Cyclone Power Technologies Inc. announced that Falck Schmidt Defense Systems has signed an exclusive Engineering Development Agreement with Cyclone Power Technologies. This agreement provides for the development over the next 6 months, of a militarized 10 Kw auxiliary power unit (APU) for worldwide military applications. FSDS will be the exclusive worldwide distributor for both military and aerospace power applications. The exclusive Engineering Development Agreement calls for an initial engineering fee of $225,000. Other license fees will be agreed upon within the next 90 days. Work has commenced with FSDS mechanical and electrical engineers arriving at Cyclone on June 21, 2016. The statement of design work and critical path calls for the building of two systems to be built at Cyclone's offices. These will then be taken to FSDS for militarized testing. FSDS engineers will assist Cyclone in the necessary changes to the basic Cyclone 10 Kw system to make it applicable to military standards. The exclusive Engineering Development Agreement allows FSDS the rights to build and sell the Cyclone powered systems exclusive to all military and aerospace worldwide as representative and pay cyclone a license or royalty fee.