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Press release, Jan 5, 2004

Creo Signs Agreement to Resell Xerox Digital Systems; Companies to
Cooperate on Digital Printing Workflow Software Development

Vancouver, BC, Canada and Rochester, NY, Jan. 5, 2004 ? Creo Inc. (NASDAQ:
CREO; TSX: CRE) and Xerox Corporation (NYSE: XRX) announced today that they have
entered into an agreement under which Creo will resell Xerox?s mid-range and
entry-level production color digital presses in the United States and Canada.

Effective February 1, Creo will sell the Xerox DocuColor? 3535, 5252 and 6060
digital color presses combined with the Creo Spire? color server and other
prepress software. In addition, Creo will work with Xerox?s direct sales force
to identify sales opportunities for the DocuColor iGen3 production press.

The reseller agreement allows Xerox to increase the penetration of digital
presses into commercial print establishments and offers Creo the ability to
provide customers with a complete digital printing solution.

?Xerox and Creo have worked together for many years and we share a vision for
how digital print can help commercial printers be more successful,? stated Amos
Michelson, Creo chief executive officer. ?With this agreement, we will be able
to support our customers in their move to a combined offset and digital printing

Under the new agreement, Creo will provide system analysis and applications
support for the prepress workflow software systems including the Spire color
server, while Xerox will provide service and support for the digital presses.
Xerox will continue to sell the Scitex Spire color server as part of its
complete digital print portfolio through existing Xerox channels.

The companies also announced that they will cooperate on the development of
workflow software that increases the value of digital print for production
customers. Xerox and Creo are both supporters of Networked Graphic Production? (NGP?)
? the industry-wide initiative with over 30 partners working to automate the
entire print production process and create an efficient, collaborative
environment between management and production systems. NGP Partners are
committed to working together to deliver seamlessly integrated, cross-vendor
solutions that decrease cycle times, cut costs and increase revenues. Xerox and
Creo expect that their unified workflow software developments will be leading
examples of the application of open industry standards. The first examples of
the collaborative development are expected to be demonstrated at the upcoming
Drupa 2004 tradeshow in May.

?Creo?s relationships with commercial printers and its dominant installed base
of prepress workflow systems mean that we can bring the value of digital
printing to more customers by working together,? said Gil Hatch, president,
Xerox Production Systems Group. ?Our joint product development will address our
customers? workflow challenges to provide more efficient processes and deliver
greater productivity.?

The combined future digital workflow solutions will allow printing professionals
to tightly integrate digital printing into their current production operations.
For instance, initial work on a project can be completed without a commitment to
any particular method of print. At the click of a mouse, operators will
instantly direct work to either a digital or an offset press and intervening
prepress steps like imposition, formatting and color calibration will be
automatically executed. This workflow allows customers to deliver a full range
of printed products with unmatched quality and efficiency.