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                                  UNITED STATES

                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

            QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                  FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2000
                  ---------------------------------------------

                         Commission File Number 0-21041

                               EXCELON CORPORATION
                               -------------------
             (Exact name of registrant as specified in its charter)


          Delaware                                               02-0424252
          --------                                               ----------
 (State or other jurisdiction of                              (I.R.S.  Employer
 incorporation or organization)                              Identification No.)


     25 Mall Road, Burlington, MA                                     01803
     ----------------------------                                     -----
(Address of principal executive offices)                            (Zip Code)


       Registrant's telephone number, including area code: (781) 674-5000

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
                                   ---         ---

                The  number of shares  outstanding  of the  registrant's  common
stock as of April 30, 2000 was 29,322,530.

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<PAGE>




EXCELON CORPORATION

INDEX TO FORM 10-Q

<TABLE>
<CAPTION>

PART I - FINANCIAL INFORMATION                                                        Page
                                                                                      ----
<S>                                                                                   <C>
Item 1.  Financial Statements

         Consolidated Balance Sheets as of March 31, 2000 and December 31, 1999         3

         Consolidated Statements of Operations for the Three Months
         Ended March 31, 2000 and 1999                                                  4

         Consolidated Statements of Cash Flows for the Three Months
         Ended March 31, 2000 and 1999                                                  5

         Notes to the Consolidated Financial Statements                                 6

Item 2.  Management's Discussion and Analysis of Financial   Condition
         and Results of Operations                                                      7

Item 3.  Quantitative and Qualitative Disclosures About Market Risk                     11



PART II - OTHER INFORMATION

Item 1. Legal Proceedings                                                               11

Item 4. Submission of Matters to a Vote of Security Holders                             11

Item 6. Exhibits and Reports on Form 8-K                                                11

Signatures                                                                              13


                                       2
<PAGE>



ITEM 1.  FINANCIAL STATEMENTS

eXcelon Corporation
Consolidated Balance Sheets
(in thousands, except shares)

                                                                            March 31,          December 31,
                                                                               2000               1999
                                                                          ---------------    ---------------
Assets                                                                      (Unaudited)

Current assets:
     Cash and cash equivalents                                            $   15,362         $   13,847
     Short-term investments                                                    4,977              5,327
     Accounts receivable, net                                                 13,708             13,902
     Prepaid expenses and other current assets                                 1,283                946
                                                                          ------------       -------------
Total current assets                                                          35,330             34,022

Property and equipment, net                                                    5,063              5,169
Marketable securities                                                          3,982              4,589
Capitalized software, net                                                      2,572              2,503
Other assets                                                                   1,117              1,122
                                                                          ------------       ------------
Total assets                                                              $   48,064         $   47,405
                                                                          ============       ============

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
     Current portion of capital lease obligations                          $       -         $       17
     Accounts payable                                                          3,991              3,404
     Accrued expenses                                                          3,532              3,898
     Accrued compensation                                                      2,575              2,876
     Deferred revenue                                                          7,946              7,697
                                                                          ------------       ------------
Total current liabilities                                                     18,044             17,892

Stockholders' equity:
  Preferred stock, $.01 par value; authorized 5,000,000
       shares; no shares issued or outstanding                                     -                  -
  Common stock, $.001 par value; authorized 200,000,000 shares;
     29,233,592 and 28,117,730 shares issued and outstanding
                                                                                  29                 29
  Additional paid-in capital                                                  69,861             66,731
  Accumulated deficit                                                        (35,764)           (35,054)
  Accumulated other comprehensive loss                                        (3,533)            (1,620)
  Advances to stockholders                                                      (573)              (573)
                                                                          -------------      -------------
Total stockholders' equity                                                    30,020             29,513
                                                                          -------------      -------------
Total liabilities and stockholders' equity                                $   48,064         $   47,405
                                                                          =============      =============


                       The accompanying notes are an integral part of the consolidated financial statements.
</TABLE>

                                        3
<PAGE>

  eXcelon Corporation
  Consolidated Statements of Operations
  Unaudited
  (in thousands, except per share data)

<TABLE>
<CAPTION>

                                                                Three Months Ended
                                                                    March 31,
                                                  -----------------------------------------------
                                                                2000                      1999
<S>                                                         <C>                         <C>
Revenues:
   Software                                                  $ 10,074                    $8,204
   Services                                                     6,930                     4,904
                                                               ------                     -----
      Total revenues                                           17,004                    13,108
Cost of revenues:
   Cost of software                                               633                       418
   Cost of services                                             3,760                     2,985
                                                                -----                     -----
      Total cost of revenues                                    4,393                     3,403

Gross profit                                                   12,611                     9,705
Operating expenses:
   Selling and marketing                                        9,105                     7,981
   Research and development                                     3,020                     2,470
   General and administrative                                   1,537                     1,528
                                                                -----                     -----
      Total operating expenses                                 13,662                    11,979

Operating loss                                                 (1,051)                   (2,274)
Other income, net                                                 341                       265
                                                                -----                     -----
Net loss                                                       $ (710)                 $ (2,009)
                                                               =======                 =========

Loss per share:
Basic                                                         $ (0.02)                   $ (0.07)
Diluted                                                       $ (0.02)                   $ (0.07)

Weighted average shares outstanding:

Basic                                                          29,085                     28,088
Diluted                                                        29,085                     28,088




                       The accompanying notes are an integral part of the consolidated financial statements.
</TABLE>

                                       4
<PAGE>


eXcelon Corporation
Consolidated Statements of Cash Flows
Unaudited
(in thousands)

<TABLE>
<CAPTION>
                                                                              Three Months Ended
                                                                                   March 31,
                                                                           2000                 1999
                                                                   -------------------------------------
<S>                                                                     <C>                 <C>
Cash flows from operating activities:

   Net loss                                                               $ (710)             $(2,009)
   Adjustments to reconcile net loss to net
     cash provided by operating activities:
     Depreciation and amortization                                         1,039                  602
     Bad debt expense                                                         26                  350
     Other                                                                    15                   20
Changes in operating assets and liabilities:

     Accounts receivable                                                      96                1,531
     Prepaid expenses and other current assets                              (339)                (241)
     Other assets                                                             (8)                 (51)
     Accounts payable and accrued expenses                                   (29)                (682)
     Deferred revenue                                                        391                  704
                                                                             ---                  ---
Net cash provided by operating activities                                    481                  224
                                                                             ---                  ---

Cash flows from investing activities:

     Capital expenditures                                                   (500)                (419)
     Purchased Software                                                     (325)                 (40)
     Purchases of marketable securities                                   (2,384)              (4,006)
     Proceeds from maturities and sales of marketable securities           3,341                6,062
                                                                           -----                -----
Net cash provided by investing activities                                    132                1,597
                                                                             ---                -----
Cash flows from financing activities:

     Proceeds from the issuance of common stock                            1,156                  157
     Purchases of treasury stock                                               -                 (247)
     Repayments of capital lease obligations                                 (17)                  (3)
                                                                            ----                  ---
Net cash provided by (used for) financing activities                       1,139                  (93)
                                                                           -----                  ----

Effect of exchange rate changes on cash                                     (237)                (133)
                                                                            -----                -----

Net change in cash and cash equivalents                                    1,515                1,595

Cash and cash equivalents, beginning of period                            13,847               14,846
                                                                          ------               ------
Cash and cash equivalents, end of period                                $ 15,362             $ 16,441
                                                                        ========             ========

                       The accompanying notes are an integral part of the consolidated financial statements.
</TABLE>


                                       5
<PAGE>

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

A.  BASIS OF PRESENTATION

The  consolidated   financial   statements   include  the  accounts  of  eXcelon
Corporation  and its wholly owned  subsidiaries.  All  significant  intercompany
transactions  and balances have been  eliminated.  In the opinion of management,
the  accompanying   unaudited  consolidated  financial  statements  contain  all
adjustments,  consisting only of those of a normal recurring  nature,  necessary
for a fair presentation of our financial  position,  results of operations,  and
cash flows at the dates and for the periods indicated. While we believe that the
disclosures presented are adequate to make the information not misleading, these
financial  statements  should  be  read in  conjunction  with  the  consolidated
financial  statements  and related  notes  included in our Annual Report on Form
10-K for the year ended  December 31,  1999.  Certain  information  and footnote
disclosures  normally  included in financial  statements  prepared in accordance
with generally  accepted  accounting  principles  have been condensed or omitted
pursuant to Securities and Exchange  Commission rules and  regulations.  Certain
reclassifications  have been made for consistent  presentation.  We operate in a
single industry segment: computer software and related services.

The  results  for the three  months  ended  March 31,  2000 are not  necessarily
indicative  of the  results to be  expected  for the entire  fiscal  year ending
December 31, 2000.

B.  NET LOSS PER SHARE

Basic   earnings   per  share  is  computed  by  dividing   net  income  by  the
weighted-average  number of common shares  outstanding  for the period.  Diluted
earnings  per  share  is  computed  by  dividing  net  income  by the sum of the
weighted-average  number of common  shares  outstanding  for the period plus the
number of common  shares  issuable  upon the assumed  exercise  of all  dilutive
securities,  such as stock  options.  The following is a calculation of earnings
per  share  ("EPS")  for the three  months  ended  March  31,  2000 and 1999 (in
thousands, except per share amounts):

                                                        2000          1999
                                                        ----          ----

Net loss                                             $ (710)     $ (2,009)
                                                     =======     =========

Weighted average shares outstanding:                  29,085        28,088
Stock options (dilutive)                                   -             -
                                                  ----------    ----------
Diluted shares                                        29,085        28,088
                                                      ======        ======

Basic EPS                                           $ (0.02)      $ (0.07)
Diluted EPS                                         $ (0.02)      $ (0.07)

Options  to  purchase  4,489,211  and  1,960,765  shares  of common  stock  were
outstanding for the three months ended March 31, 2000 and 1999, respectively but
were  excluded  from the  computations  of  diluted  earnings  per  share as the
inclusion  of these  shares  would have been  anti-dilutive  due to the net loss
incurred in both periods presented.

C.   COMPREHENSIVE INCOME

The table below sets forth  comprehensive loss for the three-month periods ended
March 31, 2000 and 1999 (in thousands):

                                                          2000           1999
                                                          ----           ----

Net loss                                               $ (710)      $ (2,009)
Accumulated other comprehensive loss:
  Foreign currency translation adjustments               (135)          (341)
  Net unrealized loss on marketable securities             (2)            (5)
                                                       -------      ---------
Comprehensive loss                                     $ (847)      $ (2,355)
                                                       =======      =========

                                        6
<PAGE>

D.  NEW ACCOUNTING STANDARDS

In March 2000, the Financial  Accounting  Standards Board ("FASB") released FASB
Interpretation  No. 44,  "Accounting  for Certain  Transactions  Involving Stock
Compensation"  ("FIN 44"),  an  interpretation  of Accounting  Principles  Board
Opinion No. 25,  "Accounting  for Stock Issued to Employees"  ("APB 25"). FIN 44
provides  guidance  for  certain  issues  that  arise  in  applying  APB 25.  We
anticipate that the adoption of FIN 44 will not have a significant effect on our
financial position and results of operations.

In December 1999, the  Securities and Exchange  Commission  ("SEC") issued Staff
Accounting  Bulletin No. 101,  "Revenue  Recognition  in Financial  Statements,"
("SAB 101") as amended by SAB 101A, which is effective no later than the quarter
ending June 30, 2000. SAB 101 clarifies the SEC's views regarding recognition of
revenue.  We will adopt SAB 101 in the second  quarter of 2000 and are currently
evaluating the effects it will have. We anticipate  that the adoption of SAB 101
will not have a  material  effect  on our  financial  position  and  results  of
operations.

On June 15, 1998, the FASB issued Statement of Financial Accounting Standard No.
133,  "Accounting  for Derivative  Instruments  and Hedging  Activities"  ("SFAS
133").  SFAS 133 is effective  for fiscal years  beginning  after June 15, 2000.
SFAS 133 requires  that all  derivative  instruments  be recorded on the balance
sheet at their fair values.  Changes in fair values of derivatives  are recorded
each period in current  earnings or other  comprehensive  income,  depending  on
whether a derivative is designated as part of a hedge transaction and, if it is,
depending on the type of hedge  transaction.  We anticipate that the adoption of
SFAS 133 will not have a material  effect on our financial  position and results
of operations.

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS

FORWARD-LOOKING STATEMENTS

This Report contains forward-looking statements, which reflect the current views
of  management  with  respect to future  events  that will have an effect on our
future financial performance,  including without limitation statements regarding
future  revenue  and  expense  levels,  the impact of various  legal  claims and
adequate  liquidity to meet our capital and operating  requirements for the next
twelve  months.   These  statements  include  the  words  "expect,"   "believe,"
"estimate,"  and similar  expressions.  Such  statements  are not  guarantees of
future  performance,  and involve certain risks,  uncertainties  and assumptions
that could cause our future results to differ materially from those expressed in
any forward-looking  statements.  We disclaim any intent or obligation to update
publicly any forward-looking  statements whether in response to new information,
future  events or  otherwise.  Important  information  about the basis for those
assumptions and factors that could cause our actual results to differ materially
from these forward-looking  statements is contained in "Certain Factors That May
Affect Future  Results"  included in  "Management's  Discussion  and Analysis of
Financial  Condition  and Results of  Operations"  contained  in our 1999 Annual
Report on Form 10-K, which section is incorporated herein by reference.

RESULTS OF OPERATIONS

The following table shows certain consolidated financial data as a percentage of
our total revenue for the three months ended March 31, 2000 and 1999:


                                       7
<PAGE>

                                          Three Months Ended
                                                March 31,
                                            2000         1999
                                    --------------------------------

Total revenues:                             100%        100%
                                            ----        ----

Cost of revenues:
  Software                                     4           3
  Services                                    22          23
                                            ----        ----
Total cost of revenues                        26          26
                                            ----        ----

Gross profit                                  74          74
                                            ----        ----

Operating expenses:
  Selling and marketing                       53          60
  Research and development                    18          19
  General and administrative                   9          12
                                            ----        ----
Total operating expenses                      80          91
                                            ----        ----

Operating loss                               (6)        (17)

Other income, net                              2           2
                                            ----        ----

Net loss                                    (4)%       (15)%
                                            ====       =====


                                       8
<PAGE>


TOTAL  REVENUES.  Our total  revenues  increased to $17.0  million for the three
months  ended  March 31,  2000 from $13.1  million for the same period for 1999,
reflecting a 41.3% increase in service revenues and a 22.8% increase in software
revenues.  This increase was primarily due to increased  demand for our recently
expanded line of business-to-business ("B2B") products and services.

SOFTWARE  REVENUES.  Software revenues  increased 22.8% to $10.1 million for the
three months ended March 31, 2000 from $8.2 million for the same period in 1999.
This increase was primarily  due to increased  sales of B2B software,  including
our new B2B  Integration  Server,  which was  released in March 2000,  partially
offset by a decline in our Data Server  software  revenues.  We expect  software
license  revenues  from our B2B  business to increase in future  periods.  As we
continue  to  place  greater  focus on our B2B  product  line,  our Data  Server
software license revenues may stabilize or decline in future periods. The timing
of closing  large-sized  software deals could result in  fluctuations  of future
software license revenues in any quarter.

SERVICES  REVENUES.  Services  revenues  increased 41.3% to $6.9 million for the
three months ended March 31, 2000 from $4.9 million for the same period in 1999.
The  increase is due to higher  demand for our  consulting  services  related to
customer  deployments  of our  software  and  to  higher  maintenance  revenues,
reflecting continued growth in our installed base of Data Server and B2B product
lines.  We  plan  to  hire  additional   consulting  personnel  during  2000  to
accommodate  projected  additional growth for our consulting  services driven by
our expectation of growing B2B software revenues in future periods.

REVENUES  FROM  INTERNATIONAL  OPERATIONS.   Revenues  from  operations  of  our
international  subsidiaries  increased as a percentage of our total revenues, to
48.5% for the three months ended March 31, 2000  compared  with 44% for the same
period in 1999.  The  increase in  international  revenues as a percent of total
revenues was primarily due to growth in the Asia Pacific region.

COST OF  SOFTWARE.  Cost of software  increased  51.4% to $633,000 for the three
months ended March 31, 2000 compared to $418,000 for the same period in 1999 and
increased  as a percent  of  software  revenues  to 6.2% from 5.1% for the first
three  months  of 2000 and 1999,  respectively.  The  increase  is due to higher
amortization  expense  associated with  additional  purchases of technology from
third  parties  in 1999 and 2000 for  inclusion  in our  recently  expanded  B2B
product line.

COST OF SERVICES. Cost of services increased 26.0% to $3.8 million for the three
months  ended March 31,  2000 from $3.0  million for the same period in 1999 and
decreased  as a  percent  of  services  revenues  to 54.2%  from  60.9%  for the
corresponding  periods.  The  increase  in cost of services  reflects  growth in
staffing necessary to generate and support increased worldwide services revenues
and to provide  customer  support  to our  installed  base.  The  decrease  as a
percentage of revenues  reflects higher  utilization of consulting  personnel as
well as increased maintenance revenue, which has a higher margin.

SELLING AND MARKETING.  Selling and marketing  expenses  increased 14.1% to $9.1
million for the three months ended March 31, 2000 from $8.0 million for the same
period in 1999 and  decreased  as a percentage  of total  revenues to 53.5% from
60.9% for the same periods.  The increase in dollars reflects the cost of hiring
additional  sales and marketing  personnel,  the  development  of expanded sales
distribution  channels,  and an increase in promotional activities and marketing
programs,  primarily  relating to our Dynamic B2B  Solutions  product  line.  We
expect selling and marketing expense to continue to increase in absolute dollars
in future  periods,  but to  remain  at  approximately  the same  percentage  of
revenues as for the quarter ended March 31, 2000.

RESEARCH AND DEVELOPMENT.  Research and development  expenses increased 22.3% to
$3.0 million for the three months ended March 31, 2000 from $2.5 million for the
same period in 1999 and  decreased as a percent of total  revenues to 17.8% from
18.8% for the same  periods.  The  increase  in  dollars  was  primarily  due to
increased  staffing  associated with our recently expanded Dynamic B2B Solutions
product line.

GENERAL AND ADMINISTRATIVE.  General and administrative  expenses increased 0.6%
to $1.54  million for the three  months ended March 31, 2000 from $ 1.53 million
in 1999 and decreased as a percentage  of total  revenues to 9.0% from 11.7% for
the same periods.  We expect general and  administrative  expense to continue to
increase in absolute  dollars in future periods,  but to remain at approximately
the same percentage of revenues as for the quarter ended March 31, 2000.

                                       9
<PAGE>

OTHER INCOME.  Other income  increased  28.7%,  to $341,000 for the three months
ended March 31, 2000 from  $265,000  for the same period for 1999.  The increase
was largely the result of increased  cash balances and higher rates of return on
our cash and investments.

PROVISION  FOR INCOME  TAXES.  No income  taxes were  provided  during the three
months  ended  March 31, 2000 and 1999 due to the net losses we incurred in both
periods.

LIQUIDITY AND CAPITAL RESOURCES

At March 31, 2000, our principal sources of liquidity  included $24.3 million of
cash,  cash  equivalents and short-term  investments,  as well as a $2.0 million
revolving line of credit with Silicon Valley Bank.  Availability  under the line
of credit,  expiring  September 2000, is based on a formula of eligible accounts
receivable,  subject  to  compliance  with  certain  covenants.  Borrowings  are
collateralized by our assets, excluding intellectual property, and bear interest
at the bank's prime rate. At March 31, 2000, no borrowings were outstanding, and
we were in  compliance  with the  bank's  covenants.  A letter  of credit in the
amount of $325,000 under the line of credit was outstanding at that date.

Net cash provided by our operating  activities was $481,000 for the three months
ended March 31, 2000, as compared to $224,000  provided by operating  activities
for the same period in 1999.  The increase in cash provided was primarily due to
a lower net loss combined with higher levels of depreciation  and  amortization,
offset by  changes  in  various  working  capital  items,  principally  accounts
receivable, during the three months ended March 31, 2000 as compared to the same
period in 1999.

Our investing  activities  provided  $132,000 of cash for the three months ended
March 31, 2000, as compared  with cash provided by investing  activities of $1.6
million for the same period in 1999. The decrease in cash provided was primarily
attributable  to the net sale of  $957,000  of  marketable  securities  in 2000,
compared to the net sale of $2.1 million of  marketable  securities in the first
three months of 1999.

Our financing  activities provided net cash of $1.1 million for the three months
ended  March 31,  2000,  as  compared  to  $93,000  of cash  used for  financing
activities  in the same  period  in 1999.  The  increase  in cash  provided  was
primarily due to an additional $1.0 million in cash from stock option  exercises
during the three  months  ended  March 31,  2000  compared to the same period in
1999,  as well as the  non-recurring  purchase of  $247,000  of treasury  shares
during the 1999 period.

We believe that our current cash, cash equivalents,  marketable securities, bank
facilities and funds generated from  operations,  if any, will provide  adequate
liquidity  to meet our capital and  operating  requirements  for the next twelve
months.

EURO CONVERSION

On January 1, 1999, eleven of the fifteen member countries of the European Union
established fixed conversion rates between their existing  sovereign  currencies
and the Euro,  making the Euro their  common  legal  currency on that date.  The
legacy  currencies  will remain legal tender in the  participating  countries as
denominations  of the Euro  between  January  1, 1999 and  January  1, 2002 (the
"transition period").

During the transition  period,  public and private parties may pay for goods and
services using either the Euro or the participating country's legacy currency on
a "no compulsion,  no prohibition"  basis.  However,  conversion rates no longer
will be  computed  directly  from one legacy  currency to  another.  Instead,  a
triangular  process  will  apply  whereby  an amount  denominated  in one legacy
currency will first be converted into the Euro.  The resultant  Euro-denominated
amount will then be converted into the second legacy currency.

                                       10
<PAGE>

We have evaluated the business implications of conversion to the Euro, including
technical adaptation of information  technology and other systems to accommodate
Euro-denominated   transactions,   long-term  competitive  implications  of  the
conversions and the effect on market risk with respect to financial  instruments
and do not expect a material impact on our operations.

NEW ACCOUNTING STANDARDS

In March 2000, the Financial  Accounting  Standards Board ("FASB") released FASB
Interpretation  No. 44,  "Accounting  for Certain  Transactions  Involving Stock
Compensation"  ("FIN 44"),  an  interpretation  of Accounting  Principles  Board
Opinion No. 25,  "Accounting  for Stock Issued to Employees"  ("APB 25"). FIN 44
provides  guidance  for  certain  issues  that  arise  in  applying  APB 25.  We
anticipate that the adoption of FIN 44 will not have a significant effect on our
financial position and results of operations.

In December 1999, the  Securities and Exchange  Commission  ("SEC") issued Staff
Accounting  Bulletin No. 101,  "Revenue  Recognition  in Financial  Statements,"
("SAB 101") as amended by SAB 101A, which is effective no later than the quarter
ending June 30, 2000. SAB 101 clarifies the SEC's views regarding recognition of
revenue.  We will adopt SAB 101 in the second  quarter of 2000 and are currently
evaluating the effects it will have. We anticipate  that the adoption of SAB 101
will not have a  material  effect  on our  financial  position  and  results  of
operations.

On June 15, 1998, the FASB issued Statement of Financial Accounting Standard No.
133,  "Accounting  for Derivative  Instruments  and Hedging  Activities"  ("SFAS
133").  SFAS 133 is effective  for fiscal years  beginning  after June 15, 2000.
SFAS 133 requires  that all  derivative  instruments  be recorded on the balance
sheet at their fair values.  Changes in fair values of derivatives  are recorded
each period in current  earnings or other  comprehensive  income,  depending  on
whether a derivative is designated as part of a hedge transaction and, if it is,
depending on the type of hedge  transaction.  We anticipate that the adoption of
SFAS 133 will not have a material  effect on our financial  position and results
of operations.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

There have been no significant  changes in our market risk exposure as described
in  Management's  Discussion and Analysis of Financial  Condition and Results of
Operations included in our 1999 Annual Report on Form 10-K and which description
is incorporated herein by reference.

PART II: OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

We are  subject  to  various  legal  proceedings  and  claims  that arise in the
ordinary course of business.  We currently  believe that resolving these matters
will  not  have  a  material  adverse  impact  on  our  consolidated   financial
statements.

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

On January 27, 2000, a Special Meeting of  Stockholders  was held in Burlington,
Massachusetts  to act upon a proposal to further  amend our Amended and Restated
Certificate  of  Incorporation  to change the name of our  Company  from  Object
Design, Inc. to eXcelon Corporation.  This matter was voted upon and approved by
the stockholders of the Company at the meeting as follows:

FOR               AGAINST           ABSTAIN

24,322,611        40,736            67,335


                                       11
<PAGE>

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

(a)    Exhibits

EXHIBIT NUMBER                              DESCRIPTION

*3.3      Amended and Restated Certificate of Incorporation
*3.5      Amended and Restated By-laws of the Company
 3.6      Certificate  of  Amendment  of Amended  and  Restated  Certificate  of
          Incorporation dated January 27, 2000 (filed herewith)
27.1      Financial Data Schedule (filed herewith)

* This exhibit is  incorporated by reference to the similarly  numbered  exhibit
filed as part of the Company's  Registration  Statement on Form S-1,  Securities
and Exchange Commission File No. 333-05241.

(b)   Reports on Form 8-K

No reports on Form 8-K were filed during the quarter ended March 31, 2000.


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<PAGE>

SIGNATURES

Pursuant to the  requirements  of the Securities  Exchange Act of 1934,  eXcelon
Corporation  has duly caused this Quarterly  Report on Form 10-Q to be signed on
its behalf by the undersigned, thereunto duly authorized.

                                 EXCELON CORPORATION
                                 (Registrant)

May 12, 2000                     By: /s/ Robert N. Goldman
                                   -------------------------------------
                                   Robert N. Goldman
                                   President and Chief Executive Officer


May 12, 2000                     By: /s/ Lacey P. Brandt
                                   -------------------------------------
                                   Lacey P. Brandt
                                   Chief Financial Officer



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