AASI Aircraft Secures $7.1 Million New Funding.

Business Editors & Defense/Aerospace Writers

LONG BEACH, Calif.--(BUSINESS WIRE)--March 29, 2001

Advanced Aerodynamics & Structures Inc. (Nasdaq:AASI) today announced that it has received an initial funding of $4,100,000 from a convertible debenture agreement with private investors, who have committed to invest up to $7.1 million within the year 2001.

According to the terms of the agreement, the company will issue up to $7.1 million of 5 year, 5% convertible debentures, which are convertible into common stock of the company.

Dr. Carl L. Chen, chairman, president and chief executive officer of AASI said, "We are very pleased that the investors have a high degree of confidence in us and have agreed to provide financial support to AASI, notwithstanding a very difficult financial market.

"The new funds, plus the $20 million equity line activated last October, will be of great help to AASI as it seeks to achieve its goal of completing the FAA certification process and ramping up for mass production of the JETCRUZER 500(TM)."

David Turner, vice president and chief financial officer, said, "We will make sure that all funds will be used very efficiently in moving toward the success of the JETCRUZER 500 program."

The company currently has 188 JETCRUZER 500 aircraft orders, representing a backlog of $226 million.

The JETCRUZER 500 is a high-speed single engine, corporate propjet aircraft that can accommodate first class seating for six people, including the pilot. Powered by a Pratt & Whitney propjet engine, the JETCRUZER 500 will cruise near jet speeds of 345 miles per hour at altitudes of up to 30,000 ft.

Advanced Aerodynamics & Structures Inc. is a development-stage company organized to design, develop, have certified by the FAA, manufacture and market propjet and jet aircraft for the world business, commercial and government markets.

Certain statements contained in this news release, including statements concerning AASI's ("company") future cash and financing requirements, the company's ability to obtain proceeds from the equity line, the company's ability to continue to obtain market acceptance of the JETCRUZER 500 aircraft, the company's ability to obtain regulatory approval of the JETCRUZER 500, and the competitive market for sales of small business aircraft and other statements contained herein regarding matters that are not historical facts, are forward-looking statements; actual results may differ materially from those set forth in the forward-looking statements, which statements involve risks and uncertainties, including without limitation those risks and uncertainties set forth in the company's Registration Statement on Form SB-2 under the heading "Risk Factors," and the company's Form 10-KSB and Form 10-QSB on file with the SEC.