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                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549
                            ------------------------


                                  FORM 10-K/A



                                AMENDMENT NO. 1


                      FOR ANNUAL AND TRANSITIONAL REPORTS
                    PURSUANT TO SECTIONS 13 OR 15(d) OF THE
                        SECURITIES EXCHANGE ACT OF 1934

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   /X/     ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
           SECURITIES EXCHANGE ACT OF 1934
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                  FOR THE FISCAL YEAR ENDED DECEMBER 31, 2000
                                       OR

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   / /     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
           SECURITIES EXCHANGE ACT OF 1934
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                FOR THE TRANSITION PERIOD FROM ______ TO ______

                         COMMISSION FILE NUMBER 0-28436
                            ------------------------
                               OPEN MARKET, INC.
             (Exact name of registrant as specified in its charter)

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               DELAWARE                                     04-3214536
    (State or other jurisdiction of                      (I.R.S. Employer
    incorporation or organization)                    Identification Number)
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                                ONE WAYSIDE ROAD
                        BURLINGTON, MASSACHUSETTS 01803
              (Address of principal executive offices) (Zip Code)
                                 (781) 359-3000
              (Registrant's telephone number, including area code)
          Securities registered pursuant to Section 12(b) of the Act:
                                      None
                                (Title of class)

          Securities registered pursuant to Section 12(g) of the Act:
                              Title of each class
                         Common Stock, $.001 par value
                        Preferred Stock Purchase Rights

    Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports) and (2) has been subject to such
filing requirements for the past 90 days. Yes /X/ No / /

    Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. / /

    As of March 28, 2001, the aggregate market value of the Registrant's voting
securities held by non-affiliates of the Registrant was approximately
$52,150,181.

    As of March 28, 2001, 46,906,717 shares of the Registrant's Common Stock,
$.001 par value per share, were outstanding.

    Portions of the Proxy Statement for the Annual Meeting of Stockholders
expected to be held in June 2001 are incorporated by reference into Part III.

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                               TABLE OF CONTENTS

                                     PART I


<Table>
<S>                     <C>
     <C>
 1.
Business....................................................      3

 2.
Properties..................................................     15

 3.                     Legal
Proceedings...........................................     16

 4.                     Submission of Matters to a Vote of Security
Holders.........     16

                                           PART II

 5.                     Market for the Registrant's Common Equity and Related
                        Stockholder
Matters.........................................     17

 6.                     Selected Consolidated Financial
Data........................     17

 7.                     Management's Discussion and Analysis of Financial
Condition
                        and Results of
Operations...................................     18

 7A.                    Quantitative and Qualitative Disclosure About Market
Risk...     39

 8.                     Consolidated Financial Statements and Supplementary
Data....     39

 9.                     Changes in and Disagreements with Accountants on
Accounting
                        and Financial
Disclosure....................................     69

                                           PART III

10.                     Directors and Executive Officers of the
Registrant..........     70

11.                     Executive
Compensation......................................     70

12.                     Security Ownership of Certain Beneficial Owners and

Management..................................................     70

13.                     Certain Relationships and Related
Transactions..............     70

                                           PART IV

14.                     Exhibits, Financial Statement Schedules and Reports on
Form

8-K.........................................................     70
</Table>


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                                     PART I

                                ITEM 1. BUSINESS

    Open Market is a provider of enterprise content management and delivery
application software. Our software solutions are designed to enable businesses
and other organizations to use the Internet to optimize interactions with their
site visitors, employees, customers and distribution channels, in order to
reduce costs, accelerate business processes, gain market share, establish new
revenue streams and compete in the new online economy. We believe that quality
interactions result from the reliable and timely exchange of compelling and
accurate information, and a consistent series of quality interactions is the key
to building and sustaining business relationships.

    We build our software based on two core beliefs. First, information, or
content, is a strategic asset, and world-class organizations strive to excel at
managing crucial information. For these organizations, the Internet introduces
new information management challenges and opportunities. Second, web
applications managing this crucial information must be reliable, scalable,
flexible and open. This puts new requirements on how eBusiness application
software needs to be developed and delivered.

    Companies use our software to build and operate captivating web sites, rich
product catalogs, self-service applications and web services for their
distribution channels, marketplaces and customers. Our products acquire content
from people and systems, manage that information through approval and workflow
processes, and then disseminate it in personalized delivery formats to trading
partners' systems and to a variety of presentation devices, including web
browsers, wireless devices, personal digital assistants and e-mail. These
eBusiness applications, which we call "content-driven eBusiness solutions" are
designed to enable companies to reduce costs, strengthen customer loyalty and
establish new revenue streams.

    Our focus on content-driven eBusiness solutions marks an important shift in
our strategy. As we began 2000, our strategy was to provide a broad suite of
eBusiness software solutions, addressing both the (i) e-commerce and (ii) web
content management segments of the internet infrastructure market. In
October 1999, we completed the acquisition of FutureTense, Inc., which added web
content management software to our product offerings. The FutureTense products
for web content management, plus our existing Transact-TM- system for web order
management, comprised our suite of e-commerce software solutions for large
businesses. We also addressed small and medium-size businesses through
application service providers (ASPs) who host and resell our software as a
network service. Our ShopSite catalog-builder plus Transact-TM- comprised our
suite of e-commerce software solutions for ASPs. During the year, however, ASP
spending on e-commerce software slowed as adoption by small and medium-size
businesses did not meet their expectations. We also experienced a decline in
Transact-TM- sales to large businesses, reflecting their evolving desire to
integrate web orders into existing order systems instead of installing an
additional order management system for independent web business units.


    As 2000 progressed, our content management products, based on the
FutureTense acquisition, coupled with new content management and delivery
products we introduced during 2000, experienced strong growth and by year-end
represented a majority of our revenue. Reflecting these shifts in demand, and
the underlying favorable market dynamics for content management and delivery
solutions, we announced a change in strategy and a restructuring plan in
October 2000 (the "2000 Restructuring"). Under the 2000 Restructuring, we
focused all of our efforts on content-driven eBusiness solutions and an expanded
product line for content management and content delivery. The 2000 Restructuring
also included the elimination of approximately 92 employees and 90 outside
consultants across the following functions: services (99), research and
development (49), marketing (10), general and administrative (13) and
sales (11). In connection with the 2000 Restructuring, we incurred severance
costs for terminated employees, wrote off goodwill related to the ICentral
acquisition as we decided to divest of our ShopSite product line, accrued a
software


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contract commitment that resulted from a change in product strategy and accrued
office lease impairment costs due to the reduction in workforce. The total cash
impact of the 2000 Restructuring amounted to approximately $3,693,000. We paid
approximately $836,000 in 2000, and all remaining liabilities are expected to be
paid by December 31, 2001. In addition to headcount reductions, we undertook
plans to transition our professional services organization to focus on
higher-margin design assurance services for partners.



    In April of 2001, we implemented an additional restructuring plan designed
to bring costs in line with revenue and strengthen our financial performance
(the "April 2001 Restructuring"). This restructuring included the elimination of
approximately 57 employees across the following functions: services (21),
research and development (8), general and administrative (9) and sales and
marketing (19). In connection with the restructuring, we incurred severance
costs for terminated employees. The total cash impact of the April 2001
Restructuring amounted to approximately $532,000. We paid approximately $396,000
in the second quarter of 2001, and all remaining liabilities are expected to be
paid by December 31, 2001.


    In the Internet infrastructure industry, our software is generally called a
"content management and delivery system." According to Forrester's eBusiness
TechRankings-TM-, our content management software rated number one for three
consecutive months, starting in December 2000. Our content-driven eBusiness
solution software has been licensed by nearly 300 customers in 39 countries,
including publishers and media companies such as The McGraw-Hill Companies,
FT.com (The Financial Times Group) and The New York Times Company; financial
services companies such as J.P. Morgan Chase, GE Capital and The Hartford
Financial Services Group; and manufacturers such as 3Com, BASF and Milacron.

CHALLENGES RELATED TO THE CONTINUED GROWTH OF THE INTERNET

    We believe customers place significant value on managing information as a
strategic asset, and the Internet has provided pervasive and powerful new ways
to move information within and across organizations. Early adopters of eBusiness
solutions are using the Internet to exchange information more effectively,
reduce costs, strengthen customer loyalty and create new revenue streams. We
believe the continued growth of the Internet promises new opportunities for
innovative applications and business benefits. But, the growth of the Internet
also presents new challenges.

    VOLUME OF INFORMATION.  The combination of Internet and computing advances
is driving the creation of increasingly large amounts of unique new information
every year. According to a study released in October 2000 by the University of
California at Berkeley entitled "How Much Information," 250 megabytes of unique
new information was created for every man, woman and child on the planet in the
year 2000 (250 megabytes is roughly equivalent to the information in 250 books).
Further, this type of information is projected to double every year for the
foreseeable future. We believe the sheer volume of online information that
organizations must manage strains existing systems and creates the need for new
solutions to describe, manage, and utilize a rapidly growing base of
information.

    VELOCITY OF INFORMATION.  The growth of the Internet is also accelerating
the speed of information exchange. Next generation wireless networks promise to
expand data rates from 9.6 kilobits per second (kbps) today to 64 or 144 kbps.
Broadband technologies are already providing wired users with a 25X boost in
Internet access bandwidth compared to dial-up data rates. With higher data
rates, we believe businesses will use more rich media, such as audio and video,
to enable new applications and continue to improve the user experience. We
believe the accelerating rate of information delivery to organizations and the
demand for information at higher data rates to customers creates the need for
new systems that can accept, process and deliver information at higher speeds.

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    VISIBILITY OF INFORMATION.  According to the Pew Internet & American Life
Project, 56 percent of all adults in the U.S. had Internet access in the second
half of 2000, which was an increase of 9 percent over the first half of the
year. We believe the number of people with Internet access will continue growing
worldwide, as will the amount of time each user spends online. We also believe
users will connect to the Internet with a growing variety of devices, including
wireless phones, personal digital assistants, personal computers and new
Internet appliances. While a growing base of users makes new applications
possible, we believe it also increases application complexity, since information
must be personalized for each user and their device of choice. We believe it
also increases the impact of errors, since mistakes are visible by an ever
larger connected population. This expanding visibility of information creates
the need for software solutions that can scale reliably with growing user
populations.

    VOLATILITY OF INFORMATION.  The growth of the Internet and computing
technologies has also enabled information to change more rapidly. More people
have access to personal computers, office productivity software, and Internet
connections, enabling them to more easily create and modify information. In the
increasingly competitive economy, changes must be conveyed rapidly to
information consumers. We believe organizations need software solutions that
enable information owners to easily and quickly make changes, and then rapidly
send those changes to a variety of destinations.

BUSINESS PROBLEMS THAT NEED TO BE SOLVED

    The volume, velocity, visibility and volatility of information driven by the
Internet presents both risks and opportunities. Poorly managed information can
result in increased costs and missed opportunities. Yet managing information
effectively can yield increased competitive advantage. In our experience,
organizations seeking to take advantage of the Internet encounter three business
problems as they struggle with increasingly large amounts of rapidly changing
information that moves more quickly to ever larger audiences.

    FRAGMENTED WEB OPERATIONS.  Many large organizations today find that web
initiatives have been established in several different divisions or business
units. Each business unit has formed its own web team and has built or bought
their own web technologies. Information has become replicated in each group's
web sites. Changes and updates have to be implemented by each group in their
respective systems, so they are labor-intensive and slow. In addition, they are
often trouble-prone since one or more web sites may be overlooked. Organizations
are seeking solutions to consolidate redundant web teams and duplicate
technologies. They also seek solutions to eliminate inconsistent copies of
information, enforce consistent presentation of their brand identity and reduce
the time required to implement changes.

    CONTENT-CHOKED & CONTENT-DRIVEN.  The Internet drives organizations of all
sizes across a variety of industries to develop and refine competencies and
systems for information publishing and information distribution. Publishers and
media companies need to be able to create and manage a growing volume of
information and quickly distribute it in a personalized way to a growing base of
users and variety of presentation devices. Companies in other industries are
recognizing that the timely delivery of complete and accurate information is a
significant driver of customer satisfaction and loyalty, so they need to
establish new publishing processes. Across all industries, organizations are
discovering that current systems cannot adapt to the new volume, velocity,
visibility and volatility of the Internet, and they are seeking new solutions.

    INTEGRATION WITHIN & ACROSS ORGANIZATIONS.  Internet users today want to be
able to interact and take action, from simple actions like purchase or bid, to
more complex operations, like managing portfolios, checking real-time inventory
levels or maintaining subscription profiles. Organizations also want to share
sensitive data with trusted trading partners, integrate product catalogs with
marketplaces and offer new web services. These sophisticated Internet
applications require rich descriptive

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information combined with transactional data and services from existing
enterprise systems. Organizations are seeking new solutions that integrate with
their existing systems, support new business processes and connect to trading
partners and marketplaces.

ARCHITECTURE FOR CHANGE

    Increasing computing power, greater Internet bandwidth, expanding
information volume and more Internet users appear to be trends that will persist
for several years. This will present organizations with new challenges every
year as they strive to use the Internet for competitive advantage. The key
question for Chief Information Officers and Information Technology executives is
how to select eBusiness software technologies and vendors in the midst of this
continued change driven by the Internet. Deferring technology decisions until
the Internet matures puts the organization's current competitiveness at risk and
is not a viable option.

    We believe a key to navigating change is to focus on sound architecture.
While the Internet is still relatively new, the management of information is
not. Well-designed information architecture can better support the flow of
information into, through, and across organizations. Information architecture
also enables the maintenance of information by authorized owners, captures the
relationships between information, and facilitates the re-use of information.

    We believe systems to manage information must be based on sound technology
architecture as well. The technology architecture must support performance
scalability and reliability requirements, as well as the iterative nature of
eBusiness application development. We believe the technology architecture must
also be open, enabling integration to other systems and supporting future
extensions. We believe open technology architectures can minimize staffing and
training issues by employing technology standards that are widely used and known
by many technical professionals.

THE OPEN MARKET SOLUTION

CONTENT-DRIVEN EBUSINESS SOLUTIONS

    Our eBusiness solutions are founded on the premise that content drives
eBusiness. We believe the volume, velocity, visibility and volatility of content
continue to increase dramatically with the rapid expansion of the Internet. In
short, we believe effective management and delivery of content is both vital and
strategic to the success of any eBusiness, whether selling products from a
catalog, delivering up-to-the-minute news and articles or managing customer
portfolios. Our software empowers enterprises to achieve their eBusiness goals
by rapidly developing high-end, high-volume, high-traffic web sites.

    Our new product family, Content Server-TM- Enterprise Edition (CSEE-TM-),
which was announced in March 2001, is an integrated suite of eBusiness solutions
that employ two core technologies, our open PowerAsset information architecture
and the Java-TM- 2 Enterprise Edition (J2EE-TM-) technology architecture. The
PowerAsset information architecture is designed to maximize value by enabling
enterprise content to be kept in a "presentation neutral" format so it can be
easily reused across multiple web sites and delivery services. Because CSEE-TM-
software is built directly on top of leading J2EE-TM- application servers from
BEA, IBM and iPlanet, customers benefit from fast development of content-driven
Internet applications using mainstream Java-TM- technical tools, simple
integration with existing systems and technologies that support growth and
change.

    CSEE-TM- helps organizations acquire content, manage content, and deliver
content in support of their business goals and objectives.

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CONTENT ACQUISITION

    We automate content acquisition from legacy databases and syndicated
newsfeeds, and acquire content in multiple formats (such as Microsoft Word-TM-,
Adobe PDF-TM-, audio and video files) from multiple sources (such as writers,
designers and business managers) distributed globally.

    INTEGRATION SOLUTIONS.  We provide integration technologies that import
enterprise content and business process information from enterprise resource
planning (ERP) and other existing systems. This facilitates streamlining of
business processes and reduces coding by reusing enterprise business logic such
as tax and shipping logic. These integration technologies also leverage existing
enterprise content.

    BUSINESS MANAGER CONTROL OF THE USER EXPERIENCE.  Open Market's
user-friendly browser-based interface facilitates increased productivity by
non-technical contributors and editors. In addition, the interface fosters the
creation of segments, the effective management of products and the launch of
promotions by non-technical marketers.

CONTENT MANAGEMENT

    UNIFIED LOOK AND FEEL.  We enable enterprises to create a unified look and
feel for their eBusiness across multiple lines of business and multiple channels
around the world. Our products make it easier to perform global changes to a web
site by using templates to control the presentation of the site.

    CATALOG MANAGEMENT.  CSEE-TM- is designed to help enterprises manage
dynamic, information-rich, constantly changing online catalogs that can contain
tens of thousands of products. Our software also delivers product information
from enterprise business systems to customers, including real-time prices and
product availability. Finally, our PowerAsset information architecture makes it
easier to link related information to catalog entries, such as product reviews
and similar products.

    WORKFLOW MANAGEMENT.  Efficient workflow management is possible because our
technology allows enterprises to control the movement of content through the
acquisition, editing, approval and presentation stages. CSEE-TM- is designed to
facilitate increased productivity and faster time-to-web by streamlining and
controlling an enterprise's content development and associated processes. Our
workflow management can also play a role in the implementation of enterprise
policies and procedures, empowering employees to work cross-functionally more
efficiently (e.g. by expediting joint workgroup editing, legal approvals and
business manager approvals).

CONTENT DELIVERY

    PERSONALIZATION.  Our PowerAsset information architecture makes it easy to
deliver personalized content for particular customers, visitors or partners, and
also to aid in developing personalized marketing campaigns. In addition, our
software performs visitor profile management and uses a recommendation engine to
create an engaging customer experience.

    SYNDICATION.  With CSEE-TM-, our customers can more easily syndicate their
content by driving it through public networks to enterprise business partners,
information agencies, business intelligence services and channels.

    PRESENTATION ON MULTIPLE DELIVERY DEVICES.  Our PowerAsset information
architecture on the J2EE-TM- technology foundation offers the scalability,
personalization and dissemination flexibility necessary to deliver content to
any delivery device, including e-mail, wireless devices, personal digital
assistants and a variety of Internet-enabled appliances.

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OPEN MARKET APPROACH

    POWERASSET INFORMATION ARCHITECTURE.  We developed our PowerAsset
information architecture to maximize the efficiency and value of an enterprise's
information assets (such as images, news articles, logos, product information
and audio files). This is accomplished by keeping information in a
presentation-neutral format and by managing information as objects which include
both the information itself and its associated properties or characteristics. We
call these objects PowerAssets. Instead of trapping information in a web page or
proprietary format, we treat enterprise information as dynamic, independent
assets that can be flexibly extended, reused, and manipulated. This enables
customers to take indivdual information assets and relate them to other assets,
deliver them to multiple sites and device types and control how they are used by
eBusiness systems such as online catalogs, personalization applications and net
market places.

    J2EE-TM- APPLICATION SERVERS.  We believe J2EE-TM- provides an open,
scalable and reliable technological foundation for eBusiness content management
and delivery. J2EE-TM-'s multi-tiered division of functionality frees
organizations from previously expensive and time-consuming application
development, server administration and upgrades. J2EE-TM- also makes it easier
for enterprises to add packaged enterprise-specific third-party applications or
build their own unique organization-specific applications.

    Since our software products are developed in Java-TM- and deployed as
components that are layered on top of J2EE-TM- application servers, we inherit
the strengths and capabilities of the underlying application server. Some of the
advantages that J2EE-TM- application servers provide to our software products
include: (i) performance scalability to handle the high-volume, high-traffic
content demands of large, global enterprises, (ii) reliability to ensure content
is delivered where and when it is needed, and (iii) flexibility to integrate
with existing enterprise systems, ensuring content can pass from existing
systems to eBusiness systems and back again. Since J2EE-TM- application servers
and our software products are based on industry standard languages and protocols
including Java-TM- and eXtended Markup Language (XML), our customers and
partners also benefit from the availability of technical professionals that can
work with our software without specialized training in proprietary languages or
complex software architectures.

    We believe that the combination of our PowerAsset information architecture
and our commitment to building software on top of the J2EE-TM- application
server technology architecture provides our customers with eBusiness solutions
with a lower total cost of ownership than other alternatives. Our performance
and scalability advantages can reduce spending on computer hardware. The breadth
of capability we provide can reduce spending on packaged software, and our
adherence to open industry standards can reduce the cost of both the initial
implementation and the ongoing enhancement and operation of eBusiness systems.

STRATEGY

    Our objective is to advance our position as a provider of application
software for content-driven eBusiness solutions. To achieve this objective, we
have adopted the following strategies:

    MAINTAIN PRODUCT LEADERSHIP.  Our enterprise application software products
for content-driven eBusiness solutions have been recognized by industry analysts
as the top-ranked content management and delivery system. We intend to maintain
this leadership position by continuing to focus on new ways to use the expanding
Internet to better manage strategic information assets and accomplish business
objectives. We intend to continue helping organizations manage and exchange
information to optimize interactions with their site visitors, employees,
customers and distribution channels. We also intend to continue to utilize open,
scalable, reliable, and industry standard software technology to build our
application software products. It is our goal to continue to provide
best-of-breed, high-end, high-performance software solutions to maintain our
competitive product advantage.

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    FOCUS ON TOTAL COST OF OWNERSHIP.  To maximize our customer's return on
eBusiness investments, we intend to focus on both enhancing benefits and
reducing costs. We also intend to focus on reducing the costs of acquiring,
implementing and operating eBusiness solutions by continuing to deliver a broad
range of capability in a modular family of software products. We believe this
will enable our customers to start with an affordable and manageable project and
acquire additional software capabilities as their needs require. We also plan to
lower computer server hardware acquisition costs by maximizing the performance
of our software products. We intend to reduce the implementation costs of
eBusiness solutions by continuing to provide an integrated family of software
products that address a broad range of eBusiness needs. This reduces the need to
purchase and integrate software from multiple vendors. We also intend to reduce
costs by adhering to industry standards, which enables our customers and
partners to use technical professionals with widely available skills and to use
their choice of development tools for implementation.

    INCREASE MARKET AWARENESS AND SALES CHANNELS.  Our marketing efforts are
designed to build awareness of Open Market as a provider of content management
solutions, to generate sales leads, and to help customers realize the benefits
of implementing content-driven eBusiness solutions. Since there are many
companies offering content management solutions and claiming to support
J2EE-TM-, our marketing efforts also seek to help customers understand the
difference between competing alternatives. To accomplish our marketing
objectives, we make it easy for prospective customers to download and evaluate
our software, and we cooperate with our partners on a variety of marketing
programs. We also intend to expand our sales channels with a combination of
direct and indirect sales strategies for specific geographies and market
segments.

    EXPAND STRATEGIC ALLIANCES.  To continue our growth, we intend to expand
relationships with key technology partners, such as our current platform
partners IBM, BEA, and iPlanet, which provide J2EE-TM- application servers for
our content-driven eBusiness solutions. We also plan to expand the strategic
partnerships we have with large domestic and international system integrators in
order to both increase sales to existing customers and drive sales to new
customers.

    MAXIMIZE CUSTOMER SATISFACTION.  Content-driven eBusiness solutions
frequently start small and expand with growing user traffic. Customers
frequently respond to increased traffic by adding new features and capabilities,
and successful projects frequently motivate additional projects in other parts
of the organization. These characteristics drive long-term relationships with
our customers, starting with the initial software purchase and many subsequent
additional purchases. Plus, prospective customers frequently request references
from existing customers during their evaluation process. For these reasons,
customer satisfaction is strategically important and we intend to continue to
strive to maximize customer satisfaction with our software solutions.

    ATTRACT, DEVELOP AND RETAIN HIGHLY SKILLED EMPLOYEES.  Attracting,
developing and retaining employees is critical to our success. Our business
depends on highly skilled people to identify and create best practices for
managing information assets and then to develop software based on those
practices. We also depend on people's talents to present our solutions to the
marketplace, to support and manage customer relationships, and to contribute to
the company's success in all functional areas. In addition to competitive
benefits and compensation, we seek to provide our employees with opportunities
to achieve their professional and personal objectives. We strive to keep our
employees informed of our strategies and progress so that they may each apply
their unique talents and skills to the organization's success.

PRODUCTS

    Our customers implement content-driven eBusiness solutions using our Content
Server-TM- Enterprise Edition (CSEE-TM-) family of software products. Announced
in March 2001, this family of high-performance J2EE-TM--based products consists
of new releases of six existing software products and

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one new product, Marketing Studio-TM-. All seven are focused on content-driven
eBusiness solutions, and CSEE-TM- is modular so customers can start small and
expand as their needs dictate.

CONTENT SERVER-TM-

    Content Server-TM- is the foundation of Content Server Enterprise Edition
(CSEE-TM-). It provides core content management and delivery services, and
features a template engine supporting XML and JavaServer-TM- Pages (JSP),
caching, revision control, search capability and security features. With Release
3.5, JSP developers have access to Content Server's value-added services for
content management and dynamic page assembly. Release 3.5 is available on three
of the industry's leading J2EE-TM- application servers, providing enterprises
flexibility in their choice of infrastructure. The Content Server-TM- engine
drives all of our other solutions.

CONTENT CENTRE-TM-

    Content Centre-TM- is the CSEE-TM- content management and delivery
application that streamlines web production processes (e.g. content creation,
acquisition, relationship building and workflow) and delivers both static and
dynamic sites to a variety of target audiences and devices. Release 3.5 adds new
features designed to improve publishing performance.

CATALOG CENTRE-TM-

    Catalog Centre-TM- creates catalogs that can be used to store and manage
enterprise products and services for use by partners, customers and channels.
Release 1.1 is designed to allow the loading and management of larger and more
complex catalogs.

PERSONALIZATION CENTRE-TM-

    Personalization Centre-TM- enables site visitors to customize their
experience by selecting what they want displayed and by defining information
channels according to their specific interests. It also enables business
managers to create visitor segments and use rules or recommendation engines to
personalize the presentation of information and services for each segment.
Release 1.2 supports the new capabilities of CSEE-TM-.

MARKETING STUDIO-TM-

    Marketing Studio-TM- provides business managers with an intuitive,
wizard-based user interface to create customer segments, product promotions and
product or content recommendations based on a visitor's profile or behavior.

INTEGRATION CENTRE-TM-

    Integration Centre-TM- enables content-driven eBusiness solutions to access
the transactional data and services in existing enterprise systems. This
integration with other systems within an enterprise is often referred to as
Enterprise Application Integration (EAI). Release 2.0 expands EAI capabilities
for SAP AG's R/3-Registered Trademark- enterprise resource planning (ERP)
system. It also adds a new XML document exchange for integration with
marketplaces and trading partners, often referred to as Business-to-Business
integration (B2Bi).

SATELLITE SERVER-TM-

    Satellite Server-TM- is an intelligent content caching product, which
utilizes small-distributed servers to handle the high-volume delivery of
personalized, dynamic content. Release 1.1 supports the new capabilities of
CSEE.-TM-

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COMPANY PRODUCT PACKAGING AND PRICING



    We offer a variety of packaging and pricing options for our CSEE family of
software products, to achieve flexibility in aligning our technology with
companies executing their content-driven eBusiness strategies. Customers seeking
an enterprise platform for an integrated content-driven eBusiness may license
our entire Content Server Enterprise Edition (CSEE) family of software products.
Those companies pursuing less comprehensive initiatives, but which are still
focused on making strategic investments in content-driven eBusiness solutions,
may license Content Server and Content Centre and then add on at a later date
Catalog Centre, Personalization Centre, Marketing Studio, Integration Centre or
Satellite Server as their needs dictate. By offering this variety of packaging
options, we allow our customers to make strategic investments in our technology,
without necessarily committing to a larger enterprise platform.



    We also offer a wide variety of pricing options to our customers. We
currently offer our packaged software on a price per cpu basis, which customers
license on a perpetual basis. License fees for our products typically range from
approximately one hundred thousand dollars to one million dollars. The pricing
for our professional services is generally on a time and material basis. The
pricing for our maintenance and support is 16% of the license fee for basic
service or 22% for premier service.


PARTNERS

TECHNOLOGY PARTNERS

    During the year 2000, we formed or solidified strategic partnerships with
the leading J2EE-TM- application server vendors BEA, IBM, and iPlanet and the
leading UNIX platform providers IBM and Sun Microsystems, to deliver complete
standards-based eBusiness solutions. We currently support two major technology
categories: strategic platform partners (IBM, BEA, Sun Microsystems and
iPlanet), and complementary technology partners (including partners such as
WebMethods, Alta Vista, and Screaming Media). Our focus is to bring programs to
market with these technology partners, allowing us to increase our sales and
marketing channels worldwide.

    We have also created a Technology Partner Program managed by a dedicated
team of our employees that focuses on complementing our technology with
technology from a variety of partners, each of which might offer technology
which is used by us in a number of ways such as (i) an embedded technology in
one of our products or (ii) part of a solution offering we jointly bring to
market.

SERVICE PARTNERS

    In 2000, we began expanding our indirect sales channels through an enhanced
partner program and a partner-centric sales model. Building a network of
experienced partners, which now includes over 50 system integrators, value-added
resellers and distributors worldwide, has been key to this initiative. We have
recently established relationships with several large domestic and international
companies, leveraging their skills and networks to integrate our products with
current and emerging technologies, and enable them to implement our solution at
customer sites. These partners include Agency.com, Accenture, Exa, Exodus,
DeepBridge, Granitar, IBM Global Services, iXL, Logica, Merle Associates, Nexus
IT, Open Dimensions, PricewaterhouseCoopers, RareMedium and Sopheon.

    Our Partner Program offers a comprehensive training curriculum, new
co-marketing opportunities, access to demonstration software and developer-level
support. A planned certification program for our partners will expand the level
of training and support that we effectively deliver to our partner network.

    We provide worldwide training, support, marketing and sales assistance to a
number of leading system integrators and resellers that sell, install and
support our products.

                                       11
<Page>
    Our relationship with these partners will continue to be essential, as our
customers frequently retain the services of these companies for the
implementation of our software products and the delivery of scalable solutions.
We believe building on our established relationships and creating new
relationships with partners will enable us to sell additional products to our
existing customer base as well as gain new, long-term customers more rapidly.

SERVICES

    We believe that providing a comprehensive range of technical and education
services is a critical component of the successful deployment and operation of
our products. Professional services, also critical to our client's success, are
primarily provided through partnerships with leading systems integration and
consulting firms.

    We offer a wide range of services to our customers and partners, including
maintenance and technical support, professional services design assurance and
education services. We support our products primarily from service centers in
Burlington, Massachusetts; Amsterdam, the Netherlands and Singapore.

    PROFESSIONAL SERVICES.  We have a unique solution design and assurance
approach to professional services. The solution design and assurance approach
provides key subject matter expertise and direction to our clients, while our
systems integration partners provide the full implementation services that our
mutual clients require. This allows us to focus on software invention and
development, maintain a relationship with our clients and an understanding of
the solutions they are building, while also providing an opportunity for our
partners to build practices around our products. This focus on solution design
and assurance services is the result of the changes we announced in October
2000. Prior to this decision, we provided full implementation services to
selected customers as well as services to support our partners.

    TECHNICAL SUPPORT SERVICES.  Our technical support staff comprises of a
group of highly trained professionals. The support team assists customers and
partners with technical questions, problems and product deployment-related
issues, and onsite installation services. In addition, we provide software
maintenance on our products, which includes updates, upgrades of the released
software, technical bulletins and ongoing communication regarding existing
products. Our technical support service offerings are competitively priced and
are renewable on an annual basis.

    Our Basic Service Program features Internet access to a Product Knowledge
base, unlimited phone and e-mail support during business hours and software
updates and upgrades on a when and if available basis. Our Premier Service
Program includes Basic Service entitlements plus 24 X 7 access to support
specialists.

    EDUCATION SERVICES.  Our education services group trains our customers and
partners. These in-depth professional courses cover the entire spectrum of our
products. We hold classes regularly at training facilities in the United States,
the Netherlands, Australia, and Singapore. In addition, we provide onsite
customized training solutions for our customers and partners.

CUSTOMERS AND MARKETS

    Our content-driven eBusiness software solutions are used by nearly 300
customers worldwide across a broad spectrum of industries, including publishers
and media companies, financial services companies and
manufacturers/distributors. We began marketing and selling our content-driven
eBusiness solutions in 1998.

                                       12
<Page>
    A representative list of customers includes:


<Table>
<S>                                 <C>                              <C>
MEDIA/PUBLISHING
BUREAU OF NATIONAL AFFAIRS          FINANCIAL TIMES                  SPACE.COM,
INC.
BUSINESS WEEK ONLINE                THE MCGRAW-HILL COMPANIES        TORONTO
STAR

FINANCIAL SERVICES
CREDIT LYONNAIS                     MACQUARIE BANK                   THE CAPITAL
GROUP
INDEPENDENT INSURANCE               SMILE

MANUFACTURERS, DISTRIBUTORS & MARKETPLACES
CUTLER-HAMMER                       MILACRON
THE BASF GROUP                      GE LIGHTING                      INGRAM
MICRO

OTHER INDUSTRIES
ANWB                                TIM TELECOM ITALIA
</Table>


COMPETITION

    The market for Internet application software for content management and
delivery is relatively new, intensely competitive, quickly evolving and subject
to rapid technological change. We expect competition to continue to increase in
the future. Our products compete with custom solutions developed in-house by
prospective customers, as well as products from competing software vendors such
as Art Technology Group (ATG), BroadVision, Interwoven, Documentum, Vignette and
others. In addition, larger companies with much broader product offerings such
as BEA, IBM, Microsoft and Oracle, may bundle their products to discourage users
from purchasing our products. Companies such as IBM, BEA and iPlanet also may
add content management functionality to their application servers or introduce
their own content management software. Some of our current and potential
competitors have longer operating histories, greater name recognition, larger
installed customer bases and substantially greater financial, technical and
marketing resources than we do. As a result, these competitors may be able to
develop and expand their product offerings more quickly, adapt more swiftly to
new or emerging technologies and changes in customer demand, devote greater
resources to the marketing and sale of their products, pursue acquisitions and
other opportunities more readily and adopt more aggressive pricing policies. In
addition, competitors have established and, in the future, may establish
cooperative relationships among themselves or with third parties to market or
enhance their products. Accordingly, it is possible that new competitors or
alliances among competitors may merge and rapidly acquire significant market
share. Competitive pressures may make it difficult for us to acquire and retain
customers and are likely to result in price reductions, reduced gross margins
and loss of market share.

    Competitive factors in the Internet application software market include
innovative technology, breadth of product features, product quality, marketing
and distribution resources, customer service and support and price. While we
have demonstrated our ability to compete, there can be no assurance that we will
be able to compete successfully against current or future competitors.

SALES AND MARKETING

    Our objective is to achieve broad market penetration by employing multiple
distribution channels, including our direct sales force and indirect sales
channels, as well as partners who sell complementary products and services and
are in a position to influence the selection decision for our software. We use a
variety of marketing programs, executed with our channels and partners, to build
awareness for our offerings and generate sales leads.

                                       13
<Page>
    DIRECT SALES ORGANIZATION.  As of December 31, 2000, our sales organization
was comprised of 100 professionals throughout the United States and in
Australia, Canada, France, Germany, Italy, Japan, The Netherlands, Singapore and
the United Kingdom. Our sales organization includes sales executives, indirect
channel managers, partner managers, technical pre-sales consultants, field
marketing staff, sales administration and management staff.

    INDIRECT SALES CHANNELS.  We are represented by distributors in countries
where we do not have a direct sales force, including Brazil, Hong Kong, India,
Israel, Korea, Malaysia and South Africa. We have resellers that work
cooperatively with our direct sales organization in several international
countries. Several of our systems integrator and consulting partners already
resell our software, including IBM Global Services.

    PARTNERS.  Partners that provide complementary products and services are a
very important part of our sales and marketing strategies. Our software requires
specific servers and software to be in place before our solution can be
installed and operated. Examples of these platform components include servers
running Sun Microsystems' Solaris operating environment or Microsoft Windows NT,
databases from Oracle, Sybase, or Microsoft, and Java application servers from
BEA, IBM or iPlanet. Since we drive demand for these platform products, we have
the opportunity to form mutually beneficial sales relationships with each of
these companies. We are expanding our efforts in this area.

    In addition, many of our customers have limited technical staffs or short
delivery timeframes and therefore need consulting services to assist with the
implementation of our software. They may also require hosting services or
additional capabilities provided by web services or complementary software
products. We establish mutual sales relationships with providers of these
value-added products and services as well.

    MARKETING.  Our marketing priorities are to build awareness and sales leads
for our content-driven eBusiness solutions, and to provide our distribution
channels with sales and marketing materials. We seek to engage our channels and
partners in joint marketing activities. Our marketing program consists of a mix
of activities including (i) free downloads of our software for evaluation,
(ii) web site marketing, (iii) advertising, (iv) attendance at trade shows and
seminars, (v) speaking engagements, (vi) industry analyst briefings, (vii) user
conferences, partner briefings and customer appreciation programs,
(viii) direct and email marketing, and (ix) the development of sales tools and
marketing literature.

RESEARCH AND PRODUCT DEVELOPMENT

    We believe our future success will depend in large part on our ability to
develop software products that address the evolving needs of our customers.
Accordingly, we intend to continue to expand and enhance our existing product
offerings and introduce new products. Our customers and partners provide
significant product feedback that is channeled into product development and
innovation. While we expect that certain of our new products will be developed
internally, we may, based on timing and cost considerations, expand our product
offerings through partnerships. In addition, we may use external development
resources for certain of our products and product components.

    Since our inception, we have made substantial investments in product
development and related activities. As of December 31, 2000, we had 117
employees and independent contractors devoted to product development. Our
research and development expenses were approximately $24.8 million,
$22.4 million, and $25.9 million in 2000, 1999 and 1998, respectively.


INTELLECTUAL PROPERTY AND LICENSES



    We rely on trademark, copyright, patent and trade secret laws, employee and
third-party non-disclosure agreements and other methods to protect our
proprietary technology. We require


                                       14
<Page>

software licensees to enter into license agreements that impose certain
restrictions on their use of our software. Typically, these licenses are
perpetual, subject to termination upon breach by the customer of the terms of
the license agreement, including violations of permitted use of the licensed
software. In addition, we have taken steps to avoid disclosure of our trade
secrets, including requiring those persons with access to our proprietary
technology and information to enter into confidentiality agreements with us and
restricting access to our source code.



    We hold 12 U.S. patents that assert claims for certain aspects or uses of
electronic commerce software, including, among others:



    - distributed commerce;



    - secure, real-time payment using credit and debit cards over the Internet;



    - the use of "electronic shopping carts" and session identifiers; and



    - the use of telephone numbers as URLs involving redirection by a directory
      server.



    Our United States patents have expiration dates ranging from 2006 through
2018. We continually assess our technology for potential patent filings and have
additional patent applications pending in the United States, Europe and other
jurisdictions throughout the world relating to our product architecture and
technology. Generally, we seek patent protection for inventions and developments
made by our personnel and incorporated into our products or otherwise falling
within our fields of interest. Patents are important to our business. However,
we do not believe that any particular patent, or related group of patents, is so
essential to our business that a successful challenge to its scope or validity
would materially affect our operations as a whole.



    When appropriate, we use trademarks to register our products. We currently
hold four registered trademarks in the United States having expiration dates
ranging from 2006 through 2008, and have several corresponding registrations in
a number of jurisdictions throughout the world. We have also filed applications
for additional trademarks in the United States and corresponding applications in
a number of jurisdictions throughout the world. Trademarks are important to our
business. However, no particular trademark is so important that a successful
challenge to our right to use such trademark would materially affect our
operations as a whole.



    We also license patents and technical know-how from third parties. However,
the loss of any one of these licenses or our inability to renew any particular
license on commercially reasonably terms would not materially affect our
operations as a whole.


EMPLOYEES

    As of December 31, 2000, we had 509 employees and independent contractors.
Of the total number of employees and independent contractors, 117 were in
engineering, 145 in sales and marketing, 77 in customer service, 101 in
professional services and 69 in general and administration. We have not
experienced any work stoppages and consider our relations with our employees to
be good.

                               ITEM 2. PROPERTIES

    Our principal offices are located in Burlington, Massachusetts and consist
of approximately 120,000 square feet of office space. The Burlington facility
lease expires in February 2010. We believe our existing facilities are adequate
to meet our future needs.

    In addition, we have sales offices throughout the United States, Canada, the
United Kingdom, France, Germany, The Netherlands, Italy, Japan, Singapore and
Australia. We offer support services to

                                       15
<Page>
our customers principally from our facilities located in Burlington,
Massachusetts; Amsterdam, the Netherlands; Sydney, Australia and Singapore.

                           ITEM 3. LEGAL PROCEEDINGS


    Six putative class actions were filed between June 14, 2000 and August 10,
2000, against us and certain of our officers and directors in the United States
District Court for the District of Massachusetts. These actions, each filed on
behalf of an alleged class of our shareholders who purchased our common stock
between November 8, 1999 and April 18, 2000, allege violations of Sections 10(b)
and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated
under the Securities Exchange Act. In particular, they allege, among other
things, that during the putative class period, the defendants sought to mislead
the investing public by overstating Open Market's prospects and the quality of
its products. The plaintiffs are seeking monetary damages and other appropriate
relief. On January 25, 2001, the court entered an order consolidating these
actions into one action. On April 13, 2001, the plaintiff filed a consolidated
class action complaint. On May 29, 2001, the defendants filed a motion seeking
dismissal of all counts of the consolidated complaint.


    On January 8, 2001, we filed a patent infringement lawsuit against Intershop
Communications, Inc. in the U.S. District Court for the District of Delaware.
Our complaint alleges that Intershop's software products infringe upon three of
our patents. We are seeking injunctive relief and damages due to Intershop's
infringement. On March 1, 2001, Intershop filed its answer denying infringement
and asserting claims for a declaratory judgement of invalidity of the patents
and non-infringement.

          ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

    None.

                                       16
<Page>
                                    PART II

               ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND
                          RELATED STOCKHOLDER MATTERS

    Our common stock is quoted on the Nasdaq National Market under the symbol
"OMKT". The following table sets forth, for the periods indicated, the high and
low prices per share for our common stock as reported on the Nasdaq National
Market.

<Table>
<Caption>
QUARTER ENDED                                                   HIGH       LOW
-------------                                                 --------
--------
<S>                                                           <C>        <C>
December 31, 2000...........................................   $ 6.13     $  .94
September 30, 2000..........................................    14.50       5.25
June 30, 2000...............................................    26.50       7.88
March 31, 2000..............................................    65.50      23.88
December 31, 1999...........................................    49.86      12.25
September 30, 1999..........................................    16.25      11.25
June 30, 1999...............................................    17.50      11.50
March 31, 1999..............................................    17.44      11.19
</Table>

    As of February 28, 2001, there were 460 holders of record of our common
stock.

    We have never declared or paid any cash dividends on our capital stock. We
presently intend to retain future earnings, if any, to finance the growth of our
business and do not expect to pay any cash dividends.


                  ITEM 6. SELECTED CONSOLIDATED FINANCIAL DATA


    The following selected financial information should be read in conjunction
with "Management's Discussion and Analysis of Financial Condition and Results of
Operations" and the consolidated financial statements and the notes thereto,
included elsewhere in this report.

    The merger of FutureTense Inc. in October 1999 was accounted for as a
pooling of interests and accordingly all prior period financial data has been
restated as if the merger took place at the beginning of such periods. Our
historical data is not necessarily indicative of future results.

    The selected consolidated balance sheet information presented below as of
December 31, 2000, and 1999 and the operating information for each of the three
years in the period ended December 31, 2000, have been derived from our
consolidated financial statements that have been audited by Arthur Andersen LLP,
independent public accountants, and are included elsewhere in the report. The
selected consolidated balance sheet information as of December 31, 1998, 1997
and 1996 and the operating information for each of the two years in the period
ended December 31, 1997 have been derived from our consolidated financial
statements, audited by Arthur Andersen LLP, not appearing in this report. Arthur
Andersen LLP did not audit the financial statements of FutureTense as of
December 31, 1998, and for the year ended December 31, 1998. Such financial
statements are included in our consolidated financial statements. These
financial statements were audited by other auditors whose report has been
furnished to Arthur Andersen LLP, and their opinion, in so far as it relates to
amounts included for FutureTense, is based solely upon the report of other
auditors. The report of the other auditors for

                                       17
<Page>
FutureTense as of December 31, 1998, and for the year ended December 31, 1998 is
included in this report.

<Table>
<Caption>
                                                           YEARS ENDED DECEMBER
31,
                                                    (IN THOUSANDS, EXCEPT PER
SHARE DATA)

----------------------------------------------------
                                               2000       1999       1998
1997       1996
                                             --------   --------   --------
--------   --------
<S>                                          <C>        <C>        <C>
<C>        <C>
OPERATING INFORMATION
Revenues:
  Revenues.................................  $ 88,981   $ 83,026   $ 64,546   $
61,447   $ 22,517
  Cost of revenues.........................    44,846     25,572     18,579
11,853      5,496
                                             --------   --------   --------
--------   --------
  Gross profit.............................    44,135     57,454     45,967
49,594     17,021
                                             --------   --------   --------
--------   --------
  Selling and marketing....................    48,763     38,343     34,772
38,079     25,006
  Research and development.................    24,801     22,446     25,910
28,307     17,114
  General and administrative...............    12,099      8,667     11,096
10,935      6,755
  Amortization of intangible assets........     2,745      3,387      3,006
1,351         --
  In-process research and development......        --         --      5,700
34,679         --
  Restructuring charge.....................     6,948         --      2,042
   --         --
  Merger related costs.....................        --      4,328         --
   --         --
                                             --------   --------   --------
--------   --------
  Total operating expenses.................    95,356     77,171     82,526
113,351     48,875
                                             --------   --------   --------
--------   --------
  Loss from operations.....................   (51,221)   (19,717)   (36,559)
(63,757)   (31,854)
                                             --------   --------   --------
--------   --------
  Gain from investment.....................    13,318         --         --
   --         --
  Interest income (expense), net...........       879        517        238
2,099      3,054
  Other expense............................      (110)      (166)      (324)
 (218)        --
                                             --------   --------   --------
--------   --------
  Loss before provision for income taxes...   (37,134)   (19,366)   (36,645)
(61,876)   (28,800)
                                             --------   --------   --------
--------   --------
  Provision for income taxes...............       662        414        325
  584        360
                                             --------   --------   --------
--------   --------
  Net loss.................................  $(37,796)  $(19,780)  $(36,970)
$(62,460)  $(29,160)
                                             --------   --------   --------
--------   --------
  Weighted average shares outstanding --
    basic and diluted......................    45,606     42,655     37,815
34,347     30,251
  Net loss per share -- basic and
    diluted................................  $  (0.83)  $  (0.46)  $  (0.98)  $
(1.82)  $  (0.96)
                                             ========   ========   ========
========   ========

BALANCE SHEET INFORMATION
Cash, cash equivalents and marketable
  securities...............................  $ 30,430   $ 32,291   $ 36,719   $
30,909   $ 75,180
Working capital............................  $  7,878   $ 27,576   $ 28,309   $
16,455   $ 69,866
Total assets...............................  $ 70,075   $ 88,805   $ 99,200   $
83,590   $ 89,246
Long-term debt, net of current
  maturities...............................  $     --   $  2,657   $  2,937   $
   99   $    257
Stockholders' equity.......................  $ 20,657   $ 49,958   $ 41,436   $
36,380   $ 69,724
</Table>

    ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
                             RESULTS OF OPERATIONS

    YOU SHOULD READ THE FOLLOWING DISCUSSION OF OUR FINANCIAL CONDITION AND
RESULTS OF OPERATIONS TOGETHER WITH THE CONSOLIDATED FINANCIAL STATEMENTS AND
THE RELATED NOTES INCLUDED ELSEWHERE IN THIS REPORT. THE FOLLOWING FINANCIAL
DATA APPEAR IN THOUSANDS.

OVERVIEW

    Open Market is a provider of enterprise content management and delivery
application software. Our software solutions are designed to enable businesses
and other organizations to use the Internet to optimize interactions with their
site visitors, employees, customers and distribution channels, in order to
reduce costs, accelerate business processes, gain market share, establish new
revenue streams and

                                       18
<Page>
compete in the new online economy. We believe that quality interactions result
from the reliable and timely exchange of compelling and accurate information and
a consistent series of quality interactions is the key to building and
sustaining business relationships.

    We build our software based on two core beliefs. First, information, or
content, is a strategic asset, and world-class organizations strive to excel at
managing crucial information. For these organizations, the Internet introduces
new information management challenges and opportunities. Second, web
applications managing this crucial information must be reliable, scalable,
flexible and open. This puts new requirements on how eBusiness application
software needs to be developed and delivered.

    Companies use our software to build and operate captivating web sites, rich
product catalogs, self-service applications and web services for their
distribution channels, marketplaces and customers. Our products acquire content
from people and systems, manage that information through approval and workflow
processes, and then disseminate it in personalized delivery formats to trading
partners' systems and to a variety of presentation devices, including web
browsers, wireless devices, personal digital assistants and e-mail. These
eBusiness applications, which we call "content-driven eBusiness solutions" are
designed to enable companies to reduce costs, strengthen customer loyalty and
establish new revenue streams.

    Since our inception, our business has principally focused on providing high
performance software applications that enable businesses to engage in
business-to-business and business-to-consumer commerce over the Internet. Over
the past three years, we made a series of acquisitions that were intended to
expand the Internet commerce functionality that we offer our customers. In 1997,
we acquired Waypoint Software Corporation, a provider of business-to-business
catalog solutions, Folio Corporation, a leading supplier of software publishing
tools for managing critical business information and Mission Critical
Technologies, a provider of software to the publishing industry. In 1998, we
acquired ICentral Incorporated, a provider of a browser-based online
store-building tool targeted at small to medium size businesses. In June 1999,
we decided to cease investing in the Folio product line, and we formed a
strategic partnership with NextPage, Inc. in which we granted NextPage exclusive
worldwide marketing and distribution rights for the software publishing tools we
acquired from Folio. This partnership allowed us to reduce our cost structure
and ensured us of a minimum royalty revenue stream of $1,167 per quarter from
July 1999. In March 2001, we sold the Folio product line to NextPage and
therefore there will be no more future revenue stream from these products
beginning in the second quarter of 2001. In October 1999, we also merged with
FutureTense, Inc., a provider of web site content management products. We have
accounted for the FutureTense merger as a pooling of interests. In
October 2000, we announced a restructuring plan to reduce expenses and align
investments with our new strategy of focusing on the market for content
management and delivery software solutions, which we believe best positions the
Company for future profitability and long-term revenue growth.

    We recognize revenue in accordance with Statement of Position (SOP) 97-2,
SOFTWARE REVENUE RECOGNITION, as amended by SOP 98-9. We generate revenue from
two sources: license fees for the use of our products, and service revenues for
implementation, support, consulting and training related to our products.

    We recognize license fee revenues upon licensing and delivery of the
software, if there is persuasive evidence of an agreement, the fee is fixed or
determinable, and collectibility is probable. If the license is subject to
customer acceptance or significant post-delivery obligations exist, we defer the
revenue recognition of the license fee until customer acceptance has occurred or
the post-delivery obligations have been met. We have established sufficient
vendor specific objective evidence for the value of professional services,
training, and maintenance and support services based on the price charged when
these elements are sold separately. Accordingly, software license revenue is
recognized under the residual method in arrangements in which software is
licensed with professional services,

                                       19
<Page>
training, and maintenance and support services. Under the residual method, the
fair value of the undelivered elements is deferred and subsequently recognized
as earned.


    We execute separate contracts that govern the terms and conditions of each
software license and maintenance arrangement and each professional service
arrangement. These contracts may be an element in a multiple element
arrangement. Revenues under multiple element arrangements, which may include
several different software products or services sold together, are allocated to
each element based on the residual method in accordance with the Statement of
Position 98-9, SOFTWARE REVENUE RECOGNITION, WITH RESPECT TO CERTAIN
ARRANGEMENTS. Although the Company generally does not provide its customers with
contractual rights of return, it has issued credits for returns and allowances
for its customers in the past, and as a result, the Company provides for
estimated returns and allowances on products and services in accordance with
FASB No. 48 REVENUE RECOGNITION WHEN RIGHT OF RETURN EXISTS.


    We also enter into reseller arrangements for certain of our products that
typically provide for sublicense fees payable to us based on a percentage of our
list price. We recognize these sublicense revenues from resellers when earned,
either on a per-unit basis or, for guaranteed minimums, upon shipment of the
master copy of all our software to which the guaranteed sublicense fee minimums
relate, if there are no significant post-delivery obligations, and if all other
criteria of SOP 97-2 and 98-9 are met.

    Our service revenues are derived from a wide variety of contracted services
for technical support, consulting and training related to our products. We
charge fees for maintenance and support based on a percentage, generally 16% to
22%, of the corresponding license fee, depending on the level of support, and
recognize these fees ratably over the life of the maintenance and support
contract. Our maintenance agreements provide for unspecified product upgrades
and enhancements and technical support in the form of telephone or on-site
assistance. These agreements are renewable at the election of the customer.
Accordingly, our maintenance and technical support revenues are typically a
function of new product licenses and the annual renewal of maintenance
agreements. We also generate revenues from professional services, which include
implementation and technical consulting, and from education services, including
on-site and online training services. We recognize revenues from professional
and education services as such services are performed.

    We report our revenues according to three operating segments:
Content-centric eBusiness applications, Transact/ShopSite and other revenue. Our
Content-centric eBusiness revenues include license fees and service revenues
from our Content Server family of integrated products. Our Transact/ ShopSite
revenues include license fees and service revenues from our Transact and
ShopSite products. The other revenues relate, historically, to license fees and
service revenues generated from the software publishing tools acquired from
Folio and other products, certain of which have been discontinued. Since
July 1999, other revenues relate primarily to the royalties received from
NextPage in accordance with our arrangement.

    Our cost of product revenues consists of costs to distribute our products,
including the cost of the media on which our products are delivered, and royalty
payments to third-party vendors for technology that is incorporated into our
products. Our cost of service revenues consists primarily of the salaries and
related costs of our technical personnel.

    Software development costs that qualified to be capitalized were immaterial
in all periods. Accordingly, we have charged all such expenses to research and
development in the period incurred.

    Our customer base is diversified, with no single customer representing
greater than 10% of our total revenues for years ended December 31, 2000, 1999,
and 1998.


    Based upon our current revised operating plan and projected capital
expenditures for 2001, we believe that existing unrestricted cash and cash
equivalents, including the recent proceeds from our preferred stock offering and
the sale of the Folio technology to NextPage will be sufficient to fund our
operations, debt service and capital expenditure requirements at least through
December 31, 2001. However, if we are unable to meet our revised operating plan
for 2001, we may need to raise additional funding through the sale of assets, or
raise debt or equity capital. Such funding, if required, may not be available on
terms favorable to the Company. Further, in the event that we are unable to
obtain any such required additional cash infusions, we may be required to
curtail certain of our operations and sell certain additional assets.


                                       20
<Page>
RESULTS OF OPERATIONS

REVENUES

<Table>
<Caption>

        COMPARATIVE

        PERCENTAGE
                                                       YEARS ENDED DECEMBER 31,
          CHANGES

------------------------------   -------------------

    1999 TO    1998 TO
                                                      2000       1999       1998
      2000       1999
                                                    --------   --------
--------   --------   --------
<S>                                                 <C>        <C>        <C>
    <C>        <C>
Content-centric eBusiness application revenues....  $41,954    $11,065    $
625      279%       1670%
Transact/ShopSite revenues........................   41,408     62,294
37,768      (34%)        65%
Other revenues....................................    5,619      9,667
26,153      (42%)       (63%)
                                                    -------    -------
-------      ---        ----
Total revenues....................................  $88,981    $83,026
$64,546        7%         29%
                                                    =======    =======
=======      ===        ====
</Table>

    In 2000, total revenues increased by approximately $5,955, or 7%, from the
prior year. The increase was attributed primarily to an increase in
content-centric eBusiness application revenues of $30,889, or 279%, from 1999.

    In 1999, total revenues increased by approximately $18,480, or 29%, from the
prior year. The increase was primarily attributed to growth in Transact/ShopSite
revenues of $24,526, or 65%, from 1998.

PRODUCT REVENUES

<Table>
<Caption>

        COMPARATIVE

        PERCENTAGE
                                                       YEARS ENDED DECEMBER 31,
          CHANGES

------------------------------   -------------------

    1999 TO    1998 TO
                                                      2000       1999       1998
      2000       1999
                                                    --------   --------
--------   --------   --------
<S>                                                 <C>        <C>        <C>
    <C>        <C>
Content-centric eBusiness application product
  revenues........................................  $29,994    $ 8,295    $
446      262%       1760%
Transact/ShopSite product revenues................   13,599     38,426
21,734      (65%)        77%
Other product revenues............................    4,757      7,021
21,403      (32%)       (67%)
                                                    -------    -------
-------      ---        ----
Total product revenues............................  $48,350    $53,742
$43,583      (10%)        23%
                                                    =======    =======
=======      ===        ====
</Table>


    In 2000, total product revenues decreased by approximately $5,392 from the
prior year. Content-centric eBusiness application product revenues increased
approximately $21,699, or 262%, from the prior year, due primarily to growth in
the number of units sold which contributed approximately $14,000 to the increase
in revenue, as well as higher average revenue per unit, which contributed
approximately $7,000 towards the increase in revenue. The increase in units in
2000 was due to an increase in demand for our Content-centric applications from
our enterprise customers. This was offset by a decrease of approximately
$24,827, or 65%, in Transact/ShopSite product revenues from the prior year. The
decrease in Transact/ShopSite product revenues was attributed to the realignment
of the North American sales organization, which led to fewer orders being
closed, the decline in average revenue generated by Transact licenses because of
a decrease in demand from our enterprise customers and changes in market
dynamics where customers were choosing to use existing ERP solutions for online
commerce, as opposed to choosing a stand-alone system such as Transact. In
addition, we recorded an increase in sales returns and allowances of
approximately $2,509 in 2000, which related primarily to an estimated number of
returns and allowances for our Transact product, when compared to 1999. In March
2001, we sold the Folio product line to NextPage and therefore there will be no
future revenue stream from these products beginning in the second quarter of
2001.



    Open Market operates in a market environment characterized by intense
competition, rapid technological change, changing customer needs and constant
new product development. In addition, Open Market is currently transitioning
from its heritage Transact/ShopSite business, and concentrating on the market
for content management and delivery solutions. Further, the external economic
climate


                                       21
<Page>

in Open Market's principal geographic markets evidenced an increasing
deterioration in the fourth quarter of 2000, which served to decrease
information technology spending, adversely impacting Open Market. All of these
factors served to contribute to Open Market's overall sequential declines in
quarterly revenues during each quarter of 2000, and the confluence of all these
dynamics makes it very difficult for Open Market to accurately project future
revenue results.



    Considering the foregoing, Open Market believes revenues from its heritage
Transact/ShopSite business segment will continue to decline on a quarterly
basis, as Open Market de-emphasizes this business, and that license revenues,
professional services revenues and maintenance and support revenues related to
the heritage Transact/ShopSite business will decline as a result.



    Open Market believes its new content management and delivery product
offerings and its sales capacity, as represented by its direct sales
representatives and it distribution partners, position it favorably for
increased revenue growth in its content management and delivery segment.
However, during the fourth quarter of 2000, revenues from Open Market's content
management and delivery segment actually decreased on a quarterly basis as
compared to the third quarter of 2000. In addition, the external economic
environment in Open Market's principal geographic markets continued to
deteriorate, which had the effect of slowing information technology spending.



    Accordingly, while Open Market believes it is positioned favorably for
revenue growth in its content management and delivery business segment, it is
subject to the many risks described above and, accordingly, Open Market cannot
assure that it will achieve future revenue growth for its content management
business segment. Further, in the event the adverse trend evidenced by the
decline in revenue in Open Market's content management business segment
experienced during the fourth quarter of 2000 continues, and Open Market's
Transact/ShopSite revenues continue to decline as Open Market expects, Open
Market will be forced to reduce costs or modify its operating activities
accordingly, which may result in additional restructuring charges being incurred
or other adverse financial ramifications for Open Market.


    In 1999, the increase of approximately $10,159 in total product revenues was
attributed to increases in both our Transact/ShopSite and content-centric
eBusiness application product revenues. This growth was a result of increases in
the number of licenses to new customers and follow-on licenses to our installed
base of customers. In addition, in 1999 we recorded a full year of revenues from
the content-centric eBusiness application management product compared to
recording only six months of such revenues in 1998. Other product revenues in
1999 decreased by approximately $14,382 from the prior year. The decline was the
result of decreases in licenses and royalties from our Folio publishing suite of
products.

    Product revenues accounted for 54%, 65%, and 68% of total revenues in fiscal
years 2000, 1999, and 1998, respectively. We expect that product revenues will
continue to comprise the greater percentage of total revenues for the
foreseeable future.

SERVICE REVENUES

<Table>
<Caption>

        COMPARATIVE

        PERCENTAGE
                                                       YEARS ENDED DECEMBER 31,
          CHANGES

------------------------------   -------------------

    1999 TO    1998 TO
                                                      2000       1999       1998
      2000       1999
                                                    --------   --------
--------   --------   --------
<S>                                                 <C>        <C>        <C>
    <C>        <C>
Content-centric eBusiness application service
  revenues........................................  $11,960    $ 2,770    $
179      332%       1447%
Transact/ShopSite service revenues................   27,809     23,868
16,034       17%         49%
Other service revenues............................      862      2,646
4,750      (67%)       (44%)
                                                    -------    -------
-------      ---        ----
Total service revenues............................  $40,631    $29,284
$20,963       39%         40%
                                                    =======    =======
=======      ===        ====
</Table>

                                       22
<Page>

    In 2000, total service revenues increased by $11,347, or 39%, from the prior
year. Content-centric eBusiness application service revenues grew $9,190, or
332%, from the prior year, primarily as a result of an increase in consulting
engagements related to our Content-centric products, as well as an increase in
maintenance and support revenues from new customers and renewals from installed
customers. Transact/ShopSite service revenues increased by $3,941, or 17%, from
the prior year, primarily due to an increase in professional service revenue
from Transact product-related consulting projects that were contracted in 2000
and 1999. The increase in Transact/ShopSite service revenues in 2000 was due in
part to the backlog of professional services engagements at the end of 1999
which were completed and recorded as revenue during 2000. We expect that the
Transact/ShopSite service revenue will decline due to the completion in the
first half of 2000 of the majority of our professional services engagements
related to Transact. In 2000, other service revenues declined $1,784, or 67%,
from 1999. The decline was due to the elimination of service revenue related to
the Folio publishing segment.


    In 1999, total service revenues increased by $8,321 from the prior year as a
result of increased demand for our consulting and technical service offerings
from both new and existing customers. Transact/ShopSite service revenues grew
approximately $7,834 from the prior year due to an increase in consulting
projects as well as an increase in maintenance and support revenues from our new
and installed base of customers. Content-centric eBusiness application service
revenues increased significantly as a result of growth in new product license
business. In 1999, other service revenues declined by approximately $2,104 as
compared to 1998. This decline was due to reductions in both consulting and
maintenance and support revenues for the Folio publishing suite as a result of
the Master Distribution Agreement with NextPage.

    For 2000, 1999, and 1998, service revenues comprised 46%, 35%, and 32%,
respectively, of total revenues.

COST OF PRODUCT REVENUES


<Table>
<Caption>
                                                         YEARS ENDED DECEMBER
31,

------------------------------
                                                        2000       1999
1998
                                                      --------   --------
--------
<S>                                                   <C>        <C>        <C>
Content-centric eBusiness application product
  revenues..........................................   $3,452     $1,242     $
55
Transact/ShopSite product revenues..................    3,584      2,980
2,530
Other product revenues..............................      417        211
629
                                                       ------     ------
------
Cost of product revenues............................   $7,453     $4,434
$3,214
                                                       ======     ======
======
  Percentage of cost of product revenues............       15%         8%
 7%
  Product gross margin..............................       85%        92%
93%
</Table>


    Cost of product revenues includes the costs to distribute products, costs of
media on which products are delivered, royalties for third-party technology that
are embedded into certain products, and royalties for the resale of third-party
software products.

    In 2000 and 1999, the increased cost of product revenues was attributed
primarily to increases in content-centric eBusiness application product
revenues, which carry higher third party technology costs than Transact/ShopSite
products. We believe that our cost of product revenues as a percentage of
product revenues will be in the range of 10% to 15% for the foreseeable future.

                                       23
<Page>
COST OF SERVICE REVENUES


<Table>
<Caption>
                                                      YEARS ENDED DECEMBER 31,

------------------------------
                                                     2000       1999       1998
                                                   --------   --------
--------
<S>                                                <C>        <C>        <C>
Content-centric eBusiness application service
  revenues.......................................  $12,125    $ 1,973    $   145
Transact/ShopSite service revenues...............   24,422     17,282     13,106
Other service revenues...........................      846      1,883      2,114
                                                   -------    -------    -------
Cost of service revenues.........................  $37,393    $21,138    $15,365
                                                   =======    =======    =======
  Percentage cost of service revenues............       92%        72%
73%
  Service gross margin...........................        8%        28%
27%
</Table>


    Cost of service revenues consists primarily of personnel related costs,
outside consultants and costs incurred in providing development, consulting,
support, and other technical services to customers.

    In 2000, cost of service revenues increased by approximately $16,255 from
the prior year primarily due to growth in outside consulting expenses of $9,987,
employee-related expenses, including recruiting and training costs of $3,066,
travel-related expenses of $1,237 and increases in certain other equipment and
office-related costs of $672. In 2000, we continued to hire additional
consultants through both internal hiring and external contracting sources in
order to meet the needs of our customers. In 2000, the decrease in service gross
margin was attributed primarily to the increased use of outside consultants, as
well as additional costs and utilization inefficiencies arising from our
changing service model and continued investment in the product and
implementation training of our expanding partner network.

    In 1999, cost of service revenues increased by $5,773 from 1998 primarily
due to a growth in employee-related expenses of $1,843 and outside consulting
expenses of $3,912. During 1999, we continued to hire additional professional
service personnel and outside consultants.

OPERATING EXPENSES

<Table>
<Caption>
                                                     YEARS ENDED DECEMBER 31,
               PERCENTAGE OF REVENUES

------------------------------------      ------------------------------------
                                                 2000          1999
1998          2000          1999          1998
                                               --------      --------
--------      --------      --------      --------
<S>                                            <C>           <C>           <C>
        <C>           <C>           <C>
Selling and marketing....................      $48,763       $38,343
$34,772          55%           46%           54%
Research and development.................       24,801        22,446
25,910          28%           27%           40%
General and administrative...............       12,099         8,667
11,096          14%           10%           17%
Amortization of intangible assets........        2,746         3,387
3,006           3%            4%            5%
Acquired in-process research and
  development............................           --            --
5,700          --            --             9%
Restructuring charge.....................        6,948            --
2,042           8%           --             3%
Merger related costs.....................           --         4,328
--          --             5%           --
                                               -------       -------
-------         ---            --           ---
Total operating expenses.................      $95,356       $77,171
$82,526         108%           92%          128%
                                               =======       =======
=======         ===            ==           ===
</Table>

SELLING AND MARKETING

    Selling and marketing expenses consist primarily of the cost of sales and
marketing personnel and outside consultants, as well as the costs associated
with marketing programs, media relations activities, industry tradeshows, sales
seminars, advertising and product literature.

    In 2000, selling and marketing expenses increased $10,420 from the prior
year primarily as a result of increases in employee-related expenses related to
the revamping of the North American sales organization, including recruiting and
relocation costs of $6,109, general marketing expenses, including

                                       24
<Page>
marketing programs and materials, of $2,385 and increases in equipment and
facilities expenses of $507.

    In 1999, selling and marketing expenses increased by approximately $3,571
primarily as a result of an increase in commission expense related to the
increase in revenues.

RESEARCH AND DEVELOPMENT

    Research and development expenses consist primarily of the cost of research
and development personnel and independent contractors, certain licensed
technology, and equipment and facilities costs related to such activities.

    In 2000, research and development expenses increased approximately $2,355
from the prior year. The increase was attributed primarily to increases in
employee-related expenses, including recruiting and outside consulting expenses,
of $1,299, office equipment expenses of $401, and third party technology
maintenance and support costs of $271. These increases were related to our new
product releases and enhancements made to existing products throughout the year.

    In 1999, research and development expenses decreased approximately $3,464
from the prior year. The decrease was attributed primarily to reductions in
employee-related expenses of $2,745 and outside consulting expenses of $719 as a
result of an overall reduction in research and development headcount from the
prior year. This headcount reduction was primarily the result of the completion
of development projects related to the release of an upgraded version of
Transact in the first quarter of 1998.

    Software development costs that qualified to be capitalized were immaterial
in all periods, and accordingly, we have charged all such expenses to research
and development in the period incurred. Management believes that we will
continue to devote substantial resources to our product development activities
and that our expense levels will increase slightly over the next year.

GENERAL AND ADMINISTRATIVE

    General and administrative expenses consist primarily of the cost of
finance, management and administrative personnel, and legal and other
professional fees.


    In 2000, general and administrative expenses increased $3,432 from the prior
year. The increase was attributable primarily to an increase of $2,754 in bad
debt expense. The additional bad debt expense was recorded to increase our
allowance for bad debt to cover our exposure for a number of customers that had
experienced cash flow difficulties during 2000.


    In 1999, general and administrative expenses decreased approximately $2,429
from the prior year. The decrease was attributable primarily to a decrease of
$1,200 in bad debt expense. In addition, other expense items such as travel,
professional fees and equipment rental decreased compared to 1998.

AMORTIZATION OF INTANGIBLES

    In 2000, amortization of intangibles decreased approximately $641 from the
prior year. The decrease was attributable to the full amortization of
intangibles related to Mission Critical Technologies, a FutureTense acquisition,
being recorded during 1999.

    In 1999, amortization of intangibles increased approximately $381 from the
prior year as a result of recording a full year of amortization costs related to
the ICentral acquisition in April 1998.

                                       25
<Page>
2000 RESTRUCTURING CHARGE

    In the fourth quarter of 2000, we recorded a $6,948 restructuring charge to
reduce expenses and align investments with new strategies designed for future
profitability and long-term revenue growth. The major components of the
restructuring charge were employee severance, benefits and related costs,
outside services, and goodwill amortization related to the ICentral acquisition
(see Note 3(a)).

1999 MERGER RELATED COSTS

    As a result of the acquisition of FutureTense during the fourth quarter of
1999 (See Note 3(b)), we incurred one-time costs related to the merger of
$4,328. These costs were comprised of professional fees and other charges of
$3,353 and costs to exit contractual obligations and asset impairments of $975.
The total cash impact related to the transaction was $3,394 which, at
December 31, 2000, had been fully paid.

NON-OPERATING INCOME (EXPENSE)

<Table>
<Caption>
                                                         YEARS ENDED DECEMBER
31,

------------------------------
                                                        2000       1999
1998
                                                      --------   --------
--------
<S>                                                   <C>        <C>        <C>
Gain from investment................................  $13,318     $  --      $
--
Interest income.....................................    1,326     1,221
1,429
Interest expense....................................     (447)     (704)
(1,191)
Other (expense)/income..............................     (110)     (166)
(324)
                                                      -------     -----
------
    Total non-operating income......................  $14,087     $ 351      $
(85)
                                                      =======     =====
======
</Table>

    Interest income represents interest earned on cash, cash equivalents and
marketable securities. SFAS No. 130, REPORTING COMPREHENSIVE INCOME, requires
disclosure of all components of comprehensive income on an annual and interim
basis. Comprehensive income is defined as the change in equity of a business
enterprise during a period from transactions and other events and circumstances
from non-owner sources. In our case, the changes in equity included in
comprehensive income are comprised of the reported net income for all periods'
presented and unrealized gains on investments.

    In 2000, non-operating income increased $13,736 from the prior year. The
increase was attributable primarily to a gain on investment of $13,318, of which
$12,321 was realized on the conversion of 291,667 shares of SightPath, Inc.
preferred stock (formerly known as Clearview Technologies) to 208,259 shares of
Cisco Systems common stock on May 16, 2000 and the remaining $997 was realized
on August 4, 2000 when the shares of Cisco were sold for an average price of
$65.35 per share.

    The decrease in interest income in 1999 from the prior year was due to lower
average investments in cash, cash equivalents and marketable securities as a
result of funding of operations and capital expenditures. Interest expense
relates to the interest charged on our line-of-credit and long-term obligations.
Interest expense decreased in 1999 due mainly to the repayment of the note
payable issued in connection with the Folio acquisition in 1997. Other
income/expense primarily represents foreign currency translation gains and
losses.

PROVISION FOR INCOME TAXES

    We recorded a provision for foreign income taxes of $662, $414, and $325 in
2000, 1999, and 1998, respectively. This provision relates to the amount of
estimated taxes due in foreign jurisdictions for our foreign operations and
certain withholding taxes. We have had losses for U.S. tax purposes for all
periods to date and, accordingly, there has been no provision for U.S. income
taxes. We believe that

                                       26
<Page>
the provision for income taxes will fluctuate in the future and is dependent
upon the geographical location of future sales and the associated withholding
taxes in certain countries. The provision for income taxes will also fluctuate
when we become eligible for corporate income taxation in the United States.

LIQUIDITY AND CAPITAL RESOURCES

    Our operating activities used cash and cash equivalents of approximately
$16,308, $7,978, and $32,996 during 2000, 1999, and 1998, respectively. In 2000,
the increased use of cash from operating activities was primarily the result of
the higher net loss compared to 1999. In addition, we received cash of $13,609
from the sale of our shares of Cisco Systems, Inc., common stock on August 4,
2000 which offset the cash used from operating activities during 2000. In 1999,
the use of cash from operating activities improved as a result of lower net loss
when compared to 1998.

    In 2000, investment activities provided cash and cash equivalents of
approximately $5,538. The primary source of cash from investing activities in
2000 was the sale of marketable securities in the amount of approximately
$4,807. Cash used to purchase hardware, software and other capital equipment was
approximately $3,765. This was offset by approximately $4,200 from the sale of
our building in Provo, Utah, in October 2000. In 1999, our investing activities
provided cash and cash equivalents of approximately $51. The primary source of
cash from investing activities in 1999 was $1,973 related to the sales of
marketable securities. In 1998, we used cash and cash equivalents of
approximately $11,397; the principal use of cash was $5,933 for purchases
related to certain property and equipment and $5,521 for the purchase of
marketable securities.

    Our financing activities provided cash and cash equivalents of approximately
$12,322, $5,510, and $46,124 during 2000, 1999, and 1998, respectively. In 2000,
cash and cash equivalents provided by financing activities consists of $8,031
from the issuance of common stock under our stock option and stock purchase
plans and $7,055 of net borrowing under our bank line of credit. In addition, we
used cash of $2,764 to repay in full the mortgage related to our property in
Provo, Utah, which was sold in October 2000. In 1999, cash and cash equivalents
provided by financing activities consists of $4,500 related to the sale of
redeemable preferred stock, $7,369 from the issuance of common stock under our
stock option and stock purchase plans. This was offset by the repayment of a
$5,000 note payable in connection with the Folio acquisition. In 1998, we
received proceeds of $5,000 from Intel and $20,000 from CMG Information
Services, Inc. and Capital Ventures International from the issuance of common
stock. In addition, we received proceeds of $4,595 from the issuance of common
stock under our stock option and stock purchase plans and $8,496 from the
issuance of redeemable convertible preferred stock. Also in 1998, we repaid
$5,000 of the note payable issued to the previous owners in connection with the
Folio acquisition with a cash payment of $1,818. The balance of $3,182 was
settled by the issuance of our common stock. FutureTense had net payments on
notes payable of $1,200 to a bank.

    In July 1998, we entered into a $2,800 mortgage of our Provo, Utah, building
which bore interest at the fixed rate of 8.5%. The mortgage principal payments
are based upon a 20-year term with a balloon payment of $2,468 due on June 19,
2003. This mortgage was paid in full in October 2000 upon the sale of the
building.


    We had an unsecured credit facility arrangement with Silicon Valley Bank,
which provided up to $15,000 in financing in the form of a demand line of
credit. Borrowings under this line were limited to 80% of eligible domestic
accounts receivable and 90% of eligible foreign accounts receivable, as defined,
and bore interest at the prime lending rate (9.5% at December 31, 2000). We were
required to comply with certain restrictive covenants under this agreement and
the line was collateralized by our accounts receivable. We were in compliance
with all such covenants at December 31, 2000. As of December 31, 2000, our
borrowings under this facility was $11,459. This line was fully paid in
January 2001 and expired on January 15, 2001. In February 2001, we replaced this
line with a secured credit facility arrangement with the same bank. This
facility provides up to $12,000 in financing in the


                                       27
<Page>

form of a demand line of credit. Borrowings under this line are limited to
between 60% and 80% of eligible domestic accounts receivable and 90% of eligible
foreign accounts receivable, as defined, and bear interest at the prime ending
rate plus 2%. The line is collateralized by all assets. We are required to
comply with certain financial covenants under this agreement, including a
requirement that we (i) raise, on or before March 15, 2001, additional capital
of at least $10,000,000 through the sale of subordinated debt, equity
securities, non-core assets, certain stock interests and/or the proceeds of
lawsuit settlements and (ii) maintain a minimum tangible net worth in an amount
equal to (a) a base amount, ranging from $10,000,000 to $20,000,000 from the
date of the agreement to December 30, 2001, and fixed at $18,000,000 on and
after December 30, 2001, plus (b) 85% of all consideration received after the
date of the agreement from any sale of our equity securities and/or subordinated
debt, excluding amounts received in connection with the additional capital
requirement described above. Other restrictive covenants under this agreement
include restrictions on (i) our use of proceeds and (ii) our ability to sell the
company, make loans, declare dividends, increase compensation payments,
subordinate debt and encumber the collateral. Effective March 30, 2001, we
entered into a modification to the secured credit facility which, among other
things, extended the date by which we were required to raise the $10,000,000 of
additional capital discussed above from March 15, 2001 to March 31, 2001 and
reduced the minimum tangible net worth we are required to maintain to an amount
equal to (i) a base amount, ranging from $5,500,000 to $15,000,000 from the date
of the agreement to December 31, 2001, and fixed at $8,500,000 on and after
December 30, 2001, plus (ii) 85% of all consideration received after the date of
the original loan agreement from any sale of our equity securities and/or
subordinated debt, excluding amounts received in connection with the additional
capital requirement described above.


    We had a royalty line of credit with the same bank, which provided up to
$6,996 in financing in the form of a line of credit. Borrowings under this line
were limited to 85% of minimum guaranteed royalty receivable from NextPage, as
defined, and bore interest at the prime lending rate (9.5% at December 31,
2000). Our borrowing under this facility was $5,946 at December 31, 2000. This
line was fully paid in January 2001. In concert with our March 2001 sale of the
underlying technology to NextPage, this line terminated.

    At December 31, 2000, we had net operating loss carryforwards for income tax
purposes of approximately $169,000. These losses are available to reduce federal
and state taxable income, if any, in future years. These losses are subject to
review and possible adjustment by the Internal Revenue Service and may be
limited in the event of certain cumulative changes in ownership interests of
significant shareholders over a three-year period that are in excess of 50%.
While management believes that we have experienced a change in ownership in
excess of 50%, management does not believe that this change in ownership will
significantly impact our ability to utilize our net operating loss
carryforwards.

    In March 2001, we sold 5,000 shares of Series E Preferred Stock for gross
proceeds of approximately $5.0 million and sold the Folio technology to
NextPage, Inc. for approximately $6.6 million. Based upon our current revised
operating plan and projected capital expenditures for 2001, we believe that
existing unrestricted cash and cash equivalents, including the recent proceeds
from our preferred stock offering and the sale of the Folio technology to
NextPage will be sufficient to fund our operations, debt service and capital
expenditure requirements at least through December 31, 2001. However, if we are
unable to meet our revised operating plan for 2001, we may need to raise
additional funding through the sale of assets, or raise debt or equity capital.
Such funding, if required, may not be available on terms favorable to the
Company. Further, in the event that we are unable to obtain any such required
additional cash infusions, we may be required to curtail certain of our
operations and sell certain additional assets.

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EURO CURRENCY

    On January 1, 1999, certain member countries of the European Union (EU)
established fixed conversion rates between their existing currencies and the
EU's common currency, the Euro. The former currencies of the participating
countries are scheduled to remain legal tender as denominations of the Euro
until January 1, 2002, when the Euro will be adopted as the sole legal currency.

    We continue to assess the impact that the conversion to the Euro will have
on our European operations. We are evaluating the potential impact in several
areas of our business, including the ability of our information systems to
handle Euro-denominated transactions and the impact on exchange costs and
currency exchange rate risks. We are also evaluating the impact that
cross-border price transparencies, which may affect the ability to price
products differently in various countries, will have on our gross margin.
Although we are still in the assessment phase, the conversion to the Euro is not
expected to have a material impact on our operations or financial position.

CERTAIN FACTORS THAT MAY AFFECT FUTURE RESULTS

INTRODUCTION

    This Annual Report contains certain forward-looking statements. For this
purpose, any statements contained herein that are not statements of historical
fact may be deemed to be forward-looking statements. Without limiting the
generality of the foregoing, the words "believes", "anticipates", "plans",
"expects", and similar expressions are intended to identify forward-looking
statements. There are a number of important factors that could cause our actual
results to differ materially from those indicated by forward-looking statements
made in this Annual Report and presented elsewhere by management from time to
time. Some of the important risks and uncertainties which may cause our
operating results to differ materially or adversely are discussed below.

WE HAVE A HISTORY OF SIGNIFICANT LOSSES AND THESE LOSSES MAY CONTINUE IN THE
FUTURE WHICH COULD CAUSE THE MARKET PRICE OF OUR COMMON STOCK TO DECLINE.

    We have experienced operating losses in each quarterly and annual period
since our inception and these operating losses may continue in the future. We
incurred net losses of $37.0 million for the year ended December 31, 1998,
$19.8 million for the year ended December 31, 1999, and $37.8 million for the
year ended December 31, 2000. As of December 31, 2000, our accumulated deficit
was $202.3 million. We expect to continue to make investments to broaden the
range of our product offerings. These efforts will require capital expenditures,
a substantial portion of which we will make long before any corresponding
revenue may be realized. We may never achieve profitability, and if we do
achieve profitability in any period, we may not be able to sustain or increase
profitability on a quarterly or annual basis.


    Because we continue to incur losses, we will be required to raise additional
capital in order to fund our operations, expand our business and increase our
revenues. We cannot assure you that we will be successful in raising additional
funds on terms which are acceptable to us or at all, or in increasing our
revenues. In the event that we are unable to obtain additional cash infusions
when required, we expect that we will have to significantly curtail certain or
our operations, sell certain of our assets or otherwise reduce the breadth of
our operations, all of which could adversely affect our business and potential
future growth and prospect.



IF OUR FINANCIAL PERFORMANCE DOES NOT IMPROVE AS A RESULT OF RECENT
RESTRUCTURINGS, WE MAY NOT REALIZE EXPECTED BENEFITS FROM OUR COST SAVING
MEASURES.



    In October 2000 and April 2001, we restructured our operations to reduce
expenses by streamlining our workforce and realigning resources across business
segments to appropriately support


                                       29
<Page>

each segment's customer base. In October 2000, we eliminated 92 employees and
90 outside consultants, and in April 2001, we eliminated an additional
57 employees. In addition, we transitioned our professional services
organization to focus on higher-margin design assurance services for partners.
The implementation of these restructurings has required significant time
commitments from our senior management. We may experience a decline in product
and services revenues and a loss of customers as a result of decreasing our
headcount and changing the mix of products and services to which we devote our
development and marketing efforts without realizing any benefits. We cannot
provide assurance that our financial performance will improve as a result of
these cost-saving measures.


THE SUCCESS OF OUR BUSINESS DEPENDS, IN LARGE PART, ON OUR NEW CONTENT SERVER
ENTERPRISE EDITION EBUSINESS SOLUTIONS WHICH HAVE BEEN RECENTLY INTRODUCTED AND
MAY NOT BE WIDELY ADOPTED BY OUR CUSTOMERS.

    We expect to derive substantially all of our product license revenues in the
future from our newly announced CSEE software. Our future growth and
profitability will depend upon on the successful release, introduction and
customer acceptance of this new suite of products and future enhancements to
these products. Any factors adversely affecting the pricing of, demand for or
market acceptance of our suite of CSEE software products, including competition
or technological change, could cause our revenues to decline and our business
and future operating results to suffer.


IF DEMAND FOR OUR CONTENT MANAGEMENT APPLICATIONS DOES NOT CONTINUE, OUR
REVENUES MAY NOT INCREASE OR MAY DECLINE AND OUR OPERATING RESULTS WILL BE
ADVERSELY AFFECTED.


    Because we have only been primarily focused on providing content management
and delivery solutions for a short time, we have a limited operating history
pursuing this business model. The revenue growth potential of this market for
content management is still unproven. As a result, our historical financial
statements may not be an accurate indicator of our future operating results. In
addition, we have limited insight into trends that may emerge and affect our new
line of business, and we cannot forecast our operating expenses based on our
historical results. Our future operating results depend upon the development and
growth of the market for Internet-based packaged software applications,
including content management and delivery applications. If the Internet content
management and delivery market fails to continue to develop or develops more
slowly than expected, our business and prospects will suffer.


IF OUR SOFTWARE CEASES TO BE COMPATIBLE WITH OR WE ARE UNABLE TO LICENSE
THIRD-PARTY TECHNOLOGY OR IF DEFECTS IN THIS TECHNOLOGY EXIST, OUR PRODUCT
SHIPMENTS COULD BE DELAYED.



    Our software requires specific servers and software to be in place before it
can be installed and operated. For example, platform components include servers
running on Sun Microsystems Solar is operating environment, or Microsoft Windows
NT, databases from Oracle, Sybase or Microsoft and Java application servers from
BEA, IBM or iPlanet. The licenses from these third parties may not continue to
be available to us on commercially reasonable terms, or at all or our software
may cease to be compatible with this technology. If we were to lose any of these
technology licenses or if our software ceased to be compatible with this
technology, we would have to cease selling our products that incorporate or rely
on this technology and expend substantial amounts of resources to redesign our
products using equivalent technology, if available. If we are forced to cease
selling and to redesign our products, our business and prospects would be
adversely affected.


IF WE FAIL TO MAINTAIN AND STRENGTHEN OUR RELATIONSHIPS WITH OUR SERVICE
PARTNERS, WE MAY NOT ACHIEVE EXPECTED REVENUE GROWTH.

    We have recently expanded our indirect sales channels through an enhanced
partner program and rely on our partners' skills and networks to integrate our
products with other technologies and to implement our products at customer
sites. If a significant number of potential systems integrators adopt

                                       30
<Page>
a different product or technology as part of their integrated solution instead
of our products, we may not achieve expected revenue growth. In addtion, if we
fail to maintain relationships with these partners or build new relationships,
our ability to expand our customer base may be harmed. We also cannot be sure
that such service partners will be able to successfully support our products
within their overall solutions, and our revenues may vary depending on their
ability to offer such support.

IF WE DO NOT COMPETE EFFECTIVELY, PARTICULARLY AGAINST ESTABLISHED PARTICIPANTS
WITH GREATER FINANCIAL AND OTHER RESOURCES THAN OURS, WE WILL LOSE MARKET SHARE.

    The market for ebusiness content management and delivery applications is
relatively new, rapidly evolving and intensely competitive. If we fail to
compete successfully with current or future competitors, we may lose market
share. Our customers' requirements and the technology available to satisfy those
requirements continually change. We expect competition in this market to persist
and increase in the future. Our primary competition includes in-house
development efforts by prospective customers and other vendors of application
software or application development platforms and tools directed at interactive
commerce and financial services, such as Art Technology Group, BroadVision,
Documentum, Interwoven and Vignette.

    In addition, larger companies with much broader product offerings, such as
BEA, IBM, Microsoft and Oracle, may bundle their products to discourage users
from purchasing our products. Companies such as BEA, IBM and iPlanet also may
add content management functionality to their application servers or introduce
their own content management software. Some of our current and potential
competitors have longer operating histories, greater name recognition, larger
installed customer bases and significantly greater financial, technical and
marketing resources than we do. As a result, these competitors may be able to
develop and expand their product offerings more quickly, adapt more swiftly to
new or emerging technology and changes in customer demands, devote greater
resources to the marketing and sales of their product, pursue acquisition and
other opportunities more readily and adapt more aggressive pricing policies. In
addition, competitors have established and, in the future, may establish
cooperative relationships among themselves or with third parties to market or
enhance their products. Accordingly, it is possible that new competitors or
alliances among competitors may emerge and rapidly acquire significant market
share. Competitive pressures may make it difficult for us to acquire and retain
customers and are likely to result in price reductions, reduced gross margins
and loss of market share.

IF WE DO NOT RESPOND EFFECTIVELY AND ON A TIMELY BASIS TO RAPID TECHNOLOGICAL
CHANGES AND EVOLVING INDUSTRY STANDARDS, OUR PRODUCTS MAY BECOME OBSOLETE, AND
WE WOULD PROBABLY LOSE EXISTING CUSTOMERS AND BE UNABLE TO ATTRACT NEW ONES.

    Internet markets are characterized by rapidly changing technologies,
evolving industry standards, frequent new product and service introductions and
changing customer demands. Our new product family, Content Server Enterprise
Edition, employs the J2EE technology architecture. We cannot assure you that
this architecture will be widely adopted, that we can continue to support J2EE
standards established by Sun from time to time or that the J2EE brand will
continue to be made available to us in the future. If J2EE support decreases or
we could not continue to use Java or Java related technologies, we may have to
modify our product line to run on other platforms. If we could not implement
modifications to our products on a timely basis, our revenues could decline.

    In addition, the introduction of new products or technologies could render
our product offerings obsolete, reduce the cost of competing products or
increase the number of products similar to those that we provide or plan to
provide. Our future success will depend on our ability to adapt to rapidly
changing technologies and to enhance existing solutions and develop and
introduce a variety of new solutions and services to address our customers'
changing demands. We may be required to make significant and ongoing investments
in future periods in order to remain competitive. Further, we may

                                       31
<Page>
experience difficulties that could delay or prevent the successful design,
development, introduction or marketing of our solutions and services or lengthen
our sales cycles. In addition, our new solutions or enhancements must meet the
requirements of our current and prospective customers and must achieve
significant market acceptance. Any material delays in introducing new solutions
and enhancements may cause customers to forego purchases of our solutions and
purchase those of our competitors. Our failure to successfully design, develop,
test and introduce new products and/or services, or the failure of our recently
introduced products or services to achieve market acceptance, could prevent us
from maintaining existing client relationships, gaining new clients or expanding
our markets. In such a case, we would not achieve our expected revenue growth.


IF WE ARE NOT SUCCESSFUL IN ATTRACTING AND RETAINING MANAGEMENT TEAM MEMBERS AND
OTHER HIGHLY QUALIFIED INDIVIDUALS IN THE INTERNET INDUSTRY WE MAY NOT BE ABLE
TO SUCCESSFULLY IMPLEMENT OUR BUSINESS STRATEGY.


    Our ability to establish and maintain a position of technology leadership in
the highly competitive ebusiness software market depends in large part upon our
ability to attract and retain highly qualified managerial, sales and technical
personnel. We have recently experienced the departure of several senior
executives and may experience the departure of executives in the future due to
competition for talent from start-ups and other companies. Our future success
also depends on our continuing to attract, retain and motivate highly skilled
employees. Competition for employees in our industry is intense. We may be
unable to retain our key employees or attract, assimilate or retain other highly
qualified employees in the future. We have from time to time in the past
experienced, and we expect to continue to experience in the future, difficulty
in hiring and retaining highly skilled employees with appropriate
qualifications. If our stock price continues to decline, we may face a difficult
and significant task of motivating key personnel to stay committed to us.

FLUCTUATIONS IN OUR QUARTERLY REVENUE AND OPERATING RESULTS MAY RESULT IN
REDUCED PROFITABILITY AND CAUSE THE PRICE OF OUR COMMON STOCK TO DECLINE.

    We have experienced significant fluctuations in our results of operations on
a quarterly and annual basis. We expect to continue experiencing significant
fluctuations in our future quarterly and annual results of operations due to a
variety of factors, many of which are outside our control, including:

    - the introduction of new products by us and our competitors;

    - the variability and length of sales cycles associated with our product
      offerings;

    - the market acceptance of, and demand for, our products;

    - the pace of development of electronic commerce conducted on the Internet;

    - customer order deferrals in anticipation of enhancements or new products
      offered by us or our competitors;

    - non-renewal of service agreements;

    - software defects and other product quality problems;

    - the mix of products and services we sell;

    - customer retention;

    - the ability to collect payments from our customers on a timely basis;

    - any changes in our pricing policies and/or those of our competitors;

    - changes in the level of operating expenses;

    - sales productivity; and

                                       32
<Page>
    - general economic conditions.

    In addition, our operating expenses are largely based on anticipated revenue
trends and a significant portion of our expenses, such as leased real estate
facilities, depreciation and personnel, is fixed in the short term. Accordingly,
our results of operations are particularly sensitive to fluctuations in
revenues. If our revenues fall below our expectations, we would probably not be
able to reduce our fixed or other expenses in sufficient time to respond to the
shortfall. If our operating results fall below the expectations of securities
analysts or investors in some future quarter or quarters, the market price of
our common stock is likely to decline.


IF WE ARE UNABLE TO MEET THE OPERATIONAL, LEGAL AND FINANCIAL CHALLENGES THAT WE
WILL ENCOUNTER IN OUR INTERNATIONAL OPERATIONS, WE MAY NOT BE ABLE TO GROW OUR
BUSINESS.



    We currently derive a significant portion of our revenue from the sale of
our products outside the United States. In the quarter ended March 31, 2001, we
derived approximately 47% of our total revenues from sales outside North
America. We are increasingly subject to a number of challenges which
specifically relate to our international business activities. Our international
operations may not be successful if we are unable to meet and overcome these
challenges, which would limit the growth of our business. These challenges
include:



    - failure of local laws to provide the same degree of protection against
      infringement of our intellectual property;



    - protectionist laws and business practices that favor local competitors,
      which could slow our growth in international markets;



    - potentially longer sales cycles to sell products, which could slow our
      revenue growth from international sales; and



    - potentially longer accounts receivable payment cycles and difficulties in
      collecting accounts receivable.



BECAUSE WE EXCHANGE FOREIGN CURRENCY RECEIVED FROM INTERNATIONAL SALES INTO U.S.
DOLLARS AND ARE REQUIRED TO MAKE FOREIGN CURRENCY PAYMENTS, WE MAY INCUR LOSSES
DUE TO FLUCTUATIONS IN FOREIGN CURRENCY TRANSLATIONS.



    We recognize foreign currency gains and losses arising from our operations
in the period incurred. As a result, currency fluctuations between the U.S.
dollar and the currencies in which we do business will cause foreign currency
translation gains and losses, which may cause fluctuations in our future
operating results. We do not currently engage in foreign exchange hedging
transactions to manage our foreign currency exposure.



WE MAY NOT BE ABLE TO GENERATE ADDITIONAL REVENUE FROM OUR PLANNED INTERNATIONAL
EXPANSION TO OFFSET THE COSTS ASSOCIATED WITH ESTABLISHING AND MAINTAINING
FOREIGN OPERATIONS.



    A component of our growth strategy is to expand our presence in foreign
markets. It will be costly to establish international facilities and operations
and to promote the use of our products in international markets. Even if we are
able to successfully expand our international operations, we cannot be certain
that we will succeed in maintaining or expanding international market demand for
our products. Revenue from international activities may not offset the expense
of establishing and maintaining these foreign operations.


                                       33
<Page>

WE MAY NOT BE ABLE TO PROTECT OUR PROPRIETARY RIGHTS ALLOWING COMPETITORS TO
ENTER OUR MARKETS AND REDUCE OUR MARKET SHARE.


    We regard our products, services and technology as proprietary. We attempt
to protect them through a combination of patents, copyrights, trademarks and
trade secret laws. We also generally enter into confidentiality agreements with
our employees, consultants and customers, and generally control access to and
distribution of our documentation and other proprietary information. These
methods may not be sufficient to protect our proprietary rights. We have no
patented technology that would preclude or inhibit competitors from entering our
market. Although we hold several U.S. patents asserting claims relating to
certain aspects or uses of electronic commerce software, we cannot be sure of
the degree of intellectual property protection those patents will provide.
Despite these precautions, it may be possible for a third party to copy or
otherwise misappropriate and use our products, services or technology without
authorization, particularly in foreign countries where the laws may not protect
our proprietary rights to the same extent as do the laws of the United States.
We also cannot assure you that third parties will not develop similar technology
independently.


WE MAY BE SUBJECT TO INFRINGEMENT CLAIMS THAT COULD SUBJECT US TO SIGNIFICANT
LIABILITY AND DIVERT THE TIME AND ATTENTION OF OUR SENIOR MANAGEMENT.


    We have resorted, and may continueto resort, to litigation in the future to
enforce our intellectual property rights, to protect our trade secrets or to
determine the validity and scope of the proprietary rights of others. On
January 8, 2001, we filed a patent infringement lawsuit against Intershop
Communications, Inc. in the U.S. District Court for the District of Delaware. We
allege that Intershop's software products infringe upon three of our patents. We
are seeking injunctive relief and damages due to the infringement. On March 1,
2001, Intershop filed its answer denying infringement and asserting claims for a
declaratory judgement of invalidity of the patents and non-infringement. We can
provide no assurance as to the outcome of this litigation. There is a risk that
our patents can be declared invalid and unenforceable. Any conclusion of this
litigation in a manner adverse to us could have a material adverse effect on our
business. In addition, this litigation could result in substantial costs and
diversion of resources and could harm our business.

    In addition to licensing technologies from third parties, we are developing
and acquiring additional proprietary intellectual property. Third parties may
try to claim our products or services infringe their intellectual property. We
expect that participants in our markets will be increasingly subject to
infringement claims. Any claim, whether meritorious or not, could be time
consuming, result in costly litigation and/or require us to enter into royalty
or licensing agreements. These royalty or licensing agreements might not be
available on terms acceptable to us or at all, in which case we would have to
cease selling, incorporating or using those products and services that
incorporate the challenged intellectual property and expend substantial amounts
of resources to redesign our products or services. If we are forced to enter
into royalty or licensing agreements or to redesign our products or services,
our business and prospects would suffer.

IF LIMITATION ON THE ONLINE COLLECTION OF PROFILE INFORMATION ARE IMPOSED, THE
UTILITY OF THE PERSONALIZATION FUNCTIONALITY OF OUR PRODUCTS WOULD BE LIMITED,
AND WE MAY NOT ATTRACT A SIGNIFICANT NUMBER OF NEW CUSTOMERS.

    One of the principal features of our products is the ability to develop and
maintain profiles of online users to assist business managers in personalizing
content and commercial offers to be displayed to specific online users. The
resistance of online users to providing personal data and any future laws and
regulations prohibiting use of personal data gathered online without express
consent or requiring businesses to notify their web site visitors of the
possible dissemination of their personal data could limit the utility of our
products. These types of laws or regulations could heighten privacy concerns by
requiring businesses to notify web site users that the data captured from them
online may be used by marketing entities to direct product messages to them.
While we are not aware of any laws or

                                       34
<Page>
regulations of this type currently in effect or in development in the United
States, other countries and political entities, including the European Union and
its member states, have adopted legal requirements imposing restrictions on the
collection, use and processing of personal data. It is possible that similar
legal requirements could be adopted in the United States. If the privacy
concerns of consumers are not adequately addressed, the effectiveness of our
products could be impaired and we may not attract new customers and the revenues
they represent.

OUR PRODUCTS MAY CONTAIN DEFECTS, WHICH MAY PROVE COSTLY AND TIME CONSUMING FOR
US TO CORRECT.

    Sophisticated software products, such as those we develop and market, may
contain errors or failures that become apparent when we introduce the products
or when we provide an increased volume of services. We cannot assure you that
testing by us and our potential customers will detect all errors in our products
prior to licensing or sale. Correcting such errors may result in loss of
revenues, delay in market acceptance, diversion of development resources, damage
to our reputation or increased service and warranty costs, any of which would
adversely affect our business and our ability to market our products profitably.

EXISTING AND FUTURE EXPORT CONTROLS MAY DELAY THE INTRODUCTION OF NEW PRODUCTS
OR LIMIT OUR ABILITY TO DISTRIBUTE PRODUCTS OUTSIDE OF THE UNITED STATES.

    Due to the encryption technology contained in our products, our products are
subject to export controls within the United States. These export controls,
either in their current form or as may be subsequently enacted, may delay the
introduction of new products or limit our ability to distribute products outside
the United States. In addition, federal or state legislation or regulation may
further limit levels of encryption or authentication technology. Also, various
countries regulate the import of certain encryption technology and have adopted
laws relating to personal privacy issues that could limit our ability to
distribute products in those countries.

OUR BUSINESS MAY SUFFER IF THE INTERNET INFRASTRUCTURE IS UNABLE TO EFFECTIVELY
SUPPORT THE GROWTH IN DEMAND PLACED ON IT.

    Our success will depend, in large part, upon the maintenance of the Internet
infrastructure, such as reliable network backbones with the necessary speed,
data capacity and security, and the timely development of enabling products such
as high speed modems, for providing reliable Internet access and services and
improved content. We cannot assure you that the Internet infrastructure will
continue to effectively support the demands placed on it as the Internet
continues to experience increased numbers of users, frequency of use and
increased bandwidth requirements. Even if the necessary infrastructure or
technologies are developed, we may have to spend considerable amounts to adapt
our solutions accordingly. Furthermore, the Internet has experienced a variety
of outages and other delays due to damage to portions of its infrastructure.
These outages and delays could impact the Internet sites of customers using our
products and services.

THE IMPOSITION OF SALE AND OTHER TAXES ON PRODUCTS SOLD BY OUR CUSTOMERS OVER
THE INTERNET COULD HAVE A NEGATIVE EFFECT ON ONLINE COMMERCE AND, AS A RESULT,
ON DEMAND FOR OUR PRODUCT.

    The imposition of new sales or other taxes could limit the growth of
eBusiness generally and, as a result, the demand for our products. There is
recent federal legislation that limits the imposition of state and local taxes
on Internet-related sales. In 1998, the United States Congress passed the
Internet Tax Freedom Act, which places a three-year moratorium on state and
local taxes on Internet access, unless the tax was already imposed prior to
October 1, 1998, and discriminatory taxes on electronic commerce. There is a
possibility that Congress may not renew this legislation in 2001. If Congress
chooses not to renew this legislation, state and local governments would be free
to impose taxes on goods purchased over the Internet. In addition, one or more
foreign countries may seek to impose sales

                                       35
<Page>
or other tax collection obligations on out-of-jurisdiction companies that engage
in electronic commerce. A successful assertion by one or more foreign countries
that companies engaged in electronic business should collect sales or other
taxes on sales of their products over the Internet, even though not physically
present in the foreign country, could indirectly reduce demand for our products.

WE ARE PARTY TO SECURITIES CLASS ACTION LITIGATION WHICH MAY BE COSTLY TO DEFEND
AND THE OUTCOME OF WHICH IS UNCERTAIN AND MAY HARM OUR BUSINESS.


    We and several of our former and present officers and directors are named as
defendants in several class action complaints which have been filed on behalf of
certain of our stockholders who purchased securities between November 8, 1999
and April 18, 2000. These complaints allege violations of Sections 10(b) and
20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated under
this Act. In particular, they allege, among other things, that during the
putative class period, we sought to mislead the investing public by overstating
Open Market's prospects and the quality of our products. The plaintiffs are
seeking monetary damages and other appropriate relief. On January 25, 2001, the
court entered an order consolidating these actions into one action. On
April 13, 2001, the plaintiff filed a consolidated class action complaint. On
May 29, 2001, we filed a motion seeking dismissal of all counts of the
consolidated complaint.


    We can provide no assurance as to the outcome of this securities litigation.
Any conclusion of this litigation in a manner adverse to us would have a
material adverse effect on our business, financial condition, and results of
operations. In addition, the cost to us of defending any litigation or other
proceeding, even if resolved in our favor, could be substantial. Such litigation
could also substantially divert the attention of our management and our
resources in general. Uncertainties resulting from the initiation and
continuation of this litigation or other proceedings could harm our ability to
compete in the marketplace. Because the price of our common stock has been, and
may continue to be, highly volatile, we have no assurance that additional
securities class action complaints will not be filed against us in the future.


OUR STOCKHOLDERS MAY EXPERIENCE FURTHER DILUTION AND THE PRICE OF OUR COMMON
STOCK MAY DECLINE AS A RESULT OF OUR SERIES E PREFERRED STOCK FINANCING.


    In March 2001 we sold $5.0 million of our Series E 6% Cumulative Convertible
Preferred Stock and warrants to purchase approximately 900,000 shares of our
common stock at an exercise price of $1.9078 per share, subject to certain
adjustments, to a fund managed by the Palladin Group. The warrants are
exercisable for a period of five years.

    The Series E Preferred Stock is convertible at the option of the holder into
shares of our common stock at an initial conversion price of $1.5262 per share,
subject to certain adjustments. The initial conversion price is subject to
adjustment on the six-month anniversary of the initial issuance, provided that
in no event shall the adjusted conversion price be less than $0.8176. In
addition, the conversion price is subject to adjustment in the event that we
issue securities below the conversion price, with certain exceptions.

    The shares of Series E Preferred Stock bear dividends at an annual rate of
6.0% of the liquidation preference of these shares, payable semi-annually,
through the issuance of shares of our common stock or, at our option, in cash.
Holders of Series E Preferred Stock have the right, after two years, to require
us to redeem the Series E Preferred Stock for cash or convert such shares into
our common stock, at our option. Also, in the event of a "change in control" as
defined in the terms of the Series E Preferred Stock, if the Series E Preferred
Stock is not converted into shares of common stock by the holder, we are
required to redeem the Series E Preferred Stock for cash, with such cash
redemption equal to 115% of the Series E Preferred Stock liquidation preference.
As a result, the Series E Preferred Stock may be converted and the common stock
purchase warrants may be exercised at a

                                       36
<Page>
price per share that may be less than the then current market price of our
common stock which may cause substantial dilution to our existing common
stockholders. In no event, however, shall we be required to issue in excess of
19.99% of our outstanding shares of common stock as of March 20, 2001, upon the
conversion of the Series E Preferred Stock and the exercise of the warrants.

    We are required to register the shares of common stock issuable upon
conversion and upon exercise of the warrants under the Securities Act of 1933
for public resale. Any sale of shares of common stock into the public market by
the holders of the Series E Preferred Stock could cause a decline in the trading
price of our common stock.


OUR STOCKHOLDERS MAY EXPERIENCE FURTHER DILUTION AND THE PRICE OF OUR COMMON
STOCK MAY DECLINE IF WE SELL SHARES OF OUR COMMON STOCK UNDER OUR EQUITY LINE.



    On May 25, 2001, we entered into an agreement with Theddingworth
International Limited to provide Open Market with up to $40,000,000 in private
equity funding. Pursuant to this agreement, we have the right, but not the
obligation, to raise up to $40,000,000 through the issuance and sale of our
common stock to the investor pursuant to a series of draw downs over a period of
24 months. The draw downs are subject to the satisfaction of a number of
conditions, including the filing and effectiveness of a registration statement
with the Securities and Exchange Commission covering the resale of the shares
purchased under the agreement. Pricing for the shares issuable under the
agreement is based on the weighted average price of our common stock over a
period of time prescribed in the agreement. We will use the funds received from
sales of the common stock under the agreement for working capital and other
general corporate purposes. We cannot request a draw down which would result in
the issuance of an aggregate number of shares of common stock pursuant to the
agreement which exceeds 19.9% of the total number of shares of our common stock
outstanding on May 25, 2001 without obtaining stockholder approval of such
excess issuance.



    In connection with the agreement, we issued to Theddingworth a warrant to
purchase up to 350,000 shares of our common stock at an exercise price of $1.91
per share, subject to adjustment in the case of a stock split, stock dividend or
other similar adjustment to capitalization. The warrant is exercisable for a
period of five years.



    The resale by Theddingworth of the common stock that it purchases from us
will increase the number of our publicly traded shares, which could depress the
market price of our common stock. Moreover, as all the shares we sell to
Theddingworth will be available for immediate resale, the mere prospect of our
sales to it could depress the market price for our common stock. The shares of
our common stock issuable to Theddingworth under the equity line facility will
be sold at a 10% discount to the volume-weighted average daily price of our
common stock during the applicable drawdown period and the proceeds paid to us
upon each draw down will be net of an escrow agent fee of $1,000. If we were to
require Theddingworth to purchase our common stock at a time when our stock
price is low, our existing common stockholders will experience substantial
dilution. The issuance of shares to Theddingworth will therefore dilute the
equity interest of existing stockholders and could have an adverse effect on the
market price of our common stock.



    The perceived risk of dilution may cause our stockholders to sell their
shares, which would contribute to a downward movement in the stock price of our
common stock. Moreover, the perceived risk of dilution and the resulting
downward pressure on our stock price could encourage Theddingworth to engage in
short sales of our common stock. By increasing the number of shares offered for
sale, material amounts of short selling could further contribute to progressive
price declines in our common stock.


                                       37
<Page>
       ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

    FOREIGN EXCHANGE HEDGING.  The accounts of our foreign subsidiaries are
translated in accordance with SFAS No. 52, FOREIGN CURRENCY TRANSLATION. In
translating the accounts of the foreign subsidiaries into U.S. dollars, assets
and liabilities are translated at the rate of exchange in effect at year-end,
while stockholders' equity is translated at historical rates. Revenue and
expense accounts are translated using the weighted-average exchange rate in
effect during the year. Foreign currency translation and transaction gains or
losses for our subsidiaries are included in the accompanying consolidated
statements of operations since the functional currency for our subsidiaries is
the U.S. dollar. We have not entered into hedges of our foreign currency
exposures.

    INVESTMENT PORTFOLIO.  We do not invest in derivative financial instruments.
Our investment policy permits only high credit quality investment vehicles, and
this policy also limits the amount of credit exposure of any one issue, issuer,
and type of investment. See "Note 2--Summary of Significant Accounting Policies"
in the accompanying Notes to Consolidated Financial Statements.

        ITEM 8. CONSOLIDATED FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

    See Index to Consolidated Financial Statements set forth on page 36.

QUARTERLY FINANCIAL RESULTS

    The following table sets forth certain unaudited quarterly financial data
for 2000 and 1999. In the opinion of management, the unaudited quarterly
information has been prepared on the same basis as the audited consolidated
financial statements and includes all adjustments, consisting only of normal
recurring adjustments, necessary for the fair presentation of the information
for the periods presented. The quarterly operating results are not necessarily
indicative of results of operations for any future period.

                                       38
<Page>
    The merger of FutureTense Inc. in October 1999 was accounted for as a
pooling of interests and accordingly all prior period financial data has been
restated as if the merger took place at the beginning of such periods.

<Table>
<Caption>

THREE MONTHS ENDED

--------------------------------------------------------------------------------
-------
                                          MAR. 31,   JUNE 30,   SEPT. 30,   DEC.
31,   MAR. 31,   JUNE 30,   SEPT. 30,   DEC. 31,
                                            1999       1999       1999
1999       2000       2000       2000        2000
                                          --------   --------   ---------
--------   --------   --------   ---------   --------

(UNAUDITED)
<S>                                       <C>        <C>        <C>         <C>
      <C>        <C>        <C>         <C>
REVENUES:
Content-centric eBusiness application
  product...............................  $   480    $   599     $ 1,808    $
5,408    $ 7,654    $ 8,714    $  8,901    $  4,725
Transact/ShopSite product...............    7,825     10,541       9,710
10,350      6,561      5,837         967         234
Other product...........................    2,385      2,418       1,071
1,147      1,140      1,168       1,167       1,282
                                          -------    -------     -------
-------    -------    -------    --------    --------
  Product revenues......................   10,690     13,558      12,589
16,905     15,355     15,719      11,035       6,241
                                          -------    -------     -------
-------    -------    -------    --------    --------
Content-centric eBusiness application
  service...............................      182        973       1,000
615      2,031      3,394       3,900       3,575
Transact/ShopSite service...............    4,803      5,091       6,483
7,491      7,243      7,257       7,315       5,058
Other service...........................      919        940         529
258        194        147          87         430
                                          -------    -------     -------
-------    -------    -------    --------    --------
  Service revenues......................    5,904      7,004       8,012
8,364      9,468     10,798      11,302       9,063
                                          -------    -------     -------
-------    -------    -------    --------    --------
    Total revenues......................   16,594     20,562      20,601
25,269     24,823     26,517      22,337      15,304
                                          -------    -------     -------
-------    -------    -------    --------    --------

COST OF REVENUES:
Product revenues........................      764      1,014         850
1,806      2,376      2,311       2,086         680
Service revenues........................    4,151      5,197       4,986
6,804      7,714      8,972      10,493      10,214
                                          -------    -------     -------
-------    -------    -------    --------    --------
  Total cost of revenues................    4,915      6,211       5,836
8,610     10,090     11,283      12,579      10,894
                                          -------    -------     -------
-------    -------    -------    --------    --------
    Gross profit........................   11,679     14,351      14,765
16,659     14,733     15,234       9,758       4,410
                                          -------    -------     -------
-------    -------    -------    --------    --------

OPERATING EXPENSES:
Selling and marketing...................    8,497      9,360       8,539
11,947     10,477     12,632      12,608      13,046
Research and development................    5,238      5,872       5,514
5,822      6,036      6,422       6,426       5,917
General and administrative..............    2,230      1,969       2,662
1,806      2,372      2,957       3,393       3,377
Amortization of intangibles.............      852        852         897
786        765        766         765         449
Restructuring charge....................       --         --          --
--         --         --          --       6,948
Merger related costs....................       --         --          --
4,328         --         --          --          --
                                          -------    -------     -------
-------    -------    -------    --------    --------
  Total operating expenses..............   16,817     18,053      17,612
24,689     19,650     22,777      23,192      29,737
  Loss from operations..................   (5,138)    (3,702)     (2,847)
(8,030)    (4,917)    (7,543)    (13,434)    (25,327)
Other income............................       19        119         142
71        201     12,550       1,071         265
                                          -------    -------     -------
-------    -------    -------    --------    --------
  Loss before income taxes..............   (5,119)    (3,583)     (2,705)
(7,959)    (4,716)     5,007     (12,363)    (25,062)
Provision for income taxes..............       42        103          71
198         52        298          34         278
                                          -------    -------     -------
-------    -------    -------    --------    --------
  Net loss..............................  $(5,161)   $(3,686)    $(2,776)
$(8,157)   $(4,768)   $ 4,709    $(12,397)   $(25,340)
                                          =======    =======     =======
=======    =======    =======    ========    ========
</Table>

                                       39
<Page>
                               OPEN MARKET, INC.

                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS


<Table>
<S>                                                           <C>
Report of Independent Public Accountants....................     39
Report of Independent Accountants...........................     40
Consolidated Balance Sheets as of December 31, 2000 and
  1999......................................................     41
Consolidated Statements of Operations for the years ended
  December 31, 2000, 1999 and 1998..........................     42
Consolidated Statements of Redeemable Convertible Preferred
  Stock and Stockholders' Equity for the years ended
  December 31, 2000, 1999 and 1998..........................     43
Consolidated Statements of Cash Flows for the years ended
  December 31, 2000, 1999
  and 1998..................................................     44
Notes to Consolidated Financial Statements..................     45
</Table>


                                       40
<Page>
                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Board of Directors and Stockholders of Open Market, Inc.:

    We have audited the accompanying consolidated balance sheets of Open
Market, Inc. (a Delaware corporation) and subsidiaries as of December 31, 2000
and 1999, and the related consolidated statements of operations, redeemable
convertible preferred stock and stockholders' equity and cash flows for each of
the three years in the period ended December 31, 2000. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits. We did not audit the 1998 financial statements of
FutureTense, Inc., a company acquired during 1999 in a transaction accounted for
as a pooling of interests, as discussed in Note 4(a). Such financial statements
are included in the consolidated financial statements of Open Market, Inc. and
reflect 4% of total revenues in 1998. These statements were audited by other
auditors whose report has been furnished to us and our opinion, insofar as it
relates to amounts included for FutureTense, Inc., is based solely upon the
report of the other auditors.

    We conducted our audits in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits and the report of the other
auditors provide a reasonable basis for our opinion.

    In our opinion, based on our audit and the report of the other auditors, the
financial statements referred to above present fairly, in all material respects,
the financial position of Open Market, Inc. and subsidiaries as of December 31,
2000 and 1999, and the results of their operations and their cash flows for each
of the three years in the period ended December 31, 2000, in conformity with
accounting principles generally accepted in the United States.

                                          /s/ Arthur Andersen LLP

Boston, Massachusetts
March 23, 2001

                                       41
<Page>
                       REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors and Stockholders of Open Market, Inc:

    In our opinion, the balance sheet of FutureTense, Inc. and the related
statements of operations, changes in stockholders' deficit and cash flows, which
are not included herein, present fairly, in all material respects, the financial
position of FutureTense, Inc. at December 31, 1998, and the results of its
operations and its cash flows for the year ended December 31, 1998 in conformity
with accounting principles generally accepted in the United States of America.
These financial statements are the responsibility of the Company's management;
our responsibility is to express an opinion on these financial statements based
on our audits. We conducted our audits of these statements in accordance with
auditing standards generally accepted in the United States of America, which
require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

/s/ PricewaterhouseCoopers LLP

Boston, Massachusetts
March 10, 1999

                                       42
<Page>
                               OPEN MARKET, INC.

                          CONSOLIDATED BALANCE SHEETS

                     (IN THOUSANDS, EXCEPT PER SHARE DATA)

<Table>
<Caption>
                                                                 DECEMBER 31,

-------------------
                                                                2000       1999
                                                              --------
--------
<S>                                                           <C>        <C>
                                     ASSETS
Current Assets:
  Cash and cash equivalents.................................  $ 20,717   $
19,258
  Marketable securities.....................................     9,713
13,033
  Accounts receivable, net of allowances of $5,896 and
    $4,130 in 2000 and 1999, respectively...................    22,385
27,211
  Prepaid expenses and other current assets.................     4,481
4,264
                                                              --------
--------
      Total current assets..................................    57,296
63,766
                                                              --------
--------
Property and equipment, at cost:
  Computers and office equipment............................    17,643
17,535
  Leasehold improvements....................................     5,694
5,527
  Furniture and fixtures....................................     2,372
2,304
  Land and building.........................................        --
4,200
                                                              --------
--------
      Total property and equipment..........................    25,709
29,566
  Less--accumulated depreciation and amortization...........    16,663
16,043
                                                              --------
--------
      Net property and equipment............................     9,046
13,523
                                                              --------
--------
Intangible assets...........................................     2,657
8,657
Other assets................................................     1,076
1,372
Long-term marketable securities.............................        --
1,487
                                                              --------
--------
      Total assets..........................................  $ 70,075   $
88,805
                                                              ========
========

                      LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
  Current maturities of long-term obligations...............  $     --   $
108
  Lines of credit...........................................    17,405
10,350
  Accounts payable..........................................     5,538
5,657
  Accrued expenses..........................................    18,463
13,773
  Deferred revenues.........................................     8,012
6,302
                                                              --------
--------
      Total current liabilities.............................    49,418
36,190
                                                              --------
--------
Long-term obligations, net of current maturities............        --
2,657
Commitments and Contingencies (Note 9)
Stockholders' Equity:
  Preferred Stock, $0.10 par value--
    Authorized--2,000 shares, issued and
    outstanding--None.......................................        --
--
  Common stock, $0.001 par value--
    Authorized--300,000 shares, issued and
      outstanding--46,708 and 44,098 shares in 2000 and
      1999, respectively....................................        47
44
  Additional paid-in capital................................   223,162
214,783
  Deferred compensation.....................................      (216)
(329)
  Accumulated deficit.......................................  (202,336)
(164,540)
                                                              --------
--------
      Total stockholders' equity............................    20,657
49,958
                                                              --------
--------
      Total liabilities and stockholders' equity............  $ 70,075   $
88,805
                                                              ========
========
</Table>

  The accompanying notes are an integral part of these consolidated financial
                                  statements.

                                       43
<Page>
                               OPEN MARKET, INC.

                     CONSOLIDATED STATEMENTS OF OPERATIONS

                     (IN THOUSANDS, EXCEPT PER SHARE DATA)


<Table>
<Caption>
                                                                   FOR THE YEARS
ENDED
                                                                       DECEMBER
31,

------------------------------
                                                                2000       1999
     1998
                                                              --------
--------   --------
<S>                                                           <C>        <C>
   <C>
Revenues:
  Product revenues..........................................  $ 48,350   $
53,742   $ 43,583
  Service revenues..........................................    40,631
29,284     20,963
                                                              --------
--------   --------
    Total revenues..........................................    88,981
83,026     64,546
                                                              --------
--------   --------
Cost of Revenues:
  Product revenues..........................................     7,453
4,434      3,214
  Service revenues..........................................    37,393
21,138     15,365
                                                              --------
--------   --------
    Total cost of revenues..................................    44,846
25,572     18,579
                                                              --------
--------   --------
    Gross profit............................................    44,135
57,454     45,967
                                                              --------
--------   --------
Operating Expenses:
  Selling and marketing.....................................    48,763
38,343     34,772
  Research and development..................................    24,801
22,446     25,910
  General and administrative................................     8,500
7,822      9,578
  Allowance for bad debt....................................     3,599
845      1,518
  Amortization of intangible assets.........................     2,745
3,387      3,006
  In-process research and development.......................        --
--      5,700
  Restructuring charge......................................     6,948
--      2,042
  Merger related costs......................................        --
4,328         --
                                                              --------
--------   --------
    Total operating expenses................................    95,356
77,171     82,526
                                                              --------
--------   --------
    Loss from operations....................................   (51,221)
(19,717)   (36,559)
                                                              --------
--------   --------
Gain from investments.......................................    13,318
--         --
Interest income.............................................     1,326
1,220      1,429
Interest expense............................................      (447)
(703)    (1,191)
Other expense, net..........................................      (110)
(166)      (324)
                                                              --------
--------   --------
    Loss before provision for income taxes..................   (37,134)
(19,366)   (36,645)
                                                              --------
--------   --------
Provision for income taxes..................................       662
414        325
                                                              --------
--------   --------
    Net loss................................................  $(37,796)
$(19,780)  $(36,970)
                                                              ========
========   ========
Net loss per share--Basic and diluted.......................  $  (0.83)  $
(0.46)  $  (0.98)
                                                              ========
========   ========
Weighted average common shares outstanding--Basic and
  diluted...................................................    45,606
42,655     37,815
                                                              ========
========   ========
</Table>


  The accompanying notes are an integral part of these consolidated financial
                                  statements.

                                       44
<Page>
                               OPEN MARKET, INC.
     CONSOLIDATED STATEMENTS OF REDEEMABLE CONVERTIBLE PREFERRED STOCK AND
                              STOCKHOLDERS' EQUITY
                       (IN THOUSANDS, EXCEPT SHARE DATA)
<Table>

            STOCKHOLDERS' EQUITY

     ----------------------------------
                                                                   REDEEMABLE
                                                                   CONVERTIBLE
         COMMON STOCK
                                                                 PREFERRED STOCK
     ---------------------

---------------------                $.001      ADDITIONAL
                                                                NUMBER
CARRYING     NUMBER      PAR        PAID-IN
                                                              OF SHARES
VALUE     OF SHARES    VALUE       CAPITAL
                                                              ----------
--------   ----------   --------   ----------

                      33       137,543
Balance, December 31, 1997..................................   1,135,000   $
6,686    32,683,000     $         $
<S>                                                           <C>          <C>
     <C>          <C>        <C>
  Exercise of common stock options..........................          --
--       977,000        1         3,447
  Employee stock purchase plan..............................          --
--       132,000       --         1,147
  Issuance of common stock for payment of note payable......          --
--       221,000       --         3,182
  Conversion of other equity to common stock................          --
--       628,000        1         6,919
  Issuance of common stock in ICentral acquisition..........          --
--       480,000       --        10,000
  Issuance of common stock in private placements, net of
    issuance costs of $738..................................          --
--     1,882,000        2        24,260
  Issuance of FutureTense Series C redeemable convertible
    preferred stock.........................................     686,000
5,000            --       --            --
  Conversion of note payable................................      26,000
189            --       --            --
  Issuance of FutureTense Series D redeemable convertible
    preferred stock.........................................   2,398,000
3,550            --       --            --
  Cancellation of restricted common stock...................          --
--        (8,000)      --            --
  Reversal of deferred compensation related to termination
    of stock options........................................          --
--            --       --          (330)
  Compensation expense related to stock options.............          --
--            --       --            23
  Amortization of deferred compensation.....................          --
--            --       --            --
  Net loss..................................................          --
--            --       --            --
                                                              ----------
--------   ----------     ----      --------
Balance, December 31, 1998..................................   4,245,000
15,425    36,995,000       37       186,191
  Exercise of common stock options..........................          --
--     1,323,000        2         6,242
  Employee stock purchase plan..............................          --
--        93,000       --         1,125
  Issuance of common stock in ICentral acquisition..........          --
--        49,000       --           609
  Issuance of FutureTense Series D redeemable convertible
    preferred stock.........................................   3,039,000
4,500            --       --            --
  Conversion of FutureTense preferred stock into Open Market
    common stock............................................  (7,284,000)
(19,925)    5,638,000        5        19,920
  Amortization of deferred compensation.....................          --
--            --       --            --
  Deferred compensation related to issuance of common stock
    options.................................................          --
--            --       --           696
  Net loss..................................................          --
--            --       --            --
                                                              ----------
--------   ----------     ----      --------
Balance, December 31, 1999..................................          --
--    44,098,000       44       214,783
  Exercise of common stock options..........................          --
--     2,516,000       26         7,102
  Employee stock purchase plan..............................          --
--       117,000       --           938
  Rescission of exercise of common stock options............          --
--       (23,000)     (23)          (12)
  Compensation expense related to stock options.............          --
--            --       --           351
  Amortization of deferred compensation.....................          --
--            --       --            --
  Net loss..................................................          --
--            --       --            --
                                                              ----------
--------   ----------     ----      --------
Balance, December 31, 2000..................................          --   $
--    46,708,000     $ 47      $223,162
                                                              ==========
========   ==========     ====      ========

<S>                                                           <C>           <C>
      <C>             <C>            <C>

     STOCKHOLDERS' EQUITY

--------------------------------------------------------------------

                                                                   OTHER EQUITY

----------------------
                                                               COMMON
                                       TOTAL
                                                                SHARE
CARRYING   DEFERRED        ACCUMULATED    STOCKHOLDERS'
                                                              EQUIVALENTS
VALUE     COMPENSATION     DEFICIT         EQUITY
                                                              -----------
--------   -------------   ------------   ------------

Balance, December 31, 1997..................................    628,000     $
6,920        $(325)       $(107,790)      $ 36,381
  Exercise of common stock options..........................         --
--           --               --          3,448
  Employee stock purchase plan..............................         --
--           --               --          1,147
  Issuance of common stock for payment of note payable......         --
--           --               --          3,182
  Conversion of other equity to common stock................   (628,000)
(6,920)          --               --             --
  Issuance of common stock in ICentral acquisition..........         --
--           --               --         10,000
  Issuance of common stock in private placements, net of
    issuance costs of $738..................................         --
--           --               --         24,262
  Issuance of FutureTense Series C redeemable convertible
    preferred stock.........................................         --
--           --               --             --
  Conversion of note payable................................         --
--           --               --             --
  Issuance of FutureTense Series D redeemable convertible
    preferred stock.........................................         --
--           --               --             --
  Cancellation of restricted common stock...................         --
--           --               --             --
  Reversal of deferred compensation related to termination
    of stock options........................................         --
--          275               --            (55)
  Compensation expense related to stock options.............         --
--          (23)              --             --
  Amortization of deferred compensation.....................         --
--           41               --             41
  Net loss..................................................         --
--           --          (36,970)       (36,970)
                                                               --------
-------        -----        ---------       --------
Balance, December 31, 1998..................................         --
--          (32)        (144,760)        41,436
  Exercise of common stock options..........................         --
--           --               --          6,244
  Employee stock purchase plan..............................         --
--           --               --          1,125
  Issuance of common stock in ICentral acquisition..........         --
--           --               --            609
  Issuance of FutureTense Series D redeemable convertible
    preferred stock.........................................         --
--           --               --             --
  Conversion of FutureTense preferred stock into Open Market
    common stock............................................         --
--           --               --         19,925
  Amortization of deferred compensation.....................         --
--          399               --            399
  Deferred compensation related to issuance of common stock
    options.................................................         --
--         (696)              --             --
  Net loss..................................................         --
--           --          (19,780)       (19,780)
                                                               --------
-------        -----        ---------       --------
Balance, December 31, 1999..................................         --
--         (329)        (164,540)        49,958
  Exercise of common stock options..........................         --
--           --               --          7,128
  Employee stock purchase plan..............................         --
--           --               --            938
  Rescission of exercise of common stock options............         --
--           --               --            (35)
  Compensation expense related to stock options.............         --
--           --               --            351
  Amortization of deferred compensation.....................         --
--          113               --            113
  Net loss..................................................         --
--           --          (37,796)       (37,796)
                                                               --------
-------        -----        ---------       --------
Balance, December 31, 2000..................................         --     $
--        $(216)       $(202,336)      $ 20,657
                                                               ========
=======        =====        =========       ========
</Table>

  The accompanying notes are an integral part of these consolidated financial
                                  statements.

                                       45
<Page>
                               OPEN MARKET, INC.

                     CONSOLIDATED STATEMENTS OF CASH FLOWS

                                 (IN THOUSANDS)

<Table>
<Caption>
                                                                 YEARS ENDED
DECEMBER 31,

------------------------------
                                                                2000       1999
     1998
                                                              --------
--------   --------
<S>                                                           <C>        <C>
   <C>
Cash Flows from Operating Activities:
  Net loss..................................................  $(37,796)
$(19,780)  $(36,970)
  Adjustments to reconcile net loss to net cash used in
    operating activities --
    Depreciation and amortization...........................     4,075
4,572      5,561
    Amortization of intangible assets.......................     6,000
3,815      3,006
    Write-off of in-process research and development........        --
--      5,700
    Stock based compensation expense........................       113
1,008        (14)
    Non-cash charge related to stock option rescission......       351
--         --
    Loss on disposition of fixed assets.....................        --
--         39
    Write-down of assets related to restructuring...........        --
--        294
  Changes in assets and liabilities --
    Accounts receivable.....................................     5,223
1,331     (8,804)
    Prepaid expenses and other current assets...............      (169)
(1,828)      (339)
    Accounts payable........................................      (217)
2,310       (283)
    Accrued expenses........................................     4,800
(358)    (1,613)
    Deferred revenues.......................................     1,312
952        427
                                                              --------
--------   --------
Net cash used in operating activities.......................   (16,308)
(7,978)   (32,996)
Cash Flows from Investing Activities:
  Purchases of property and equipment.......................       435
(2,068)    (5,933)
  Repayment of loan by Founder..............................        --
--        993
  Maturities (purchases) of marketable securities...........     4,807
1,973     (5,521)
  Cash paid in acquisitions.................................        --
--     (1,420)
  Decrease in other assets..................................       296
146        484
                                                              --------
--------   --------
Net cash provided by (used in) investing activities.........     5,538
51    (11,397)
Cash Flows from Financing Activities:
  Net borrowings (payments) under the lines of credit.......     7,055
(650)     4,631
  Proceeds from (payments on) long-term obligations.........    (2,764)
(709)     2,830
  Proceeds from the issuance of redeemable convertible
    preferred stock, net of issuance costs..................        --
4,500      8,496
  Payments on note payable..................................        --
(5,000)    (1,818)
  Proceeds from the factoring of accounts receivable........        --
--      3,128
  Proceeds from employee stock purchase plan................       938
1,125      1,147
  Proceeds from exercise of stock options...................     7,128
6,244      3,448
  Rescission of exercise of stock options...................       (35)
--         --
  Proceeds from issuance of common stock in private
    placements..............................................        --
--     24,262
                                                              --------
--------   --------
Net cash provided by financing activities...................    12,322
5,510     46,124
Foreign Exchange Effect on Cash and Cash Equivalents........       (93)
(60)        67
Net Increase (Decrease) in Cash and Cash Equivalents........     1,552
(2,417)     1,731
Cash and Cash Equivalents, beginning of year................    19,258
21,735     19,937
                                                              --------
--------   --------
Cash and Cash Equivalents, end of year......................  $ 20,717   $
19,258   $ 21,735
                                                              ========
========   ========
Supplemental Disclosure of Cash Flow Information:
Interest paid during year...................................  $    427   $
1,046   $  1,372
                                                              ========
========   ========
Taxes paid during year......................................  $    104   $
228   $     48
                                                              ========
========   ========
Supplemental Schedule of Non-cash Financing Activities:
Conversion of non-interest bearing note into shares of
  Series C redeemable convertible preferred stock...........  $     --   $
--   $    189
                                                              ========
========   ========
  Payment of note payable through issuance of common stock
    (See Note 4)............................................  $     --   $
--   $  3,182
                                                              ========
========   ========
In connection with the acquisition of ICentral, the
  following non-cash transaction occurred:
  Fair value of assets acquired.............................  $     --   $
--   $ 12,086
  Liabilities assumed.......................................        --
--       (666)
  Issuance of common stock..................................        --
--    (10,000)
                                                              --------
--------   --------
Cash paid for acquisition and acquisition costs.............  $     --   $
--   $ (1,420)
                                                              ========
========   ========
</Table>

                                       46
<Page>
                               OPEN MARKET, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

(1) OPERATIONS

    Open Market is a provider of enterprise content management and delivery
application software. Our software solutions are designed to enable businesses
and other organizations to use the Internet to optimize interactions with their
site visitors, employees, customers and distribution channels, in order to
reduce costs, accelerate business processes, gain market share, establish new
revenue streams and compete in the new online economy. We believe that quality
interactions result from the reliable and timely exchange of compelling and
accurate information and a consistent series of quality interactions is the key
to building and sustaining business relationships.

    We build our software based on two core beliefs. First, information, or
content, is a strategic asset, and world-class organizations strive to excel at
managing crucial information. For these organizations, the Internet introduces
new information management challenges and opportunities. Second, web
applications managing this crucial information must be reliable, scalable,
flexible and open. This puts new requirements on how eBusiness application
software needs to be developed and delivered.

    Companies use our software to build and operate captivating web sites, rich
product catalogs, self-service applications and web services for their
distribution channels, marketplaces and customers. Our products acquire content
from people and systems, manage that information through approval and workflow
processes, and then disseminate it in personalized delivery formats to trading
partners' systems and to a variety of presentation devices, including web
browsers, wireless devices, personal digital assistants and e-mail. These
eBusiness applications, which we call "content-driven eBusiness solutions", are
designed to enable companies to reduce costs, strengthen customer loyalty and
establish new revenue streams.

    We are subject to risks common to growing technology-based companies.
Operating results are largely dependent upon continued development and growth of
Internet commerce, lengthy sales cycles, dependence on system integrators,
competition, fluctuations in quarterly operating results, managing rapid
expansion, international operations, product defects, dependence on intellectual
property and potential intellectual property rights infringements.

    In March 2001, we issued $5.0 million of preferred stock and sold the Folio
technology $6.6 million (See Note 16). Based upon our current operating plan and
projected capital expenditures for 2001, we believe that existing unrestricted
cash and cash equivalents including the recent proceeds from our preferred stock
offering and the sale of the Folio technology to NextPage will be sufficient to
fund our operations, debt service and capital expenditure requirements at least
through December 31, 2001. However, if we are unable to meet our revised
operating plan for 2001, we may need to raise additional funding through the
sale of assets or raise debt or equity capital. Such funding, if required, may
not be available on terms favorable to the Company.

(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

    The accompanying consolidated financial statements reflect the application
of the following significant accounting policies described in this note and
elsewhere in the accompanying notes to consolidated financial statements.

                                       47
<Page>
                               OPEN MARKET, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
    (A) PRINCIPLES OF CONSOLIDATION

    The accompanying consolidated financial statements include the accounts of
the Company and our wholly owned subsidiaries, which includes
FutureTense, Inc., for all periods presented. All material inter-company
accounts and transactions have been eliminated in consolidation.

    (B) REVENUE RECOGNITION

    We recognize revenue in accordance with Statement of Position (SOP) 97-2,
SOFTWARE REVENUE RECOGNITION, as amended by SOP 98-4. Additionally, the American
Institute of Certified Public Accountants recently issued SOP 98-9 SOFTWARE
REVENUE RECOGNITION, WITH RESPECT TO CERTAIN ARRANGEMENTS, which provides for
certain amendments to SOP 97-2, which is effective for transactions entered into
beginning January 1, 2000. This pronouncement did not materially impact our
revenue recognition practices. We generate revenues from two sources: license
fees for the use of our products and service revenues for implementation,
support, consulting and training related to our products.

    We execute separate contracts that govern the terms and conditions of each
software license and maintenance arrangement and each professional services
arrangement. These contracts may be an element in a multiple element
arrangement. Revenues under multiple element arrangements, which may include
several different software products or services sold together, are allocated to
each element based on the residual method in accordance with SOP 98-9.

    We use the residual method when fair value does not exist for one of the
delivered elements in an arrangement. Under the residual method, the fair value
of the undelivered elements is deferred and subsequently recognized. We have
established sufficient vendor-specific objective evidence for the value of
professional services, training and maintenance and support services based on
the price charged when these elements are sold separately. Accordingly, software
license revenue is recognized under the residual method in arrangements in which
software is licensed with professional services, training and maintenance and
support services.


    Revenues from software license agreements are recognized upon delivery of
the software if there is evidence of an agreement, the payment is fixed or
determinable and collection is probable. If an acceptance period is required or
post-delivery obligations exist, revenues are recognized upon customer
acceptance and/or completion of the obligation. We enter into reseller
arrangements for certain products that typically provide for sublicense fees
payable to us based on a percentage of our list price. Royalty and sublicense
revenues from our reseller arrangements are recognized when earned, either on a
per-unit basis as reported to us by our licensees, or with regards to guaranteed
minimums, upon shipment of the master copy of all software to which the
guaranteed minimum sublicense fees relate, if there are no significant
post-delivery obligations. Revenues for post-contract customer support are
recognized ratably over the term of the support period, which is typically one
year. Service revenues, which include education, implementation and consulting
services, are recognized in the period services are provided, if customer
acceptance is not required, there is evidence of an agreement, the revenues are
fixed or determinable and collection is probable. Although the Company generally
does not provide its customers with contractual rights of return, it has issued
credits for returns and allowances for its customers in the past, and as a
result, the Company provides for estimated returns and allowances on


                                       48
<Page>
                               OPEN MARKET, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

products and services in accordance with FASB No. 48, REVENUE RECOGNITION WHEN
RIGHT OF RETURN EXISTS.


    Cost of product revenues consists of costs to distribute the product,
including the cost of the media on which it is delivered and royalty payments to
third-party vendors. Cost of service revenues consists primarily of consulting
and support personnel salaries and related costs.

    Deferred revenues represent cash received from customers for products and
services in advance of revenue recognition.

    (C) CASH, CASH EQUIVALENTS AND MARKETABLE SECURITIES

    We account for investments under Statement of Financial Accounting Standards
(SFAS) No. 115, ACCOUNTING FOR CERTAIN INVESTMENTS IN DEBT AND EQUITY
SECURITIES. Under SFAS No. 115, investments for which we have positive intent
and ability to hold to maturity, consisting of cash equivalents and marketable
securities, are reported at amortized cost, which approximates fair market
value. Cash equivalents are highly liquid investments with original maturities
of less than three months. Marketable securities are investment-grade securities
with original maturities of greater than three months. The average maturity of
our marketable securities was approximately two months and five months at
December 31, 2000 and 1999, respectively. Long-term marketable securities are
investment-grade securities with maturities of greater than one year. To date,
we have not recorded any realized gains or losses.

<Table>
<Caption>
                                                               DECEMBER 31,
                                                            -------------------
                                                              2000       1999
                                                            --------   --------
<S>                                                         <C>        <C>
Cash and cash equivalents
    Cash..................................................  $18,756    $ 9,464
    Commercial paper and corporate bonds..................       --      3,496
    Money market accounts.................................    1,779      4,905
    U.S. government, state, municipal and agency
      securities..........................................      182      1,393
                                                            -------    -------
      Total cash and cash equivalents.....................  $20,717    $19,258
                                                            =======    =======
Marketable securities
    Corporate and other debt securities...................  $ 6,463    $11,433
    State and municipal bonds.............................    3,250      1,600
                                                            -------    -------
      Total marketable securities.........................  $ 9,713    $13,033
                                                            =======    =======
Long-term marketable securities
    Corporate and other debt securities...................  $    --    $ 1,487
                                                            =======    =======
      Total long-term marketable securities...............  $    --    $ 1,487
                                                            =======    =======
</Table>

                                       49
<Page>
                               OPEN MARKET, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
    (D) DEPRECIATION AND AMORTIZATION

    We provide for depreciation and amortization using the straight-line method
to allocate the cost of property and equipment over their estimated useful lives
as follows:

<Table>
<Caption>
                                                               ESTIMATED
ASSET CLASSIFICATION                                          USEFUL LIFE
--------------------                                          -----------
<S>                                                           <C>
Computers and office equipment..............................  3-5 years
Leasehold improvements......................................  Lease term
Furniture and fixtures......................................   7 years
Building....................................................   25 years
</Table>

    (E) RESEARCH AND DEVELOPMENT EXPENSES

    We have evaluated the establishment of technological feasibility of our
products in accordance with SFAS No. 86, ACCOUNTING FOR THE COSTS OF COMPUTER
SOFTWARE TO BE SOLD, LEASED OR OTHERWISE MARKETED. We sell products in a market
that is subject to rapid technological change, new product development and
changing customer needs; accordingly, we have concluded that technological
feasibility is not established until the development stage of the product is
nearly complete. We define technological feasibility as the completion of a
working model. The time period, during which costs could be capitalized, from
the point of reaching technological feasibility until the time of general
product release, is very short and consequently, the amounts that could be
capitalized are not material to our financial position or results of operations.
Therefore, we have charged all such costs to research and development in the
period incurred.

    (F) TRANSLATION OF FOREIGN CURRENCIES


    The accounts of our foreign subsidiaries are translated in accordance with
SFAS No. 52, FOREIGN CURRENCY TRANSLATION. In translating the accounts of the
foreign subsidiaries into U.S. dollars, current assets and liabilities are
translated at the rate of exchange in effect at year-end, while non-monetary
assets and stockholders' equity is translated at historical rates. Revenue and
expense accounts are translated using the weighted-average rate in effect during
the year. Foreign currency translation and transaction gains or losses for the
foreign subsidiary are included in the accompanying consolidated statements of
operations since the functional currency of these subsidiaries is the U.S.
dollar. The foreign currency loss was $123, $92 and $290 for 1998, 1999 and
2000, respectively. We had accounts receivable of approximately $2,021 and
$1,036 denominated in foreign currencies as of December 31, 2000 and 1999,
respectively. We mark these receivables to market and record a gain or loss,
which is a component of other income/expense in the consolidated statements of
operations. To date we have not incurred a significant loss on accounts
receivable.


    (G) NET LOSS PER SHARE

    We apply SFAS No. 128, EARNINGS PER SHARE. SFAS No. 128 establishes
standards for computing and presenting earnings per share and applies to
entities with publicly held common stock or potential common stock. We have
applied the provisions of SFAS No. 128 and Staff Accounting Bulletin (SAB)
No. 98 for all periods presented. Net loss per share is based upon the weighted
average outstanding

                                       50
<Page>
                               OPEN MARKET, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
shares of common stock, adjusted to give effect to the number of equivalent
shares of our common stock issued in connection with the FutureTense acquisition
for all periods presented. Diluted net loss per share for the years ended 2000,
1999 and 1998 is the same as basic net loss per share as the inclusion of the
potential common stock equivalents would be anti-dilutive. The number of
outstanding anti-dilutive potential common shares, which consist of warrants and
stock options that are not included in basic net loss per common share, were
10,667,000, 8,595,000 and 6,722,000 for 2000, 1999 and 1998, respectively.

    (H) CONCENTRATIONS OF CREDIT RISK

    SFAS No. 105, DISCLOSURE OF INFORMATION ABOUT FINANCIAL INSTRUMENTS WITH
OFF-BALANCE-SHEET RISK AND FINANCIAL INSTRUMENTS WITH CONCENTRATIONS OF CREDIT
RISK, requires disclosure of any significant off-balance-sheet risk and credit
risk concentrations. We have no significant off-balance-sheet risk or credit
risk concentrations. We maintain our cash and cash equivalents with several
financial institutions and invest in investment-grade securities. We did not
have any customers with revenues greater than 10% of total revenues in the years
ended December 31, 2000, 1999 and 1998 or accounts receivable balances greater
than 10% of total accounts receivable as of December 31, 2000 and 1999.

    (I) POST-RETIREMENT BENEFITS

    We have no obligations for post-retirement benefits.

    (J) FINANCIAL INSTRUMENTS

    The estimated fair values of our financial instruments, which include cash
equivalents, marketable securities, accounts receivable, accounts payable and
short-term lines of credit, approximate their carrying value.

    (K) USE OF ESTIMATES

    The preparation of the accompanying consolidated financial statements
required the use of certain estimates by management in determining our assets,
liabilities, revenues and expenses. Actual results could differ from those
estimates.

    (L) RECLASSIFICATIONS

    We have reclassified certain prior year information to conform to the
current year's presentation.

    (M) COMPREHENSIVE LOSS

    SFAS No. 130, REPORTING COMPREHENSIVE INCOME, requires disclosure of all
components of comprehensive loss on an annual and interim basis. Comprehensive
loss is defined as the change in equity of a business enterprise during a period
from transactions and other events and circumstances from non-owner sources. Our
comprehensive loss is the same as the reported net loss for all periods
presented.

                                       51
<Page>
                               OPEN MARKET, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
    (N) DISCLOSURES ABOUT SEGMENTS OF AN ENTERPRISE

    We apply SFAS No. 131, DISCLOSURES ABOUT SEGMENTS OF AN ENTERPRISE AND
RELATED INFORMATION which establishes standards for reporting information
regarding operating segments in annual financial statements and requires
selected information for those segments to be presented in interim financial
reports issued to stockholders. SFAS No. 131 also establishes standards for
related disclosures about products and services and geographic areas. Operating
segments are identified as components of an enterprise about which separate
discrete financial information is available for evaluation by the chief
operating decision maker, or decision making group, in making decisions on how
to allocate resources and assess performance. Our chief decision-maker, as
defined under SFAS No. 131, is a combination of the Chief Executive Officer and
the Chief Financial Officer.

    We report our revenues according to three operating segments:
Content-centric eBusiness applications, Transact/ShopSite and other revenue. Our
Content-centric eBusiness revenues include license fees and service revenues
from our Content Server suite of integrated products. Our Transact/ ShopSite
revenues include license fees and service revenues from our Transact and
ShopSite products. The other revenues relate, historically, to license fees and
service revenues generated from the software publishing tools acquired from
Folio and other products, certain of which have been discontinued. Subsequent to
June 1999, other revenues relate primarily to the royalties received from
NextPage in accordance with our strategic arrangement.

<Table>
<Caption>
                                                      YEARS ENDED DECEMBER 31,

------------------------------
                                                     2000       1999       1998
                                                   --------   --------
--------
<S>                                                <C>        <C>        <C>
REVENUES:
Content-centric eBusiness application product
  revenues.......................................  $29,994    $ 8,295    $   446
Transact/ShopSite product revenues...............   13,599     38,426     21,734
Other product revenues...........................    4,757      7,021     21,403
                                                   -------    -------    -------
Total product revenues...........................   48,350     53,742     43,583
                                                   -------    -------    -------
Content-centric eBusiness application service
  revenues.......................................   11,960      2,770        179
Transact/ShopSite service revenues...............   27,809     23,868     16,034
Other service revenues...........................      862      2,646      4,750
                                                   -------    -------    -------
Total service revenues...........................   40,631     29,284     20,963
                                                   -------    -------    -------
Total revenues...................................  $88,981    $83,026    $64,546
                                                   =======    =======    =======
</Table>

                                       52
<Page>
                               OPEN MARKET, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)


<Table>
<Caption>
                                                      YEAR ENDED DECEMBER 31,

------------------------------
                                                     2000       1999       1998
                                                   --------   --------
--------
<S>                                                <C>        <C>        <C>
Cost of Revenues:
Cost of Content-centric eBusiness application
  product revenues...............................  $ 3,452    $ 1,242    $    55
Cost of Transact/ShopSite product revenues.......    3,584      2,980      2,530
Cost of other product revenues...................      417        211        629
                                                   -------    -------    -------
Total cost of product revenues...................    7,453      4,433      3,214
                                                   -------    -------    -------

Cost of Content-centric eBusiness application
  service revenue................................   12,125      1,973        145
Cost of Transact/ShopSite service revenue........   24,422     17,282     13,106
Cost of other service revenue....................      846      1,883      2,114
                                                   -------    -------    -------
Total cost of service revenue....................   37,393     21,138     15,365
                                                   -------    -------    -------
  Total Cost.....................................  $44,846    $25,571    $18,579
                                                   =======    =======    =======

Gross Profit:
Gross profit from Content-centric eBusiness
  application product revenues...................  $26,542    $ 7,053    $   391
Gross profit from Transact/ShopSite product
  revenues.......................................   10,015     35,446     19,204
Gross profit from other product revenues.........    4,340      6,810     20,774
                                                   -------    -------    -------
Total gross profit from product revenues.........   40,897     49,309     40,369
                                                   -------    -------    -------

Gross profit from Content-centric eBusiness
  application service revenue....................     (165)       797         34
Gross profit from Transact/ShopSite service
  revenue........................................    3,387      6,586      2,928
Gross profit from other service revenue..........       16        763      2,636
                                                   -------    -------    -------
Total gross profit from service revenue..........    3,238      8,146      5,598
                                                   -------    -------    -------
  Total gross profit.............................  $44,135    $57,455    $45,967
                                                   =======    =======    =======
</Table>


                                       53
<Page>
                               OPEN MARKET, INC.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                (IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
    Revenues from geographical sources in total and as a percentage of total
revenues for 2000, 1999 and 1998 were as follows:

<Table>
<Caption>
                                                           YEARS ENDED DECEMBER
31,

-------------------------------------------------
                                                2000              1999
   1998
                                               -------           -------
  -------
<S>                                            <C>       <C>     <C>       <C>
  <C>       <C>
North America................................  $53,019    60%    $58,341    70%
  $44,407    68%
Europe.......................................   18,046    20      11,636    14
    8,057    12
United Kingdom...............................    9,004    10       7,198     9
    6,374    10
Asia Pacific.................................    5,193     6       2,813     3
    3,072     5
Japan........................................    2,263     3       1,582     2
    1,618     3
Other........................................    1,456     1       1,456     2
    1,018     2
                                               -------   ---     -------   ---
  -------   ---
Total........................................  $88,981   100%    $83,026   100%
  $64,546   100%
                                               =======   ===     =======   ===
  =======   ===
</Table>

    All of our product sales for the years ended December 31, 2000, 1999 and
1998 were shipped from our facilities located in the United States. As of
December 31, 2000 and 1999, all of our assets relate to the content-centric
eBusiness and Transact/ShopSite segments except for $3,889 and $10,173,
respectively, which are attributable to the other product revenue segment.
Substantially all of our long-lived assets are located in the United States.

    (O) LONG-LIVED ASSETS

    We evaluate the carrying value of long-lived assets based on the guidance in
SFAS No. 121, ACCOUNTING FOR THE IMPAIRMENT OF LONG-LIVED ASSETS AND FOR
LONG-LIVED ASSETS TO BE DISPOSED OF. Our evaluation considers strategy,
competitive information, market trends and operating performance. During the
fourth quarter of 2000, we decided to divest the ShopSite product line due to
the fact that goodwill is not realizable. We expensed the remaining goodwill
balance of $3,255 which is included in the restructuring charge in the
accompanying statement of operations. Based on our evaluation at December 31,
2000, we do not believe any other impairment of long-lived assets exists.

                                       54
<Page>
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

    (P) NEW ACCOUNTING STANDARDS

    The Securities and Exchange Commission issued Staff Accounting Bulletin
(SAB) No. 101, REVENUE RECOGNITION, in December 1999. We were required to adopt
this new accounting guidance through a cumulative charge to operations, in
accordance with Accounting Principles Board Opinion (APB) No. 20, ACCOUNTING
CHANGES, no later than the fourth quarter of fiscal 2000. The adoption of this
guidance did not have a material impact on our operating results for all periods
presented.

    In June 1998, the FASB issued SFAS No. 133, ACCOUNTING FOR DERIVATIVE
INSTRUMENTS AND HEDGING ACTIVITIES. This statement establishes accounting and
reporting standards for derivative instruments, including certain derivative
instruments embedded in other contracts, and for hedging activities. SFAS
No. 133, as amended by SFAS No. 137, is effective for all fiscal quarters of
fiscal years beginning after June 15, 2000. SFAS No. 133 is not expected to have
a material impact on our consolidated financial statements.

(3) SPECIAL CHARGES

    (A) RESTRUCTURING CHARGES


    (i) In the fourth quarter of 2000, we implemented a restructuring plan to
reduce expenses and align investments with new strategies designed for future
profitability and long-term revenue growth. The major component of the
restructuring charge related to the elimination of approximately 92 employees
and 90 outside consultants across the following functions: services (99),
research and development (49), marketing (10), general and administrative
(13) and sales (11). Other components of the restructuring charge included
write-off of goodwill related to the ICentral acquisition as we decided to
divest our ShopSite product line, the accrual of a software contract commitment
that resulted from a change in product strategy and accrual of office lease
impairment costs due to the reduction in workforce. The total cash impact of the
restructuring amounted to approximately $3,693. We paid approximately $836 in
2000, and all remaining liabilities are expected to be paid by December 31,
2001. Following are the significant components of the restructuring charge:


<Table>
<Caption>
RESTRUCTURING COSTS                                            AMOUNT
-------------------                                           --------
<S>                                                           <C>
Employee severance, benefits and related costs..............   $2,894
ICentral goodwill write-off.................................    3,255
Office lease................................................      299
Termination costs of certain contractual arrangements.......      500
                                                               ------
Total.......................................................   $6,948
                                                               ======
</Table>

    (ii) In the fourth quarter of 1998, we implemented a restructuring plan to
better align our operating costs with our anticipated future revenue stream. The
major component of the restructuring charge related to the elimination of
approximately 67 employees across the following functions: research and
development (27), marketing (17), general and administrative (22) and services
(1). In addition, 10 employees moved from research and development to services.
Other components related to settling certain contractual arrangements for
porting and product integration that resulted from a change in product strategy.
Other charges included the write-off of unutilized software, originally intended
for use by the sales force but not implemented due to the reduction in marketing
personnel.

                                       55
<Page>
(3) SPECIAL CHARGES (CONTINUED)
The total cash impact of the restructuring amounted to approximately $1,748. All
liabilities were paid as of December 31, 1999. Following were the significant
components of the restructuring charge:

<Table>
<Caption>
RESTRUCTURING COSTS                                            AMOUNT
-------------------                                           --------
<S>                                                           <C>
Employee severance, benefits and related costs..............   $1,260
Write-off of assets.........................................      294
Termination costs of certain contractual arrangements.......      488
                                                               ------
Total.......................................................   $2,042
                                                               ======
</Table>

    (B) NON-RECURRING CHARGES

    As a result of the acquisition of FutureTense during the fourth quarter of
1999 (See Note 4(a)), we incurred one-time costs related to the merger of
$4,328. These costs were comprised of professional fees and other charges of
$3,353 and costs to exit contractual obligations and asset impairments of $975.
The total cash impact related to the transaction was $3,394, which has all been
paid as of December 31, 2000.

(4) ACQUISITIONS

    (A) FUTURETENSE, INC.

    Effective October 15, 1999, we completed a merger with FutureTense, Inc.,
(FutureTense) a software Internet content management and delivery company. We
issued 7,346,210 shares of our common stock to the holders of outstanding
FutureTense stock. Each FutureTense share was exchanged for .384 shares of our
common stock. In addition, we assumed FutureTense employee stock options and
warrants that converted into options to acquire 1,124,628 shares of our stock.
As of the date of the consummation of the merger, the common stock and the
converted options issued by us had an aggregate market value of $111,180. The
merger has been accounted for as a pooling of interests, and accordingly, all
prior period financial statements presented herein have been restated as if the
merger took place at the beginning of such periods. In addition, in connection
with this acquisition, we entered into employment agreements in 1999 with key
employees of FutureTense.

    During the nine month period ended September 30, 1999, we recorded revenues
of $432 related to the sale of FutureTense products and services as part of a
reseller agreement. This amount has been eliminated in consolidation. No other
material adjustments were required as a result of conforming the accounting
policies of FutureTense to our existing policies.

    In accordance with Accounting Principles Board Opinion (APB) No. 16, the
following information presents statement of operations data for the periods
preceding the merger.

<Table>
<Caption>
                                                                 NINE MONTHS
     YEARS ENDED
                                                                    ENDED
  -----------------
                                                              SEPTEMBER 30, 1999
  DECEMBER 31, 1998
                                                              ------------------
  -----------------
                                                                 (UNAUDITED)
<S>                                                           <C>
  <C>
Open Market:
  Revenues..................................................       $ 52,160
      $ 62,145
  Net Loss..................................................         (6,251)
       (30,472)
FutureTense:
  Revenues..................................................       $  6,032
      $  2,401
  Net Loss..................................................         (5,374)
        (6,498)
</Table>

                                       56
<Page>
(4) ACQUISITIONS (CONTINUED)
    (B) ICENTRAL INCORPORATED

    On April 30, 1998, we acquired all of the outstanding shares of capital
stock of ICentral, Incorporated (ICentral) based in Provo, Utah. ICentral
specializes in Internet store-building products geared to small and medium-sized
businesses. As payment of the purchase price, we (i) issued an aggregate of
480,140 shares of our common stock and (ii) made a cash payment of $720 to the
former stockholders of ICentral. The value of the shares of our common stock
issued in connection with the acquisition was approximately $10,000 based on a
weighted-average market price, as defined. In addition, in connection with this
acquisition, we entered into employment agreements in 1999 with certain key
employees of ICentral under which we agreed to pay bonuses in an aggregate
amount of $1,000, depending on certain future events, as defined. The employees
earned $609 under the employment agreements, which was paid through the issuance
of 48,752 shares of common stock under our 1994 Stock Purchase Plan. The
remainder was forfeited due to termination of employment. For financial
statement purposes, this acquisition was accounted for as a purchase, and
accordingly, the results of operations of ICentral subsequent to April 30, 1998
are included in our consolidated statements of operations.

    The aggregate purchase price of $12,086 consisted of the following:

<Table>
<Caption>
DESCRIPTION                                                    AMOUNT
-----------                                                   --------
<S>                                                           <C>
Common stock................................................  $10,000
Cash........................................................      720
Assumed liabilities.........................................      666
Acquisition costs...........................................      700
                                                              -------
    Total purchase price:...................................  $12,086
                                                              =======
</Table>

    The purchase price was allocated based upon the fair value of the tangible
and intangible assets acquired. These allocations represent the fair values
determined by an appraisal. The appraisal incorporated proven valuation
procedures and techniques in determining the fair value of each intangible
asset. The purchase price has been allocated as follows:

<Table>
<Caption>
DESCRIPTION                                                    AMOUNT
-----------                                                   --------
<S>                                                           <C>
Current assets..............................................  $    86
Other acquired intangible assets............................    6,300
In-process research & development...........................    5,700
                                                              -------
    Total assets acquired:..................................  $12,086
                                                              =======
</Table>

    The in-process research and development has been expensed as a charge
against operations as of the closing of the transaction and is included in the
accompanying 1998 consolidated statement of operations. The amount allocated to
in-process research and development relates to projects that had not yet reached
technological feasibility and that, until completion of development, have no
alternative future use. These projects were to require substantial development
and testing prior to reaching technological feasibility. However, there could be
no assurance that these projects would reach technological feasibility or
develop into products that would be sold profitably by us. The technology
acquired in the acquisition of ICentral has required substantial additional
development by us. During the fourth quarter of 2000, we decided to divest this
product, and we expensed the remaining balance of $3,255 of this intangible
asset. We have recorded approximately $4,200 and $1,260 of amortization expense
relating to these intangible assets during 2000 and 1999, respectively.

                                       57
<Page>
(5) INTANGIBLE ASSETS

    Intangible assets consist principally of goodwill and the value of acquired
technology. These intangibles were obtained from our acquisitions of Folio and
ICentral. We amortize these intangibles over their estimated useful lives as
follows:

<Table>
<Caption>
                                                                DECEMBER 31,
                                               ESTIMATED     -------------------
ACQUISITION                                   USEFUL LIFE      2000       1999
-----------                                   ------------   --------   --------
<S>                                           <C>            <C>        <C>
Net intangibles related to Folio
  Acquisition...............................  5 to 7 years   $  9,137   $  9,137
Net intangibles related to ICentral
  Acquisition*..............................  5 to 7 years      6,300      6,300
Net intangibles related to Mission Critical
  Acquisition...............................  3 years           1,581      1,581
                                                             --------   --------
Total intangible assets.....................                   17,018     17,018
Less: Accumulated amortization..............                  (14,361)
(8,361)
                                                             --------   --------
Net intangible assets.......................                 $  2,657   $  8,657
                                                             ========   ========
</Table>

------------------------

*   The intangible related to the ICentral acquisition was written off in 2000
    as part of a restructuring charge. See Note 3a on Restructuring and Note 4b
    on the ICentral Acquisition.

(6) LONG-TERM OBLIGATIONS AND CREDIT FACILITIES

    (A) LINE-OF-CREDIT ARRANGEMENTS


    (i) We had an unsecured credit facility arrangement with Silicon Valley
Bank, which provided up to $15,000 in financing in the form of a demand line of
credit. Borrowings under this line are limited to 80% of eligible domestic
accounts receivable and 90% of eligible foreign accounts receivable, as defined,
and bore interest at the prime lending rate (9.50% at December 31, 2000). We
were required to comply with certain restrictive covenants under this agreement,
and the line was collateralized by our accounts receivable. We were in
compliance with all such covenants at December 31, 2000. As of December 31,
2000, our borrowing under this facility was $11,459. This line was fully paid in
January 2001 and expired on January 15, 2001. In February 2001, we replaced this
line with a secured credit facility arrangement with the same bank, which
provides up to $12,000 in financing in the form of a demand line of credit.
Borrowings under this line are limited to between 60% and 80% of eligible
domestic accounts receivable and 90% of eligible foreign accounts receivable, as
defined, and bear interest at the prime lending rate plus 2%. The line is
collateralized by all assets. We are required to comply with certain financial
covenants under this agreement, including a requirement that we (i) raise, on or
before March 15, 2001, additional capital of at least $10,000,000 through the
sale of subordinated debt, equity securities, non-core assets, certain stock
interests and/or the proceeds of lawsuit settlements and (ii) maintain a minimum
tangible net worth in an amount equal to (a) a base amount, ranging from
$10,000,000 to $20,000,000 from the date of the agreement to December 30, 2001,
and fixed at $18,000,000 on and after December 30, 2001, plus (b) 85% of all
consideration received after the date of the agreement from any sale of our
equity securities and/or subordinated debt, excluding amounts received in
connection with the additional capital requirement described above. Other
restrictive covenants under this agreement include restrictions on (i) our use
of proceeds and (ii) our ability to sell the company, make loans, declare
dividends, increase compensation payments, subordinate debt and encumber the
collateral. Effective March 30, 2001, we entered into a modification to the
secured credit facility which, among other things, extended the date by which we
were required to raise the $10,000,000 of additional capital discussed above
from March 15, 2001 to March 31, 2001 and reduced the minimum tangible net worth
we are required to maintain to an amount equal to (i) a base amount, ranging
from $5,500,000 to $15,000,000 from the date of the agreement to December 31,
2001, and


                                       58
<Page>
(6) LONG-TERM OBLIGATIONS AND CREDIT FACILITIES (CONTINUED)

fixed at $8,500,000 on and after December 30, 2001, plus (ii) 85% of all
consideration received after the date of the original loan agreement from any
sale of our equity securities and/or subordinated debt, excluding amounts
received in connection with the additional capital requirement described above.


    (ii) We had a royalty line of credit with a bank, which provided up to
$6,996 in financing in the form of a line of credit. Borrowings under this line
were limited to 85% of guaranteed minimum royalties receivable from Next Page,
as defined, and bore interest at the prime lending rate (9.50% at December 31,
2000). Our borrowings under this facility were $5,946 at December 31, 2000. This
line was fully paid in January 2001. In concert with our March sale of the
underlying technology to NextPage, this line terminated.

    (B) MORTGAGE

    In July 1998, we entered into a $2,800 mortgage of our Provo, Utah, property
which bore interest at the fixed rate of 8.5%. The mortgage was paid in full in
October 2000 upon the sale of this property.

(7) INCOME TAXES

    We account for income taxes under SFAS No. 109, ACCOUNTING FOR INCOME TAXES,
the objective of which is to recognize the amount of current and deferred income
taxes payable or refundable at the date of the financial statements as a result
of all events that have been recognized in the accompanying consolidated
financial statements, as measured by enacted tax laws.

    The provision for income taxes for the years ended December 31, 2000, 1999
and 1998 consists of foreign income and withholding taxes.

    At December 31, 2000, we had net operating loss carryforwards for federal
income tax purposes of approximately $169,000, which expire through
2007 - 2020. We also have certain tax credits available to offset future federal
and state income taxes, if any. Net operating loss carryforwards and credits are
subject to review and possible adjustments by the Internal Revenue Service and
may be limited in the event of certain cumulative changes in excess of 50% in
the ownership interests of significant stockholders over a three-year period. We
believe that we have experienced a change in ownership in excess of 50%. We do
not believe that this change in ownership will significantly impact our ability
to utilize our net operating loss carryforwards.

    The components of our deferred tax asset are as follows:

<Table>
<Caption>
                                                            2000       1999
                                                          --------   --------
<S>                                                       <C>        <C>
Net operating loss carryforwards........................  $ 67,570   $ 47,463
Amortization of intangible assets.......................    19,448     15,818
Tax credit carryforwards................................     3,941      2,894
Temporary differences...................................    (3,965)    (3,109)
                                                          --------   --------
Total deferred tax assets...............................    86,994     63,066
Less--valuation allowance...............................   (86,994)   (63,066)
                                                          --------   --------
Net deferred tax assets.................................  $     --   $     --
                                                          ========   ========
</Table>

    It is our objective to become a profitable enterprise and to realize the
benefits of our deferred tax assets. However, in evaluating the realizability of
these deferred tax assets, management has considered our operating history, the
volatility of the market in which we compete, the operating losses incurred to
date and believes that given the significance of this evidence, a full valuation
reserve against our deferred tax assets is required as of December 31, 2000 and
1999.

                                       59
<Page>
(8) STOCKHOLDERS' EQUITY

    (A) PREFERRED STOCK

    In April 1996, our Board of Directors authorized the issuance of up to
2,000,000 shares of $.10 par value preferred stock. At December 31, 2000, no
shares were issued and outstanding.

    In connection with the merger with FutureTense, which was accounted for as a
pooling of interest, all outstanding shares of FutureTense preferred stock were
exchanged for our common stock. The shares of Series A, B, C and D Preferred
Stock issued were as follows:

<Table>
<Caption>

              SHARES

              OF OPEN

              MARKET
DESCRIPTION OF                                           NUMBER OF   PRICE PER
  GROSS       COMMON
PREFERRED STOCK                     DATE                  SHARES       SHARE
 PROCEEDS      STOCK
---------------        -------------------------------   ---------   ---------
----------   ---------
<S>                    <C>                               <C>         <C>
<C>          <C>
Series A                        February 1996              380,651     $3.15
$1,199,050     730,850
Series B                 July 1996 and October 1997        754,178      7.28
 5,486,645   1,448,022
Series C                 February 1998 and June 1998       711,842      7.29
 5,189,328   1,366,737
Series D               December 1998 and February 1999   5,436,837      1.48
 8,049,782   2,087,745
</Table>

    The Series A, B, C and D Preferred Stock had the following rights,
preferences and privileges. The Series A, B, C and D Preferred shareholders each
had a liquidation preference over the common stock in the event of a
liquidation, dissolution or winding up of the Company. The Series A, B, C and D
Preferred shareholders were entitled to receive dividends at the defined
dividend rate, when and if declared by the Board of Directors. We were required
to redeem and convert the Series A, B, C and D Preferred Stock for the
redemption price plus any declared but unpaid dividends beginning February 10,
2002. The preferred shareholders were entitled to vote with the common
stockholders on an as-converted basis. The Series A, B, C and D Preferred
shareholders also had the right of first refusal to purchase any new securities
offered by us, as defined. These rights, preferences and privileges terminated
upon the consummation of the merger between FutureTense and us.

    (B) COMMON STOCK RESERVED

    Common stock reserved for issuance at December 31, 2000 consisted of the
following:

<Table>
<S>                                                       <C>
Stock Incentive Plan....................................  14,986,000
Warrants................................................     334,728
                                                          ----------
Total...................................................  15,320,728
                                                          ==========
</Table>

    (C) PRIVATE PLACEMENTS

    In June 1998, Intel Corporation made an investment in us, purchasing 335,852
unregistered shares of our common stock for an aggregate purchase price of
$5,000.

    In July 1998, CMG Information Services, Inc., an investor and developer of
Internet companies ("CMG"), and Capital Ventures International, a fund managed
by Heights Capital Management ("CVI"), made a $20,000 equity investment in us.
Pursuant to the terms of the agreements, we issued an aggregate of 1,545,893
shares of our common stock to CMG and CVI at a price of $12.94 per share. In
addition, we issued to CMG and CVI warrants to purchase 334,728 shares of common
stock at a price of $16.43 per share, which expire on July 30, 2003. We filed a
registration statement on Form S-3, covering all such shares of common stock,
which was declared effective by the Securities and Exchange Commission on
August 13, 1998.

                                       60
<Page>
(8) STOCKHOLDERS' EQUITY (CONTINUED)

    (D) STOCKHOLDERS' RIGHTS

    In January 1998, our Board of Directors adopted a Shareholder Rights Plan
declaring a dividend of one right for each share of our common stock outstanding
at the close of business on February 12, 1998. The rights entitle our
shareholders to purchase one one-thousandth of a share of a Series A of Junior
Participating Preferred Stock of the Company at an exercise price of $65.00 per
share. The rights become exercisable in the event that another party acquires or
announces its intention to acquire beneficial ownership of 18% or more of our
common stock. Such percentage may, at the Board's discretion, be lowered,
although in no event may it be lower than 10%. In the event of such an
acquisition or similar event, each right, except those owned by the acquirer,
will enable the holder of the right to purchase that number of common shares of
the Company which equals the exercise price of the right divided by one-half of
the market price of the common stock. In addition, if we are involved in a
merger or other transaction with another party in which we are not the surviving
corporation, or we sell or transfer 50% or more of our assets or earning power
to another party, each right will entitle its holder to purchase that number of
shares of common stock of the other party which equals the exercise price of the
right divided by one-half of the market price of such common stock. The rights
expire ten years from the date of the grant.

    (E) COMMON STOCK

    At December 31, 2000, we had outstanding 1,703,998 shares of common stock
which are subject to restriction agreements (the "Restriction Agreements") under
the 1996 Incentive Plan. Pursuant to the Restriction Agreements, we have the
right to repurchase any unvested shares of common stock in the event of
termination of employment with cause, as defined, or due to stockholder's
voluntary resignation with us at 25% of the then-current fair market value of
the common stock. Shares subject to the Restriction Agreements vest quarterly
over a five year period commencing December 1995, subject to certain
acceleration provisions. In connection with the consummation of the merger of
FutureTense, the restrictions on these shares were accelerated and then
converted into shares of our common stock. At December 31, 2000, all shares
subject to Restriction Agreements had vested and were no longer subject to our
right of repurchase.

    During 1996, FutureTense issued 1,057,786 shares of restricted common stock
to certain employees and consultants. The estimated value of these shares
totaled $110 and was recorded as deferred compensation and is being amortized as
compensation expense over the vesting period of the restricted common stock.

    In July 1998, 7,918 shares of unvested restricted stock, granted to a
consultant in 1996, were cancelled. The deferred compensation associated with
the grant was not significant at the date of cancellation.

    (F) STOCK OPTION PLANS

    During 1994, our Board of Directors adopted the 1994 Stock Incentive Plan
(the 1994 Incentive Plan). Under the Incentive Plan, as amended, we have
reserved and may issue up to 19,201,000 shares of common stock or options to
purchase common stock. As of December 31, 2000, there are 1,084,000 shares
available for issuance under the 1994 Incentive Plan.

    In September 1996, FutureTense's Board of Directors adopted the 1996
FutureTense Plan (the 1996 Incentive Plan) under which 1,125,000 shares of
common stock are reserved for issuance to employees, officers, directors and
consultants upon the exercise of options granted under the 1996 Incentive Plan.
As of December 31, 2000, there were 109,000 shares available for issuance under
the

                                       61
<Page>
(8) STOCKHOLDERS' EQUITY (CONTINUED)
1996 Incentive Plan. Since our merger with FutureTense in October 1999, no new
options have been granted under the 1996 Incentive Plan.

    In August 1999, our Board of Directors adopted the 1999 Stock Incentive Plan
(the 1999 Incentive Plan). Under the Incentive Plan, we have reserved and may
issue up to 4,000,000 shares of common stock or options to purchase common
stock. As of December 31, 2000, there are 494,000 shares available for issuance
under the 1999 Incentive Plan.

    Under the terms of the above-mentioned Incentive Plans, the Board of
Directors may grant incentive stock options or non-qualified stock options to
purchase shares of our common stock. The purchase price and vesting schedule
applicable to each option grant are determined by the Board of Directors.
Generally, options vest over a four-year period and expire 10 years from the
date of grant.

    In 1996, our Board of Directors approved the 1996 Director Option Plan (the
Director Plan) whereby we have reserved and may issue up to 200,000 shares of
common stock. Under the terms of the Director Plan, each newly elected director
will be granted an option to purchase 20,000 shares of common stock. In
addition, commencing with the 1998 annual meeting of stockholders and for every
annual meeting of stockholders thereafter, each director who is not a founder or
employee of the Company will be granted an option to purchase 10,000 shares of
common stock. Generally, these options vest over a four-year period and expire
10 years from the date of grant. The vesting of these options will accelerate
upon a change of control, as defined in the Director Plan. At December 31, 2000,
there were 9,600 options available for grant under this plan.

    We recorded deferred compensation when stock options were granted to
employees at an exercise price per share that is less than the fair market value
on the date of the grant. Deferred compensation was recorded in an amount equal
to the excess of the fair market value per share over the exercise price
multiplied by the number of shares purchasable under the option. We recorded
$113, $399 and $41 of deferred compensation expense in 2000, 1999 and 1998,
respectively, which represented the difference between the fair market value of
the common stock on the date of grant, for accounting purposes, and the exercise
price.

    In November 1998, the Compensation Committee of the Board of Directors
authorized a Stock Option Exchange Program (the Program). Under the terms of the
program, all current employees, excluding certain officers then subject to
Section 16 of the Securities Exchange Act of 1934, had the option to request
that we cancel their existing options and replace them with a new option.
Options for a total of 2,258,153 shares were surrendered under the program by
employees and exchanged for new options at the new option exercise price and
vesting schedule. The new exercise price was equal to the fair market value of
our common stock on November 13, 1998, or $7.875. The repriced shares were
subject to certain selling restrictions through 1999. These repriced options are
reflected as grants and cancellations in the 1998 stock option activity below.

                                       62
<Page>
(8) STOCKHOLDERS' EQUITY (CONTINUED)
    The following is a summary of the stock option activity for all plans:

<Table>
<Caption>
                                                 2000                    1999
                1998
                                        ----------------------
---------------------   ---------------------
                                                      WEIGHTED
WEIGHTED                WEIGHTED
                                                      AVERAGE
AVERAGE                 AVERAGE
                                                       PRICE
PRICE                   PRICE
                                         NUMBER OF      PER      NUMBER OF
PER      NUMBER OF      PER
                                          SHARES       SHARE       SHARES
SHARE       SHARES      SHARE
                                        -----------   --------   ----------
--------   ----------   --------
<S>                                     <C>           <C>        <C>
<C>        <C>          <C>
Outstanding at beginning of year......    8,259,000    $ 9.29     6,622,000    $
5.47     6,741,000    $ 5.94
    Granted...........................    9,441,000     14.47     5,022,000
13.31     5,129,000     11.22
    Exercised.........................   (2,515,000)     2.83    (1,323,000)
4.66      (977,000)     3.53
    Canceled..........................   (4,853,000)    19.62    (2,062,000)
9.77    (4,271,000)    10.98
                                        -----------    ------    ----------
------    ----------    ------
Outstanding at end of year............   10,332,000    $10.54     8,259,000    $
9.29     6,622,000    $ 5.47
Options available for grant at end of
  year................................    1,697,000               6,262,000
         5,198,000
Options exercisable...................    1,827,000    $ 9.46     2,963,000    $
3.66     2,239,000    $ 2.91
Weighted-average fair value of options
  granted during the year.............  $     13.49              $     9.89
        $     6.30
                                        ===========    ======    ==========
======    ==========    ======
</Table>

<Table>
<Caption>
                                                    OPTIONS OUTSTANDING
    OPTIONS EXERCISABLE
                                           -------------------------------------
  -----------------------
                                                          WEIGHTED     WEIGHTED
                WEIGHTED
                                                           AVERAGE      AVERAGE
                 AVERAGE
                                                          REMAINING    EXERCISE
                EXERCISE
                                             NUMBER      CONTRACTUAL     PRICE
    NUMBER        PRICE
                                           OUTSTANDING      LIFE       PER SHARE
  EXERCISABLE   PER SHARE
                                           -----------   -----------   ---------
  -----------   ---------
<S>                                        <C>           <C>           <C>
  <C>           <C>
$0.17- 0.52..............................     369,000        6.59       $ 0.43
     287,000     $ 0.41
$1.03- 1.56..............................   1,124,000        9.79         1.51
       2,000       1.50
$1.66- 2.00..............................     372,000        9.91         1.93
          --         --
$2.66- 2.66..............................   1,236,000        9.80         2.66
          --         --
$2.97- 7.50..............................   1,069,000        9.58         4.19
      33,000       6.91
$7.81- 7.88..............................     828,000        6.62         7.88
     573,000       7.88
$9.00- 9.00..............................   1,409,000        9.30         9.00
          --         --
$9.37-12.13..............................   1,279,000        8.43        11.41
     495,000      11.62
$12.23-14.75.............................   1,041,000        8.83        13.17
     294,000      13.31
$14.88-55.00.............................   1,605,000        9.00        31.80
     143,000      19.23
                                           ----------        ----       ------
   ---------     ------
                                           10,332,000        8.95       $10.54
   1,827,000     $ 9.46
                                           ==========        ====       ======
   =========     ======
</Table>

    (G) THE 1996 EMPLOYEE STOCK PURCHASE PLAN

    In April 1996, our Board of Directors approved the 1996 Employee Stock
Purchase Plan (the Purchase Plan) under which we have reserved and may issue up
to an aggregate of 750,000 shares of our common stock in accordance with the
Purchase Plan. Under the terms of the Purchase Plan, employees who meet certain
eligibility requirements may purchase shares of our common stock at 85% of the
closing price of the common stock on the first or last day of each six-month
offering period, whichever is lower. In 2000, 1999 and 1998, we issued 117,000,
93,000 and 132,000 shares, respectively, for gross proceeds of approximately
$938, $1,125 and $1,147, respectively. At December 31, 2000, there were 348,000
shares available for issuance under the Purchase Plan.

                                       63
<Page>
(8) STOCKHOLDERS' EQUITY (CONTINUED)
    (H) PRO FORMA DISCLOSURE OF STOCK-BASED COMPENSATION

    SFAS No. 123, ACCOUNTING FOR STOCK-BASED COMPENSATION, requires the
measurement of the fair value of stock options or warrants granted to employees
to be included in the statement of operations or, alternatively, disclosed in
the notes to consolidated financial statements. We have determined that we will
continue to account for stock-based compensation for employees under Accounting
Principles Board Opinion No. 25 and elect the disclosure-only alternative under
SFAS No. 123. We record the fair market value of stock options and warrants
granted to non-employees in the consolidated statements of operations. We have
computed the pro forma disclosures required under SFAS No. 123 for stock options
granted in 2000, 1999 and 1998 using the Black-Scholes option pricing model. The
weighted-average assumptions used for 2000, 1999 and 1998 are as follows:

<Table>
<Caption>
                                                      2000       1999       1998
                                                    --------   --------
--------
<S>                                                 <C>        <C>        <C>
Risk-free interest rate...........................  4.44%      5.96%      4.91%
Expected dividend yield...........................  --         --         --
Expected life.....................................  4 years    6 years    7
years
Expected volatility...............................  149%       103%       108%
</Table>

    The total value of the options granted to employees and stock issued under
the employee stock purchase plan during 2000, 1999 and 1998 was computed as
approximately $127,364, $49,664 and $32,320, respectively. The pro forma effect
of these option grants for the years ended December 31, 2000, 1999 and 1998 is
as follows:

<Table>
<Caption>
                                                                2000       1999
     1998
                                                              --------
--------   --------
<S>                                                           <C>        <C>
   <C>
Net loss, as reported.......................................  $(37,796)
$(19,780)  $(36,970)
                                                              ========
========   ========
Net loss, pro forma.........................................  $(71,812)
$(36,894)  $(44,839)
                                                              ========
========   ========
Net loss per share--Basic and diluted
As reported.................................................  $  (0.83)  $
(0.46)  $  (0.98)
                                                              ========
========   ========
Pro forma...................................................  $  (1.57)  $
(0.86)  $  (1.19)
                                                              ========
========   ========
</Table>

    The resulting pro forma compensation expense may not be representative of
the amount to be expected in future years as the pro forma expense may vary
based upon the number of options granted. The Black-Scholes option pricing model
was developed for use in estimating the fair value of traded options that have
no vesting restrictions and are fully transferable. In addition, option pricing
models require the input of highly subjective assumptions, including expected
stock price volatility. Because our employee stock options have characteristics
significantly different from those of traded options and because changes in the
subjective input assumptions can materially affect the fair value estimate, in
management's opinion, the existing models do not necessarily provide a reliable
single measure of the fair value of our employee stock options.

                                       64
<Page>
(9) COMMITMENTS AND CONTINGENCIES

    (A) FACILITIES

    We lease our facilities and certain equipment under operating leases that
expire through February 2010. The future minimum lease commitments at
December 31, 2000, net of sublease income, are as follows:

<Table>
<Caption>
YEAR ENDED DECEMBER 31,                                       COMMITMENTS
-----------------------                                       -----------
<S>                                                           <C>
2001........................................................    $ 5,456
2002........................................................      4,799
2003........................................................      4,571
2004........................................................      4,489
2005........................................................      4,218
Thereafter..................................................     19,250
                                                                -------
                                                                $42,783
                                                                =======
</Table>

    Rent expense included in the accompanying consolidated statements of
operations was approximately $6,143, $2,585 and $3,171 for the years ended
December 31, 2000, 1999 and 1998, respectively. We subleased a portion of our
Burlington office space during 1999.

    (B) CLASS ACTION SUIT

    We are aware of six putative class actions that were filed between June 14,
2000 and August 10, 2000, against us and certain of our officers and directors
in the United States District Court for the District of Massachusetts. These
actions, each filed on behalf of an alleged class of our shareholders who
purchased their common stock between November 8, 1999 and April 18, 2000, allege
violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934
and Rule 10b-5 promulgated thereunder. The plaintiffs are seeking monetary
damages and other appropriate relief. On January 25, 2001, the court entered an
order consolidating these actions into one action. We have meritorious defenses
against this suit and intend to fight this suit vigorously.

(10) RELATED PARTY TRANSACTIONS

    We have entered into agreements with certain stockholders that provide for
product and service revenues. We believe that the terms of these transactions
are on terms no less favorable to us than could be obtained from unaffiliated
third parties. We recognized product and service revenues from related parties
of approximately $444, $259 and $208 during the years ended December 31, 2000,
1999 and 1998, respectively. We had related party accounts receivable of
approximately $70 and $71 related party deferred revenue of approximately $104
and $41 included in the accompanying consolidated balance sheets as of
December 31, 2000 and 1999, respectively, from certain stockholders.

(11) EXCLUSIVE DISTRIBUTION AGREEMENT

    On June 9, 1999, we announced the formation of a strategic partnership with
NextPage, Inc. Under the terms of the agreement, as amended on September 30,
1999, in exchange for exclusive worldwide marketing and distribution rights for
Folio publishing products, NextPage will pay us a minimum of $14,000 in
guaranteed royalties over a three-year period, commencing July 1, 1999. We are
recording the guaranteed royalty revenue ratably over the three-year period. At
the end of the three-year period, NextPage has an option to obtain all rights,
title and interests to the Folio products for a purchase price equal to such
products' estimated fair-market value. In addition, we received a minimum of

                                       65
<Page>
(11) EXCLUSIVE DISTRIBUTION AGREEMENT (CONTINUED)
$3,000 in software license fees from NextPage in exchange for NextPage's
non-exclusive worldwide rights to market and distribute our Transact/ShopSite
software products to the commercial publishing industry. In connection with this
distribution agreement, we recorded $4,664 and $5,441 in publishing revenue
during 2000 and 1999, respectively. See Note 15(b).

(12) EMPLOYEE BENEFIT PLAN

    In October 1995, we adopted a 401(k) savings and investment plan (the 401(k)
Plan) for eligible employees. Each participant may elect to contribute up to 15%
of his or her compensation for the plan year, subject to certain limitations, as
defined. At the discretion of our Board of Directors, matching contributions are
made to the 401(k) Plan. To date, there have been no discretionary contributions
made by us to the 401(k) Plan.

(13) ACCRUED EXPENSES

    Accrued expenses consist of the following:


<Table>
<Caption>
                                                               DECEMBER 31,
                                                            -------------------
                                                              2000       1999
                                                            --------   --------
<S>                                                         <C>        <C>
Payroll and related expenses..............................  $ 6,120    $ 6,002
Professional and consulting fees..........................    1,163        552
Restructuring.............................................    3,106        389
Royalties.................................................    2,729      1,034
All other.................................................    5,345      5,796
                                                            -------    -------
                                                            $18,463    $13,773
                                                            =======    =======
</Table>


(14) DEFERRED REVENUES

    Deferred revenues consist of the following:


<Table>
<Caption>
                                                                 DECEMBER 31,

-------------------
                                                                2000       1999
                                                              --------
--------
<S>                                                           <C>        <C>
Future product deliverables.................................   $1,244     $  149
Prepaid royalties...........................................    1,167         --
Prepaid service revenues....................................    5,601      6,153
                                                               ------     ------
                                                               $8,012     $6,302
                                                               ======     ======
</Table>


(15) QUARTERLY FINANCIAL RESULTS

    The following table sets forth certain unaudited quarterly financial data
for 2000 and 1999. In the opinion of management, the unaudited quarterly
information has been prepared on the same basis as the audited consolidated
financial statements and includes all adjustments, consisting only of normal
recurring adjustments, necessary for the fair presentation of the information
for the periods presented. The quarterly operating results are not necessarily
indicative of results of operations for any future period.

                                       66
<Page>
(15) QUARTERLY FINANCIAL RESULTS (CONTINUED)
    The merger of FutureTense Inc. in October 1999 was accounted for as a
pooling of interests and accordingly all prior period financial data has been
restated as if the merger took place at the beginning of such periods.

<Table>
<Caption>
                                                               THREE MONTHS
ENDED

--------------------------------------------------------------------------------
-------
                             MAR. 31,   JUNE 30,   SEPT. 30,   DEC. 31,   MAR.
31,   JUNE 30,   SEPT. 30,   DEC. 31,
                               1999       1999       1999        1999       2000
      2000       2000        2000
                             --------   --------   ---------   --------
--------   --------   ---------   --------
                                                                   (UNAUDITED)
<S>                          <C>        <C>        <C>         <C>        <C>
    <C>        <C>         <C>
REVENUES:
Content-centric eBusiness
  application product......  $   480    $   599     $ 1,808    $ 5,408    $
7,654    $ 8,714    $  8,901    $  4,725
Transact/ShopSite
  product..................    7,825     10,541       9,710     10,350
6,561      5,837         967         234
Other product..............    2,385      2,418       1,071      1,147
1,140      1,168       1,167       1,282
                             -------    -------     -------    -------
-------    -------    --------    --------
  Product revenues.........   10,690     13,558      12,589     16,905
15,355     15,719      11,035       6,241
                             -------    -------     -------    -------
-------    -------    --------    --------
Content-centric eBusiness
  application service......      182        973       1,000        615
2,031      3,394       3,900       3,575
Transact/ShopSite
  service..................    4,803      5,091       6,483      7,491
7,243      7,257       7,315       5,058
Other service..............      919        940         529        258
194        147          87         430
                             -------    -------     -------    -------
-------    -------    --------    --------
  Service revenues.........    5,904      7,004       8,012      8,364
9,468     10,798      11,302       9,063
                             -------    -------     -------    -------
-------    -------    --------    --------
    Total revenues.........   16,594     20,562      20,601     25,269
24,823     26,517      22,337      15,304
                             -------    -------     -------    -------
-------    -------    --------    --------

COST OF REVENUES:
Product revenues...........      764      1,014         850      1,806
2,376      2,311       2,086         680
Service revenues...........    4,151      5,197       4,986      6,804
7,714      8,972      10,493      10,214
                             -------    -------     -------    -------
-------    -------    --------    --------
  Total cost of revenues...    4,915      6,211       5,836      8,610
10,090     11,283      12,579      10,894
                             -------    -------     -------    -------
-------    -------    --------    --------
    Gross profit...........   11,679     14,351      14,765     16,659
14,733     15,234       9,758       4,410
                             -------    -------     -------    -------
-------    -------    --------    --------
OPERATING EXPENSES:
Selling and marketing......    8,497      9,360       8,539     11,947
10,477     12,632      12,608      13,046
Research and development...    5,238      5,872       5,514      5,822
6,036      6,422       6,426       5,917
General and
  administrative...........    2,230      1,969       2,662      1,806
2,372      2,957       3,393       3,377
Amortization of
  intangibles..............      852        852         897        786
765        766         765         449
Restructuring charge.......       --         --          --         --
--         --          --       6,948
Merger related costs.......       --         --          --      4,328
--         --          --          --
                             -------    -------     -------    -------
-------    -------    --------    --------
    Total operating
    expenses...............   16,817     18,053      17,612     24,689
19,650     22,777      23,192      29,737
    Loss from operations...   (5,138)    (3,702)     (2,847)    (8,030)
(4,917)    (7,543)    (13,343)    (25,327)
Other income...............       19        119         142         71
201     12,550       1,071         265
                             -------    -------     -------    -------
-------    -------    --------    --------
    Loss before income
    taxes..................   (5,119)    (3,583)     (2,705)    (7,959)
(4,716)     5,007     (12,363)    (25,062)
Provision for income
  taxes....................       42        103          71        198
52        298          34         278
                             -------    -------     -------    -------
-------    -------    --------    --------
    Net loss...............  $(5,161)   $(3,686)    $(2,776)   $(8,157)
$(4,768)   $ 4,709    $(12,397)   $(25,340)
                             =======    =======     =======    =======
=======    =======    ========    ========
</Table>

(16) SUBSEQUENT EVENTS

   (a) In March 2001, we sold $5.0 million of our Series E 6% Cumulative
Convertible Preferred Stock and warrants to purchase approximately 900,000
shares of our common stock at an exercise price of $1.9078 per share, subject to
certain adjustments, to an affiliate of the Palladin Group. The warrants are
exercisable for a period of five years.

    The Series E Preferred Stock is convertible at the option of the holder into
shares of our common stock at an initial conversion price of $1.5262 per share,
subject to certain adjustments. The initial

                                       67
<Page>
(16) SUBSEQUENT EVENTS (CONTINUED)
conversion price is subject to adjustment on the six-month anniversary of the
initial issuance, provided that in no event shall the adjusted conversion price
be less than $0.8176. In addition, the conversion price is subject to adjustment
in the event that we issue securities below the conversion price, with certain
exceptions.

    The shares of Series E Preferred Stock bears dividends at an annual rate of
6.0% of the liquidation preference of these shares, payable semi-annually,
through the issuance of shares of our common stock or, at our option, in cash.
Holders of Series E Preferred Stock have the right, after two years, to require
us to redeem the Series E Preferred Stock for cash or convert such shares into
our common stock, at our option. Also, in the event of a "change in control" as
defined in the terms of the Series E Preferred Stock, if the Series E Preferred
Stock is not converted into shares of common stock by the holder, we are
required to redeem the Series E Preferred Stock for cash, with such cash
redemption equal to 115% of the Series E Preferred Stock liquidation preference.
We are required to register the shares of common stock issuable upon conversion
and upon exercise of the warrants under the Securities Act of 1933 for public
resale.

    (b) On March 26, 2001, we announced that NextPage had exercised its option
to purchase the Folio technology, which it had been licensing, from us. NextPage
paid us approximately $6,600 in cash in the first quarter of 2001, to complete
the sale. As a result of this sale, there will be no future revenue stream from
these products beginning in the second quarter of 2001. We will record a gain of
approximately $4.0 million on this sale in the first quarter of 2001.

    ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
                             FINANCIAL DISCLOSURES

    None.

                                       68
<Page>
                                    PART III

    The information required by Items 10 through 13 are incorporated by
reference to our Definitive Proxy Statement for the 2001 Annual Meeting of
Stockholders scheduled for June 20, 2001.

                                    PART IV
    ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

    (a) The following documents are filed as part of this report:

       (1) Financial Statements

           Report of Independent Accountants

           Consolidated Balance Sheet as of December 31, 2000 and 1999

           Consolidated Statement of Operations for the years ended
           December 31, 2000, 1999 and 1998

           Consolidated Statement of Redeemable Convertible Preferred Stock and
           Stockholders' Equity for the years ended December 31, 2000, 1999 and
           1998

           Consolidated Statement of Cash Flows for the years ended
           December 31, 2000, 1999 and 1998

           Notes to Consolidated Financial Statements

       (2) Financial Statement Schedules

           Schedule II--Valuation and Qualifying Accounts

           Exhibits. The Exhibits listed in the Exhibit Index immediately
           preceding such Exhibits are filed as part of this Annual Report on
           Form 10-K.

    (b) During the fourth quarter of 2000, we filed the following reports on
       Form 8-K:

       (1) On December 4, 2000, Open Market, Inc. announced that Harland K.
           LaVigne had been named Chairman of the Board of Directors, President
           and CEO, effective immediately. The Current Report on Form 8-K
           reporting this event was filed with the Securities and Exchange
           Commission on December 8, 2000.

       (2) On October 18, 2000, Open Market, Inc. (the "Company") announced that
           effective in early November 2000, Betty J. Savage would resign as the
           Company's Vice President and Chief Financial Officer. The Current
           Report on Form 8-K reporting this event was filed with the Securities
           and Exchange Commission October 26, 2000.

                                       69
<Page>
                                   SIGNATURES


    Pursuant to the requirements of Section 13 or 15(d) of the Securities Act of
1934, the Registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.



<Table>
<S>                                                    <C>  <C>
                                                       OPEN MARKET, INC.

                                                       By:              /s/
EDWARD DURKIN

-----------------------------------------
                                                                          Edward
Durkin
                                                            Vice President and
Chief Financial Officer
Date: August 2, 2001                                              (Principal
Financial Officer)

                                                       By:             /s/
ANNMARIE RUSSELL

-----------------------------------------

Annmarie Russell
                                                                    Vice
President of Finance
Date: August 2, 2001                                              (Principal
Accounting Officer)
</Table>


                                       70
<Page>
                                                                     SCHEDULE II

                               OPEN MARKET, INC.
                       VALUATION AND QUALIFYING ACCOUNTS
                                 (IN THOUSANDS)


<Table>
<Caption>
                                                                       ADDITIONS
                                           BALANCE AT    ADDITIONS     CHARGED
TO                 BALANCE AT
                                           BEGINNING       DUE TO      COSTS AND
     AMOUNTS       END OF
                                           OF PERIOD    ACQUISITIONS    EXPENSES
   WRITTEN OFF     PERIOD
                                           ----------   ------------
----------   -----------   ----------
<S>                                        <C>          <C>            <C>
   <C>           <C>
ACCOUNTS RECEIVABLE ALLOWANCES
Bad Debt Allowance.......................    $2,870                      $3,599
     $3,599        $2,870
Sales Returns and Allowances.............     1,260                       3,768
      2,002         3,026
                                             ------      ---------       ------
     ------        ------
December 31, 2000........................    $4,130                      $7,367
     $5,601        $5,896
                                             ======      =========       ======
     ======        ======
Bad Debt Allowance.......................    $2,543                      $  845
     $  518        $2,870
Sales Returns and Allowances.............       393                       1,259
        392         1,260
                                             ------      ---------       ------
     ------        ------
December 31, 1999........................    $2,936                      $2,104
     $  910        $4,130
                                             ======      =========       ======
     ======        ======
Bad Debt Allowance.......................    $1,482                      $1,518
     $  457        $2,543
Sales Returns and Allowances.............       101                         347
         55           393
                                             ------      ---------       ------
     ------        ------
December 31, 1998........................    $1,583                      $1,865
     $  512        $2,936
                                             ======      =========       ======
     ======        ======
</Table>


<Table>
<Caption>
                                           BALANCE AT
           BALANCE AT
                                           BEGINNING
             END OF
                                           OF PERIOD    ADDITIONS   DEDUCTIONS
 OTHER       PERIOD
                                           ----------   ---------   ----------
--------   ----------
<S>                                        <C>          <C>         <C>
<C>        <C>
RESTRUCTURING CHARGE
Year Ended December 31, 2000.............     $  --      $6,948        $ 587
 $3,255      $3,106
                                              -----      ------        -----
 ------      ------
Year Ended December 31, 1999.............     1,088          --        1,088
     --          --
                                              -----      ------        -----
 ------      ------
Year Ended December 31, 1998.............        --       2,042          954
     --       1,088
                                              -----      ------        -----
 ------      ------
</Table>

<Table>
<Caption>
                                           BALANCE AT
            BALANCE AT
                                           BEGINNING
              END OF
                                           OF PERIOD    ADDITIONS   DEDUCTIONS
  OTHER       PERIOD
                                           ----------   ---------   ----------
---------   ----------
<S>                                        <C>          <C>         <C>
<C>         <C>
NON-RECURRING CHARGES
Year Ended December 31, 2000.............     $389      $   --         $139
$    --        $250
                                              ----      ---------      ----
---------      ----
Year Ended December 31, 1999.............       --         389           --
     --         389
                                              ----      ---------      ----
---------      ----
</Table>
<Page>
                                 EXHIBIT INDEX


<Table>
<Caption>
       EXHIBIT
         NO.               DESCRIPTION
---------------------      -----------
<C>                        <S>
          2.1              Agreement and Plan of Merger, dated July 14, 1999 by
and
                           among the Registrant, OM/SA Acquisition Corporation
and
                           FutureTense, Inc. (1)

          3.1 *            Amended and Restated Certificate of Incorporation of
the
                           Registrant, as amended.

          3.2 *            Second Amended and Restated By-laws of the
Registrant.

          4.1              Specimen Certificate for shares of Common Stock,
$.001 par
                           value, of the Registrant. (2)

          4.2              Form of Rights Certificate. (3)

          4.3              Rights Agreement, dated as of January 26, 1998,
between the
                           Registrant and Fleet National Bank (f/k/a BankBoston,
N.A.)
                           as Rights Agent. (4)

          4.4              Amendment No. 1, dated as of February 17, 1999, to
the
                           Rights Agreement, dated as of January 26, 1998,
between the
                           Registrant and Fleet National Bank (f/k/a BankBoston,
N.A.)
                           as Rights Agent. (5)

          4.5              Amendment No. 2, dated as of March 20, 2001, to the
Rights
                           Agreement, dated as of January 26, 1998, between the
                           Registrant and Fleet National Bank (f/k/a BankBoston,
N.A.)
                           as Rights Agent. (6)

         10.1              1994 Stock Incentive Plan, as amended. (2)#

         10.2              1996 Employee Stock Purchase Plan. (2)#

         10.3              Amended and Restated 1996 Director Option Plan. (7)#

         10.4              1999 Stock Incentive Plan. (1)#

         10.5              FutureTense, Inc. 1996 Stock Incentive Plan. (8)#

         10.6              Employment Agreement between the Registrant and Gary
B.
                           Eichhorn, dated November 7, 1995. (2)#

         10.7              Amendment No. 1, dated as of April 15, 1998, to
Employment
                           Agreement between the Registrant and Gary B.
Eichhorn, dated
                           November 7, 1995. (9)#

         10.8              Invention and Non-Disclosure Agreement, dated
November 10,
                           1995, between the Registrant and Gary B. Eichhorn.
(2)

         10.9              Lease between Wayside Realty Trust and Registrant
dated
                           March 11, 1997. (10)

         10.10**           Loan and Security Agreement by and between Silicon
Valley
                           Bank and the Registrant, dated February 28, 2001.

         10.11             Export-Import Bank Loan and Security Agreement
between
                           Silicon Valley Bank and Registrant, dated September
26,
                           1997. (11)

         10.12*            Fourth Loan Modification Agreement (EXIM Line), dated
                           February 28, 2001, to the Export-Import Bank Loan and
                           Security Agreement between Silicon Valley Bank and
                           Registrant, dated September 26, 1997.

         10.13             Securities Purchase Agreement, dated as of July 30,
1998, by
                           and between the Registrant and CMG Information
Services,
                           Inc. (12)

         10.14             Securities Purchase Agreement, dated as of July 30,
1998, by
                           and between the Registrant and Capital Ventures
                           International. (12)

         10.15             Stock Purchase Warrant, dated as of July 30, 1998, by
and
                           between the Registrant and CMG Information Services,
                           Inc. (12)

         10.16             Stock Purchase Warrant, dated July 30, 1998, by and
between
                           the Registrant and Capital Ventures International.
(12)
</Table>


<Page>


<Table>
<Caption>
       EXHIBIT
         NO.               DESCRIPTION
---------------------      -----------
<C>                        <S>
         10.17             Registration Rights Agreement, dated as of July 30,
1998, by
                           and between the Registrant and CMG Information
Services,
                           Inc. (12)

         10.18             Registration Rights Agreement, dated as of July 30,
1998, by
                           and between the Registrant and Capital Ventures
                           International. (12)

         10.19             Form of Executive Retention Agreement entered into by
the
                           Registrant on one hand, and each of the following
executive
                           officers of the Registrant: Joseph Alwan, Ronald
Matros,
                           Gregory Pope, Betty Savage and B.C. Krishna. (10)#

         10.20++           Master Software License and Distribution Agreement,
dated
                           June 30, 1999 between NextPage L.C. and the
                           Registrant. (13)

         10.21++           Amended Master Software License and Distribution
Agreement,
                           dated September 30, 1999 between NextPage, L.C. and
the
                           Company. (14)

         10.22             Form of Employment Agreement entered into by and
between the
                           Registrant and Ronald J. Matros. (8)#

         10.23             Form of Employment Agreement entered into by and
between the
                           Registrant and B.C. Krishna. (8)#

         10.24*            Employment Agreement, dated as of December 1, 2000,
between
                           the Registrant and Harland K. LaVigne. #

         10.25*            Employment Agreement, dated as of November 17, 2000,
between
                           the Registrant and Edward Durkin. #

         10.26*            Executive Retention Agreement, dated as of November
17,
                           2000, between the Registrant and Edward Durkin.

         10.27             Real Estate Purchase and Sale Agreement, dated August
23,
                           2000. (15)

         10.28             Amendment to Real Estate Purchase, dated August 23,
                           2000. (15)

         10.29             Purchase Agreement, dated as of March 20, 2001, by
and among
                           the Registrant and the Purchasers listed therein. (6)

         10.30             Registration Rights Agreement, dated as of March 20,
2001,
                           by and among the Registrant and the Purchasers listed
                           therein. (6)

         10.31             Common Stock Warrant, dated as of March 20, 2001,
issued by
                           the Registrant to Halifax Fund, L.P. (6)

         10.32             Adjustment Warrant, dated as of March 20, 2001,
issued by
                           the Company to Halifax Fund, L.P. (6)

         21.1 *            Subsidiaries of the Registrant.

         23.1 **           Consent of Arthur Andersen LLP.

         23.2 **           Consent of PricewaterhouseCoopers LLP.
</Table>


------------------------


   * Previously filed.



  ** Filed herewith.



  # Denotes management contract or compensatory plan or arrangement.



  ++ Confidential treatment granted as to certain portions which were omitted
     and previously filed separately with the Securities and Exchange
     Commission.


 (1) Incorporated by reference to the Registrant's Registration Statement on
     Form S-4, as amended (File No. 333-84801).

 (2) Incorporated by reference to the Registrant's Registration Statement on
     Form S-1, as amended (File No. 333-03340).
<Page>
 (3) Incorporated by reference to the Registrant's Form 8-A filed January 30,
     1998.

 (4) Incorporated by reference to the Registrant's Current Report on Form 8-K,
     dated January 30, 1998.

 (5) Incorporated by reference to the Registrant's Current Report on Form 8-K,
     dated February 17, 1999.

 (6) Incorporated by reference to Registrant's Current Report on Form 8-K, dated
     March 20, 2001.

 (7) Incorporated by reference to the Registrant's Quarterly Report on
     Form 10-Q for the quarter ended June 30, 2000.

 (8) Incorporated by reference to the Registrant's Annual Report on Form 10-K
     for the year ended December 31, 1999.

 (9) Incorporated by reference to the Registrant's Quarterly Report on
     Form 10-Q for the quarter ended March 31, 1998.

 (10) Incorporated by reference to the Registrant's Annual Report on Form 10-K
      for the year ended December 31, 1997.

 (11) Incorporated by reference to the Registrant's Quarterly Report on
      Form 10-Q for the quarter ended September 30, 1997.

 (12) Incorporated by reference to the Registrant's Current Report on Form 8-K,
      dated July 30, 1998.

 (13) Incorporated by reference to the Registrant's Quarterly Report on
      Form 10-Q for quarter ended June 30, 1999.

 (14) Incorporated by reference to the Registrant's Quarterly Report on
      Form 10-Q for the quarter ended September 30, 1999.

 (15) Incorporated by reference to the Registrant's Quarterly Report on
      Form 10-Q for the quarter ended September 30, 2000.