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Wednesday, 04/15/2015 7:09:27 PM

Wednesday, April 15, 2015 7:09:27 PM

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June 12, 2014


World Surveillance Group Issues Letter to Shareholders

KENNEDY SPACE CENTER, FL--(Marketwired - Jun 12, 2014) - (US-RET) Lt. Colonel Drew West, the Chairman of the Board of Directors of World Surveillance Group Inc. (PINKSHEETS: WSGI), a developer of lighter-than-air unmanned aerial systems (UAS), has issued a letter to shareholders. Lt. Colonel West was appointed Chairman of WSGI on June 5, 2014.

June 12, 2014

Dear Shareholders,

I'd like to take this opportunity to thank you for your ongoing commitment to WSGI. I also wanted to let you know how excited I am to work with a company that has been a partner of mine for the past couple years and with a management team that I have so much admiration for. The accomplishments made by the team in the past few years have been impressive. That being said, we have a tremendous amount of work to do in an effort to reach our goals and improve our Company's performance. I am confident that my years of military experience combined with my success in the private sector will compliment those of the management team so that we can work together for the growth and success of WSGI.

I am pleased to report that we have several pro-active initiatives related to the commercialization of the Argus One airship. As identified on WSGI's website, the Argus One is undergoing several operational assessments by members and associates of the Ohio Lighter Than Air UAS Consortium. The Consortium is presently focused on developing a new propulsion system and a set of Argus One-specific sensor and payload options to enhance its performance and marketability. So far, the Consortium consists of industry partners and research entities and supporting associates. By fourth quarter this year, we believe the academic team of the Consortium should be on-line with at least one or more major university research departments committed to contributing to the project. Various tests and flight demonstrations will likely continue through 2014.

Concurrently, WSGI leadership is executing a market evaluation as to the relevancy of the intended applications of the Argus One, and new possibilities for untethered lighter-than-air UAS in regards to intelligence, surveillance and reconnaissance, communications, data distribution and cyber security. We have already had several productive conversations with representatives from the worlds of business, government and academia, including subject matter experts on unmanned stratospheric operations. These discussions should issue in an updated business case document for viable military and commercial applications by end of the third quarter 2014 that will further clarify and focus our on-going sales efforts for the Argus One.

In regards to our GTC business, GTC is witnessing a very strong and increasing global demand for its mobile satellite services (MSS) products. The number of customer transactions for MSS product orders has increased by approximately 525% for the first five months of 2014 compared to the same period in 2013 and non-related party revenue from sales of MSS products has increased by over 945% for the first five months of 2014 compared to the same period in 2013.

We have also seen significant growth in sales of Globalstar related products, specifically simplex airtime which has seen an increase of more than 900% for the first five months of 2014 compared to the same period in 2013. This is due primarily to GTC having secured a number of very profitable tracking contracts during the past year, some of which were awarded directly as a result of GTC's advanced mapping portal, GTCTrack. This portal is proving to be very popular with customers that require a single platform for monitoring and tracking a wide range of GPS satellite tracking devices.

During late 2013, GTC began selling a small number of its products on Amazon.com, with the majority of products being fulfilled by Amazon directly to customers. Sales through Amazon have helped to contribute towards the significant jump in GTC revenue during 2014 to date. Amazon.com shipped GTC products to more than 550 customers in the first five months of 2014.

The significant jump in our recent MSS revenue is a result of a large global market for the products we sell. GTC has a worldwide customer base as the majority of the products sold by us can operate anywhere in the world. We have achieved these results with very limited resources and personnel. I believe we can significantly increase our MSS revenues going forward by expanding our website product range, increasing investment in Google AdWords, expanding our range of products on Amazon.com, opening an identical store on Amazon.ca and recruiting additional personnel globally to pursue new business opportunities and address the increasing number of inquiries we receive 24 hours a day from all over the world. Additionally, we intend to aggressively pursue significant new tracking business opportunities that have been presented to us that could prove highly profitable going forward.

As of June 5, 2014, WSGI completed a share exchange resulting in our ownership of 10 million shares of Series D Convertible Preferred Stock of Drone Aviation Holding Corp. (PINKSHEETS: DRNE). We will hold this valuable asset for future business initiatives.

In addition to the re-focus on the various sectors of our business, WSGI is also committed to the review of and improvement in our balance sheet and the pursuit of acquisition opportunities beneficial to the Company. This is an exciting time to be at WSGI and I look forward to serving the shareholders and working with my fellow WSGI teammates to reward your long-standing loyalty.

For additional information about WSGI, please visit www.wsgi.com.
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