Citadon Announces Record Sales Quarter and Promotion of Key Executive

Q4 Sales Bookings Show Increase of 50% in Year-Over-Year Comparison

San Francisco - February 10, 2004 - Citadon, a leader in Web-based collaboration, document management and business process management solutions, today announced that the company enjoyed a record $5.05 million in sales bookings for the fiscal fourth quarter ending December 31, 2003. Robust demand for the Collaborative Workspaces offering helped to generate a 50% increase in sales bookings over the same quarter in the prior year, which enabled Citadon to be both cash-flow positive and break-even for the fiscal year.

"This was an extremely gratifying quarter for Citadon for a number of reasons" said Howard Koenig, Citadon CEO. "Chief among our accomplishments was the sales execution by Citadon's field organization in attracting 22 new customers, which included a multi-year, multi-million dollar deal with an automobile manufacturer. In recognition of the stellar sales performance in 2003, Daniel Tunnell has been promoted to the position of Executive Vice President of Worldwide Sales," Mr. Koenig added.

"These numbers validate Harvard professor Theodore Levitt's axiom that people don't want to buy a quarter-inch drill, they just want a quarter-inch hole," said Nikitas Koutoupes, Principal at Insight Venture Partners, whose firm led Citadon's latest financing round. "Now that organizations are focused on the business value versus technology acquisition, we believe the Application Service Provider (ASP) space is just in the first inning." According to International Data Corporation, the worldwide ASP market will reach $21.8 billion in 2006.

Other highlights for fiscal year 2003:

• Added 55 new Citadon CW™ customers.
• Successfully introduced Citadon BPD™, a powerful business process design offering.
• Adoption of Citadon solutions in new vertical industries.
• Expanded European distribution into Scandinavia through an agreement with Copenhagen, Denmark-based GlobePoint A/S.
• Secured $15 million in working capital.
• Strengthened management team with key hires.

About Citadon
Citadon is an award-winning provider of Web-based collaboration and Business Process Management solutions for project-oriented organizations. Citadon provides an on demand solution that enables customers and their constituents to seamlessly share and manage a wide variety of document types, automate and propagate complex business processes, collaborate and communicate without barriers while providing a mechanism for capturing and leveraging knowledge. Since Citadon hosts these applications, users can immediately begin to take advantage of software that can reduce both financial and legal risk, improve profitability, enforce accountability and add predictability to global projects.

More than 40,000 subscribers in over 60 countries on projects with a market value in excess of $130 billion currently access Citadon hosted applications. Current Citadon customers include Shell Oil Products, the Bechtel Group, GE, Blue Cross/Blue Shield, The Chicago Transit Authority, Alcoa, ICA Fluor Daniel and Novo Nordisk Engineering. More information is available at www.citadon.com.

Media Contacts:

Citadon, San Francisco
Dan Pepper - 415-216-2303
dpepper@citadon.com

Smith Public Relations, Los Angeles
Caroline Somphone - 310-788-0456
caroline@smith-pr.com