dataware's near-term business strategy includes:

--Rolling out a new corporate name and brand during the first week of October,

--Divesting certain non-strategic proprietary products and technologies,

--Pursuing additional financing arrangements,

--Establishing more long-term customer relationships,

--Focusing on entering into additional partnerships and alliances,

--Carefully managing expenses, and

--Shifting away from dot-com client activity to the Global 2000.

"Our multi-faceted strategy has been designed to position Dataware at the forefront of the market," Mahoney stated. "Our pending announcements will effectively differentiate us from systems integrators and other e-business solution providers."

"Dataware has taken great steps to avoid the pitfalls that some e-business companies have encountered. Some of these companies have chased opportunistic, short-term sales at the expense of the client relationship. Dot-com companies, in particular, have proven to be a problem for some solution providers for a couple of reasons: one, they often create an artificially high demand for services, and two, their earnings potential has not been as high as anticipated. For these reasons, we have stopped pursuing business with dot-com companies and are now exclusively targeting business-to-employee and business-to-business corporate accounts."

Mahoney continued, "Further, we fully realize that many of our technology components still have good market appeal and are valued by our clients. As part of the further refinement in our strategy, we are in active discussion to divest certain products and technologies. We believe divesting these products will help us to increase our focus, further reduce our non-strategic product investments and raise additional funding. Additionally, we are continuing efforts to secure new financing arrangements."

"In short, the Dataware team is excited about our future," Mahoney concluded. "We are seeing tremendous demand and market opportunities. With a strong and complete management team, talented solutions staff and comprehensive business strategy now in place, Dataware is ready to capitalize on the vast opportunities in the e-business solutions marketplace."

About Dataware

Dataware is a leading provider of e-business solutions to Global 2000 companies worldwide. Dataware uses a unique combination of its proven Xcellera methodology, cutting-edge skills, superior technology components, and significant experience to deliver innovative Internet-based solutions at Net Speed. Dataware solutions extend the Internet's potential to provide customers with key competitive and operative advantages. The Company is headquartered in Cambridge, Mass., with offices throughout North America, Europe, and Asia. For more information, please visit www.dataware.com or call 617-577-2400 (USA), or 44-(0)-1895-827200 (International).

Statements in this press release about the company's prospects are forward-looking statements based on assumptions that may not be realized for various reasons. Important factors that could cause actual results to differ materially from these statements include, but are not limited to: that the company may not secure the additional financing it requires; that the lead time to finalize large engagements may be longer than expected; that the company may not be able to divest its legacy product business; that pending customer agreements on which the company has begun work may not actually be finalized; that the company may not be able to hire sufficient qualified personnel to deliver the level of business it is anticipating; that the company's customers may be less able to buy its services due to reduced support from the capital markets; that the company may not be able to effectively compete against larger, more established e-business solutions providers; that the company may not be able to develop appropriate new distribution channels capable of delivering these offerings economically and on time; and that increases in various cost and expense categories may exceed management's current expectations. Further information on these and other potential factors that could affect the company's financial results are included in the company's most recent Forms 10-K, 10-Q, and 8-K filed with the Securities and Exchange Commission.