IMPORTANT NEWS FROM SOFTQUAD INC.

Dear Valued Customer,

SoftQuad International and Interleaf Inc. recently announced that the companies have concluded an agreement whereby Interleaf Inc. has acquired the Panorama and Author/Editor product lines, along with the Toronto based Panorama engineering group.

SoftQuad has always placed a great deal of value in its relationships with its SGML customers. Ensuring a solid path forward for our people, products and customers was an important criteria in completing this transaction. We are pleased with Interleaf's decision to commit to the Panorama and Author/Editor product lines and feel confident that their worldwide network of professionals will continue to deliver the quality of service you have come to expect from a SoftQuad product.

SoftQuad Inc. will focus its development, marketing and sales efforts going forward on our HTML and XML authoring tools. We are pleased to announce that HoTMetaL PRO 5.0 is now available. Our Vancouver engineering team is hard at work on XMetaL and future versions of HoTMetaL. The official launch of XMetaL is scheduled for the November XML '98 show in Chicago. We hope to see you there.

The Panorama engineering team has now completed its transition to Interleaf thereby ensuring continuity of product development and the delivery of on-going contract services.

Should you have any questions, please call:

• Interleaf Technical Support: (800) 688-5151
• Interleaf Sales: (800) 955-5323
• For more Interleaf information please visit www.interleaf.com

We would like to thank you for your support and commitment to the SoftQuad family of products.

Regards,
Roberto Drassinower
General Manager

SoftQuad Inc.

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