Northstar Aerospace, Inc. receives $53 million first production contract for
AH-64D Apache Modernization

    
    LISTED: TSX
    SYMBOL: NAS  Common Shares
    

CHICAGO, IL, May 4 /CNW/ - (All amounts in this news release are stated in U.S. dollars.) Northstar Aerospace (Canada), Inc., a subsidiary of Northstar Aerospace, Inc. ("Northstar"), has received a purchase contract from The Boeing Company for the production of transmission components using the innovative split-torque Face Gear technology for the U.S. Army's AH-64D Apache Block III Helicopter Modernization Program.

The $53 million contract is for production of components for 74 transmissions plus initial spares as part of the low rate initial production phase of the Apache Block III Program. Deliveries start in late 2010 and continue through 2012.

The manufacturing process and equipment needed to produce Face Gears, a fundamental component of the innovative transmissions, are proprietary to Northstar. Face Gears, by nature of their gear tooth geometry, presented unique manufacturing challenges to the aerospace industry. Northstar developed a manufacturing solution that included the design and manufacture of multi-axis CNC Face Gear grinding machines capable of meeting the exacting aerospace standards on a production basis.

The split-torque Face Gear transmission initially increases power by more than 20 percent with growth capability to 36 percent within practically the same physical operating space as the conventional transmission. The Face Gear transmission has only two reduction stages, compared to three in the conventional transmission, reducing the number of parts and weight. It is also expected to have 200% better availability.

Northstar has been working on the Apache Block III program under a development contract to Boeing since 1999 and will continue development work into the fourth quarter of 2010. The current Army objective is for 690 AH-64D Apache Block III helicopters over the next 15 to 20 years. Foreign aircraft sales and spares could significantly increase orders for Face Gear transmissions.

"Receipt of this purchase contract is a significant milestone for the Apache Block III Program, Northstar and our many employees who have contributed to the development of Face Gear technology. Sole manufacturing rights for Face Gears will provide Northstar with a building block for profitable growth well into the future. Foreign sales provide additional growth opportunities," said Glenn Hess, President and Chief Executive Officer, Northstar Aerospace, Inc.

Northstar Aerospace (Canada), Inc. is a subsidiary of Northstar Aerospace, Inc. Northstar Aerospace, Inc. (www.nsaero.com) is North America's leading independent manufacturer of flight critical gears and transmissions. Northstar Aerospace is a public company (TSX:NAS) with operating subsidiaries in the United States and Canada. Its principal products include helicopter gears and transmissions, accessory gearbox assemblies, rotorcraft drive systems and other machined and fabricated parts. It also provides maintenance, repair and overhaul of transmissions and drive systems. The Company's executive offices are located in Chicago, Illinois. Its plants are located in Chicago, Illinois; Phoenix, Arizona; Anderson, Indiana; and Milton and Windsor, Ontario.

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For further information: Greg Schindler, Chief Financial Officer, [phone], or [email protected]