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                             SPATIAL TECHNOLOGY INC.
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                (Name of Registrant as Specified in Its Charter)


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    (Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)

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                              FOR IMMEDIATE RELEASE

          SPATIAL ANNOUNCES PLANNED SALE OF ITS COMPONENT BUSINESS DIVISION TO
          DASSAULT SYSTEMES

          Deal Validates the ACIS 3D Toolkit's Position as a World-Leading Solid
          Modeling Technology and Allows Spatial to Focus on Its Growing
          PlanetCAD Internet Business

BOULDER, Colo., July 5, 2000 -- Spatial Inc. (AMEX-STY), a leading developer of
Web-hosted engineering application services, e-frastructure, interoperability
solutions and open, component 3D modeling technology, today announced plans to
sell the assets of its Component Business Division to Dassault Systemes in a
cash transaction of $21.5 million and cross licensing agreements for component
and Internet technologies. Upon shareholder approval and finalization of the
transaction, Spatial's Component Business Division, whose products include the
ACIS(R) 3D Toolkit, IntraVISION(R) and JetScream(TM), will become a wholly-owned
subsidiary of Dassault Systemes operating under the Spatial name.

Under the terms of the agreement, Dassault Systemes will purchase all the assets
of Spatial's Component Business Division including products, trademarks, patents
and intellectual property, and will be operated as a subsidiary of Dassault
Systemes. Mike Payne, current CTO of Dassault Systemes, will become CEO, and
Dick Sowar, CTO and chairman of Spatial, will remain in a leadership role within
the new company. Upon completion of the transaction, Spatial will focus on its
growing Web engineering application services business and will operate under the
name of PlanetCAD Inc.

"Dassault Systemes is clearly the best home for Spatial's Component Business
Division because it has both the resources and vision to grow the investment in
the component business, expand the product line, and ensure the continuing
success of our customers who have made large investments in ACIS and related
component technologies," said Sowar. "Dassault Systemes has a proven track
record of acquiring strategic businesses and allowing them the flexibility to
operate to their optimal potential. This is a great outcome for the licensees,
end users and employees whose success depends on these mission-critical
products."

Dassault Systemes is a premier software developer for the CAD/CAM/CAE/PLM
industries with its flagship CATIA, ENOVIA and DELMIA solutions that address the
digital engineering enterprise. Its corporate vision is to have 3D everywhere,
anytime and for everyone by providing world-class 3D technologies, components
and solutions.

"Dassault Systemes' strategy is to offer 3D everywhere, anytime and for
everyone," said Bernard Charles, president of Dassault Systemes. "Expanding the
component part of our business is part of this strategy and we will be building
on the established user-base, talented staff and excellent reputation that
Spatial has in this area. We are fully committed to the success of existing and
future Spatial customers, partners and employees."

PlanetCAD was formed by Spatial in January 2000 to help streamline the movement
of digital CAD model data throughout the manufacturing supply chain, and has
developed proprietary technologies that enable the rapid delivery, distribution
and hosting of complex engineering software services across the Internet.

Under a set of cross licensing agreements that are an integral part of the
transaction, PlanetCAD will have a perpetual license agreement for the component
technologies being sold to Dassault Systemes; the companies will share joint
rights to Spatial's healing and translation technologies, and will jointly
develop and enhance those technologies; PlanetCAD will provide Dassault Systemes
with a co-branded version of its 3Dshare.com model interoperability service for
use on Dassault Systemes Web sites worldwide; and the companies will cooperate
in bringing advanced applications from Dassault Systemes to the Web.

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"This transaction will allow us to focus completely on building a new generation
of Web based engineering services under the PlanetCAD banner," said Bruce
Morgan, president and CEO, Spatial. "This deal establishes a tight-knit working
partnership between the companies for 3D component technologies and Web-based
services that will go a long way to reshaping the industry and benefiting
engineers around the world."

"We recognize that Spatial's leadership in Web-based engineering software
services is an important opportunity that we wish to build upon," said Charles.
"We look forward to a continued relationship with PlanetCAD through a strategic
partnership for 3D technology and engineering services on the Web."

Subject to shareholder approval, Dassault Systemes will increase its minority
investment in PlanetCAD, following its participation in the initial venture
funding completed in February of this year.

AN INVESTOR WEBCAST CONFERENCE REGARDING THIS NEWS WILL BE HELD BY BRUCE MORGAN
AND DICK SOWAR AT 2.30 P.M. MOUNTAIN DAYLIGHT TIME (MDT) ON WEDNESDAY, JULY 5.
THIS CAN BE ACCESSED AT INVESTOR BROADCAST NETWORK'S VCALL WEB SITE AT
WWW.VCALL.COM. TO JOIN THE CALL, PLEASE VISIT THE SITE 15 MINUTES BEFORE THE
CONFERENCE AND DOWNLOAD THE NECESSARY SOFTWARE. REPLAYS WILL BE AVAILABLE
SHORTLY AFTER THE CALL.

THERE WILL BE A PRESS CONFERENCE CALL ON THURSDAY, JULY 6 AT 9:30 A.M. MOUNTAIN
DAYLIGHT TIME, 11:30 A.M. EASTERN DAYLIGHT TIME REGARDING THE NEWS. TO JOIN THE
CALL, DIAL 800-553-3587 AND THEN ENTER 760249 AS YOUR CONFIRMATION NUMBER. THE
NUMBER FOR INTERNATIONAL CALLERS IS 001-1-303-267-1001. PLEASE JOIN THE CALL
FIVE MINUTES BEFORE START TIME.

ABOUT SPATIAL INC.
Spatial is the world's leading provider of Web-based services, e-frastructure
and advanced engineering technology solutions to streamline the digital
manufacturing supply chain and set global standards for product engineers,
designers, software developers and manufacturing professionals. Spatial is
headquartered in Boulder, Colo., USA, and has offices in California, Germany,
Japan and the United Kingdom. For more information, visit Spatial's Web site at
www.spatial.com or call (303) 544-2900.

Spatial's PlanetCAD division (www.planetcad.com) develops and delivers
Web-hosted application services, e-commerce sites and portals that are the
premier online destinations for manufacturing and design engineers needing to
streamline the movement of digital model data throughout the manufacturing
supply chain. PlanetCAD's application services include: 3Dshare.com(TM)
(www.3dshare.com), which provides online translation and repair of 3D CAD models
to streamline the flow of engineering data between organizations regardless of
the installed CAD systems; 3Dpublish.com(TM) (www.3dpublish.com), an application
service for the online, automated capture of high resolution 2D graphics from 3D
CAD models; and Bits2Parts.com(TM) (www.bits2parts.com), an e-commerce service
that facilitates the communication and data transmission process between
manufacturers and rapid prototyping service bureaus across the Web.


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Spatial Technology Inc., 3Dshare.com, 3Dpublish.com, Bits2Parts.com, ACIS 3D
Toolkit, SAT and PlanetCAD are trademarks. ACIS and IntraVISION are registered
trademarks of Spatial Technology Inc. All other trademarks are properties of
their respective companies.

Completion of the transaction is subject to the approval of the shareholders of
Spatial. A proxy statement will be sent to shareholders as soon as practicable.
When it is available, shareholders should read the proxy statement in its
entirety because it will contain important information about the transaction.
When it is available, security holders may obtain copies of the definitive proxy
statement from the Securities and Exchange Commission at its Internet Website
(www.sec.gov) or from the company by request to Spatial Inc. Investor Relations:
Geoff High, Pfeiffer Public Relations (303) 393-7044, geoff@pfeifferpr.com.

                                                        
SPATIAL INC. CONTACT:                                      SPATIAL INC. PUBLIC RELATIONS CONTACT:
Rachael Dalton-Taggart, PR Manager                         Bill Tompkins, Metzger Associates
(303) 544-2986, rachael.taggart@spatial.com                (303) 786-7000, bill@metzger.com

SPATIAL INC. INVESTOR RELATIONS CONTACT:                   DASSAULT SYSTEMES CONTACT:
Geoff High, Pfeiffer Public Relations                      Morgane Gourcuff
(303) 393-7044, geoff@pfeifferpr.com                       (33) 1-40-99-42-18, morgane_gourcuff@ds-fr.com

DASSAULT SYSTEMES OF AMERICA CONTACT:
Sheri Chow
(818) 673-2134, sheri_chow@ds-us.com