Aerion (Supersonic Jet) and Airbus Announce New Agreement, Expanded Collaboration

More North American-based Airbus Group, Inc. resources made available to bring the supersonic AS2 to market

Las Vegas, NV, NBAA – November 16, 2015 With joint engineering efforts
accelerating on the Aerion AS2 supersonic business jet program, Aerion and
Airbus Group, Inc. today announced a new agreement that will expand North
American-based Airbus Group, Inc. resources to the AS2 program. Support from
Airbus Group operations in North America will include engineering, procurement
and supply chain management, logistics planning, program management, and
government relations. These new resources will augment engineering support
from Airbus Defence and Space (AIRBUS D&S) in Spain.

“The collaboration between Aerion and Airbus Group has been extremely
beneficial and productive,” said Allan McArtor, Chairman and CEO of Airbus
Group, Inc. “The further we proceed along the development path with Aerion,
the greater our enthusiasm for this program and the deeper our commitment.
Under our new agreement, our two companies are working as one to bring
Aerion’s supersonic AS2 to the business jet market,” he added.

“This undertaking is completely in line with Airbus Group’s legacy of developing
innovations in flight,” said McArtor, “such as our current work on the Perlan
Mission II glider - the world’s first engineless aircraft designed to reach the edge
of space - which made its successful first flight recently, and the E-Fan
technology demonstrator - which this summer became the first fully electric,
twin-engine aircraft taking off under its own power to fly across the English
Channel.”

“Airbus Group has a long history of supporting innovation, and Aerion’s
innovative aerodynamic technology unquestionably offers long-term benefits
to the industry in terms of performance and efficiency,” said Doug Nichols,
Aerion CEO.

Engineering progress report
At the one-year anniversary of the Aerion/Airbus Group collaboration, the two
companies drew back the curtains on engineering efforts that have proceeded
quietly, but steadily, since the first joint engineering team meeting in 2014.
Airbus Defence and Space has made significant progress in the engineering of
airframe structures, the AS2’s digital (fly-by-wire) flight control system, its
integrated fuel system, and landing gear. Notable accomplishments include
preliminary designs for:

• A strong and light 10-spar carbon fiber wing structure;
• Fuselage and empennage structures;
• An innovative articulating main landing gear system that minimizes space
requirements in the fuselage when stowed/retracted;
• A fuel system that is integrated with the digital fly-by-wire system for
control of center of gravity;
• Flight control design that takes advantage of small, powerful actuators that
can be housed in the AS2’s thin flying surfaces;
• A fly-by-wire system based on Airbus Group’s long experience with digital
flight control technology.

To supplement the design process, AIRBUS D&S has built a sample titanium
wing leading-edge section for evaluation and is testing composite material
specimens to optimize material properties.

Aerion is the lead for other systems, such as avionics, electrical, environmental
control, hydraulics, and auxiliary power. In conjunction with AIRBUS D&S,
Aerion had made preliminary space allocations for every system with weight and
balance considerations in mind. Candidate suppliers have been identified and the
supplier selection process has begun.

September joint design review highlights engineering progress
This past September, senior engineering staff from Aerion, AIRBUS D&S, Airbus
Group, Inc., and other tier-one equipment suppliers gathered at Aerion
headquarters in Reno for a four-day technical and program review, covering
engineering accomplished to date on all structures and aircraft systems.
“The results of this comprehensive quarterly review were nothing short of
excellent,” said Ken McKenzie, Senior Vice President for Strategy and Corporate
Development at Airbus Group, Inc. “We see clear and achievable technical
solutions to the design of a supersonic jet, and a realistic roadmap for helping
Aerion proceed toward construction and flight.”

“The take-away from the design review and the effort this past year,” said
Aerion Senior Vice President for Aircraft Development Mike Hinderberger, “is
that we have moved out of the conceptual design phase into commercializing
Aerion technology.

We are doing the engineering work today that will allow us to build and fly a
supersonic jet at the turn of the next decade.”

Engine selection nearing
“We are targeting the first half of 2016 to select a propulsion system, which will
enable us to formally launch the program shortly thereafter,” reported Nichols.
Aerion is planning on a first flight of the AS2 in 2021 and entry into service
in 2023, following FAA certification. EASA certification would follow closely
thereafter.

Aerion has identified existing core engines suitable for adaptation to the needs
of supersonic flight. “We will proceed with an engine that allows us to meet our
performance goals with the minimum changes required,” said Nichols. “Aerion
is focused on an engine solution that meets Stage 4 noise standards while
preserving long-range supersonic performance. This is a significant challenge
with a low-bypass supersonic engine, but solutions are in sight with today’s
engine technology.”

Aerion will bring to market a supersonic jet that operates efficiently within
today’s regulatory environment, including rules regarding supersonic flight over
land. This takes advantage of the ability of the AS2 to operate efficiently just
below the speed of sound at Mach 0.95 to 0.98, and at speeds up to Mach 1.5 over
water and other areas where supersonic flight is permitted.

A win-win collaboration
In September 2014 Aerion and Airbus Group announced their technology
collaboration. That relationship was conceived as a two-way street, with Airbus
Group receiving exclusive access to Aerion high-speed technology as well as
Aerion proprietary software for analyzing high-speed airflow and for airframe
optimization. The collaboration brings a full spectrum of engineering disciplines
to design, build, and certify the AS2 business jet. This latest agreement will
expand that support beyond the engineering of the aircraft and into its
commercialization for the business jet community.

“This is Aerion’s jet and Aerion’s program, with substantial benefits accruing to
Airbus Group,” said McKenzie. “We gain new technology and tools, and through
our collaboration will be expanding engineering knowledge and refining
processes suchas digital manufacturing. The AS2 program will be an incubator for innovation in
design, engineering, and manufacturing.”

Airbus Group will provide major components and Aerion will conduct final
assembly in the U.S. Both companies envision a long-term relationship for
ongoing technical support.