KWESST Micro Systems Inc. (TSXV: KWE) ('KWESST' or 'the Company') today announced the successful completion of the first phase of three deliverables under a contract to support a U.S. military customer featuring the Company's signature Tactical Awareness and Situational Control System' ('TASCS').

This first deliverable under a $500,000 (CAD) contract demonstrated the TASCS Integrated Fires Module ('IFM') on mortars and the Augmented Weapon Sight ('AWS'), a system developed by AeroVironment Inc. ('AeroVironment') and KWESST to provide real-time situational awareness and targeting information. AWS streams Full Motion Video ('FMV') from an overhead Unmanned Aerial Vehicle ('UAV' or 'drone') manufactured by AeroVironment into the TASCS architecture for the purpose of target identification, accurate first-shot hits and real-time Battle Damage Assessment ('BDA'). The AWS system has been an ongoing collaboration between KWESST and AeroVironment. 'These important military exercises demonstrate the maturity of the TASCS system,' said KWESST CEO Jeff MacLeod. 'We are very pleased at the performance of the system and the valuable user feedback. We expect the next two contracted demonstration exercises later this year to attract added customer attention and the development of operating procedures that will be employed in more extensive exercises expected in early 2021.' David Luxton, Executive Chairman, added, 'Demonstration exercises like this with military customers are an important phase in the process towards potential introduction into service. It is very encouraging that this key U.S. military customer is scheduling additional exercises, and that at least two other NATO military customers have similar capability demonstration contracts under consideration.'

About TASCS, IFM and AWS

'TASCS' is an app and snap-on weapon adaptor that streams situational awareness and targeting information from any source directly to soldiers' smart devices and their weapons systems for a leap ahead in safer and more effective engagement of adversaries. 'IFM' is the variant of TASCS that integrates this capability into many short-range and long-range weapons systems, including grenade launchers and mortars. 'AWS' utilizes the TASCS system to stream situational and targeting information from AeroVironment Unmanned Aerial Vehicles ('UAV's, or 'drones') directly to the TASCS display on soldiers' smart devices and weapons systems in real time.

About KWESST

KWESST develops and commercializes high-value ultra-miniaturized technology applications that make a critical difference to the safety and operational effectiveness of personnel in the defence and security industries. The company's current portfolio of unique proprietary offerings include: its signature TASCS TM (Tactical and Situational Control System) for real-time awareness and targeting information from any source (including drones) streamed directly to users' smart devices and weapons; the autonomous Grey Ghost TM soldier-portable micro drone missile system that defends against small hostile drones including swarms using high-speed kinetic impact; a Ground Laser Defence system to counter the emerging threat of weaponized lasers against personnel and, the PhantomTM electronic battlefield decoy system to mask the electromagnetic signature of friendly forces with decoy signatures at false locations to deceive and confuse adversaries. All systems can operate stand-alone or integrate seamlessly withOEM products and battlefield management systems including Frontline, Edge, Killswitch and ATAK (Android Tactical Assault Kit) among others. KWESST also has developmental 'smart ordnance' projects including its 'Shot Counter' system, which records the number and type of rounds fired, for optimized firearms maintenance and performance. The Company is headquartered inOttawa, Canada, with representative offices in Washington, DC, London, UK and Abu Dhabi, UAE and trades on the TSXV under the symbol KWE.

Contact:

Email: frame@kwesst.com

Cautionary Note Regarding Forward-Looking Statements

This news release includes certain 'forward-looking statements' under applicable Canadian securities legislation. Forward-looking statements include, but are not limited to, statements with respect to the timing for the commencement of trading and the plans and operations of KWESST after giving effect to the Qualifying Transaction. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to: general business, economic, competitive, political and social uncertainties. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. KWESST disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

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