Argon ST, Inc. Announces Increase for U.S. Army Contract.

FAIRFAX, Va. -- Argon ST, Inc. (NASDAQ:STST), announced today that a contract for the Operational Test-Tactical Engagement System (OT-TES) Communications Upgrade program has been increased in scope and value. U.S. Army, PEO-STRI/PM-ITTS added $6.7 million to the contract value bringing the total value to over $40 million. The Government intends to continue its practice of incrementally funding the program.

OT-TES provides a mobile, high-fidelity, tactical engagement simulation and field instrumentation system that collects and reports real-time casualty assessment and other required data. OT-TES is capable of supporting operational testing and evaluation of Army weapon systems, doctrine and tactics. The modification to the contract includes numerous updates to the technical baseline to better support future operational testing activities at Fort Hood, Texas.

San Diego Research Center (SDRC), a wholly-owned subsidiary of Argon ST, leads the OT-TES Communications Upgrade program team, which includes L3/Nova Engineering of Cincinnati OH, Icon Systems of San Diego CA, TESCO of Fort Hood TX, Harris of Melbourne FL, Inter-Coastal Electronics of Mesa AZ, and Research Analysis & Maintenance, Inc. of El Paso TX.

Jay Grove, Argon ST Vice President for Network Systems, stated, "We are pleased that PM ITTS has awarded this contract modification. We, with our partners, are dedicated to bringing cutting-edge communications and networking capability to the test and evaluation community.

About Argon ST, Inc.

Argon ST designs, develops, and produces systems and sensors for the Command and Control, Communications, Computers, Intelligence, Surveillance, and Reconnaissance (C4ISR) markets including SIGINT (signals intelligence), ESM (Electronic Support Measures), EW (Electronic Warfare), imaging, and acoustic systems serving domestic and worldwide markets.

Forward-Looking Statements

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