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RE: 3D Systems' Year 2000 (Y2K) Readiness Disclosure Information provided you either in writing or contained on 3D Systems' past and present Year 2000 Internet website pages regarding products and services offered by 3D Systems or with respect to 3D Systems' year 2000 processing capabilities or readiness are "Year 2000 Readiness Disclosures" in conformance with the Year 2000 Information and Readiness Disclosure Act of 1998 (Public Law 105-271, 112 Stat. 2386) enacted on October 19, 1998. This designation applies to information delivered directly to you, through or derived from 3D Systems' pas and present Year 2000 Internet website pages, www.3dsystems.com, and other materials. At 3D Systems (the Company) we are aware of the potential impact the Year 2000 could have on our information technology and business operations. To answer this challenge 3D Systems has been actively pursuing a Year 2000 readiness program since February 1998. This letter provides our customers, vendors, and other stakeholders with the status of 3D Systems' ongoing program to assess and analyze existing systems, to create and implement action plans for bringing the systems into Y2K readiness, and to test those systems for compliance. Our program covers business systems, vendor compliance, manufacturing systems, end-use products, and facilities as detailed below. Y2K Program Overview and Status for Business Systems: For definition purposes, "Business Systems" includes (but is not limited to) the following areas: end-user computer systems, network infrastructure (circuits and service providers, connectivity devices, server hardware, peripherals, and related software), telephone and fax systems, video systems, and other shared enterprise-wide systems. The Company is continuing its comprehensive evaluation of internal business systems. As part of the Worldwide IT Infrastructure Upgrade effort, certain critical infrastructure is being upgraded or replaced to meet Year 2000 requirements. These infrastructure upgrades will also provide the benefit of meeting Euro dollar requirements and will significantly expand the Company's overall operational capability. At the completion of these current projects, the Company will be conducting system tests to validate compliance of the overall infrastructure. To date, the Company has substantially completed inventory, risk analysis, and remediation on business systems Worldwide. We are continuing with Y2K issue resolution (patches, upgrades, and/or replacements) on all major systems including our shared business applications, end-user computer systems, and network infrastructure. The Company believes that the vast majority of Y2K-related issues that relate to internal business systems will be resolved and validated before the January 1st, 2000 rollover event. The Company has also started developing internal (employee) and external (customer) response plans to effectively deal with unforeseen issues that may arise as a result of the Millennium rollover. Vendor Compliance The Company has communicated with its suppliers regarding their Y2K compliance status and efforts, and continues to monitor the status of its critical suppliers. During the 3rd and 4th quarters of 1999, the Company conducted a final assessment of each of these suppliers. These suppliers have communicated that they are Y2K compliant and our key suppliers believe that Y2K issues will not preclude them from continuing product shipments. Manufacturing Systems The Company has identified and assessed Y2K issues on its systems used in manufacturing and shipping of its products. That assessment included facilities and environmental systems, shop-floor systems, as well as the manufacturing control and planning systems mentioned above. That assessment along with Y2K compliance testing revealed that our manufacturing systems are Y2K compliant. End-Use Products The Y2K issues with the Company's current and past products have been identified, and upgrade pathways have been determined. These issues and pathways have been proactively communicated to its customers. All the required software updates to bring its products to Y2K readiness have released, the last of which was posted on the Company's web site at the end of September 1999. The Company believes that all customers qualified for no charge upgrades, or who placed orders by July 31, 1999, received those upgrades by the end of August 19999. The Company is in the process of issuing a final communication to all its customers summarizing the Y2K readiness requirements for its products, and informing them what to do in case of unforeseen issues following the Y2K rollover event. Attached to this disclosure letter is the Company's Product Readiness tables which provide the latest information on the Y2K readiness by product, and describe the upgrade pathways to Y2K readiness where required. Facilities and Services Providers The Y2K readiness of energy management systems, waste management providers, utility providers, and potentially inferior embedded technology, has been assessed. This assessment has provided a tier based risk assessment, and includes contingency strategies wherever necessary. While the risk of systems failures has been assessed as minimal, the potential failure of external systems such as utility providers may not be entirely predictable. Warranties 3D Systems' product warranties are as set forth in its Terms and Conditions of Sale. Information provided to our customers, vendors, and other stakeholders with regard to Y2K readiness does not constitute an offer or extension of any warranty. Sincerely,
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