Filed by Centra Software, Inc.
                                                  pursuant to Rule 425 under the
                                              Securities Act of 1933, as amended
                                               and deemed filed pursuant to Rule
                                                     14a-12 under the Securities
                                                Exchange Act of 1934, as amended

                                                                Subject Company:
                                                           Centra Software, Inc.
                                                   Commission File No. 000-27861

              Transcript of Fourth Quarter Earnings Conference Call
                            of Centra Software, Inc.

     This filing is made to publish the following transcript of the fourth
quarter earnings conference call of Centra Software, Inc. including
presentations by Leon Navickas, Chairman of the Board and Chief Executive
Officer of Centra, and Stephen A. Johnson, Chief Financial Officer, Treasurer
and Secretary of Centra.

                              Centra Software, Inc.
                     Fourth Quarter Earnings Conference Call
                                January 24, 2002
                                   5:30 pm EST

Operator:           Good day - afternoon - good afternoon ladies and gentlemen,
                    welcome to Centra's 2001 Fourth Quarter and Year End
                    teleconference call. At this time, all participants are in a
                    listen-only mode. Later, we will conduct a question-and-
                    answer session and instructions will follow at that time. If
                    anyone should require assistance during the call, please
                    press the star key followed by the 0 on your touch-tone
                    phone. As a reminder, ladies and gentlemen, this conference
                    is being recorded. In addition, this teleconference is the
                    copyrighted material of Centra Software. Any use,
                    dissemination, or reproduction of this teleconference is
                    unlawful without the express written permission of Centra.

                    I would now like to introduce your host for today's
                    conference call, Mr. Corrie Cutler from Morgan Walke
                    Associates. Please go ahead sir.

Corrie Cutler:      Thank you operator. Good afternoon everyone and welcome to
                    Centra's conference call. By now you should have received a
                    copy of the company's press release. If you have not, please
                    call my office at 212-850-5664 and a copy will be faxed to

                    With us this afternoon are Leon Navickas, Chief Executive
                    Officer, Tony Mark, President and Chief Operating Officer,
                    and Steve Johnson, Chief Financial Officer.

                    After management has completed a review of the quarter, we
                    will open the call for questions.

                    Before management begins their formal remarks, I'd like to
                    read the following safe harbor language.

                    This call may contain forward-looking statements that
                    involve risks and uncertainties regarding Centra Software.
                    Investors are cautioned that such results or events
                    predicted in these statements may differ materially from
                    actual future events or results. These risks factors include
                    but not are limited to technologically - excuse me,
                    technological difficulties, the results of future research,
                    lack of product demand and market acceptance for future and
                    current products, the effect of economic conditions, the
                    impact of competitive products and pricing, and other
                    factors outside the control of the company which are
                    detailed from time to time in the company's SEC reports.

                    Now let's turn the call over to Centra's Chief Executive
                    Officer, Mr. Leon Navickas.

Leon Navickas:      Good afternoon and thank you for joining us today. Our
                    agenda is as follows. First, I'll provide an overview of
                    Centra's performance across the various aspects of our
                    business during the fourth quarter and year ended December
                    31, 2001, and briefly comment on the announcement of our
                    plans to merge with SmartForce. Following that Steve
                    Johnson, Centra's Chief Financial Officer, will report on
                    the company's financial results. We will conclude this
                    conference call with a question and answer period. So
                    without further ado let's begin.

                    At our last quarterly conference call in October we
                    delivered news that despite demand for our solutions, our
                    ability to close business in Q3 had been directly impacted
                    by unforeseen economic and geopolitical events. Sales cycles
                    lengthened as prospects paused to evaluate the ramifications
                    on their own business and reassess expenditures. Fortunately
                    no deals were cancelled, only deferred.

                    Today, I am pleased to report to you that we had a strong
                    fourth quarter. Demand for our products and services has
                    heightened as a result of these challenging economic times
                    and we continue to win the majority of the competitive
                    evaluations that we participate in. In fact, we grew our
                    market share by signing a record number of new customers in
                    the fourth


                    quarter and closing most of the deals that were delayed by
                    economic concerns in the third quarter.

                    For the year, we grew our international sales and our ASP
                    business according to plan, extended our platform with the
                    acquisition and successful integration of Mindlever,
                    generated significant traction and momentum in sales of the
                    knowledge products, and managed our business to achieve
                    Centra's first cash flow positive quarter.

                    In Q4 Centra generated a record $11 million in revenue,
                    meeting the analysts' consensus estimates. This represents a
                    20% increase from $9.2 million in the third quarter and a
                    41% increase over the same period last year. The company
                    came in on target for the year with $39.1 million in total
                    revenue. A 70% increase over last year. In addition to the
                    increased revenues for the fourth quarter, bookings were the
                    highest in the company's history providing positive momentum
                    into 2002.

                    Pro forma EPS loss for Q4 was 8 cents per share, bettering
                    analysts estimates by 1 penny and down from a pro forma loss
                    of 14 cents per share for the third quarter. For the year
                    2001, pro forma EPS loss was 47 cents per share, versus a
                    pro forma EPS loss of 57 cents per share in 2000.

                    Our gross margins improved this quarter on the strength of
                    our software business model, up 400 basis points
                    sequentially from the previous quarter to 84%. Most of this
                    increase can be attributed to higher margins for both
                    Centra's ASP service and for our professional services

                    Software license revenue, which accounted for 69% of total
                    revenue for the quarter, was $7.6 million. A 21% increase
                    over the same period last year and an 18% increase
                    sequentially over the prior quarter.

                    Services revenue for the quarter, driven by a surge in
                    demand over the second half of 2001 for the company's
                    products delivered on a subscription basis by ASP model,
                    increased by 24% over the previous quarter to $3.4 million.

                    The company had a very strong quarter for new customer
                    acquisition signing 97 new accounts. This brings the total
                    roster of customers worldwide to over 775, serving a
                    population of nearly 2 million licensed users. New customers
                    include Ameritas, AutoNation, BMW, CheckFree,
                    CitiFinancial, Deutsche Telekom, Genentech, Cambar and
                    Barkley, Hitachi, Iron Mountain, Kinkos, Navidmedix and NCR
                    Teradata, New Balance, Queensland Rail, Sybase,
                    Underwriters Laboratories, University of Michigan, and
                    University of Montreal.


                    Through efforts to advance customer propagation more than
                    50% of total revenue in the fourth quarter came from our
                    install base corporations, government agencies, and

                    Organizations that added central licenses to their existing
                    deployments included Aventis, Cadbury Schweppes, Cingular,
                    ConAgra, Daimler-Chrysler, FirstUnion, France Telecom,
                    McKesson, Nortel Networks, Novartis, Ortho-McNeil,
                    PricewaterhouseCoopers, Siemens, and the US Internal Revenue

                    Other highlights of the quarter included the delivery of
                    CentraOne 5.3, which provides significant new recording
                    capabilities and out of the box support of Centra Knowledge
                    Catalogue, the unique product extension that gives users
                    instant access to searchable, self-service library of
                    knowledge objects, Centra recordings, and other third party
                    content from their Centra home page. These major
                    enhancements to CentraOne further reinforce the online
                    collaborative learning experience and maximize customers
                    investments through unparalleled support for standards that
                    insure interoperability and content reusability across a
                    broad range of live and self-paced delivery formats.

                    During the quarter we also strengthened our partner
                    ecosystem while deepening relationships with KPMG and PwC
                    Consulting, two of the world's largest professional services
                    firms. In Q4 KPMG Consulting Europe announced the
                    integration of Centra into a new end-to-end interactive
                    learning solution called ILS. And PwC Consulting selected
                    Centra to provide e-learning and real-time collaboration
                    capabilities to their global 2000 customers through a new
                    business initiative known as B2E.

                    Other new solution partners in Q4 included agreements with
                    Blackboard, DK Systems, Edcor, ePharmaLearning, Epiance, The
                    Forum Corporation, GP e-Learning Technologies, Plateau
                    Systems and Richardson.

                    Altering our growing international presence, Centra
                    established a sales office in Germany increasing its ability
                    to acquire and manage clients in one of the fastest growing
                    markets in Europe. Working closely with its local
                    distribution pattern, TERTIA Edusoft GmbH, Centra has added
                    some of the most prestigious organizations in Germany to its
                    customer list including Deutsche Telekom, Siemens AG, and
                    Sony Europe GmbH.

                    In Asia, a newly formed e-learning initiative group called
                    the EIG, comprised of Oracle Corporation, Global Knowledge,
                    CSK Corporation and Macnica, which is Centra's exclusive
                    distribution partner in Japan, announced that it will
                    underpin its offerings with Centra's real-time


                    collaboration platform to accelerate the adoption of
                    e-learning and collaboration within corporations across

                    Centra also added four new distribution partners to its
                    international indirect sales channel in Q4 expanding
                    coverage in the Nordics and Latin America.

                    I'm very proud of the Centra team of employees and business
                    partners in achieving these results. We entered 2002 with
                    great expectations to see our business grow and flourish

                    So now, let me spend a moment on a topic of our business
                    combination with SmartForce. First of all, we see this as
                    two phenomenally successful and market leading companies
                    coming together to meet real customer demand.

                    While more and more businesses deploy e-learning solutions
                    to accelerate knowledge transfer and increase human
                    interaction at lower cost, customers worldwide are looking
                    for one vendor to deliver solutions, not just component
                    technologies and point products. With Centra this vendor is
                    now SmartForce. As one company we plan to integrate the
                    strongest elements of our respected technology creating the
                    most robust and powerful e-learning platform. On this
                    platform we will deliver a wealth of content and
                    applications, some of which will come from SmartForce and
                    others from our vital ecosystem of partners.

                    Customers will be served by our comprehensive solutions. And
                    our business model will be enhanced by AOL-like economics
                    capitalizing on the interplay between our platform and the
                    value-add delivered on it resulting in lucrative recurring
                    revenue opportunity. This will be a win-win situation for
                    Centra customers. For the first time they will be able to
                    seamlessly deploy the world's largest and most engaging
                    content and robust set of e-learning applications over their
                    existing Centra infrastructure.

                    For the new SmartForce, this will represent a very large
                    cross selling opportunity starting today. For the existing
                    SmartForce customers we will offer more technology
                    infrastructure intended to preserve and enhance their
                    investment in e-learning solutions.

                    The SmartForce sales force of 220 strong and growing will
                    offer Centra capabilities to new accounts and existing

                    This should also be good news for the many potential
                    customers that are waiting for a comprehensive solutions
                    provider to consolidate the market and simplify the
                    provisioning of e-learning.


                    We plan to be the enabler and prime beneficiary of the
                    expanding market.

                    From an investor's perspective, the combined company has
                    scale, market leadership, and long-term sustainability. The
                    combined R&D investment that I will manage will be equal to
                    the cumulative spend of all the public e-learning companies.
                    Our brand and global presence will drive revenue opportunity
                    from around the world. With high gross margins and excellent
                    business fundamentals we envision an accretive transaction
                    that will generate healthy profits going forward.

                    To remain in the lead there will be very little that we
                    won't be able to do to address customer needs and extend our
                    leadership. This company is truly poised to be the industry
                    juggernaut with great opportunity for long-term equity

                    The Centra team is looking forward to joining SmartForce on
                    top of the e-learning industry, building this large and
                    sustainably profitable company for our customers, partners,
                    stakeholders, and employees. And I look forward to seeing
                    many of you in person over the next several weeks as we
                    launch the business combination of Centra with SmartForce.

                    Thank you very much and now let me turn the podium over to
                    Steve Johnson, Centra's Chief Financial Officer.

Steve Johnson:      Thank you Leon. For the next few minutes, I would like to
                    review with you the financial highlights of the fourth
                    quarter and for the year 2001. At the end, I'll provide
                    insight into our financial objectives for the first quarter
                    of 2002 and for the full 2002 year.

                    First, I am very pleased to announce that the fourth
                    quarter, by almost all financial metrics, was an extremely
                    positive quarter and one of the best quarters in the
                    company's history.

                    Some of the highlights include record bookings, the highest
                    quarterly amount to date for the company which was fueled by
                    strong activity from Centra's outsourced application
                    service, ASP, increased customer propagation from our
                    products and services, and a record number of new customers
                    added to our growing but large installed base now totaling
                    775 customers.

                    In addition, our pro forma loss per share was significantly
                    reduced down to 8 cents as expenses continued to remain in
                    check while the top line revenues increased significantly
                    during the quarter.


                    Lastly, for the fourth quarter, the company achieved a major
                    financial milestone. This was the first quarter in which the
                    company generated positive cash flow which, I might add,
                    amounted to approximately $1.1 million. The positive cash
                    flow was attributed to our strong efforts in collecting
                    $13.8 million in receivables during the quarter. In turn,
                    this also had a very favorable effect on reducing our DSOs
                    down to more normal levels. Our DSO at the end of the year
                    was 79 days.

                    Now, let me begin with a review of the income statement.
                    Total revenues for the fourth quarter of 2001 was $11
                    million. This was up 41% over the same period last year and
                    a 20% increase over the third quarter. Revenue for the full
                    year of 2001 was $39.1 million, an increase of 70% over the
                    previous year of $23 million.

                    Product license revenues for the fourth quarter were $7.6
                    million. A 21% increase over the same quarter last year and
                    an 18% increase over last quarter. Product license revenue
                    for the full year of 2001 was $28.8 million or a 54%
                    increase over the prior year.

                    Service revenues continued to grow at an increased rate
                    primarily driven by the demand for the company's software
                    products delivered on a hosted service basis or on a rental
                    basis as an ASP. For the fourth quarter, service revenues
                    increased to $3.4 million. A 124% increase over the fourth
                    quarter of 2000 and a 24% increase from the third quarter.

                    In addition, actual ASP orders during the quarter
                    represented approximately 10% of the total value of our
                    bookings for the fourth quarter and 9% of the total bookings
                    for the full year.

                    Gross profit was $9.3 million for the quarter. An increase
                    of 42% over the same period last year and an increase of 26%
                    from the third quarter.

                    Gross margins for the fourth quarter increased to 84%, an
                    improvement of 400 basis points from the third quarter.

                    The higher gross margin percent was attributed to higher
                    margins on Centra's ASP servers and on our maintenance
                    contract and support business during the fourth quarter.

                    Total operating expenses for the fourth quarter, excluding
                    non-cash items, was $11.4 million. A 5% increase over the
                    same period last year and only a slight 2% sequential
                    increase from the third quarter. For the full year,
                    operating expenses, excluding non-cash items, was $45.4
                    million, a 26% increase over the prior year.


                    Taking a closer look at the operating expenses, sales and
                    marketing expenses for the quarter increased in absolute
                    dollars from the third quarter by approximately $700,000 to
                    $6.6 million and declined sequentially as a percentage of
                    revenues from 64% to 59%. The increase in dollars is a
                    result of increased marketing activity and an increase in
                    the provision of bad debts.

                    Sales and marketing expenses for the full year 2001
                    increased by $2.9 million to $25.5 million from $22.6
                    million in 2000. This increase is primarily attributed to
                    headcount related spending.

                    Product development expenses for the fourth quarter
                    decreased from the third quarter by approximately $400,000
                    to $3 million. And declined as a percentage of revenues from
                    37% to 27%. The decrease can be attributed to reduced
                    recruiting and consulting fees and a reduction in other
                    headcount related expenses. Product development expenses for
                    the full year 2001 increased by $4 million to $12.5 million
                    from $8.5 million in 2000. This increases is primarily
                    attributable to headcount related spending.

                    General administrative expenses for the quarter remained
                    flat with the previous quarter at $1.8 million, and declined
                    quarter to quarter to 16% of revenues from 20% of revenues
                    in the previous quarter. General and administrative expenses
                    for the full year 2001 increased by $2.4 million to $7.4
                    million from $5 million in 2000. The increase is related to
                    increased headcount and an increase in audit and legal

                    On a pro forma basis, which excludes non-cash stock based
                    compensation expense and the amortization of goodwill and
                    other intangible assets related to the Mindlever
                    acquisition, the net loss for the fourth quarter was $1.9
                    million or 8 cents per share compared to a pro forma net
                    loss of $3.2 million or 14 cents per share in the same
                    period last year.

                    The pro forma net loss for the year 2001, which in addition
                    to the items excluded for the fourth quarter excludes a one
                    time non-operating charge in the first quarter related to
                    losses from short term investments and the write-off of
                    acquired in-process research and development related to the
                    Mindlever acquisition, was $11.5 million or 47 cents per
                    share compared to a pro forma net loss of $12.9 million or
                    57 cents per share for the year 2000.

                    The pro forma net loss per share for the fourth quarter
                    improved by 5 cents over the third quarter.

                    Net loss on a GAAP basis for the fourth quarter of 2001 was
                    $2.6 million or 10 cents per share compared with a net loss
                    of $3.4 million or 15 cents


                    per share for the same period of last year. Net loss for the
                    full year of 2001 was $16.7 million or 68 cents per share
                    compared with a net loss of $14.5 million or 67 cents per
                    share for the same period of last year.

                    Next I'd like to turn your attention to the balance sheet.
                    As I mentioned earlier, the company generated $1.1 million
                    in positive cash flow in the fourth quarter. This is the
                    first quarter in which the company was cash flow positive.
                    And this was the direct result of strong receivable
                    collections during the quarter. Our cash position, including
                    short-term investments, at the end of the fourth quarter
                    totaled $48.2 million.

                    Net accounts receivables decreased during the fourth quarter
                    by $237,000 to $9.7 million. We collected $13.8 million in
                    receivables during the quarter. As result, our DSOs declined
                    significantly to 79 days from 96 days in the previous

                    Lastly, deferred revenue at the end of the quarter was $8.2
                    million, a significant increase of over $2 million or 32%
                    over the previous quarter.

                    Now let me review the financial objectives of the company
                    for the first quarter and full year of 2002.

                    Reflecting the seasonal trend of our business, which in the
                    first quarter typically produces the lowest revenue growth
                    rate of any quarter in the year, we expect to report
                    revenues for the first quarter of 2002 in the range of 11 to
                    $11.3 million.

                    The pro forma net loss for the quarter excluding stock based
                    compensation expense and other intangible assets is expected
                    to be 8 cents per share while the net loss on a GAAP basis
                    for the first quarter is expected to be 10 cents per share.

                    For 2002 our expectations are consistent with what we have
                    stated previously, that census revenue is anticipated to be
                    in the range of $55 to $60 million representing annual
                    revenue growth of approximately 50%.

                    Gross margin for the year are expected to be in the range of
                    84 to 86%.

                    The company's objective is to report positive earnings on a
                    pro forma basis excluding stock based compensation expense
                    and other intangible assets in the range of 10 to 13 cents
                    per share. And positive earnings on a GAAP basis of 4 to 7
                    cents per share.

                    Based on management's current assessment of market
                    conditions, we forecast achieving profitability on a pro
                    forma basis in the first half of


                    2002. Now I'd like to open the call up to answer any
                    questions you may have.

Operator:           Thank you.  Our Q&A session will be handled electronically
                    today. To ask a question, please press the star key followed
                    by the digit 1 on your touch-tone telephone. We'll take your
                    questions in the order we receive them and as many as time
                    permits. We'll pause for a moment to assemble our roster.

                    And our first question today comes from Mr. Dalton Chandler
                    with Needham & Company.

Dalton Chandler:    Yeah hi guys. I was just wondering if maybe you could
                    comment on Mindlever. I know you had some expectations for
                    its contribution this quarter if, you know, met those
                    expectations or not and what you see going forward there?

Leon Navickas:      Hi, Dalton, yes, we met those expectations and we're very
                    happy with the progress we've made integrating the Mindlever
                    technology into the central end platform and believe that
                    going forward as an integral part of the solution we'll have
                    more opportunity to put that product into the hands of our
                    existing customer base, new customers, and will provide more
                    propagation opportunity in the future.

Dalton Chandler:    Okay. I don't know if you gave this or not, did you give the
                    average selling price on the quarter? I didn't hear it.

Steve Johnson:      No, we didn't. The average selling price is consistent with
                    past quarters in the neighborhood of $100,000.

Dalton Chandler:    Okay. And one other question on the SmartForce merger. Since
                    they're an Irish corporation, will you be able to utilize
                    any of your tax benefits with the merger or no?

Steve Johnson:      Not directly the result of the merger to start with. But
                    there will be, as time progresses, there will be revenues or
                    profits in the United States that can be offset by some of
                    the tax losses that they would pick up. The exact amount has
                    not been determined.

Dalton Chandler:    Okay. Thanks very much.

Steve Johnson:      No problem.

Operator:           Thank you and our next question comes from Mr. George Sutton
                    with RBC Capital Markets.


George Sutton:      Hi, guys. I wanted to see if you could give some sense of
                    the reaction that you've seen from partners and customers
                    and everybody since this deal was announced?

Leon Navickas:      Well from an employee standpoint I think we're all very
                    jazzed to execute on a breakout strategy to create the
                    industry gorilla. From our partners' standpoint this has
                    been some mixed reaction. Some are more directly affected by
                    some of the overlapping capabilities that SmartForce brings.
                    And we'll need to manage those carefully.

                    Our stated goal is to be open and extensible like we always
                    have been and continue to have that philosophy as part of
                    SmartForce and as part of our platform going forward.

                    And in terms of some other partners, certainly the
                    combination presents many more value-add opportunities to
                    create new businesses, drive larger transactions and think
                    it's all positive.

George Sutton:      I'm curious how your sales force will be integrated into the
                    SmartForce sales force meeting next week. Will there be any
                    direct involvement?

Leon Navickas:      We can't really do anything directly with each other's
                    products until we pass Hart-Scott-Rodino. And thereafter
                    we'll be doubling our efforts. Given that it's a purchase
                    transaction we'll be free to begin integration of products
                    in a substantial way and begin sharing leads and so forth.

                    Going forward we are already engaged in a partnering
                    arrangement of the same type that we have with other third
                    party companies who are doing business with us. And so that
                    collaboration market is already beginning at the same level
                    as other companies.

                    And we expect that to get stronger and more meaningful going
                    forward so that by the time this transaction closes not only
                    will we have some integrated solutions to offer our
                    customers but a sales force that's fully geared up and ready
                    to go.

                    How it's going to be organized is as a separate unit so as
                    to maintain some of its autonomy as well as its control over
                    its destiny in terms of delivering on the revenue for this
                    year. Next year the plan is to have a gradual integration of
                    the SmartForce sales force and the Centra sales force into a
                    larger entity.

George Sutton:      And lastly you made an interesting parallel to AOL. I admit
                    my naivete about AOL economics. Can you go into a little
                    more detail there?


Leon Navickas:      Well there's a tremendous interplay between content and
                    platforms or delivery mechanisms that AOL has taken
                    advantage of in terms of being able to drive their delivery
                    system with the appeal of their content. And then once their
                    delivery system is in place drive additional content through
                    that delivery system as value-add.

                    So we believe that same opportunity will exist for the new
                    SmartForce as we're able to drive solutions into the Global
                    2000 and bring along the infrastructure or the platform and
                    then when the platform is in place bring along additional
                    value-add in the form of content and other solutions from
                    ourselves and from third parties, all of which contribute to
                    new sources of revenue and a revenue model that's much more
                    robust than if we had individual piece parts or different
                    kind of business model.

George Sutton:      Got it. Okay congratulations.

Leon Navickas:      Thank you.

Operator:           Thank you. Once again that's star, 1 to ask a question.

                    And our next question will come from Mr. Howard Block with
                    Bank of America Securities.

Howard Block:       Good afternoon, Leon, Steve. How are you? A question I
                    guess, Steve, actually on the ASP business that contributing
                    to the services revenue, can you give us a sense maybe in
                    more of static state were you to mature to that point before
                    the acquisition what the gross margin would be on the ASP

Steve Johnson:      Sure. As a static state today it's better than 50% gross
                    margin. And we expect it to grow to at least 70 to 75% gross

Howard Block:       Okay so the ASP business then right now doesn't necessarily
                    have much better gross margin than the other services
                    business. But as it grows it begin to approach the software
                    gross margin?

Steve Johnson:      Yes, although the services, the maintenance piece of the
                    services is also continuing to increase in terms of our
                    margins. And I expect that to be in the mid-60s over time,
                    the 60 gross margin range.

Howard Block:       And then on the 775 customers, Leon, I'm sure you've had
                    some chance to sort give at least give a cursory review of
                    those customers and sort of map it to SmartForce's installed

                    Can you give a little color as to where you see maybe even
                    quantify a little bit a number of accounts where there's
                    either parallel efforts, number of


                    accounts where you maybe have the same relationship with the
                    business manager, where you have different relationships
                    just so we can sort of get a sense as to how long until we
                    would see some synergies and merge from the combined

Leon Navickas:      Sure. At first blush we've done a review of our customer
                    bases. And it looks as though among SmartForce's more than
                    2500 account base we have about 10% common customers. And
                    among our account base we have about 50% common customers
                    within their base. That's as a starting point.

                    And I think then we're also both engaged in really creating
                    solutions. And so going forward we're going to be doubling
                    our efforts to attack economic buyers in functional
                    organizations across sales, IT, human resources and service.
                    And in those functional organizations I'm sure we're going
                    to find more and more commonality.

                    There's also the idea that with each of our respective
                    solutions given that there's very little overlap there will
                    be opportunity to bring one another into each other's
                    opportunities. And that will be something that will
                    obviously result in revenue synergies for us going forward
                    and much more powerful revenue synergies when products are
                    more integrated and when the sales forces are more incented
                    to collaborate with each other.

Howard Block:       Okay. And in terms of the comments about the bookings being
                    the best ever, is it possible to even attempt to maybe back
                    out of that bookings in the fourth quarter what maybe would
                    have been booked in the third quarter if not for the tragic
                    September end to get a sense of how strong the bookings
                    really were in the more normalized environment?

Steve Johnson:      Sure. We estimate between 3/4 and $1 million was activity
                    that we expected to close in the third quarter that actually
                    moved into the fourth quarter. But bear in mind you always
                    have some stuff that moves. But again, this was a little bit
                    more pronounced with the events of 9/11.

Howard Block:       Okay and then lastly, Steve, I guess on the DSO that is an
                    impressive improvement. And to that extent maybe you can try
                    to reconcile how you were able to improve DSOs sequentially
                    whereas SmartForce obviously has their sort of DSO
                    challenges and an erosion, if you will, sequentially? Is
                    there something unique to your cash collecting efforts or
                    something that...

Steve Johnson:      Well we have - the way we do it is we communicate with the
                    field. And we incorporate them into the help of that
                    process. But we lend a lot of focus to it. We have a
                    terrific team here that we stay on top of the receivables.
                    We invoice the appropriate way so that the customer has no


                    complaint and doesn't delay the payment process. And we just
                    take the normal aggressive tactics and work on it.

Howard Block:       Okay thanks a lot, guys.

Steve Johnson:      Thanks, Howard.

Operator:           Okay and one final reminder, if you'd like to ask a
                    question, please press star, 1 on your phone.

                    And we have a follow-up question from Mr. George Sutton.

George Sutton:      Leon, could you run through your overlap numbers again? I
                    didn't quite understand the 10 and the 50%.

Leon Navickas:      Ten percent of SmartForce's customer base are in common with
                    our customer base. And 50% of our customer base seems to be
                    in common with SmartForce's base. So that's how we look at
                    the overlap.

                    And we have some very large customers in common right off
                    the get-go that we know of because they've called us and
                    actually requested -- I'm being mild about the requesting
                    part of it -- to get our products integrated. And these
                    include accounts like Accenture and Ariba and KPMG. So we
                    intend to make those customers real happy and basically take
                    that template of having the demand for our combined products
                    and services delivered as a comprehensive solution sometime
                    after the transaction closes midyear.

George Sutton:      Okay, great. Thanks.

Leon Navickas:      You're welcome.

Operator:           Thank you. And our next question will come from Mr. Peter
                    Martin with Jefferies & Company.

Peter Martin:       Leon, I was wondering if you could provide some inside into
                    the product roadmap in terms of where you might go with R&D
                    and what you may release if it wouldn't, you know, put you
                    in a competitive bind, if you have any insight you could
                    provide to us?

Leon Navickas:      Well, first of all, I'm going to be managing quite a lot of
                    firepower in terms of R&D capability. And we're going to be
                    able to do a lot in terms of inventing, innovating,
                    delivering solutions to customers any way they want to buy

                    The first thing we'll do is look and find redundancies if
                    there are any and try to deploy the redundant work forces on
                    the task of integration,


                    essentially doubling down on our efforts to create
                    seamlessly integrated solutions and have those ready for the
                    marketplace. That's the first task at hand. That's as much
                    as we can see right now in terms of the highest priority
                    development initiatives.

                    And then going forward I think it's safe to say you should
                    expect to see some of the things we've been talking about as
                    Centra and building out our e-learning collaborative
                    infrastructure as something that probably will continue to
                    be on the development roadmap. And we'll see those new
                    products and services coming out later.

Peter Martin:       And I guess that was what I was trying to pinpoint is just
                    from the Centra side, you know, what is the focus right now
                    from your R&D department? What capabilities do you think are
                    critical to maintain your account growth and your leadership
                    position that you've established?

Leon Navickas:      Well first of all, I think it's in three general categories.
                    First there's platforms. And we continue to invest heavily
                    in creating the best realtime collaborative engine that
                    exists on the market today with voice-over-IP and
                    application sharing and robust through the firewall and
                    over-proxy-server type communication capabilities.

                    We're also investing in knowledge management capabilities
                    for content and for the personalization and searching of
                    learning objects and central recordings and all kinds of
                    other dynamic and volatile content objects that can be

                    Secondly, we're investing in applications. And these
                    applications include our live collaborative experiences.
                    Symposium conference and e-meetings are examples of those
                    collaborative experiences aimed at different types of ways
                    people communicate, collaborate and learn with each other.

                    We're also investing in content composers. These are tools
                    that enable subject matter experts to quickly get their arms
                    around their content and make it available through the
                    collaborative system. And we're investing in capabilities to
                    manage our systems more effectively on a global basis and
                    make them scalable and extensible. That's at the application

                    And the third piece that we're investing in are solutions.
                    And with SmartForce this will be a very important initiative
                    as we combine a very rich palette of capabilities that will
                    be some of our capabilities and some of theirs to create
                    end-to-end solutions that will appeal to economic buyers and
                    sales IT services and HR and where we will be able to
                    continue and penetrate and propagate according to our sales
                    model and drive our platform and drive value-added solutions
                    through our propagation.


Peter Martin:              Thank you so much.

Leon Navickas:             You're welcome.

Operator:                  Thank you and our next question comes from Mr. Trace
                           Urdan with Think Equity Partners.

Trace Urdan:               Afternoon, gentlemen. Leon, my principle question
                           about the merger is just as to the timing. I mean,
                           clearly you guys had a strong quarter. You seemed to
                           be selling into the enterprise fine on a standalone
                           basis. And you have, you know, the partner network
                           that you've described.

                           I'm wondering, you know, what it was that prompted
                           you to make this move with SmartForce at this point
                           versus, you know, a while ago versus, you know, at
                           some point in the future?

Leon Navickas:             Well as I've been saying for about - at these
                           quarterly conference calls, we at Centra intended to
                           drive the inevitable industry consolidation
                           (inaudible). And we took the opportunity to do that
                           while we were in the strongest position to influence
                           our own outcomes and, therefore, recognize an
                           absolutely enormous opportunity to create an industry
                           juggernaut by putting two companies together, pursued
                           it aggressively and got it done so that we can make
                           2002 a very exciting year and essentially 2003 an
                           incredibly exciting year as we believe we'll be at
                           the top of the e-learning industry with platform
                           technology, value-added applications, content tools
                           and services that will be the catalyst event to
                           create this inflection in demand that we believe will
                           come from lots of new customers coming to the
                           marketplace looking for solutions that are easy to
                           deploy, easy to buy, simple, low cost to own. And we
                           intend to get started on that right away and become
                           the industry leader in that manner.

Trace Urdan:               All right, I understand the rationale. I guess I'm
                           still wondering what the catalyst was? Were you
                           seeing some change in customer behavior? Was there
                           something about the way that the Mindlever - you
                           know, the way that was being received by customers
                           that made you think that this merger needed to happen
                           sooner rather than later?

Leon Navickas:             I think you shouldn't read too much into it. It's
                           really as simply as two companies who did not need to
                           merge to be successful recognizing an enormous
                           opportunity and taking it, being able to really go on
                           a go out on a high note, attack a business that is
                           just sitting there waiting for some company to go and
                           capitalize on it. And we wanted to be that company
                           and so did SmartForce.


                           And it's as simple as that. We saw a terrific
                           opportunity. And I think it's going to mean a lot of
                           benefits for our existing customers, our partners and
                           our investors going forward with lots of potential
                           equity appreciation.

Trace Urdan:               Okay. Thank you.

Operator:                  Thank you. Mr. Clayton Kaneshiro with First Boston
                           has our next question.

Clayton Kaneshiro:         Hello and congratulations on the quarter. Just a
                           couple of quick modeling questions, when I look at
                           the maintenance services component of your business,
                           what was the gross margin there? And where could it

Steve Johnson:             Clayton, this is Steve. I see the maintenance
                           excluding the ASP part of the business growing to -in
                           terms of margins growing to a 65% margin and in terms
                           of the percentage of the business, I can see that
                           growing to about 20 to 25% as our top line continues
                           to grow.

Clayton Kaneshiro:         Okay. And in the quarter the maintenance gross margin
                           is as of now?

Steve Johnson:             The maintenance gross margin right now is in the high
                           50% gross margin range.

Clayton Kaneshiro:         Okay, okay. Great. Just one more thing, when I look
                           at the upgrade revenues or, you know, your installed
                           based revenues, can you talk about the mix between
                           product upgrade and user upgrade? Has that changed
                           meaningfully with the Mindlever acquisition here over
                           the last couple of quarters? Or has the mix not
                           changed significantly as of it?

Steve Johnson:             Well we've seen a shift this year in terms of our
                           installed base. Because it is much larger now we're
                           starting to see more revenues generated from our
                           installed base. Even though we've had record number
                           of new customers, nonetheless because we're getting
                           a broader base, we're actually seeing that it's at
                           least 50% of our business now is coming from our
                           installed base. I think you should model that going

Clayton Kaneshiro:         I guess within that 50% of the revenues coming from
                           the installed base, when I look at it maybe upgrades
                           to different types of products, different types of
                           servers that you offer versus a user upgrade has that
                           mix changed?

Steve Johnson:             No, I mean...

Leon Navickas:             Not really. We're still selling as many additional
                           user licenses to expand deployments as we are server
                           of various shapes and sizes to support the various
                           capabilities that are add-ons to our product.


Steve Johnson:             Right. There's both the increase relative to what you
                           might call upgrades of new modules whether it be from
                           symposium and adding on conference but also the
                           number of license continues to spread and propagate
                           throughout the organization.

Clayton Kaneshiro:         Right. Okay. Thank you. That's helpful.

Operator:                  Thank you and now we have a follow-up question from
                           Mr. Peter Martin.

Peter                      Martin: Steve, I wanted to ask about the deferred
                           revenue coming in at the end of the year at about
                           $8.1 million. And I want to ask you what the
                           pull-through is to the revenue line? And is a lot of
                           that revenue just the maintenance contracts that will
                           be recognized ratably?

Steve Johnson:             A percentage of it is. Also a significant percentage
                           is coming from our ASP business, which also gets
                           recognized ratably.

Peter Martin:              Okay so overall it really is the maintenance and the
                           ASP which will be pulled through over the length of
                           the contract, 12 months or so.

Steve Johnson:             Yeah typically that's what our deferred is. And what
                           happens is - yes you should expect all of that to be
                           pulled through in 2002. Okay that's the answer. Our
                           licenses mainly end up in a backlog position and not
                           on the books of the company.

Peter Martin:              Correct because once you - I mean, you have a pretty
                           installation so you'd be recognizing that revenue
                           during the period.

Steve Johnson:             Exactly.

Peter Martin:              All right, I appreciate that.

Steve Johnson:             No problem.

Operator:                  Thank you and that concludes our question and answer
                           session for today. I'll now turn the call back over
                           to Mr. Leon Navickas.

Leon Navickas:             Thank you very much, everyone, for attending. I look
                           forward to reporting again great results to you at
                           the end of our Q1 2002.

Steve Johnson:             Thanks

Leon Navickas:             Goodbye.

Operator:                  And that concludes today's conference. Thank you for


                               [End of Transcript]