WASHINGTON, DC, June 22, 1998 -- Ellipso, Inc. today announced that its subsidiary, Mobile Communications Holdings, Inc. (MCHI), has commenced construction of the first two satellites in the Ellipso™ global satellite system, in compliance with the first milestone in the company's Federal Communications Commission (FCC) license awarded on July 1, 1997. On June 17, 1998, MCHI entered into a Satellite Construction Contract with The Boeing Company. Satellite construction activities will be managed by the Boeing Satellite and Ground Control Systems organization in Seal Beach, California.

Boeing will leverage its experience with the Global Positioning System (GPS) satellite program to design and manufacture the Ellipso™ satellites. In addition to starting construction of the spacecraft, Boeing will finalize and validate the design of the complete Ellipso™ system, including the space, ground and terminal segments. Satellite subcontractors are expected to include Harris Corporation, responsible for the Ellipso™ communications payload; Israel Aircraft Industries and AEC-Able Engineering. In addition, Lockheed Martin Management & Data Systems will be the ground segment contractor and L-3 Communications Corporation is responsible for the CDMA waveform technology.

Ellipso, Inc. previously announced on May 4, 1998 that The Boeing Company would be the system integrator for design, development, construction and deployment of the Ellipso™ system. At that time Boeing was also named as the Ellipso™ space segment prime contractor. Systems integration and satellite design and development activities will be managed by the Boeing Communications & Information Management Systems organization in Anaheim, California.

"We are delighted to be able to announce that we have met the next Ellipso™ program milestone" said David Castiel, President and Chief Executive Officer of Ellipso, Inc. "Our satellite contract with Boeing puts us on target for our planned system launch in 2001."

Ellipso, Inc., the parent company of Mobile Communications Holdings, Inc., is deploying the Ellipso™ satellite-based communications system that will provide low cost and high quality digital voice and data services worldwide. Ellipso™ will focus on telephone service, but also will provide data transfer, fax, paging, voice mail, messaging and geopositioning services.

The Ellipso™ constellation has a unique, patented elliptical orbit configuration using two complementary sub-constellations totaling 17 satellites, one of which will be an on-orbit spare. Use of elliptical orbits requires fewer satellites and launch services, significantly reducing costs. These distinctive orbits allow Ellipso™ to maximize mobile personal communications coverage of highly populated areas during peak daylight hours.