Loan agreement

7 October 2016

Draganfly Investments Limited

("Draganfly" or the "Company")

Loan agreement

The Board of Draganfly, the AIM quoted investing company, announces that it has made its first investment following the two fundraising exercises completed in Summer 2016.

The Company had made a convertible term loan of £60,000 to AltEnergis Plc ("AltEnergis"), a privately owned company registered in England and Wales, specialising in the development and commercialisation of novel intellectual property. ALtEnergis currently has five core technologies under development.

The loan is for a term of one year and bears interest at the rate of 8% per annum. The loan is convertible into equity of AltEnergis at the request of the Company.

The purpose of the investment is to enable AltEnergis to secure a grant and to reinforce certain technology IP and patent rights.

In the year ended 31 December 2015, AltEnergis made an (unaudited) loss of £52,999.

Edward Bayman, Chairman of the Company, said: "The Board are constantly exploring investment possibilities. This investment gives Draganfly an interest in an exciting company with some very promising technologies."

This announcement contains inside information for the purposes of Article 7 of Regulation (EU) 596/2014 of the European Parliament and of the Council.

For further information please contact:

T Edward G Bayman +44 (0) 1534 787898

Dennis Edmonds +44 (0) 7796 338 372

Tom Price / David Hignell

Northland Capital Partners (Nominated Adviser) +44 (0) 20 3861 6625

Jon Belliss

Beaufort Securities Limited (Broker) +44 (0) 20 7382 8300