E-City Software CEO Announces Improved Aviation Climate Should Enhance Sales Opportunities

SEATTLE--(BUSINESS WIRE)--June 13, 2002--E-City Software, Inc. (E-City) (OTCBB: ECTY - News) CEO Anis Jessa announced today that improvements in the aviation market should lead to increased travel and tourism sales.

Mr. Jessa went on to explain E-City's year to date performance and to provide a road map to E-City's future growth opportunities.

The Aviation Market Is Improving and We Are In Serious Negotiations With An Aviation Partner

The past ninety days have seen a continuous and gradual improvement in the aviation and travel related business climate. As you know, many of the most financially rewarding opportunities for sales of our product remain in the travel and tourism space. While we have not signed with an aviation partner as of yet, we have experienced a marked increase in customer interest in our products for this market. We are in very serious price discussions with an aviation partner and I have great hopes that these discussions will result in a sale of our products that will serve both to alleviate our short term cash needs and to bolster our market presence within aviation related travel and tourism.

AirPortal and TaxiDispatch Products Provide Significant Revenue Possibilities

Our AirPortal Product has benefited from an increased emphasis on aviation security. While we have not successfully installed an AirPortal product in a major airport, we have received expressions of interest from Vancouver International Airport, San Diego International Airport and Major Airlines and airline partners. We are in discussions with a possible distributor of the AirPortal product. If we were successful in executing this draft distribution agreement under the terms now in negotiation, we would derive sufficient revenue from the AirPortal sale to be profitable in the next Fiscal year. We have received substantial inquiries regarding TaxiDispatch and anticipate closing our first product sale of the current version within 45 days. As TaxiDispatch sales momentum builds, we will keep our shareholders informed.

We Achieved Many of Our Goals Last Year, But There is Room for Improvement

Our yearly results should be released within the next two weeks. Without discussing those results specifically, let me say that we did have a profitable year, but the fourth quarter was disappointing leading to overall earnings that fell short of our expectations. There were many reasons for this shortfall, I will list a few here: a longer than anticipated sales cycle for municipal sales; a much longer than anticipated sales cycle for defense and security related products; intense financial pressure in the wireless/telecommunications space which has resulted in significantly less IT related spending than we had anticipated. On the positive side, we have managed to continue to keep costs low and we have kept our expenses under budget, resulting in improved profit margins. We have received fantastic feedback on the product and continue to receive inquiries on a weekly basis from large multinational corporations and local governments.

We Need to Strengthen Our Cash Position

Our cash situation needs improvement. We failed to close some sales that we had counted on in the fourth quarter and that looked very likely to close. In addition, we entered into an agreement with our TaxiDispatch partner, Fog City Taxi, to delay $375,000 in license payments until the second quarter of Fiscal 2003. This made our cash situation significantly worse than anticipated. We had also expected to receive all or substantially all of our remaining outstanding receivable of approximately $495,000 from Cityscape during the quarter. Instead, we received approximately $50,000 during the quarter and approximately $65,000 to date. These events together have weakened our cash position. We have responded by cutting expenses wherever possible. We have reduced non-essential staff. I am also in the process of actively seeking financing in order to improve our cash position and to help us continue to grow our business.

Plans for the Future:

Our plan for the future is to seek additional cash through financing and the closing of sales that are still in the sales cycle. We will continue to pursue distribution and marketing arrangements that will allow us to sell product without an extensive cash outlay. As the present version of our products is complete, we do not have to incur increased production expenses until there are more orders to fill. Therefore, we would be able to support increased third party distribution and marketing and production related to such sales for a significant time period on a small amount of incoming cash. In conclusion, we have huge growth opportunities in aviation, tourism, municipal and wireless sales and we have a renewed and streamlined focus on distribution.

E-City Software, Inc. (OTCBB: ECTY - News) is a developer of interactive maps for cities around the world. E-City sells its products to customers on the basis of both annual licensing fees and revenue share arrangements. E-City distributes its products directly to its customers, through arrangements with strategic partners and through its network of distributors and value added resellers. For more information about E-City Software or its products, please visit our website at www.ecitysoftware.com.

NOTE: Information contained in this press release, other than historical information, should be considered forward-looking in nature and is subject to various risks or uncertainties and assumptions. The risks and uncertainties include, but are not limited to the impact of competitive products and pricing, product demand and market acceptance, reliance on key strategic alliances, fluctuations in operating results, the potential unavailability of financing sources and other risks detailed from time to time in the Company's filings with the Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated or expected. E-City Software assumes no obligation to update these forward-looking statements to reflect actual results, changes in assumptions or changes in factors affecting such forward-looking statements. Forward-looking statements in this release are made pursuant to the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995.

     E-City Software, Inc.
     Anis Jessa, 206/624-8070

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