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[RIGATONI]

~AVTX...some highlights in the Q......

Advance Technologies Inc. is a developer of Infrared Enhanced Vision Technology and commercial solutions. The company has a worldwide license from Hughes Aircraft company, Los Angeles, California for a patented advanced infrared imaging system. Advance Technologies licenses and develops applied infrared enhanced vision solutions for use in diverse industries including aviation, recreational vehicles, commercial trucking, marine, security, and fire fighting applications. The Company is currently engaged in the development of night vision systems with applications in the commercial sector.

At the NBAA show in Orlando, it was announced that Kollsman and FedEx have reached an agreement whereby Kollsman will provide EVS systems for FedEx's fleet of wide body aircraft. This market is estimated at 200 aircraft. The aircraft types involved are Boeing MD-10 & MD-11, and the Airbus A300 & A310. These additional aircraft types represent a major accomplishment for EVS.

The Company is currently engaged in the development of a night vision system with applications in the military as well as civil. The Company has an agreement with a Taiwan company wherein they are jointly developing the night vision system for use in Class A coaches. The Company is also involved in the development of other Electro-optical mechanical devices

In February of 2003 the Federal Aviation Administration submitted a proposed change for operating rules that if adopted would greatly expand the EVS market opportunities. These changes deal with the operating rules for flight operations under low or reduced visibility conditions. Advance Technologies Inc. has responded to the Federal Registrar notice of proposed changes. These changes if adopted will make the certification process for EVS easier. Advance Technologies Inc. is looking forward to the finalization and the introduction of these needed changes

Kollsman has released no information on their future production plans. Their end user continues to expand the application to additional aircraft through certification activity with the FAA. This will serve to increase the EVS market.

At the NBAA show in Orlando, it was announced that Kollsman and FedEx have reached an agreement whereby Kollsman will provide EVS systems for FedEx's fleet of wide body aircraft. This market is estimated at 200 aircraft. The delivery of EVS to this market will result in four additional aircraft types receiving certification for EVS. This is a significant milestone in the EVS program.

The completion of the FedEx certification will addition several additional aircraft types to be authorized for EVS equipment. The aircraft types involved are Boeing MD-10 & MD-11, and the Airbus A300 & A310. These additional aircraft certification will facilitate the operators of these aircraft types to incorporate EVS into their fleet operations. The cost and time associated with certifying each aircraft type for EVS remains the largest hurdle for full industry acceptance. These additional aircraft types represent a major accomplishment for EVS.

The License Agreement (July 1997) between Kollsman and ATI has a royalty schedule that was specifically tailored to achieve two key elements (1) for rapid recovery of the development investment and (2) maximize long term profits to ATI predicated upon a large EVS market. Under the provisions that implement this strategy the initial production units are royalty free. The royalty per unit increases in four discrete steps to a maximum value per unit.

Kollsman Instruments released a PRESS RELEASE in September 2002, titled, KOLLMAN'S ENHANCED VISION SYSTEM PRODUCTLINE EXPAND. The Press Release announced the introduction of a "new reduced performance EVS version" called Night Window TM, a low cost derivative of the high performance Kollsman's "All-weather Window" system. The expansion of Kollsman into the higher volume, lower cost EVS market has been anticipated by Advance Technologies. This market is larger and is more accessible from an FAA certification standpoint.



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Gulfstream Aerospace announced at the NBAA show that EVS is available as optional equipment on the G500, G-V, G-400, G-IVSP, and G300 business jets. The optional equipment is available on new aircraft or retrofit to in service aircraft. In addition, EVS will be standard equipment on the new G550 and the newly announced G450. Gulfstream Aerospace has received worldwide acclaim for the EVS, and as a result GAC is aggressive marketing EVS for sales in both the new and after market sectors.