CT Holdings announces letter of intent to acquire 25% of ideavillage.com with an option to acquire up to 51%

ideavillage’s online product evaluation engine seeks to revolutionize retail distribution channel for innovative new products

Dallas, Texas, August 4, 2000 – CT Holdings, Inc. (Nasdaq: CITN), an incubator of early stage Internet services companies, today announced that it has entered into a letter of intent relating to the acquisition of 25% of the shares of ideavillage.com, with a one-year option to acquire up to an additional 26%. The companies expect to close this transaction within the next 60 days. The terms of the initial tranche of the transaction included $4.5 million in cash and 750,000 stock options, with the second tranche to be acquired from the existing shareholders for $9.0 million in CT shares valued at $5.00 per share, cash or a combination of both.

ideavillage, headquartered in New Jersey, was launched in August 1999 to take new and innovative product ideas from concept to mass retail shelves at Internet speed. In a revolutionary “clicks and mortar” process, ideavillage’s total solution integrates online product evaluation, direct-response television (DRTV), and unique in-store media into a comprehensive innovative process that selects and markets only the strongest products. We believe that retail stores, etailers and manufacturers will come to rely on ideavillage’s offering as the surest, simplest way to confidently add new and tested products to their offerings.

ideavillage seeks to re-engineer and automate the broken process of launching quality new innovative products to market. ideavillage intends to offer its solutions which will allow companies to implement the results of the online product evaluation process. ideavillage also provides an innovative new Internet enabled entrepreneur portal designed to help innovators to develop and market their new products in a joint venture with ideavillage.

ideavillage was founded by Andy Khubani, President and CEO. Mr. Khubani launched ideavillage.com in August 1999 after a nine-year career as president/sales of Telebrands. In his career at Telebrands, he increased sales to retailers a hundredfold, from $1.3 million to $130 million. From 1996-99, Andy successfully re-engineered Telebrands’ sales strategy which resulted in substantial bottom line profit growth. At ideavillage.com, Khubani has assembled a strong management team as well as a world-class advisory board to execute the company’s new business processes.

“We are very excited about the opportunity to invest in ideavillage, a company pioneering a new online approach to enabling retail and manufacturing companies to evaluate products prior to launch in the retail channel, which is intended to increase profitability for retailers, e-tailers and manufacturers,” said CT’s CEO Steven B. Solomon. “We look forward to working with the management team of ideavillage to bring the company to the next level,” he continued, “We believe that ideavillage’s comprehensive value–added decision support solutions will have a profound impact for companies doing business over the Internet and in retail channels and increase value for CT shareholders.”

Andy Khubani, CEO of ideavillage, stated “ideavillage is very excited about our partnership with CT Holdings. We were approached by several large companies and felt that CT and its portfolio companies offered the most compelling synergies and long term value for ideavillage. By combining our existing technology, products, and marketing capability with CT Holding’s management and incubation resources, we will be able to fully leverage our combined strengths to deliver unprecedented value to our customers and partners through unique, value-added, Internet-based technology.”

Mr. Solomon continued, “With our successful investments in Parago and River Logic and their continued successful development, our business model continues to accelerate. Now with the addition of ideavillage, we are more excited about the future prospects for CT’s business model than ever before. We continue to look for companies with strong prospects and innovative technologies that we believe are synergistic with the offerings of our existing portfolio companies. Following on our successes with Parago and River Logic, we believe that our acquisition of a substantial interest in ideavillage positions CT Holdings as a leader in the Internet space and will increase our shareholder value.”

ideavillage has assembled a high quality management team and an advisory board that includes leaders in the retail and manufacturing sectors, including Jerry W. Levin, Chairman, Chief Executive Officer and President of Sunbeam Corporation, and prior Chairman and Chief Executive Officer of the Coleman Company, Inc. and Revlon, Inc., Jordan Stanley, President and CEO of Free Ride Media, the Web’s first network loyalty program, Victor K. “Tory” Kiam III, President of RPI Corporation, a diversified holding company with several leading brands, and Edward J. Stern, Chairman and Chief Executive of The Hartz Mountain Corporation, North America’s largest manufacturer of pet care products. Upon closing of the transactions, we anticipate that the advisory board members will become directors of ideavillage.

About CT Holdings

CT Holdings (Nasdaq: CITN) is an incubator for early stage Internet companies (www.ct-holdings.com ). CT Holdings’ incubator ventures include Parago and River Logic. Parago (www.parago.com ) provides online, outsourced continuous customer interaction solutions and is headquartered in Dallas with offices in Silicon Valley and Los Angeles and more than 400 employees. Parago has developed a continuous customer interaction model that automates promotional management and optimizes the customer care experience for its clients. Parago, an application solution provider (ASP) and Internet based business process outsourcer (BPO), provides an online suite of promotional offerings designed to increase sales, reduce costs, and retain customers, thereby increasing customer profitability. Parago’s solutions and services include PromoCenter (on-line promotional management, on-line rebate processing, proactive e-mail, and on-line surveys), InfoCenter (online product demonstrations and manuals), and KnowledgeCenter (customer data warehousing, analysis and reporting). River Logic is a leading developer of proprietary network applications that focus on decision-making and process optimization in vertical marketplaces. River Logic creates and operates integrated networks of decision support tools, e-learning solutions, and e-commerce capabilities that revolutionize the manner in which decision-makers leverage knowledge and information, allowing them to gain decisive competitive advantage.

For more information on CT Holdings, its Internet subsidiaries, and its Citadel Technology line of security software products, please visit our Web site at http://www.ct-holdings.com. For information on purchasing products, contact us directly by writing or calling: CT Holdings, Inc., 3811 Turtle Creek Blvd., Suite 770, Dallas, Texas 75219; phone: 214/520.9292; fax: 214/520.9293. For media or investor relations contact: The Investor Relations Group at 212/736.2650.

About ideavillage

ideavillage.com was launched in August 1999 to take new and innovative product ideas, from concept to mass retail shelves at Internet speed. In a revolutionary “clicks and mortar” process, the company integrates online product evaluation, direct-response television (DRTV), and unique in-store media into a comprehensive innovative process that scientifically selects and markets only the strongest products. This system, the first of its kind, created a new consumer brand, ideavillage.com, the definitive source for innovative products. Consumers will come to trust the ideavillage.com brand as a source of fresh, high-quality products. Retail stores will come to rely on ideavillage.com as the surest, simplest way to confidently add new and tested products to their offerings.

Forward-Looking Statements: This news release contains forward-looking statements, which involve risks and uncertainties. Accordingly, no assurance can be given that the actual events and results will not be materially different than the anticipated results described in the forward-looking statement. There are a number of important factors that could cause actual results to differ materially from those expressed in any forward-looking statements. These factors include uncertainties related to the closing of the proposed acquisition and integration of the business and operations of acquired companies; availability of suitable incubator companies; and the availability of capital on terms acceptable to the Company. Investors are also directed to consider other risks and uncertainties discussed in documents with the Securities and Exchange Commission.

CT Holdings undertakes no obligation to publicly release the result of any revisions to these forward-looking statements, which may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.