Spatial Inc. Announces Planned Acquisition of Sven Technologies, Inc.

BOULDER, Colo.--(BUSINESS WIRE)--June 17, 1999--

Acquisition to Accelerate Spatial's 3D Interoperability and

Internet Visualization Business

Spatial Inc. (AMEX: STY), the world's leading developer of open, component 3D modeling technology, today announced that it has signed a non-binding letter of intent to acquire Sven Technologies, Inc. of Palo Alto, California.

Sven Technologies, Inc. is a leading provider of cutting-edge 3D software visualization technologies for industrial and architectural design, World Wide Web content development, entertainment, and other 3D software markets. Sven's products will provide 3D model visualization technology to Spatial's large, growing customer base while serving as an important component for Spatial's web-based 3D interoperability and services initiatives. For more information on Sven, visit their web site at http://www.sven-tech.com.

The proposed acquisition will provide Spatial with technologies and expertise that enhance the visualization and rendering capabilities of its entire family of 3D software products, along with providing core technology for Spatial's web-based interoperability and services strategy. Sven's rendering optimization technologies and expertise are especially well suited to rendering complex, realistic 3D models in bandwidth and processing constrained environments, such as Internet/Intranet and the World Wide Web. This addresses issues that are particularly important to Spatial's customer base and business strategy. New products resulting from the acquisition will enable viewing of large, complex, 3D CAD models across Internets, Intranets, and other network-based environments without the poor image quality, long pre-processing times, and slow rendering speeds associated with the current generation of web-based 3D viewing technologies.

Industry analyst Bruce Jenkins, vice president of Daratech Inc. (Cambridge, MA), said, "This acquisition will mark another step in Spatial's accelerating strategy to meet the demand for high-fidelity, web-centric 3D interoperability solutions among customers in the manufacturing industry as well as the software developers who serve them."

"The proposed merger of Spatial's 3D modeling technology with Sven's innovative advances in polygon mesh control will benefit anyone creating 3D models over a wide range of applications," said Dr. Jon Peddie, president of Jon Peddie Associates (Tiburon, CA), a leading 3D market research firm. "Our research indicates," Peddie added, "there is a pent-up demand for the efficient transfer of 3D model through the Internet - Spatial and Sven will be well positioned to exploit this need."

Bruce Morgan, president and CEO of Spatial Inc., explained, "Our planned acquisition of this exciting young company and its products demonstrates our commitment to providing our growing customer base with the best technology available. Our ability to provide state-of-the-art, web-based visualization tools to our customers will help them reduce time-to-market and will accelerate the growth of ACIS-enabled 3D software applications."

Saul Kato, president and CEO of Sven Technologies, Inc., said, "We are extremely excited to join Spatial. The fusion of our next-generation scalable visualization technology with Spatial's pervasive 3D modeling platform will enable Spatial's existing and future customers to bring an unprecedented level of rendering speed and visual quality into their 3D end-user applications, on and off the Internet. Together, we will enable truly effective web-based deployment, viewing, and interaction of complex 3D data across the enterprise."

It is intended that the transaction will be an asset purchase valued in the range of approximately $850,000 and $1.25 million, to be completed through a combination of cash and Spatial stock. Until the execution of a definitive acquisition agreement, neither party is obligated to proceed with the acquisition. Thereafter, the proposed acquisition will be subject to a number of conditions and there can be no assurance that the acquisition will ultimately be consummated.

Spatial Inc. is the world leader in the development of open, component 3D modeling technology and product data access, exchange and sharing solutions. The ACIS(R) 3D Toolkit, Spatial's flagship product, is universally recognized as the de facto standard 3D modeling kernel for the MCAD, CAM, CAE, and AEC industries. With nearly 500 ACIS licensees and more than 1.4 million end users of over 180 ACIS-enabled applications, ACIS is indisputably the most widely used 3D modeling kernel in the world.

The open architecture of ACIS and the industry standard ACIS SAT(TM) file format are known as the "ACIS Geometry Bus." The ACIS Geometry Bus is the key to 3D model interoperability among ACIS-enabled applications, including ABAQUS/CAE by Hibbitt, Karlsson & Sorensen, Inc., AutoCAD and Mechanical Desktop by Autodesk, Inc. (Nasdaq: ADSK), CADKEY by Baystate Technologies, Inc., GAMBIT by Fluent Inc., Grade/CUBE II by Hitachi Zosen Information Systems, GSCAD by Intergraph Corporation (Nasdaq: INGR), IronCAD by Visionary Design Systems, Inc., Maxwell 3D Field Simulation by Ansoft Corporation (Nasdaq: ANST), TurboCAD Solid Modeler by IMSI (Nasdaq: IMSI), Vellum Solids by Ashlar Inc., and Working Model 3D by MacNeal-Schwendler Corporation (NYSE: MNS).

Spatial's Interoperability Solutions Subsidiary, InterData Access (IDA), is a leading provider of product data viewing, data translation, and digital mock-up software and consulting services to Fortune 500 industrial companies worldwide. Interoperability products include IntraVISION(TM), VisionShare(TM), Data Exchange Manager, and IGES/STEP development tools. IDA's customers include Boeing, Bombardier, Caterpillar, Diebold, General Electric, Harley-Davidson, Hitachi, Lear Jet, Motorola, Northrop Grumman, and Silicon Graphics.

Spatial Inc. is headquartered in Boulder, Colorado, and has offices in Europe and Asia. Shares of Spatial stock are publicly traded on the Nasdaq-AMEX exchange under the symbol "STY" (AMEX: STY). For more information, visit Spatial's web site at http://www.spatial.com, or call [phone].

Founded in 1996, Sven Technologies, Inc. is based in Palo Alto, California. Sven develops and markets 3D computer graphics software tools that enable the creation and rapid delivery of compelling, photorealistic 3D images for use in many segments of the 3D computer graphics industry. Sven's customers work in a variety of vertical markets, including industrial design, AEC, World Wide Web content development, film and video effects, game development, medical visualization, and forensic animation. Sven develops and markets Multi-Resolution Geometry, a software development kit that allows 3D graphics developers to incorporate continuous level of detail capability into their applications for extremely rapid and high quality rendering in both networked and non-networked environments. In addition, Sven markets and develops SurfaceSuite(R) PRO, an adaptive texture mapping system. For more information, visit Sven's web site at http://www.sven-tech.com or call [phone].

Statements made in this news release that are not historical facts may be forward-looking statements. Actual results may differ materially from those projected in any forward-looking statement. There are a number of important factors that could cause actual results to differ materially from those anticipated by any forward-looking information. Acquisitions are inherently risky. The successful integration of Sven and Spatial may not ultimately be successful or result in the benefits described in this press release. Accordingly, the acquisition of Sven could have a material adverse affect on the Company's operations and operating results. A description of certain other risks and uncertainties attendant to Spatial Technology Inc. and its industry, and other factors which could affect the Company's financial results, are included in the Company's Securities and Exchange Commission filings, including but not limited to the Company's annual report on Form 10-KSB for the year ended December 31, 1998.

Spatial Technology Inc., SAT, IntraVISION, and VisionShare are trademarks of Spatial Technology, Inc. ACIS is a registered trademark of Spatial Technology Inc. Sven Technologies and Multi-Resolution Geometry are trademarks of Sven Technologies, Inc. SurfaceSuite is a registered trademark of Sven Technologies, Inc. All other trademarks and registered trademarks are the properties of their respective owners.