Elektrobit Oyj - Company Announcement

EB (ELEKTROBIT) DELIVERS TERRESTAR SATELLITE-TERRESTRIAL SMARTPHONES

STOCK EXCHANGE RELEASE
Free for publication, December 2, 2009, at 08.00 am (CET +1)
EB (ELEKTROBIT) DELIVERS TERRESTAR SATELLITE-TERRESTRIAL SMARTPHONES

Elektrobit Inc.,  a subsidiary  of Elektrobit  Corporation (EB),  and
TerreStar  Corporation  (TerreStar)  have   signed  a  frame   supply
agreement regarding the delivery of satellite-terrestrial smartphones
for TerreStar. According to the agreement EB will be responsible  for
delivering complete products  to TerreStar based  on the  EB-designed
satellite-terrestrial reference device, which includes manufacturing,
forward and reverse logistics, and after market services support.

Through this agreement, EB Wireless Solutions introduces, in addition
to its  current R&D  services and  customized solutions  offering,  a
product delivery business model, where it provides complete  products
to its  customers by  subcontracting  the production  of  EB-designed
devices  from  selected   Electronic  Manufacturing  Services   (EMS)
companies.  This  business  model  both  strengthens  EB's  strategic
position as turnkey solution provider  for its customers and  enables
EB's  Wireless   Solutions   business   to   address   new   business
opportunities.

TerreStar has  announced  that  it plans  to  launch  its  commercial
service with its satellite-terrestrial smartphones next year, and  EB
has the readiness to start  the product delivery accordingly.  Actual
delivery  volumes  for  the  satellite-terrestrial  smartphones  will
depend upon market demand, and  thus reliable delivery forecasts  can
not be provided at this stage.

Product delivery business model and the execution of the frame supply
agreement between EB and TerreStar, include typical risks related  to
any product  delivery  business model,  such  as high  dependency  on
actual product  volumes, development  of the  cost of  materials  and
production yields, warranties,  product and contractual  liabilities,
which may manifest themselves as higher cost of product delivery, and
ultimately, as lower profit.

The product delivery business  model and the  execution of the  frame
supply agreement do not have a material impact on EB's balance sheet,
net sales  and  result for  the  second  half of  2009,  and  thereby
guidance given for the said period remains unchanged.

EB and TerreStar began  their cooperation in  September 2007 when  EB
started  to  develop  advanced  handset  technologies  and  reference
devices for TerreStar's upcoming satellite-terrestrial all-IP  mobile
network.

Oulu, December 2, 2009
Elektrobit Corporation
Jukka Harju
CEO

Further information:

Ari Virtanen
Executive Vice President, Wireless Solutions
Tel. +358 400 435 878

Panu Miettinen
CFO
Tel. +358 40 344 5338


Distribution:
NASDAQ OMX Helsinki Ltd
Principal media


EB, Elektrobit Corporation
EB develops advanced technology and transforms it into enriching  end
user experiences. EB specializes  in demanding embedded software  and
hardware  solutions  for   the  automotive   industry  and   wireless
technologies. The company's net sales  for the year 2008 totaled  EUR
172.3 million. Elektrobit  Corporation is  listed on  the NASDAQ  OMX
Helsinki. www.elektrobit.com

TerreStar Corporation
TerreStar Corporation  is the  controlling shareholder  of  TerreStar
Networks Inc. and TerreStar Global Ltd. For additional information on
TerreStar  Corporation,  please  visit   the  company's  website   at
www.terrestarcorp.com.

TerreStar Networks Inc.
TerreStar Networks (www.terrestar.com),  a majority owned  subsidiary
of TerreStar Corporation (NASDAQ: TSTR),  plans to offer a  reliable,
secure and resilient satellite  terrestrial mobile broadband  network
that will provide voice, data and video services dedicated to helping
solve the critical communication  and business continuity  challenges
faced by government, emergency responders, enterprise businesses  and
rural communities.  TerreStar expects to offer next generation mobile
communications through a network of partners and service providers to
users who need "anywhere" coverage throughout the United States.