Cyclone Power Technologies' Licensee in China Completes Initial Milestones in Prototyping Stage

POMPANO BEACH, Fla. January 14, 2011; Cyclone Power Technologies Inc. announced that its licensee Great Wall Alternative Power Systems Ltd. has completed the first important milestones in the prototyping stages of its License Agreement. These targets include completing the design and IP transition work, and assembling their engineering team, needed to commence production of the initial Cyclone engine prototypes for the China market.

"We have created the basis for what I consider from my years involved with U.S. defense projects, an engineering center of excellence " stated Keith McDade, VP of Technology and Engineering of Great Wall, in charge of overseeing design, development and IP protection for the Cyclone technology in China. "We are committed to the highest level of quality in our engineering, and we expect this attention to detail and performance to define the products we develop utilizing Cyclone's technology."

Great Wall anticipates commencing building of initial engine prototypes this quarter. Their current focus is on the Cyclone WHE-25 for use with biomass-to-power generator systems. These will include distributed combined heat and power (CHP) applications, and power sources for bio-char based environmental remediation (water and soil) equipment. Subsequent development will include Cyclone's Mark V and larger engines.

"We see a massive market developing for distributed power in China's rural areas," stated Great Wall's Managing Director, Robert Devine."The first demand driver will be government-financed projects focused on cleaning up water and soil pollution in rural China. With Cyclone, we can deliver a viable biomass-based solution that combines distributed power and environmentally beneficial byproducts to support these efforts locally and at low cost."

Great Wall is led by a group of veteran China operators and investors for the purpose of developing Cyclone's technologies for the China market. Great Wall's Chairman Zhan Shan, a PRC national, previously founded several new energy ventures including China's first private municipal gas company as well as China's first technology developer of large-format lithium-ion batteries. Managing Director Robert Devine has over a decade's experience investing in the PRC's consumer goods, technology, media and real estate sectors, initially with a well-known US private equity group then later on his own account. Keith McDade, recruited from the US to be VP of Technology and Engineering, has a 20-year successful track record in engine systems engineering and management with companies such as Boeing, Pratt & Whitney and Airbus. Mr. McDade also has previous work experience in China.

CORPORATE PROFILE

Cyclone Power Technologies is the developer of the award-winning Cyclone Engine; an eco-friendly external combustion engine with the power and versatility to run everything from portable electric generators and garden equipment to cars, trucks and locomotives. Invented by company founder and CEO Harry Schoell, the patented Cyclone Engine is a modern day steam engine, ingeniously designed to achieve high thermal efficiencies through a compact heat-regenerative process, and to run on virtually any fuel - including bio-diesels, syngas or solar - while emitting fewer greenhouse gases and irritating pollutants into the air. Currently in its late stages of development, the Cyclone Engine was recognized by Popular Science Magazine as the Invention of the Year for 2008, and was presented with the Society of Automotive Engineers' AEI Tech Award in 2006 and 2008. Additionally, Cyclone was recently named Environmental Business of the Year by the Broward County Environmental Protection Department. For more information, visit www.cyclonepower.com.