Total potential value of the three orders is $102.6 million, with $57.7 million funded immediately.

- The first order is a not-to-exceed contract for five RQ-7B Shadow 200 systems, the Army's latest and most advanced fielded TUAS. The award commits $32.6 million to production now, with up to an additional $30.9 million added by the first quarter of 2007.

- The second contract, with a potential value of $27.6 million, authorizes initial funding of $13.5 million and calls for the purchase of component equipment, including an upgrade of the electro-optical/infra-red payload equipment to the newest POP-300 configuration for the existing fleet of Shadow aircraft, additional engines for fleet retrofit, and enhancement of One System ground control stations to a single configuration, consistent with the current production baseline. Additional funding is expected by the first quarter of 2007.

- The third order, issued as a fully funded, not-to-exceed contract for $11.5 million, authorizes repair and refurbishment of Shadow systems used in support of Operation Iraqi Freedom (OIF) and the Global War on Terrorism.

"The Shadow has proven itself to be an outstanding asset to U.S. forces," said United Industrial and AAI President and Chief Executive Officer Frederick M. Strader. "Shadow systems are making major contributions in Iraq and Afghanistan, providing brigade commanders with critical intelligence and superior situational awareness."

"With these latest contracts," Strader added, "the Army and AAI are building on the system's capabilities to ensure that Shadow will continue to support U.S. and allied warfighters for many years to come."

In addition to the production and upgrade of Shadow systems, AAI provides performance-based logistics support and sustainment operations for fielded and deployed U.S. Army TUAS units.

Since December 1999, when the U.S. Army selected AAI to be its TUAS prime contractor, the company has been awarded a series of annual production contracts now totaling 70 Shadow systems.

Fifty-one systems have been delivered to the customer, and system deliveries from backlog now extend through September 2008. Work will be performed at AAI's manufacturing facilities in Hunt Valley, Md.

Worldwide, Shadow systems have flown more than 33,900 missions in excess of 129,000 flight hours - more than 85 percent in support of U.S. and allied operations in OIF and Operation Enduring Freedom.

In addition to the Shadow 200, AAI manufactures a number of other unmanned aircraft systems and is recognized for its design and development of advanced ground control stations and interoperable network technologies. The company has delivered a variety of aircraft systems to allied armed forces.

Furthermore, AAI manufactures Aerosonde unmanned aircraft systems for an array of military and civil aviation uses. Customers include the Australian Defence Science and Technology Organisation, NASA and the National Oceanic and Atmospheric Administration in the United States, and the Meteorological Institutes of Japan and Korea.

AAI's One System ground control station is compatible and interoperable with multiple unmanned aircraft systems, including Shadow, Pioneer, Hunter, Warrior(TM), Fire Scout, Eagle Eye, and Aerosonde. Commonality will reduce future training and operating costs for U.S. and allied armed forces.

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