AeroMechanical Services Signs a New Canadian Customer

Calgary, Alberta – January 16, 2012 -- AeroMechanical Services Ltd. (TSX-V: AMA) (the "Company" or "AMA") has signed a contract with an airline that will become the Company’s largest Canadian customer for seven Automated Flight Information Reporting System ("AFIRSTM") 220 and 12 of the next generation AFIRS 228B, for a total of 19 aircraft.

The contract requires AMA to install AFIRS 220 and AFIRS 228B on Boeing 737-200, 767-200F and ATR–42/72 aircraft. The airline has been in business for over half a century and operates in major Canadian centres and remote northern regions. The airline also operates charter flights within the country.

“We are extremely pleased to welcome this Canadian operator as a new customer,” commented Matt Bradley, VP of Business Development at AMA. “With this addition, our Canadian customer list is now at eight airlines. The airline has indicated to us that our technology will add significant value to their operation and reinforce their commitment to safety and efficiency.”

AFIRS will enable real-time flight following and 24/7 connectivity between the aircraft and operations through the Iridium satellite communications system. The airline will also utilize AMA’s other services including engine trending, airframe and engine exceedances, and Out, Off, On and In times. The airline will use the data AFIRS provides to operate its Flight Operations Quality Assurance (FOQA) program, a type of safety monitoring program.

AMA will provide equipment and services to the airline over a five-year contract. Installations are scheduled to begin within the year and be completed over the next 18 months. If AMA completes installation on all contracted aircraft and provides recurring service for the full term of the agreement, gross revenue to AMA will be approximately $1,945,260 USD, excluding optional services. The installations for the Boeing 767-200F and ATR–42/72 will commence upon AMA receiving all necessary certifications and no issues are anticipated for the completion of the certifications.

This disclosure as it relates to this agreement is subject to the following disclaimer:

When a contract is initially signed, the intended number of aircraft, pricing and potential installation schedules is agreed to by the parties. The actual installation schedules as well as the number and types of aircraft are often revised throughout the term of the agreement as the airline realigns its fleet of aircraft with its business requirements. Delays in installations can and do occur which can affect the total value of the contracts such that the revenues noted above may not be fully achieved. Fulfilment of the contract terms may also be affected if there are any changes to government statutes, regulations or rules of the applicable governing bodies. The contract terms and values disclosed herein are based on the original information available to AMA upon execution of the contract and are subject to change. For the actual revenue earned, please see AMA’s financial statements including its revenue recognition policy disclosed within the notes to the Audited Annual Financial Statements.

About AeroMechanical Services

AeroMechanical Services Ltd., under the brand name FLYHTTM, provides proprietary technological products and services designed to reduce costs and improve efficiencies in the airline industry. The Company has patented and commercialized three products and associated services currently marketed to airlines, manufacturers and maintenance organizations around the world. Its premier technology, AFIRS™ UpTime™, allows airlines to monitor and manage aircraft operations anywhere, anytime, in real-time. If an aircraft encounters an emergency, AMA’s triggered data streaming mode, FLYHTStream™, automatically streams vital data, normally secured in the black box, to designated sites on the ground in real-time. The company has been publicly traded on the TSX Venture Exchange since 2003 under the trading symbol AMA.

AFIRS, UpTime, FLYHT, FLYHTStream and aeroQ are trademarks of AeroMechanical Services Ltd.

Contact Information

AeroMechanical Services Ltd.
Thomas R. French, CGA
VP Finance and CFO
403-291-7427
tfrench@flyht.com

Barnes Communications Inc.
Colin Languedoc
Senior Consultant
416-367-5000 ext. 225
clanguedoc@barnesir.com

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