Alabama Aircraft Announces New Contract for Subsidiary Space Vector Corporation

Alabama Aircraft Industries, Inc. (NASDAQ: AAII) announced today that its subsidiary, Space Vector Corporation, has been awarded a contract for the development, qualification, testing and production of GPS Metric Tracking Units for United Launch Alliance (ULA) of Centennial, Colorado, a joint venture between Boeing and Lockheed Martin that operates space launch systems using the Atlas V, Delta II and Delta IV. It is estimated that the contract will be worth approximately $4.9 million over the next two years.

Ron Aramini, president and chief executive officer of AAII stated, "We are very pleased to announce this award. Space Vector has become a pioneer in the production of GPS tracking units for space vehicles and this unique distinction is a very exciting prospect for the future of Space Vector."

Phil Panzera, president of Space Vector Corporation noted, "With this award from ULA, Space Vector's innovative and custom GPS solutions--which were also recently selected for use on U.S. Missile Defense Agency target programs--are now nicely positioned to assist many other launch vehicle providers in meeting the new USAF range safety requirements."

Alabama Aircraft Industries, Inc., with executive offices in Birmingham, Alabama, and facilities in Alabama, and California, performs maintenance and modification of aircraft for the U.S. Government. The company also provides aircraft parts and support and engineering services and full service overhaul and repair for a wide range of aircraft. AAII also develops and manufactures rocket vehicles and related subsystems and components.

This press release contains forward-looking statements made in reliance on the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements may be identified by their use of words, such as "believe," "expect," "intend," "anticipate," "estimate" and other words and terms of similar meaning, in connection with any discussion of the Company's prospects, financial statements, business, financial condition, revenues, results of operations or liquidity. Factors that could affect the Company's forward-looking statements include, among other things: changes in global or domestic economic conditions; the loss of one or more of the Company's major customers; the Company's ability to obtain additional contracts and perform under existing contracts; the outcome of pending and future litigation and the costs of defending such litigation; financial difficulties experienced by the Company's customers; potential environmental and other liabilities; the inability of the Company to obtain additional financing; material weaknesses in the Company's internal control over financial reporting; regulatory changes that adversely affect the Company's business; loss of key personnel; and other risks detailed from time to time in the Company's SEC reports, including its most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. The Company cautions readers not to place undue reliance on any forward-looking statements, which speak only as of the date on which they are made. The Company does not undertake any obligation to update or revise any forward-looking statements and is not responsible for changes made to this release by wire services or Internet services.

SOURCE: Alabama Aircraft Industries, Inc.

Alabama Aircraft Industries, Inc. Doris Sewell, 205-510-4935