Electric City Corp. Responds to False Statements.

ELK GROVE VILLAGE, Ill.--(BUSINESS WIRE)--August 25, 1999--

Electric City Corp. (OTC Bulletin Board: ECCC) announces today the following statements in response to issues raised by a recent investment firm. Electric City Corp. is a company created to introduce lighting control technology (EnergySaver: State of the Art Lighting Control Technology) to the U.S. market. This technology had been invented by Giorgio Reverberi in Reggio Emilia, Italy about 20 years ago. Marketed by Reverberi Elettronica and Conchiglia in countries such as Italy, Sweden and Spain, for over 17 years, there are over 5,000 units operating in 9 countries. The technology is primarily utilized in street lighting applications and municipal/public indoor applications. Locations in Europe include Ancona Airport, Anas Corporation (all major street lights in Italy), and many suburbs of Rome and the cities of Jerusalem/Tel Aviv, Israel, Budapest, Hungry and many suburbs of Rome. Saving achieved are consistent and verifiable . Electric City Corp. received the rights to manufacture and market this technology in the United States in the fall of 1996.

Joseph C. Marino, CEO and Chairman of the Board for ECCC personally oversaw the beginning stages of market development. He verified functionality with independent testing agencies such as Internek Testing Services and ETL while installing field units in their own location and the locations of current Marino Electric customers such as Valli Produce, a major drug store chain, and Apple Vacations, a travel agency. Data was for a period of over one year before ECCC began it marketing efforts to attract interested distributors. Deciding to remain a manufacturer at this stage was a decision based on Mr. Marino's desire to maintain the products integrity and to streamline costs incurred.

To date ECCC has solidified 21 exclusive distribution agreements which have first year guaranteed sales of $11,805,000 (1,574 units). These sales are guaranteed through letters of credit which allow ECCC to draw the full letter of credit amount upon nonperformance of the guaranteed sales. The contracts are 10 year exclusive agreements with sales quotas increasing over the period. Product Year 2 sales projections solely from EnergySaver sales are 41,812,500 (5,575 units), Product Year 4 are $57,277,500 (7,637 units), Product Years 1-5 have a cumulative sales volume of $268,837,500 (35,845 units). Each distributor is required to submit sales projections on a regular basis and ECCC reports the contractual requirements are well below the individual distributors internal projected goals. The exclusive distributors sell to the end users and/or establish dealer networks within their exclusive areas.

Sales for ECCC to the end user began as corporate was marketing for distributors, but in effect began once each distributor sign on with ECCC. Each distributor was trained technically to properly represent and install the EnergySaver prior to actually selling in the marketplace. For all distributors in the First Product Year has not yet come to an end.

There are over 60 units operating in the U.S. market place today, along with the units placed in Mexico. Sales for ECCC for the First Product Year are estimated to be $11,805,000 plus those sales of the recently acquired Marino Electric. Combined Year 1 projections are estimated at $14,805,000. Profit's of ECCC are expected to steadily increase at a significant rate; the manufacturing of the EnergySaver has an estimated 30-45% profit margin.

The EnergySaver: State of the Art Lighting Control Technology is a proprietary energy management system designed to reduce the cost of lighting. These savings are achieved without a loss in essential brightness and without reducing the number of hours the lights are used.

Electric City Corp. (www.electriccityeccc.com), located in Elk Grove Village, ILL., is an energy technology and manufacturing company created to introduce this State of the Art Lighting Control Technology to the United States after 17 years of success in Europe. Electric City Corporation markets and manufactures the EnergySaver products that offer savings in the range of 20% to 50% to the commercial sector on their utility bills and lighting related expenses. Some of Electric City's clients include, Frito Lay Inc., a subsidiary of PepsiCo INC PEP, Tru Vue, a subsidiary of APOGEE ENTR APOG and automobile dealerships including Ford and Dodge.

Except for the historical information contained herein, this press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of Securities Act of 1934, as amended, and are subject to the safe harbors created thereby. The Company's future actual results could differ materially from the forward-looking statements discussed herein.