Freewing Aerial Robotics Corporation, organized in 1987 under the laws of the State of Maryland, designs and produces aircraft utilizing the Company's proprietary Freewing Tilt-Body™ technology for sale and lease to private sector and government customers in the unmanned aerial vehicle ("UAV") market.
The Freewing Tilt-Body technology includes a series of inventions, for which the Company holds United States and international patents. Aircraft utilizing pivoting wing technology have a hinged wing that allows them to adjust automatically to most wind changes, thermal air currents and other causes of air turbulence. As a result, pivoting wing aircraft are less sensitive to air turbulence, creating a more stable ride than conventional fixed wing aircraft. Furthermore, pivoting wing aircraft are resistant to in-flight wing stalls, which are a major cause of aviation accidents, because their freely hinged wings automatically adjust to changes in the relative positions of the plane and the wind.
The Company's Freewing Tilt-Body technology utilizes and enhances the underlying advantages of pivoting wing technology, resulting in the creation of a stable, thrust-vectored vehicle which can take off, land and near-hover much like a helicopter and yet fly rapidly over distances like a conventional airplane. Since the pivoting wing is aerodynamically decoupled from the rest of the aircraft, it becomes possible to change the attitude of the fuselage (e.g., pointing the body of the aircraft up towards the sky) independently from the pivoting wings which do not stall and continue to fly. By placing the engine in the body of the aircraft, simple and stable thrust-vectoring is achieved because the propeller will tilt up as the body tilts up, while the pivoting wings continue to automatically set the proper angle for generating wing lift without stalling.
Utilizing its proprietary Freewing Tilt-Body technology, the Company's unmanned aerial vehicles are designed to (1) neutralize air turbulence to provide more stable platforms for the recording and measuring equipment they carry, in order to obtain better data and image quality from such equipment; (2) take off and land even where airport runways are not available; (3) perform UAV operations and missions when conventional aircraft would be grounded due to weather conditions; and (4) have fewer moving parts, be inherently stable, and be far less expensive to produce and maintain than rotary wing or other thrust-vectored UAVs.
The market for UAVs is in its early stages and is expected to experience significant growth. According to certain industry analysts and U.S. government officials, the market for UAVs, both military and commercial, should continue to grow substantially in the future, with some estimates of worldwide UAV sales in excess of $5 billion between the years 1995 and 2000.
The Company's basic business strategy has been to (i) develop the strength of its technology, utilizing cash grants from governmental agencies, resources available at reduced rates from universities and their related business incubator programs, and contractual arrangements with established designers of airplanes, (ii) generate favorable publicity and name recognition, within and outside of the aerospace industry, regarding the benefits of the Company's technology, (iii) leverage this publicity and name recognition into strategic alliances with production and marketing partners, which are designed to help the Company achieve its production and marketing objectives and also to create additional favorable publicity and name recognition, thereby increasing the Company's opportunities to create more strategic alliances with advantageous partners, (iv) utilize certain of these strategic alliances to generate sales of the Company's UAV products, by teaming with the partners in pursuit of government UAV contracts and in some instances by converting the aerospace partners into customers of the Company, and (v) utilize outsourcing arrangements to give the Company access to high quality production facilities for manufacturing its UAV aircraft without the capital investment and overhead costs of creating, maintaining and staffing such production facilities.
The Company is marketing its UAV aircraft to the armed services of the United States and selected other countries. While government defense budgets for large, costly items such as manned airplanes have generally decreased since the end of the Cold War, the amounts allocated to UAVs have substantially increased in a number of countries, including the United States.
The Company has established teaming arrangements with existing aerospace companies to pursue and bid for a number of these UAV contracts. The Company's first strategic alliance partner (since 1994), and the source of the majority of the Company's sales revenues to date, is Matra BAe Dynamics (formerly Matra Défense, S.A.) ("Matra"), the largest UAV and missile manufacturer in Europe and part of the third largest defense group in the world. The Company has performed UAV design work as subcontractor to Matra in connection with Matra's UAV development contracts with the French Armaments Agency. In connection with this effort, Matra BAe purchased a UAV from the Company for demonstration and training purposes.
Freewing recently announced the sale to Matra BAe Dynamics of distribution rights for its Scorpion UAV. The territory includes all of Europe and the Middle East. The exact sale price could not be disclosed, but was in the seven-figure range. The Matra BAe name for its UAV system is the Marvel, which combines the Scorpion air vehicle with Matra BAe payloads and command & control systems. Freewing retains all manufacturing rights, and acts as air vehicle supplier for the Marvel system throughout Matra BAe's territory. In 1994 MBD signed a strategic alliance agreement with Freewing in order to use the Scorpion airframe for the Marvel UAV system. At that time Matra bought the exclusivity only for France, the UK and Germany, for a time period into 1998. The new agreement extends MBD's exclusivity through 2002 and dramatically expands the territory for which MBD has distribution rights. MBD's Marvel UAV system is targeted for maritime customers in addition to land-based missions, given that the Scorpion airframe can operate from areas as small as helipads.
In March 1996 the Company signed an agreement with Rockwell International Corporation (now part of The Boeing Company) for joint marketing activities in the United States. Freewing and Boeing are presently performing a joint flight test program. The Company is in the process of establishing more such relationships in the United States and abroad.
The Company is also marketing its UAVs and UAV remote sensing services to private sector customers and civilian governmental agencies for such varied activities as communications relay, power line inspection, commercial fish spotting, environmental monitoring, disaster assistance, border patrol and drug enforcement work. In this regard, the Company has a contract with the National Aeronautics and Space Administration ("NASA") for the lease of Company UAVs to perform calibration services with respect to NASA satellites.
The Company is beginning production of its UAVs for sale and/or lease pursuant to a production contract signed in March 1996 with L&L Tooling and Manufacturing Inc. ("L&L"), a Texas-based supplier to the aerospace industry. The tooling for the Company's Scorpion Model 100-50 UAV was completed by L&L, and L&L delivered the first four commercial production vehicles of such model to the Company. This work was performed by L&L in a noncash transaction in exchange for Common Stock of the Company.
The Company holds nine United States patents that have been issued and has filed five additional United States patent applications (and certain corresponding foreign patents and patent applications), all of them involving pivoting wing and/or Tilt-Body technology. The Company's designs for Tilt-Body aircraft have won the 1993 Discover Magazine Award for Technological Innovation, the 1994 Design News Award for Excellence in Design, the 1995 Design & Engineering Award from Popular Mechanics, the 1996 Award for Best Product from CEO Magazine and the 1996 R&D 100 Award from Research & Development Magazine. In 1994, the U.S. Small Business Administration placed the Company's Tilt-Body technology on its list of the 96 most important innovations by U.S. small firms in the 20th century. In May 1998 Frost & Sullivan gave Freewing its 1998 Market Engineering Entrepreneurial Company Award, saying "This company is working harder, faster, and more efficiently than its more established competitors and is making solid inroads in the market despite the limitations of a small company."
The Company was affiliated with the University of Maryland's Technology Advancement Program from 1989 until late 1996, when it accepted an economic development package from the Bryan-College Station Economic Development Corporation, which entailed a move of the Company's headquarters to College Station, Texas. While maintaining working relationships with University of Maryland researchers, the Company is presently in the process of establishing additional relationships with Texas A&M University researchers.
The Company's management team includes the Company's founder, whose business background include experience in aerospace marketing, defense contracting and international business. The design team for the Company's UAV aircraft include established aerospace designers Burt Rutan and John Roncz.