On June 17, 2005, at 0957 central daylight time, a CarterCopter gyrocraft, N121CC, registered and operated by CarterCopters LLC, of Wichita Falls, Texas, was substantially damaged when it impacted trees following a loss of control while maneuvering near Olney, Texas. The private pilot and flight test engineer were not injured. Visual meteorological conditions prevailed and a flight plan was not filed for the 14 Code of Federal Regulations Part 91 research and development flight. The local flight originated from the Olney Municipal Airport (ONY), near Olney, Texas, approximately 0945. The operator reported in the Pilot/Operator Aircraft Accident Report (NTSB Form 6120.1/2) that while conducting a test flight, the gyrocraft had been flying at an airspeed of 151 miles per hour (mph) in smooth air conditions. The 2,400-hour pilot "heard a noise from the engine compartment" and reduced throttle. As airspeed decayed, the "spindle tilted to the left" and the gyrocraft started to roll to the left. The pilot pushed the control stick to the right and noted that he lost half of the "rotor control" as the gyrocraft continued turning to the left. As the pilot established a nose down attitude to maintain airspeed, he engaged the ballistic parachute switch; however, the parachute did not deploy. As a high rate of decent increased, the pilot attempted to flare using the control stick only and did not "pull collective." Subsequently, the gyrocraft impacted mesquite trees before hitting the ground. The gyrocraft came to rest on its left side in a level attitude approximately three miles east of ONY. An examination of the gyrocraft by the operator revealed that the main rotor blades were destroyed. The left and right wing, tail boom and horizontal stabilizer were separated from the fuselage. The bolts holding the propeller drive pulley to the propeller drive shaft were found "sheared." A wire to the co-pilot cyclic boost control solenoid was found separated. At 1004, the automated surface observing system at the Graham Airport (RPH), located 20 miles southeast from the accident site, reported wind from 130 degrees at 5 knots, visibility 10 statute miles, scattered clouds at 6,000 feet, temperature 30 degrees Celsius, dew point 18 degrees Celsius, and an altimeter setting of 29.83 inches of Mercury.