ACTIVEWORLDS.COM LAUNCHES CONSTRUCTION OF 3D INTERNET SHOPPING MALLS

Market Wire, 20050229

Activeworlds.com (OTC BB: AWLD), the premier developer of three-dimensional interactive software and communities on the Internet, today announced it has received the first financial installment pursuant to its contract with Australian-based internet shopping mall developer, Advanced Shopping Centre Management Pty Limited ("ASCM").

The previously announced agreement between Activeworlds.com and ASCM discussed how Activeworlds.com's revolutionary technology will be utilized and implemented by ASCM to precisely recreate global shopping malls. The agreement called for a series of upfront payments totaling $1.5 million as well as an ongoing revenue stream to be paid as a percentage of gross revenues generated by the malls.

With this initial capital infusion, Activeworlds.com will ramp up the development of the technology to be specifically used by ASCM.

"As we move forward into the development stage of the ASCM project, we will be focusing on creating a unique Internet shopping experience," says Rick Noll, Activeworlds.com CEO, "Our virtual mall technology already enables online merchants to offer features sorely lacking in most of today's e-commerce stores. Activeworlds enables store owners to provide real-time customer support, sales assistance, cross-selling, promotion and individualized care which have traditionally driven sales. The next step is to implement a strong e-commerce backend which will allow for a loyalty program and sales tracking."

"We are a strong believer in the e-commerce revolution," stated Activeworlds.com Chairman JP McCormick. "The utilization of the Active Worlds platform for the construction of Internet-based retail shopping malls and centers solidifies our position as an important mechanism for e-tailers who already have strong programs and newcomers who don't."

About Activeworlds.com, Inc. (http://www.activeworlds.com)

Active Worlds unique technology allows thousands of simultaneous users to build and explore 3D content on the internet in the same shared environment, ideally suited for such applications as e-commerce, chat, and distance learning. Activeworlds.com, Inc. has a worldwide user base of over 900,000. Activeworlds.com, Inc. offers a complete range of client, server, and development applications in a turnkey approach that enables the individual and business users to create rich and compelling online 3-D worlds. The company's 3-D multi-user environment, Active Worlds, is leading the trend towards "social" computing in 3-D, to create a sense of virtual reality. Unlike many other 3D technologies, Active Worlds is totally Internet based and does not require CD-ROMS or high bandwidth connections to display rich 3D content over the web.

About Advanced Shopping Centre Management Pty Limited ("ASCM")

ASCM is an amalgamation of two Australian consulting companies specializing in brick and mortar retailers, retail and commercial property management and wholesale distribution channels. This formation has allowed for the complete investigation of the retail industry and, in particular, the retail distribution channels on the Internet, thus determining a logical direction to retailing and its future. The company provides fully integrate Internet retail solutions that are cost-effective, user friendly and designed to assist both real world retailers and retail property developers alike. The emphasis of these assignments has been on the dealing with and the understanding of the needs of the shopping center industry and retailing as a whole. The directors of ASCM have had a total of more than 50 years experience in retail and property development consulting.

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