Celerity Releases Third Quarter Results.

Business Editors & High-Tech Writers

KNOXVILLE, Tenn.--(BUSINESS WIRE)--Nov. 17, 2000

Celerity Systems, Inc. (OTC BB:CLRT) filed its third quarter results on November 14 with the Securities and Exchange Commission, and continued its efforts of developing and deploying its technologies related to the T 6000 digital set top box and CTL 9500 digital video server on a stringent cost budget.

The most significant items in the filing, which is posted on the SEC's free EDGAR system for access by investors and other interested parties, were some one-time non-cash items. Cost of revenues for the nine months ended September 30, 2000 were $685,000 as opposed to approximately $20,000 for the same period in 1999, primarily due to a one time recognition of obsolescent inventory for its older model servers, the CTL 7000 and CTL 9000, which have been discontinued in favor of the more robust and cost effective CTL 9500.

Operating expenses for the nine months ended September 30, 2000 were approximately $2,671,000 as opposed to $2,257,000 for the same period in 1999, but approximately $1,031,000 are non-cash expenses. Cash expenses for ongoing operations, including payroll, facility costs and depreciation expense, decreased by $884,000 during this period thanks to the Company's cost control efforts.

During the third quarter, the Company announced the first order from WIT Technologies, with whom it entered into an agreement in the second quarter for digital set top boxes and servers that has the potential value of over $200 million over a five year period.

"We remain very optimistic about our company's products and prospects," said Kenneth Van Meter, President and CEO. "As our industry finally starts to take on shape and form, and more broadband networks are installed, our products are extremely well-suited for the hospitality industry, multi housing, schools, and a host of other markets."

Celerity Systems is a provider of advanced digital set top boxes and video servers for the interactive television and high speed Internet markets. Celerity can also provide end-to-end systems through strategic relationships with leading companies including Nortel, Battelle Laboratories, InnovaCom, Marconi, Cisco and Minerva Systems.

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: The statements which are not historical facts contained in this press release are forward-looking statements that involve certain risks and uncertainties including but not limited to risks associated with the uncertainty of future financial results, additional financing requirements, development of new products, government approval processes, the impact of competitive products or pricing, technological changes, the effect of economic conditions and other uncertainties detailed in the Company's filings with the Securities and Exchange Commission.