AeroMechanical Receives Government Funding
Feb. 24, 2011, Calgary - AeroMechanical Services Limited is pleased to announce it will be receiving a significant investment from the Canadian federal government of $1.96 million to assist in the development and certification of the Company’s next-generation, unique, patented Automated Flight Information Reporting System (AFIRS) product.
The funding, which AMA is expected to repay over the course of the next
15 years, was granted by the the Canadian federal government's Strategic
Aerospace and Defence Initiative ("SADI") program.
AMA has scheduled a press conference at the Company's head office in Calgary, Alberta (Suite 200W, 1144-29th Ave NE) starting at 11 am MT on Wednesday, February 23, 2011 whereby the Honourable Rob Merrifield, Minister of State (Transport), on behalf of the Honourable Tony Clement, Minister of Industry, will make the official announcement and AMA will demonstrate the capabilities of its AFIRS product, including FLYHTStream™, real-time data streaming from an aircraft in flight. The FLYHTStream emergency data streaming technology represents a significant improvement over the more widely known black box, because of its ability to transmit information in real-time to a ground based server. This avoids the necessity of having to recover the black box.
“On behalf of the Government of Canada, I am pleased to announce this investment in one of Alberta’s most promising aerospace firms,” said Minister Merrifield. “The project we are investing in today will create or maintain Canadian research jobs and help keep Canada at the forefront of the international aerospace industry.”
AMA applied to the SADI program in April 2010 and SADI has agreed to fund $1.96 million (an amount equal to 30 per cent of AMA's development, certification and Supplemental Type Certificate ("STC") costs for the Company’s patented AFIRS 228 model). The agreement will require AMA to begin repayment to SADI April 30, 2014 for a period of 15 years. Repayment is based on predetermined percentages of the total investment escalating yearly from 3.4678 per cent on April 30, 2014 to 24.5372 per cent on April 30, 2028, which is an approximate effective interest rate of 4.62 per cent per annum. The funding will enable AMA to employ additional Canadian staff to complete the certification of this unique product.
The current AFIRS 220 has been accepted by airlines globally because of its real-time capabilities for operations planning and monitoring, fleet management, fuel and emissions reduction, flight following and flexible communications capabilities. Clients and prospects are requesting more capability and AFIRS 228 is AMA’s response and commitment to provide the industry with certified products that meet or exceed regulatory requirements. AFIRS is an integrated and multi-functional data-transfer system with no comparable products in the world today.
“AeroMechanical Services Ltd. has spent 13 years developing and marketing innovative technologies for the global aviation community,” said Bill Tempany, Chief Executive Officer of AMA. “Our patented on-board system is the only product in the world that has demonstrated the capability to transmit all of the black box data from an aircraft in flight (FLYHTStream™) and continuous position information to the ground in real time, on demand, making the technology affordable to the whole industry. The participation by Industry Canada through the SADI program is a great benefit to our Company.”
The funding will commence in 2 separate tranches. The first half ($980,000) was conditional on AMA raising additional funds and that requirement was achieved December 23, 2010, note the press release (AeroMechanical Services Announces Closing of Concurrent Private Placements). The second half of the funding is conditional on the financial performance of the Company after December 31, 2011, which includes having sufficient funding available to complete the project.