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USAF UAV Battlelab Sponsors Demonstration of Proxy Aviation’s SkyForce at Creech AFB, Nevada

Unmanned aircraft demonstrated fully autonomous capability, end-user tasking, and overall range of communication

Germantown, Md. — January 9, 2006 — Proxy Aviation Systems, Inc., a company that develops fully autonomous, optionally piloted unmanned aircraft systems (UAS), announced the United States Air Force (USAF) Unmanned Aerial Vehicle Battlelab (UAVB) sponsored and cooperated in a demonstration of SkyForceTM, Proxy Aviation’s unmanned aircraft system. Held to demonstrate the autonomous capability of the system, the demonstration program was made possible through a Cooperative Research and Development Agreement (CRADA) between the USAF UAV Battlelab and Proxy Aviation.

The demonstration took place in early November at the USAF UAV Battlelab at Creech Air Force Base in Nevada. Proxy Aviation’s SkyWatcherTM, an optionally piloted, unmanned aircraft (UA) designed for intelligence, surveillance and reconnaissance (ISR) missions, was used to complete the demonstrations. End-user sensor tasking, simulated handling of system faults, and overall communication range were evaluated through a series of flight demonstrations -- each successfully completed by SkyWatcher. Portland, Oregon-based FLIR Systems, Inc. provided the Star SAFIRE III sensor used in the demonstrations.

SkyWatcher is the ISR component of SkyForce, Proxy Aviation’s comprehensive, network-centric unmanned aircraft system. SkyForce is designed to manage the cooperative flight of up to 12 unmanned aircraft in constellation formation while simultaneously distributing sensor control and viewing capability among multiple end users. The system is comprised of three main components: multiple, optionally piloted, unmanned aircraft with various quick-change payloads; a mission-management ground control station; and remote and mobile user terminals.

Col. Larry Felder, USAF UAVB Commander, said “The USAF UAV Battlelab, in cooperation with Proxy Aviation Systems, successfully conducted initial demonstrations of the SkyWatcher platform and its associated ground control station. SkyWatcher and SkyForce have potential to bring valuable combat capabilities to the warfighter.”

Don Ryan, Proxy Aviation’s Chief Executive Officer, said, “We are extremely pleased to be working with the United States Air Force UAV Battlelab and are excited with the promising results of the demonstration. Based on these recent successes, SkyForce is now one step closer to being deployed to execute critical unmanned missions around the world.”

In addition to SkyWatcher, Proxy Aviation’s UAS also includes the optionally piloted, high-performance SkyRaiderTM. Currently under development, this UA is designed to operate at higher speeds and altitudes and carry special-purpose payloads.

About Proxy Aviation Systems

Proxy Aviation Systems designs and manufactures fully autonomous, optionally piloted unmanned aircraft systems (UAS) for use in intelligence, surveillance, reconnaissance and other special missions. Proxy Aviation’s system addresses the long endurance, medium altitude, multi-payload requirements set forth by the U.S. military and the Department of Homeland Security. Founded in 2003 as a Delaware corporation, Proxy Aviation is headquartered in Germantown, Maryland. For more information, visit www.proxyaviation.com.

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Proxy Aviation Systems, Inc., SkyForce, SkyWatcher and SkyRaider are trademarks of Proxy Aviation Systems, Inc. in the United States. All other products and names are or may be trademarks or registered trademarks of their respective owners.