ADSX Applied Digital Solutions (MM)

Pilot Program to Evaluate OuterLink System Regarding National Guard, Department of Homeland Security Operational Requirements for Secure Communications and Real-Time Management of Mobile Assets SO. ST. PAUL, Minn., June 8 /PRNewswire-FirstCall/ -- Digital Angel Corporation (AMEX:DOC), an advanced technology company in the field of rapid and accurate identification, location tracking, and condition monitoring of high-value assets, announced today that its OuterLink subsidiary has won a $3.2 million contract from the South Carolina Army National Guard. The pilot project will demonstrate the capability of OuterLink's satellite-based Automatic Flight Following System (AFFS) to communicate with helicopter and ground vehicle fleets at the McEntire National Guard Base at Eastover, SC. A key component of the program will apply the OuterLink system's secure wireless data communications to demonstrate seamless interoperability with existing communications equipment of the Department of Homeland Security (DHS) and other federal or state public safety agencies, said OuterLink President Paul F. Newcomb. The terms of the 12-month contract call for OuterLink to deliver the Automatic Flight Following System; integrate it into existing National Guard equipment including helicopter and ground based vehicle operations; to test and operate it; and to provide logistical support, Newcomb added. The contract became effective on June 1, 2006. "Our systems provide dependable satellite communications every day for our customers, that include U.S. Customs & Border Protection, Gulf of Mexico helicopter operators, and more than 100 air ambulance operators we work with," Newcomb said. "This program will not only demonstrate the interoperability between our satellite communications network and the existing National Guard and DHS terrestrial communications networks, but also will demonstrate the system's integration with the aircraft Vibration Monitoring System (VMS), providing in-flight reporting of aircraft vibration and other mechanical data. This aspect of the contract is a further expansion on our award-winning aircraft Health and Usage Monitoring System (HUMS) integration project with the US Navy. We worked very hard to win this contract and we are looking forward to expanding our role in supporting DHS missions to include National Guard operations." Digital Angel's ultimate goal is to make the OuterLink satellite system the standard for providing condition-based maintenance information for all National Guard units as well as other agencies involved with the DHS and with the Department of Defense, said Digital Angel President and CEO Kevin McGrath. The contract allows for extensions to cover the possibility for additional work after the initial pilot program is completed. "Our system is designed to answer a very critical communications need: providing reliable communications in any condition and particularly when helicopters and other aircraft are operating beyond any radio coverage and at low altitudes that are well below existing radar coverage," McGrath said. "If this pilot project progresses like we are confident it will, we believe that other units of the National Guard, Department of Homeland Security and Defense Department will recognize the value of the system, which may lead to additional installations in the future." U.S. Rep. Marty Meehan (D-Massachusetts), whose district includes OuterLink's Lowell, MA headquarters, congratulated OuterLink on developing the technical expertise that led to winning the new contract. "OuterLink is on the cutting edge of secure wireless data transfer and the Army National Guard will benefit from their expertise," Meehan said. "I am pleased to have assisted OuterLink in obtaining this contract and I look forward to their continued growth." Newcomb said that the value of the OuterLink communications system is proven on a daily basis in the Gulf of Mexico where approximately 650-700 helicopters operate up to 9,000 air taxi flights a day between the coast and offshore oil drilling platforms that are now up to 200 miles offshore. OuterLink's In-Flight Reporting System monitors and tracks aircraft to ensure safety while in flight. About OuterLink Based in Lowell, MA, OuterLink, a Digital Angel subsidiary, provides satellite-based mobile asset tracking and data messaging systems. Used to manage the deployment of aircraft and land vehicles, these systems provide real-time location reporting, secure bi-directional data communication and comprehensive asset management software. They enable ground personnel to track the minute-by-minute movement of mobile assets, monitor on-board sensors and conduct bi-directional messaging with aircraft pilots and ground vehicle operators. For more information, visit http://www.outerlink.com/. About Digital Angel Corporation Digital Angel Corporation develops and deploys sensor and communications technologies that enable rapid and accurate identification, location tracking, and condition monitoring of high-value assets. Applications for the Company's products include identification and monitoring of humans, pets, fish, poultry and livestock through its patented implantable microchips; location tracking and message monitoring of vehicles and aircraft in remote locations through systems that integrate GPS and geosynchronous satellite communications; and monitoring of asset conditions such as temperature and movement, through advanced miniature sensors. Digital Angel Corporation is majority-owned by Applied Digital Inc. (NASDAQ:ADSX). For more information about Digital Angel, please visit http://www.digitalangelcorp.com/. The statements in this press release that are not strictly historical, are "forward-looking" statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and are intended to be covered by the safe harbors created by these sections. The forward-looking statements are subject to risks and uncertainties and the actual results that the Company achieves may differ materially from these forward-looking statements due to such risks and uncertainties, including, but not limited to; that Applied Digital Inc. owns 55.4% of the Company's common stock; that new accounting pronouncements regarding expensing of share based compensation may impact the Company's future results of operations, the Company may continue to incur net losses, infringement by third parties on the Company's intellectual property or development of substantially equivalent proprietary technology by the Company's competitors could negatively impact the Company's business, domestic and foreign government regulation and other factors could impair the Company's ability to develop and sell its products in certain markets, the Company relies on sales to government contractors for its animal identification and search and rescue beacon products, and any decline in the demand by these customers for such products could negatively affect the Company's business, the Company depends on a single production arrangement for its patented syringe-injectable microchips, and the loss of or any significant reduction in the production could have an adverse effect on the Company's business, technological change could cause the Company's products to become obsolete, the loss of one of the Company's principal customers could negatively impact the Company's net revenue, the Company's earnings will decline if the Company writes off goodwill and other intangible assets, options and warrants outstanding and available for issuance may adversely affect the market price of the Company's common stock, currency exchange rate fluctuations could have an adverse effect on the Company's sales and financial results, the Company depends on a small team of senior management. A detailed statement of risks and uncertainties is contained in the Company's reports to the Securities and Exchange Commission, including in particular the Company's Form 10-K for the fiscal year ended December 31, 2005. Investors and stockholders are urged to read this document carefully. The Company can offer no assurances that any projections, assumptions or forecasts made or discussed in this release will be met, and investors should understand the risks of investing solely due to such projections. The Company undertakes no obligation to revise any forward-looking statements in order to reflect events or circumstances that may arise after the date of this press release. Contact: Allen & Caron Inc. Mike Lucarelli (investors) Len Hall (media) (212)-691-8087 (949)-474-4300 DATASOURCE: Digital Angel Corporation CONTACT: Investors, Mike Lucarelli, +1-212-691-8087, , or Media, Len Hall, +1-949-474-4300, , both of Allen & Caron Inc., for Digital Angel Corporation Web site: http://www.digitalangelcorp.com/ http://www.outerlink.com/

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