Datron Systems Announces Airborne Antenna Contracts From Both Rockwell Collins and Boeing.

Business Editors/High-Tech Writers

VISTA, Calif.--(BUSINESS WIRE)--Aug. 23, 2000

Datron Systems Incorporated (Nasdaq:DTSI) today announced receipt of two development contracts funded for a total of more than $1 million from Rockwell Collins (NYSE:ROK) and the Boeing Company (NYSE:BA).

Rockwell Collins through its joint venture with News Corporation (NYSE:NWS)(NWS.A) called In Flight Network(TM) plans to provide live television, recorded video, audio, Internet and e-mail services throughout the world to airline passengers, both in flight and on the ground. The Boeing Company through "Connexion by Boeing(SM)" plans to provide passengers with Internet and corporate intranet access, e-commerce, live television and entertainment, transmission and receipt of data, shopping, travel and destination information -- all in real time.

The contracts call for development work related to the design of lens antennas derived from Datron's patented Luneburg lens technology, which was initially developed for airborne direct broadcast satellite television and first flown on a commercial airliner in 1996. The current contracts call for engineering services and products ranging from feasibility analyses to delivery of limited quantities of flight test units. Completion of the latter requirement is dependent on additional funding from the customer.

The current contracts do not cover production quantities and there are presently no assurances such contracts will be awarded to Datron. However, these development contracts are precursors for Datron to be considered as a supplier for production quantities and thus to participate in a potentially significant opportunity.

According to published information by the two customers who have issued Datron development contracts, it is their intent to begin installing two-way, wide-band satellite communication systems on commercial airliners in 2001. If Datron's airborne wide-band satellite communication antennas are ordered in production quantities in support of these initiatives, the Company has the opportunity to begin servicing a potential market with an installed base of approximately 7,000 airliners among the top 50 airlines alone. In addition, new jetliners are forecasted to be put into service at the rate of approximately 800 per year. These figures suggest a total potential market of approximately $500 to $600 million, with new airplanes providing an additional potential market of $70 to $80 million annually.

David A. Derby, chairman, president and chief executive officer of Datron Systems, stated, "We hope the information contained in this news release is read carefully, yielding neither 'irrational exuberance' nor unfounded disappointment. We wish to emphasize that Datron is not yet in receipt of production contracts for airborne wide-band antennas for the airlines, and it is entirely possible we may never receive such contracts.

"We remain, however, proud to be in receipt of development contracts based on our patented technology from not one, but both major developers of wide-band airborne satellite communication systems for the airlines, and we are acting on the belief that Datron is likely to participate in a portion of this exciting new market."

This news release may contain "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. A variety of factors could cause the Company's actual results to differ from the anticipated results expressed in such forward-looking statements. These include, among others, uncertainties stemming from the dependence of the Company on foreign sales and on large orders from a relatively small number of customers, risks relating to the decline in the Company's traditional defense business and the Company's efforts to develop and market consumer products, lack of timely development or customer acceptance of new products, changes in or unavailability of products and services offered by satellite service providers and their related suppliers, worldwide economic downturns and currency devaluations, restrictions that may be imposed by the U.S. government on the export of Company products, and the impact of competition. Investors are referred to the Company's periodic reports under the Securities Exchange Act of 1934, including without limitation the Investment Considerations set forth in the Company's Annual Report on Form 10-K.

Datron Systems provides products and services addressing the needs of emerging satellite and radio communication markets.