<PAGE>


                                RAYTHEON COMPANY
                                141 SPRING STREET
                         LEXINGTON, MASSACHUSETTS 02421

                                                              March 8, 2002


L-3 Communications Corporation
600 Third Avenue
New York, New York 10016

Attention:   Christopher C. Cambria, Esq.
             Vice President, Secretary and General Counsel

Ladies and Gentlemen:

     Reference is hereby made to the Asset Purchase Agreement, dated as of
January 11, 2002 (the "Agreement"), among Raytheon Company, a Delaware
corporation ("Raytheon"), Raytheon Australia Pty Ltd., a corporation organized
under the laws of Australia and a wholly-owned subsidiary of Raytheon ("Raytheon
Australia") (Raytheon and Raytheon Australia are each individually referred to
herein as a "Seller" and are collectively referred to herein as the "Sellers"),
and L-3 Communications Corporation, a Delaware corporation (the "Buyer").
Defined terms used herein without definition have the meanings given them in the
Agreement.

     The Sellers and the Buyer have agreed to amend the Agreement and certain
Exhibits and Schedules in order to amend certain provisions thereof relating to,
among other things, the retention of employees, the ASTOR Subcontract and
transition services. Accordingly, the Parties are entering into this letter
agreement to reflect such amendments.

     This letter will confirm the agreement of the Parties as follows:

     I.   Amendments

     1.1. Additional Buyers.

         (a) In accordance with Section 11.4 of the Agreement, L-3
Communications Corporation contemporaneously herewith has assigned its rights,
interests and obligations under the Agreement to L-3 Communications Integrated
Systems L.P., a Delaware limited partnership and a wholly-owned subsidiary of
L-3 Communications Corporation (the "L-3 U.S. Subsidiary"), and to L-3
Communications Australia Pty Ltd., a corporation organized under the laws of
Australia and a wholly-owned subsidiary of L-3 Communications Corporation (the
"L-3 Australian Subsidiary"). The L-3 U.S. Subsidiary and the L-3 Australian
Subsidiary shall from and after the date of this letter agreement each be
considered a "Buyer" for purposes of the Agreement, and shall be subject to the
rights and obligations of the Buyer under the Agreement,



<PAGE>

L-3 Communications Corporation
March 8, 2002


from and after the date of this letter agreement. L-3 Communications Corporation
hereby acknowledges that such assignment shall not relieve it of its obligations
to the Sellers under the Agreement.

         (b) At the Closing, (i) the L-3 Australian Subsidiary shall acquire all
of the Acquired Assets which are owned or held by Raytheon Australia as of the
Closing (the "Australian Acquired Assets") and shall assume and agree to pay,
perform and discharge when due all Assumed Liabilities of Raytheon Australia as
of the Closing (the "Australian Assumed Liabilities") and (ii) the L-3 U.S.
Subsidiary shall acquire all of the Acquired Assets other than the Australian
Acquired Assets and the Real Estate Leases, which leases shall be acquired by
L-3 Communications Corporation (the "U.S. Acquired Assets"), and shall assume
and agree to pay, perform and discharge when due all Assumed Liabilities other
than the Australian Assumed Liabilities and the Real Estate Leases, which leases
shall be assumed by L-3 Communications Corporation (the "U.S. Assumed
Liabilities"). The parties to the Ancillary Agreements to be executed pursuant
to Section 1.3(b) of the Agreement shall be appropriately revised to reflect the
terms of this Section 1.1(b) and, where appropriate, more than one version of an
Ancillary Agreement, with different parties thereto, shall be executed.

         (c) Section 3.1 is hereby amended and restated in its entirety to read
as follows:

          "3.1 Organization. L-3 Communication is a corporation duly organized,
          validly existing and in good standing under the laws of the state of
          Delaware. The L-3 U.S. Subsidiary is a limited partnership duly
          organized, validly existing and in good standing under the laws of the
          state of Delaware. The L-3 Australian Subsidiary is a corporation duly
          organized and validly existing under the laws of Australia."

         (d) Any notice, request, demand, claim or other communication required
to be delivered under the Agreement to or by the Buyer shall be deemed delivered
to or by the Buyer if it is delivered, in accordance with the terms of Section
11.5 of the Agreement, to or by, respectively, L-3 Communications Corporation.
Any consent or waiver required of the Buyer under the Agreement shall be deemed
given by the Buyer if it is given in writing by L-3 Communications Corporation.

     1.2. Retained Employees. Schedule 9.1 of the Agreement is amended and
restated in its entirety to read as set forth on Exhibit A hereto. With respect
to the addition of Gary Arnold to the list of Retained Employees set forth on
Schedule 9.1, the Parties hereby agree to the following additional amendments:

         (a) The "Letter Agreement dated October 23, 2001 between Raytheon
Company and Gary Arnold" is hereby deleted from Schedule 2.12 to the Agreement.


<PAGE>

L-3 Communications Corporation
March 8, 2002


         (b) The reference to Gary Arnold, his position and his annual rate of
compensation is hereby deleted from Schedule 2.16 to the Agreement.

         (c) The reference to Gary Arnold and his position is hereby deleted
from Schedule 10.12 to the Agreement.

         (d) The "Letter Agreement dated October 23, 2001 between Raytheon
Company and Gary Arnold" is hereby deleted from Section 2.5(d) of the Schedule
of Exceptions.

     1.3. Section 7.2.

         (a) Section 7.2(b) is hereby amended and restated in its entirety to
read as follows:

          "(b) any failure by the Buyer to perform any covenant or agreement
          contained in this Agreement or the Ancillary Agreements, other than
          the Subcontract Agreement between Raytheon Systems Limited and the
          Buyer attached hereto as Exhibit M; or"

         (b) The following sentence is added as a new sentence at the end of
Section 7.2: "The Parties agree that the responsibility for any liabilities or
costs that are covered by Condition 9(b) of the Subcontract Agreement between
Raytheon Systems Limited and the Buyer attached hereto as Exhibit M shall be
allocated as set forth in such Subcontract and are not covered by this Article
VII."

     1.4. Assignment and Assumption of Leases. Exhibit D (Assignment and
Assumption of Leases) to the Agreement is hereby amended to add E-Systems
Technologies Holding, Inc., a Delaware corporation, as an "Assignor" and
signatory under such Exhibit D.

     1.5. Supply Agreement Amendments.

         (a) Appendix E of Exhibit G (Supply Agreement - Raytheon as Customer)
to the Agreement is amended and restated in its entirety to read as set forth on
Exhibit B hereto.

         (b) Exhibit K (Supply Agreement - Raytheon Systems Canada, Ltd. as
Supplier) to the Agreement is hereby amended to reflect the correct name of the
Supplier: Raytheon Canada Limited.

         (c) Appendix D of Exhibit J (Supply Agreement - Thales-Raytheon Systems
Co., LLC as Supplier) to the Agreement is amended and restated in its entirety
to read as set forth on Exhibit G hereto.

         (d) Appendix F of Exhibit F (Supply Agreement - Raytheon as Supplier)
to the Agreement is amended and restated in its entirety to read as set forth on
Exhibit H hereto.



<PAGE>

L-3 Communications Corporation
March 8, 2002


         (e) Page 1 of Appendix D of Exhibit H (Supply Agreement " Raytheon
Technical Services Company as Supplier) to the Agreement is amended and restated
in its entirety to read as set forth on Exhibit I hereto.

     1.6. ASTOR Subcontract. Exhibit M (Subcontract Agreement with Raytheon
Systems Limited) to the Agreement is hereby amended as set forth on Exhibit C
hereto.

     1.7. Transition Services. Schedule I, Schedule II and Schedule III of
Exhibit Q (Transition Services Agreement) to the Agreement are amended and
restated in their entirety to read as set forth on Exhibit D hereto. The
Agreement is hereby amended by adding Exhibit S (Transition Services Agreement)
to the Agreement in the form attached hereto as Exhibit E, such Exhibit S to
document the agreement relating to transition services between Raytheon
Australia and L-3 Communications Australia Pty Ltd. and to be executed at the
Closing.

     1.8. Australian Issues. The Parties agree as set forth on Exhibit F hereto
with respect to certain Australian issues.

     1.9. Schedule 2.12. The Parties agree that section (a)(ii) of Schedule 2.12
to the Agreement is amended and restated in its entirety to read as set forth on
Exhibit J hereto.

     1.10. Section 9.4. Section 9.4 of the Agreement is hereby amended by the
addition of the following at the end thereof: "The monthly benefit rate used to
calculate benefits from Raytheon under the Retirement Plan for Hourly Employees
of the Greenville Division of E-Systems, Inc., of which Raytheon is the plan
sponsor (the "Plan") shall be the rate in effect as of the earlier of the date
the participant retires under the Plan and the date the participant terminates
employment from the Buyer. Such rate shall never exceed $36.00 even though
monthly rates negotiated in subsequent collective bargaining agreements by the
Buyer and its successors may be higher."

     1.11. Section 10.4. Section 10.4 of the Agreement is hereby amended by the
addition of the following at the end thereof: "Without limiting the foregoing,
the Buyer shall use commercially reasonable efforts (in accordance with the
standards set forth in Section 4.2) to arrange, as promptly as practicable, for
replacement arrangements (which shall include a full and complete release of
each Seller and their respective Affiliates), with respect to the following
Seller Guarantees: Performance Corporate Guarantee No. 2490 issued on November
2, 2001 by Raytheon Company for benefit of Empresa Brasileira de Aeronautica
S.A. (EMBRAER) in the amount of U.S.$ 10,728,592; and Performance Corporate
Guarantee No. 2491 issued on November 2, 2001 by Raytheon Company for benefit of
Empresa Brasileira de Aeronautica S.A. (EMBRAER) in the amount of U.S.$
3,576,197. If the Buyer is unable to effect such replacement arrangements within
30 days following the Closing Date, the Buyer shall, for either or both of such
Seller Guarantees which have not been replaced, deliver to Raytheon, on such
30th day, an irrevocable, unconditional standby letter of credit in favor of
Raytheon in an amount equal to the amount of such Seller Guarantee or
Guarantees, issued by a bank rated A or better by Standard & Poor"s, in form and
substance reasonably satisfactory to Raytheon."


<PAGE>

L-3 Communications Corporation
March 8, 2002

     1.12. Bank Account. Raytheon and the Buyer hereby agree (notwithstanding
anything to the contrary in the Agreement) that (i) Fleet Bank Account No.
27852796 (the "Account"), which is owned and operated by Raytheon, shall be
transferred by Raytheon to the Buyer as part of the transactions effected at the
Closing and the Buyer shall honor all checks written on the Account which are
outstanding as of the Closing and the amount of all such checks shall be Assumed
Liabilities; (ii) Raytheon shall, on Monday, March 11, 2002, transfer, by wire
transfer of immediately available funds, $18,638,589.82 into the Account (which
amount represents the estimated amount of the overdraft of the Account as of the
Closing Date), which funds (and any other funds therein) shall become property
of the Buyer pursuant to this Agreement and shall be Acquired Assets; (iii)
Raytheon shall issue checks as directed by the Buyer (including made payable to
the Buyer, if so requested) from Saudi American Bank Account No. 132-3458 from
time to time in an aggregate amount not to exceed 375,000 Saudi Riyads; and (iv)
the Purchase Price and the Target Net Tangible Book Value shall be increased to
$1,148,738,589.82 and $493,938,589.82, respectively.

     II.  Miscellaneous

     2.1. Except as amended as provided above, the Agreement remains in full
force and effect and binding on the Parties in accordance with its terms.

     2.2. This letter agreement (including the documents referred to herein)
together with the Agreement (as amended hereby and including all documents
referred to therein), constitutes the entire agreement among the Buyer, on the
one hand, and the Sellers on the other hand, and supersedes any prior agreements
or understandings among the Buyer, on the one hand, and the Seller, on the other
hand, and any representations or statements made by or on behalf of any Seller
or any of their respective Affiliates to the Buyer, whether written or oral,
with respect to the subject matter hereof, other than the Confidentiality
Agreement. This letter agreement shall not be amended or waived except by a
written instrument hereafter signed by each of the Parties hereto.

     2.3. This letter agreement shall not confer any rights or remedies upon any
person other than the Parties and their respective successors and permitted
assigns and, to the extent specified herein or in the Agreement, their
respective Affiliates.

     2.4. The language used in this letter agreement shall be deemed to be the
language chosen by the Parties to express their mutual intent, and no rule of
strict construction shall be applied against any Party.

     2.5. THIS LETTER AGREEMENT AND ANY DISPUTES HEREUNDER SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF DELAWARE
WITHOUT GIVING EFFECT TO ANY CHOICE OR CONFLICT OF LAW PROVISION OR RULE
(WHETHER OF THE STATE OF DELAWARE OR ANY OTHER JURISDICTION) THAT WOULD CAUSE



<PAGE>

L-3 Communications Corporation
March 8, 2002


THE APPLICATION OF LAWS OF ANY JURISDICTION OTHER THAN THOSE OF THE STATE OF
DELAWARE.


     2.6. This letter agreement may be executed in one or more counterparts,
each of which shall be deemed an original but all of which together shall
constitute one and the same instrument. This letter agreement may be executed by
facsimile signature.















<PAGE>

L-3 Communications Corporation
March 8, 2002



         Please sign where indicated below to confirm that the foregoing
accurately reflects our agreement.

                               Very truly yours,

                               RAYTHEON COMPANY



                               By:
                                  -------------------------------------------
                                  Name:
                                  Title:


                               RAYTHEON AUSTRALIA PTY LTD. (pursuant
                               to S127(1) of the Corporations Act 2001 (C"th))



                               By:
                                  -------------------------------------------
                                  Name:
                                  Title:



                               By:
                                  -------------------------------------------
                                  Name:
                                  Title:


ACCEPTED AND AGREED:

L-3 COMMUNICATIONS CORPORATION


By:
   --------------------------
   Name:
   Title:



<PAGE>

L-3 Communications Corporation
March 8, 2002


L-3 COMMUNICATIONS INTEGRATED SYSTEMS L.P.


By:   L-3 Communications AIS GP Corporation
      its general partner


By:
   ----------------------------------------
   Name:
   Title:



L-3 COMMUNICATIONS AUSTRALIA PTY LTD.
(pursuant to S127(1) of the Corporations Act 2001 (C'th))


By:
   ----------------------------------------
   Name:
   Title:


By:
   ----------------------------------------
   Name:
   Title:



<PAGE>


                                                                    Exhibit A to
                                                                    ------------
                                                                Letter Agreement
                                                                ----------------

                                                                 Schedule 9.1 to
                                                                 ---------------
                                                        Asset Purchase Agreement
                                                        ------------------------

                               Retained Employees
                               ------------------

Richard R. Anderson

Gary Arnold

Bob Bearden

Mona R. Collins

Susie Fleming

Roy Larsen

Anthony O"Brien

Thomas Wheeler

Vince McKenzie

Kent Wong

Kevin Hennabry

Mike Romanczuk





<PAGE>


                                                                    Exhibit B to
                                                                    ------------
                                                                Letter Agreement
                                                                ----------------



              Appendix E of Supply Agreement (Raytheon as Customer)
              -----------------------------------------------------























<PAGE>


                                                                    Exhibit C to
                                                                    ------------
                                                                Letter Agreement
                                                                ----------------


         Exhibit M (Subcontract Agreement with Raytheon Systems Limited) to the
Agreement is hereby amended as follows:

         On the cover page (Page 1), "36599N" is hereby inserted after
"SUBCONTRACT NUMBER." Immediately after the words "FOR THE" insert the words
"WORK AS DESCRIBED HEREIN ON THE ASTOR PROGRAMME."

         On page 2, in the first line, the Effective Date shall be 8 March 2002.

         In Paragraph 12 (Page 3), the words "This Subcontract shall be
effective on the date last written and signature by both parties hereto
providing" is hereby deleted in its entirety. In addition, at the end of what
was the third line of that paragraph, the words "have been" are hereby replaced
by the words "shall be."

         In Condition 1, for the definition of "Design Authority" (Page 8),
"[______]" is hereby deleted and replaced with "05-123 Chapter 101".

         In Condition 3 (Pages 13-14), that entire provision is deleted in its
entirety and replaced with the new Condition 3 set out in Exhibit C-1 hereto.

         In Condition 8(a) (Page 19), the reference to $108,760,957 and the
subsequent bracketed note is replaced with "the dollar amount indicated as the
total of the column entitled "Price" in Condition 3, as that amount may be
adjusted by the Contractor in accordance with the provisions in Condition 3."

         In Condition 8 (page 19), the following new paragraph 8(b)(ii) is
inserted in place of the existing paragraph 8(b)(ii): "the "Direct Cost of
Materials" (as defined below) and work subcontracted by the Subcontractor; as
used above, the term "Direct Cost of Materials" shall mean the purchase cost of
materials, plus the following: (x) the customary material burden rates of the
Subcontractor as applied to the purchase cost of materials, and (y) the
customary general and administrative expense rates of the Subcontractor as
applied only to the material burden. The foregoing rates shall be determined in
accordance with the standards and practices under the Raytheon Company Aircraft
Integration Systems Segment Cost Accounting Standards Board Disclosure Statement
(or any government approved successor thereto) in effect at the time the
materials are purchased."

         In Condition 9 (page 21), the following new paragraph 9(b) is added,
and the existing paragraph (b) is relabeled as paragraph (c): "Contractor and
Subcontractor recognize and agree that until Design Authority is transferred to
Contractor, as required by this Subcontract, Subcontractor will act as Design
Authority for the ASTOR System. Such transfer of Design Authority for the ASTOR
System shall be in accordance with this Subcontract, including without
limitation the Statement of Work contained in Annex G, but in any event shall
occur when agreed and approved by the Authority. Regardless of whether
Contractor or Subcontractor is acting as Design Authority for the ASTOR System,
in the event that the ASTOR System or any

<PAGE>


sub-system, component, parts or equipment thereof fails to meet the required
ASTOR System performance specification or other requirement:

     (i) due to (1) Contractor's delivery of CFR (including CFR delivered by
third-party subcontractors) that do not meet the requirements of the applicable
CFR specification and Annex G hereto or (2) erroneous or incomplete designs or
specifications for the ASTOR System or any sub-system, component, parts or
equipment thereof provided by Contractor or any of its affiliates (other than
Subcontractor or its predecessor, i.e., the AIS Business as defined in the asset
purchase agreement dated 11 January 2002 between Raytheon Company, Raytheon
Australia Pty. Ltd. and L-3 Communications Corporation ("Predecessor")), then
Contractor shall bear the full cost of (A) reasonable time spent by
Subcontractor in determining that such failure to meet the required ASTOR System
performance specification or other requirement was due to the cause described in
this part (i); (B) obtaining replacement CFR that meets those requirements or,
at Contractor's sole option, identifying and implementing alternative system or
other sub-system level solutions; (C) compensating Subcontractor for additional
expenses and/or labour costs incurred in the delays resulting from the need to
obtain replacement CFR and/or reperform services with respect to such
replacement CFR; and (D) any other liabilities therefor. If Subcontractor
incorrectly claims that Contractor is responsible for costs pursuant to this
part (i), then Subcontractor shall reimburse Contractor for its costs resulting
from such claim.

     (ii) due to erroneous or incomplete designs or specifications for the ASTOR
System or any sub-system, component, parts or equipment thereof (except for
those sub-systems identified in part (iii) below) provided by Subcontractor or
its Predecessor occurring before the Effective Date, then Contractor and
Subcontractor shall work together in order to minimize the costs to be incurred,
to the extent technically feasible and in a manner consistent with the
Authority's instructions, where relevant, (individually and/or jointly) with
respect to (A) reasonable time spent in determining that such failure to meet
the required ASTOR System performance specification or other requirement was due
to the cause described in this part (ii); (B) (i) redesigning and respecifying
the ASTOR System or any such sub-system, component, parts or equipment which
were both designed and specified by Subcontractor or its Predecessor and (ii)
respecifying (but not redesigning) the ASTOR System or any such sub-system,
component, parts or equipment which were specified (but not designed) by
Subcontractor or its Predecessor; (C) (i) redesigning (but not respecifying) the
ASTOR System or any such sub-system, component, parts or equipment which were
specified (but not designed) by Subcontractor or its Predecessor and (ii)
whether or not designed by Subcontractor or its Predecessor, modifying all CFR
or manufacturing new CFR; (D) causing other subcontractors or third parties to
modify CFR or manufacture new CFR; (E) additional expenses and/or labour costs
incurred by either Contractor or Subcontractor in the delays resulting from the
actions described in (A), (B), (C) and (D) above (including without limitation
the payment of liquidated damages to any third parties) and then reperforming
services with respect to such replacement designs, specifications and/or CFR;
and (F) any other liabilities therefor. Any work or rework, including redesign
undertaken by the Subcontractor pursuant to this part (ii) and any reimbursement
of costs thereof shall be subject to the procedures set forth in Condition 31
below, except that the third sentence of Condition 31(b) shall not apply.
Subcontractor shall bear all its costs incurred under part (ii)(A) and (B)
hereof, and reasonable costs incurred by Contractor in providing any assistance
requested by Subcontractor in connection therewith. Contractor and Subcontractor
further agree that the aggregate costs incurred by them, either individually or
jointly, under part (ii)(C), (D), (E) and

<PAGE>

(F) hereof shall be divided equally between them on the basis of Contractor
being responsible for fifty percent (50%) of those costs and Subcontractor being
responsible for the remaining fifty percent (50%) of those costs; provided,
however, that for the aggregate costs incurred under part (ii)(C), (D), (E) and
(F) in excess of Forty Million Dollars (US$40,000,000), Contractor shall be 100%
responsible for such costs (i.e., Subcontractor"s maximum costs incurred under
part (ii)(C), (D), (E) and (F) shall not exceed Twenty Million Dollars
(US$20,000,000). On a calendar quarterly basis, each party shall report to the
other party its costs incurred under part (ii)(C), (D), (E) and (F) during such
quarter, with appropriate supporting documentation as required in Condition 31
below; provided, however, that Contractor shall only be required to provide such
reports until such aggregate amount is reached. To the extent Contractor
provides to Subcontractor financial data in such reports, Subcontractor agrees
that it will treat such data as confidential and will restrict access to such
data to the same extent that Contractor has agreed to similar protections in
Condition 41(e) below with respect to Subcontractor's financial data. If, prior
to the time that such aggregate amount is reached, one party (the "first party")
incurred (whether individually or jointly with the other party) during such
quarter a percentage of those costs greater than the percentage for which it is
responsible, the other party (the "second party") shall, within ten (10) days
after a written request from the first party, pay whatever amount to the first
party that is necessary in order to reduce the first party's costs to the
percentage of those costs that is envisioned in the cost sharing percentages
stated above. To the extent that liquidated damages would otherwise be
recoverable by Contractor in accordance with Condition 19 below due to delays
described in this part (ii), such liquidated damages shall not be recoverable by
Contractor and this Condition 9(b)(ii) constitutes an express written waiver of
Contractor's right to recover such liquidated damages, for the purposes of
Condition 19(e) below. If either Contractor or Subcontractor incorrectly claims
that the other party is responsible for costs pursuant to this part (ii), then
the claiming party shall reimburse the other party for such other party's costs
resulting from such claim.

     (iii) due to erroneous or incomplete designs or specifications provided by
Subcontractor for those sub-systems awarded to other subcontractors by either
Contractor or Subcontractor after the Effective Date (including without
limitation related Subcontractor designs and specifications), then Subcontractor
shall be 100% responsible for the types of costs described in part (ii)(A), (B),
(C), (D), (E) and (F) above.

         Contractor and Subcontractor agree that if Contractor or an affiliate
of Contractor is required to pay, or assume responsibility for, any amounts or
liabilities pursuant to this Condition 9(b)(ii), the Purchase Price under the
Asset Purchase Agreement of even date herewith by and among Raytheon Company,
Raytheon Australia Pty Ltd. and Subcontractor (the "Asset Purchase Agreement")
shall be deemed reduced for all purposes of the Asset Purchase Agreement by such
additional amounts or liabilities."

         In Condition 14(d) (page 28), the following phrase is added at the end
of the first sentence: "; provided, that the Subcontractor"s performance is the
exclusive cause of the payment being withheld by the Authority".

         The title of Condition 19 shall be changed to "Liquidated Damages and
Success Fees".

<PAGE>

         In Condition 19 (page 34), the following language is added at the end
of paragraph 19(c): "It is further agreed, that in the event that Subcontractor
satisfies the requirements described in any of parts (x), (y) and (z) below by
the date specified in such part, Contractor shall be required to pay
Subcontractor, in addition to any and all other amounts payable to Subcontractor
under this Subcontract, by way of a success fee the following amount for each
such part:

               (x) delivery of Air Platform Number 1 on or before August 1, 2004
-- US$3,146,814;

               (y) completion of all of Subcontractor's obligations with respect
to the Logistical Support Date (as defined in the Statement of Work) on or
before April 1, 2004 -- US$675,468; and

               (z) completion of installation of all training equipment into the
Mission Operating Base on or before April 1, 2004 - US$945,618.

         The total amount of success fees which might be become payable to
Subcontractor hereunder shall not exceed US$4,767,900."

         Conditions 19(d), (e) and (f) shall be renumbered accordingly.

         In Condition 19(f) (Page 34), insert the following after the word
payable: ", and the right of the Subcontractor to obtain a Success Fee shall not
be prejudiced,".

         At the end of Condition 19(f) (Page 34), add the following before the
period: "or where the delay has been approved by the Authority or the
Contractor."

         In Condition 25(c), line 2 (Page 44), "[(to be inserted)]" is hereby
deleted and replaced with "JLK/L3/LET001". Annex N is set out in Exhibit C-7
hereto.

         In Condition 28(a), line 4 (Page 50), the phrase "except Contractor
Furnished Requirements (CFR) which fail to meet the applicable CFR specification
and SOW" is hereby inserted at the end of the second sentence.

         In Condition 28(b)(ii) (Page 50), the words "applicable and relevant"
are hereby inserted after the word "the" and before the word "requirements."

         In Condition 28(c)(i) (Page 50), the parenthetical is hereby deleted in
its entirety and replaced with "(other than CFR provided by Contractor which
fail to meet the applicable CFR specification and SOW and those parts described
in paragraph c.ii below)."

         In Condition 37(c) (Page 64), the words "and the Contractor's liability
in respect to CFR supplied to the Subcontractor shall, in any event, cease with
effect from the time that the CFR is made available or offered on such dates as
may be agreed between the Parties." are hereby deleted and replaced with ".
Nothing herein shall relieve Contractor of any obligation to timely deliver to
Subcontractor CFR that meets the requirements of the applicable CFR
specification and SOW."

<PAGE>

         In Condition 37(j) (Page 65), the following sentence shall be added as
the third sentence: "In the event Contractor and Subcontractor are unable to
agree whether delay or additional cost are attributable to Contractor"s failure,
Subcontractor shall be entitled to submit a claim to Contractor in accordance
with Condition 31, except that the third sentence of Condition 31(b) shall not
apply."

         In Condition 37(l), line 1 (Page 65), the words "in accordance with
Condition 31" shall be added after the word "Subcontractor" and before the
comma.

         In Condition 41 (Page 70), renumber the existing sub-clauses 41(e) and
41(f) as sub-clauses 41(f) and 41(g), respectively, and insert a new sub-clause
41(e) as follows: " Without prejudice to sub-clause 24.11, where the
Subcontractor provides to the Contractor financial data, in the form of
particulars of labour rates or actual costs incurred, the Contractor agrees that
it will treat such data as confidential and will restrict access to such data
only to Contractor employees working on and having a need to receive such data
in connection with the ASTOR Programme, and to senior management of the
Contractor"s parent and affiliate companies having a need to receive such data
for use on the ASTOR Programme. The Parties shall put in place internal measures
to ensure the requirements of this sub-clause are implemented at all levels."

         In Condition 41, in sub-clause 41(e) (now renumbered (f)), line 2 (Page
70), "of even date herewith" is deleted and replaced with "dated 11 January
2002."

         In Condition 41, in sub-clause 41(e) (now renumbered (f)), line 3 (Page
70), "[Buyer]" is hereby deleted and replaced with "L-3 Communications
Corporation."

         In Condition 43(a), line 3 (Page 72), "[(to be inserted)]" is hereby
deleted and replaced with the following: "Legal Counsel, AIS."

         In Condition 43 (a), lines 4-5 (Page 72), "[(to be inserted)]" is
hereby deleted and replaced with the following: "President, AIS."

         Annex A is hereby deleted in its entirety and replaced with the new
Annex A set out in Exhibit C-2 hereto.

         In Annex B, lines 1-3 (beginning "NOTE: Raytheon shall determine. . .)
and the chart entitled "Engineering Services (US DOLLARS $)" are hereby deleted,
and replaced with the chart set out in Exhibit C-3 hereto.

         The text and tables of Annex E are hereby deleted in their entirety and
replaced with the following: " The Contractor Furnished Equipment to be provided
to the Subcontractor shall be as set forth in the ASTOR Deliverables Database
(hereinafter referred to as "ADDS") and the Government Furnished Supplies
Database (hereinafter referred to as "GFSD"), as the same may be from time to
time amended by agreement between the Parties. The ADDS and GFSD shall be held
and maintained in accordance with a procedure to be agreed hereafter between the
Parties."

         Annex F is hereby deleted in its entirety and replaced with the new
Annex F set out in Exhibit C-4 hereto.

<PAGE>

         Annex F1 is hereby deleted in its entirety and replaced with the new
Annex F1 set out in Exhibit C-5 hereto.

         Annex G is hereby deleted in its entirety and replaced with the new
Annex G set out in Exhibit C-6 hereto.

         In Annex H (Page 261), lines 1-3 (beginning "[NOTE: The Technical
Specification. . .") are hereby deleted in their entirety, and replaced with the
following: "As Design Authority for the ASTOR System and subject to Condition
9(b), the Subcontractor agrees to perform its obligations under the Subcontract
in accordance with the Technical Specification which is set out in Annex A to
Contract CIS4B/9 dated 17 December 1999, and which is already in the possession
of the Subcontractor"s ASTOR Programme Office as of the Effective Date. Nothing
herein shall relieve Contractor of any obligation to timely deliver to
Subcontractor CFR that meets the requirements of the applicable CFR
specification and SOW."

         In Annex I (Page 262) lines 1-3 (beginning "[NOTE: The Acceptance
Specification. . .") are hereby deleted in their entirety, and replaced with the
following: "As Design Authority for the ASTOR System and subject to Condition
9(b), the Subcontractor agrees to perform its obligations under the Subcontract
in accordance with the Acceptance Specification which is set out in Annex C to
Contract CIS4B/9 dated 17 December 1999, and which is already in the possession
of the Subcontractor"s ASTOR Programme Office as of the Effective Date. Nothing
herein shall relieve Contractor of any obligation to timely deliver to
Subcontractor CFR that meets the requirements of the applicable CFR
specification and SOW. "

         In Annex N (Page 286), "[To be provided by RSL]" is hereby deleted, and
the words attached hereto as Exhibit C-7 are inserted in place thereof.

         Annex P (Pages 288 - 291) is hereby deleted in its entirety and
replaced with the new Annex P set out in Exhibit C-8 hereto.

         In Annex R (Pages 300-302), the Contractor has exercised its right to
amend that Annex. Annex R is hereby deleted in its entirety and replaced with
the new Annex R set out in Exhibit C-9 hereto.





<PAGE>


                                   EXHIBIT C-1

                     CONDITION 3 - SCHEDULE OF REQUIREMENTS

3.   SCHEDULE OF REQUIREMENTS

The Subcontractor shall design, develop, manufacture and supply to the
Contractor, who shall purchase and where appropriate, take delivery of the
Articles and/or Services specified below in accordance with the terms and
conditions of the Subcontract, including without limitation the obligations set
forth in Condition 4 below.

<TABLE>
<CAPTION>
  ITEM NO   TASK                                                                        COST       6% FEE              PRICE
<S>         <C>                                                                    <C>             <C>             <C>
     1      FLIGHT DECK MODIFICATION                                               $  6,538,956    $ 392,337       $  6,931,293
     2      MAIN AIRCRAFT CABIN MODIFICATION                                       $  2,842,654    $ 170,559       $  3,013,213
     3      MISSION EQUIPMENT                                                      $ 10,138,694    $ 608,321       $ 10,747,015
     4      ELECTRICAL SYSTEM MODIFICATIONS                                        $  1,620,609    $  97,237       $  1,717,846
     5      WORKSTATION AND EQUIPMENT RACKS                                        $  1,212,753    $  72,765       $  1,285,518
     6      ELECTRICAL SYSTEM SUPPORT EQUIPMENT                                    $    138,570    $   8,314       $    146,884
     7      ENVIRONMENTAL CONTROL                                                  $  3,997,798    $ 239,868       $  4,237,666
     8      STRUCTURAL MONITORING                                                  $    511,929    $  30,716       $    542,645
     9      INTERFERENCE CANCELLATION SYSTEM                                       $     18,533    $   1,112       $     19,645
    10      WORKSTATION/SERVER SOFTWARE DESIGN, DEVELOPMENT,
            TEST & INTEGRATION
   10.1              Test & Integration                                            $    954,164    $  57,250       $  1,011,414
   10.2              Software Testing                                              $    424,683    $  25,481       $    450,164
   10.3              Technical Operations and Support Documents                    $    442,274    $  26,536       $    468,810
                     - Version Description Document, Software User
                     Manual, Software Quality Programme Plan, Software
                     Configuration Plan, Software Problem Reports,
                     Software Transition Plan
   10.4              Track Manager and Control Reporting/System                    $  6,637,042    $  398,223      $  7,035,265
                     Server Software
    11      SUPPORT SEGMENT DESIGN, DEVELOPMENT, TEST AND INTEGRATION              $  5,232,370    $  313,942      $  5,546,312
   11.1     Integration of the Mission Planning and Mission Replay
            Facility Software                                                      $    188,957    $   11,337      $    200,294
    12      TRAINING SUBSYSTEM INCLUDING ICD'S, TEST PROCEDURES,
            (EXCLUDING FBFCT)                                                      $  3,778,916    $  226,735      $  4,005,651
    13      THE FIRST ARTICLE INSTALLATION, INTEGRATION AND TEST
   13.1              Integration & Test                                            $  5,082,340    $  304,940      $  5,387,280
   13.2              Aircraft System Test                                          $    489,039    $   29,342      $    518,381
   13.3              Flight Test Programme                                         $  2,055,334    $  123,320      $  2,178,654
   13.4              Aerodynamic Validation                                        $     47,359    $    2,842      $     50,201
    14      STUDIES - AIR PLATFORM SIGNATURE MEASUREMENT STUDY,                    $   (126,137)   $   (7,568)     $   (133,705)
            MARITIME SEGMENT STUDY, NBC STUDY.
    15      ALL TASKS ASSOCIATED WITH TRANSITION                                   $    263,204    $   15,792      $    278,996
    16      INTEGRATED LOGISTICS SUPPORT PROGRAMME
   16.1              Technical Manuals                                             $  4,711,759    $  282,706      $  4,994,465
   16.2              Support Equipment                                             $  1,009,475    $   60,569      $  1,070,044
   16.3              Training Curriculum                                           $  2,866,511    $  171,991      $  3,038,502
   16.4              Spares Provisioning                                           $    332,419    $   19,945      $    352,364
   16.5              Tooling                                                       $  1,025,946    $   61,557      $  1,087,503
   16.6              LSA Tasks/LORA                                                $  1,283,170    $   76,990      $  1,360,160
   16.7              Human Factors engineering services                            $    797,355    $   47,841      $    845,196
   16.8              Reliability, Maintainability and                              $    309,578    $   18,575      $    328,153
   16.9              Failure Modes and Effects Criticality                         $     79,594    $    4,776      $     84,370
   16.10             Data Reporting and Corrective Action System                   $    273,656    $   16,419      $    290,075
    17      SAFETY                                                                 $    346,248    $   20,775      $    367,023
    18      CONFIGURATION MANAGEMENT                                               $  1,836,283    $  110,177      $  1,946,460
    19      QUALITY ASSURANCE - SOURCE INSPECTION, ACCEPTANCE,                     $  2,083,260    $  124,996      $  2,208,256
            PLANS, PROCEDURES, REPORTS AND CERTIFICATION.
    20      DESIGN CERTIFICATION, AIRWORTHINESS AND MILITARY AIRCRAFT RELEASE      $  1,818,207    $  109,092      $  1,927,299
    21      PROGRAMME MANAGEMENT                                                   $ 26,895,543    $1,613,732      $ 28,509,275
    22      SYSTEM ENGINEERING                                                     $ 10,586,986    $  635,219      $ 11,222,205
    23      MISCELLANEOUS MATERIAL                                                 $ 10,412,662    $  624,760      $ 11,037,422
    24      PAINT                                                                  $     38,815    $    2,329      $     41,144

            TOTAL                                                                  $119,197,508    $7,151,850      $126,349,358
</TABLE>


<PAGE>




Notwithstanding anything contained in this Condition 3 to the contrary, the
Contractor shall have the right, exercisable upon written notice to the
Subcontractor before the date which is forty-five (45) days after the Effective
Date, to decrease the costs and prices set forth above in an aggregate amount
(which aggregate amount shall be allocable by the Contractor to the applicable
line items set forth above) equal to the sum of (i) the costs incurred by the
AIS Business (as defined in the Asset Purchase Agreement) during the period
starting as of 26 January, 2002 and ending as of the Effective Date in the
performance of work with respect to Articles and Services (as defined hereunder)
and (ii) an amount equal to six percent (6%) of such costs.









<PAGE>


                                                      EXHIBIT C-2


                                                ANNEX A - DELIVERY SCHEDULE
<TABLE>
<CAPTION>
---------- ----------------------------------------------------------- ------------- ----------------------------
ITEM                                                                   UNIT            SCHEDULED DELIVERY DATE
NO.                               DESCRIPTION                          REFERENCE

-----------------------------------------------------------------------------------------------------------------
<S>        <C>                                                         <C>            <C>
DESIGN AND DEVELOPMENT

-----------------------------------------------------------------------------------------------------------------
1          Design and Development of the Air System (Air Platform
           with Integrated Mission System)                                 Lot                     February - 08
---------- ----------------------------------------------------------- ------------- ----------------------------
2          Design and Development of the Operational Level Ground
           Station (OLGS)                                                  Lot                     February - 08
---------- ----------------------------------------------------------- ------------- ----------------------------
3          Design and Development of the Tactical Ground Station
           (TGS)                                                           Lot                     February - 08
---------- ----------------------------------------------------------- ------------- ----------------------------
4          Design and Development of the Main Operating Base (MOB)
           Mission Planning and mission Data Replay Facility,
           including the Crew Briefing Facility and the Forward            Lot                        April - 04
           Operating Base (FOB) Mission Data Replay Facility
---------- ----------------------------------------------------------- ------------- ----------------------------
5          Design and Development of the Portable Mission Planner
           (PMP) and Crew Briefing facilities                              Lot                        April - 04
-----------------------------------------------------------------------------------------------------------------

PRODUCTION

-----------------------------------------------------------------------------------------------------------------

AIR SYSTEMS


-----------------------------------------------------------------------------------------------------------------
6          Produce and supply ASTOR Air Platform                          1 Lot                      August - 04
---------- ----------------------------------------------------------- ------------- ----------------------------
7          Group "A" Kits
           Aircraft #2                                                               March 03
           Aircraft #3                                                               February 04
           Aircraft #4                                                               November 04
           Aircraft #5                                                               September 05

---------- ----------------------------------------------------------- ------------- ----------------------------
7-1        6123-00100 Placard Installation (Mech)                         4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-2        6123-02000 Seat Installation - Top (Mech)                      4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-3        6123-03000 Floor Modifications - Complete (Mech)               4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-4        6123-05000 Installation - Liner/Sidewall/Acoustics (Mech)      4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-5        6123-06000 Environmental Control Systems (Mech/Elect)          4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-6        6123-08000 Crew Rest Provisions - Structural (Mech)            4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-7        6123-09000 System Installation - Crew Rest (Elect)             4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-8.       6123-10000 System Installation - Avionics Modifications        4 Lots
           (Mech/Elect)
---------- ----------------------------------------------------------- ------------- ----------------------------
7-9        6123-11000 Oxygen System Installation (Mech/Elect)             4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-10       6123-12000 System Installation- Antennas (Mech)                4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-11       6123-14000 Console Installation (Mech/Elect)                   4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-12       6123-15000 System Installation-Radomes/Fairings (Mech)         4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
---------- ----------------------------------------------------------- ------------- ----------------------------
ITEM                                                                   UNIT            SCHEDULED DELIVERY DATE
NO.                               DESCRIPTION                          REFERENCE

-----------------------------------------------------------------------------------------------------------------
<S>        <C>                                                         <C>            <C>
7-13       6123-16000 Miscellaneous Bracketry Installation (Mech)         4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-14       6123-17000 Hydraulic Modifications Complete (Mech)             4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-15       6123-20000 Flight Deck Modification (Mech/Elect)               4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-16       6123-25000 System Installation-INTERPHONE (ICCS) (Elect)       4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-17       6123-28000 System Installation-POWER DISTR (Elect)             4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-18       6123-30000 System Installation-TACAN (Elect)                   4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-19       6123-31000 System Installation-DIGITAL DATA BUS (Elect)        4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-20       6123-33000 System Installation-V/UHF COMMS (Elect)             4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-21       6123-40000 System Installation-CMDS (Elect)                    4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-22       6123-41000 System Installation-GPS (Elect)                     4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-23       6123-42000 Miscellaneous/Emergency Equip Installation          4 Lots
           (Mech)
---------- ----------------------------------------------------------- ------------- ----------------------------
7-24       6123-47000 System Installation - LIGHTING (Mech/Elect)         4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-25       6123-48000 Countermeasures Installations - Structural          4 Lots
           (Mech)
---------- ----------------------------------------------------------- ------------- ----------------------------
7-26       6123-50000 Major Structure Installations (Mech)                4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-27       6123-51000 Lateral Stability Enhancements (Mech)               4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-28       6123-58000 System Installation-LINK-16 (Elect)                 4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-29       6123-60000 System Installation-NARROWBAND DATALINK (Elect)     4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-30       6123-61000 System Installation - Dual Mode Radar (Elect)       4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-31       6123-62000 System Installation-HF COMMS (Elect)                4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-32       6123-64000 Rack System Installation - A/C (Mech/Elect)         4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-33       6123-67000 System Installation-SECURE COMMS (Elect)            4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-34       6123-68000 System Installation-WIDE BAND DATALINK (Elect)      4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-35       6123-69000 System Installation-SMOKE DETECTION (Elect)         4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-36       6123-83000 System Installation-SATCOM (Elect)                  4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-37       6123-84000 System Installation-ICS (Elect)                     4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-38       6123-85000 System Installation-OTP (Elect)                     4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-39       6123-88000 System Installation-IFF (Elect)                     4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-40       6123-89000 System Installation-RWR (Mech/Elect)                4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-41       6123-90000 System Installation- SIMS (Mech/Elect)              4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-42       6123-91000 System Installation- MWS (Mech/Elect)               4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-43       6123-92000 System Installation- TOWED DECOY (Elect)            4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------
7-44       6123-93000 System Installation-TCAS (Elect)                    4 Lots
---------- ----------------------------------------------------------- ------------- ----------------------------

GROUND STATIONS

-----------------------------------------------------------------------------------------------------------------
8          Software for the Ground Station Work Station Server              1                        August - 04
---------- ----------------------------------------------------------- ------------- ----------------------------

-----------------------------------------------------------------------------------------------------------------
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
---------- ----------------------------------------------------------- ------------- ----------------------------
ITEM                                                                   UNIT            SCHEDULED DELIVERY DATE
NO.                               DESCRIPTION                          REFERENCE

-----------------------------------------------------------------------------------------------------------------
<S>        <C>                                                         <C>            <C>
MISSION PLANNING, BRIEFING AND REPLAY FACILITIES

-----------------------------------------------------------------------------------------------------------------
9          Produce and supply a Mission Planning and Mission Data
           Replay Facility, including Crew Briefing facilities at           1                         April - 04
           the Main Operating Base (MOB)
---------- ----------------------------------------------------------- ------------- ----------------------------
10         Produce and supply Portable Mission Planning and Crew
           Briefing Facilities                                              1                         April - 04
---------- ----------------------------------------------------------- ------------- ----------------------------
                                                                            2                         April - 04
---------- ----------------------------------------------------------- ------------- ----------------------------
11         Produce and supply Forward Operating Base (FOB) Mission
           Data Replay Facilities                                           1                         April - 04
-----------------------------------------------------------------------------------------------------------------

SOFTWARE

-----------------------------------------------------------------------------------------------------------------
12         Provision of software licences for L-3 developed software       Lot                        April - 04
-----------------------------------------------------------------------------------------------------------------

SUPPORT FACILITIES

-----------------------------------------------------------------------------------------------------------------
13         Mission System Reference Sample Facility (MSRSF) for the
           MOB                                                              1               Complete by Aug - 04
---------- ----------------------------------------------------------- ------------- ----------------------------
14         Provision of a Standard Interface for Multiple Platform
           Link Evaluation (SIMPLE)                                         1             Complete by April - 04
-----------------------------------------------------------------------------------------------------------------

INTEGRATED LOGISTIC SUPPORT & MANAGEMENT

-----------------------------------------------------------------------------------------------------------------
15-1       Implementation of ILS, including LSAR generation and
           maintenance in accordance with DEFSTAN 00-60 during             Lot                        April - 04
           Development and Production until LSD
---------- ----------------------------------------------------------- ------------- ----------------------------
15-2       Development and production of all Technical Documentation
           and Data                                                        Lot                        April - 04
-----------------------------------------------------------------------------------------------------------------

SUPPORT & TRAINING EQUIPMENT

-----------------------------------------------------------------------------------------------------------------
16         Provision of Support and Test Equipment, Training
           Equipment and Spares:
---------- ----------------------------------------------------------- ------------- ----------------------------
16-1       Aircraft Support and Test Equipment                             Lot                        April - 04
---------- ----------------------------------------------------------- ------------- ----------------------------
16-2       Ground Station Support and Test Equipment                       Lot                        April - 04
---------- ----------------------------------------------------------- ------------- ----------------------------
16-3       Provision of all training equipment derived as in
           accordance with the Training Development Plan and               Lot                        April - 04
           Training Needs Analysis (TNA)
-----------------------------------------------------------------------------------------------------------------

IN-SERVICE RELIABILITY DEMONSTRATION

-----------------------------------------------------------------------------------------------------------------
17         Provision of support to the In-Service Reliability
           Demonstration (ISRD)                                            Lot              Complete by Feb - 08
-----------------------------------------------------------------------------------------------------------------
</TABLE>


<PAGE>


                                                       EXHIBIT C-3


<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
                    POOL DESCRIPTION                                   DESCRIPTION        CURRENT DOD RATES FULLY BURDENED THROUGH
                                                                                                     TOTAL COST (NO FEE)
------------------------------------------------------------------------------------------------------------------------------------
                                             LABOR CATEGORIES                               JAN02-     JAN03-     JAN04-     JAN05-
                                                                                            DEC02      DEC03      DEC04      DEC05
------------------------------------------------------------------------------------------------------------------------------------
<S>                                                       <C>                              <C>        <C>        <C>        <C>
------------------------------------------------------------------------------------------------------------------------------------
SYSTEMS ENGINEERING                                       SYSTEMS ENGINEERING              $116.29    $120.89    $125.12    $129.67
------------------------------------------------------------------------------------------------------------------------------------
                                                          PROJECT SYSTEMS                  $116.29    $120.89    $125.12    $129.67
------------------------------------------------------------------------------------------------------------------------------------
                                                          AIRWORTHINESS /FLIGHT TEST /DAS  $116.29    $120.89    $125.12    $129.67
------------------------------------------------------------------------------------------------------------------------------------
AERO                                                      AERO                             $108.64    $112.94    $116.89    $121.15
------------------------------------------------------------------------------------------------------------------------------------
                                                          ELECTRICAL DESIGN                $108.64    $112.94    $116.89    $121.15
------------------------------------------------------------------------------------------------------------------------------------
                                                          STRUCTURAL DESIGN                $108.64    $112.94    $116.89    $121.15
------------------------------------------------------------------------------------------------------------------------------------
                                                          MECHANICAL DESIGN                $108.64    $112.94    $116.89    $121.15
------------------------------------------------------------------------------------------------------------------------------------
                                                          THERMAL/FLUID DYNAMICS           $108.64    $112.94    $116.89    $121.15
------------------------------------------------------------------------------------------------------------------------------------
                                                          ACCOUSTICS                       $101.82    $105.85    $109.55    $113.54
------------------------------------------------------------------------------------------------------------------------------------
                                                          AERODYNAMICS                     $101.82    $105.85    $109.55    $113.54
------------------------------------------------------------------------------------------------------------------------------------
                                                          MECHANICAL SYSTEMS               $101.82    $105.85    $109.55    $113.54
------------------------------------------------------------------------------------------------------------------------------------
                                                          AERO SCIENCE                     $101.82    $105.85    $109.55    $113.54
------------------------------------------------------------------------------------------------------------------------------------
                                                          AERO TEST                        $101.82    $105.85    $109.55    $113.54
------------------------------------------------------------------------------------------------------------------------------------
                                                          MASS PROPERTIES                  $101.82    $105.85    $109.55    $113.54
------------------------------------------------------------------------------------------------------------------------------------
                                                          STRESS ANALYSIS                  $101.82    $105.85    $109.55    $113.54
------------------------------------------------------------------------------------------------------------------------------------
                                                          STRUCTURAL DYNAMICS              $101.82    $105.85    $109.55    $113.54
------------------------------------------------------------------------------------------------------------------------------------
                                                          AERO DEVELOPMENT LAB             $101.82    $105.85    $109.55    $113.54
------------------------------------------------------------------------------------------------------------------------------------
                                                          ENGINEERING SERVICES             $101.82    $105.85    $109.55    $113.54
------------------------------------------------------------------------------------------------------------------------------------
                                                          HUMAN FACTORS                    $101.82    $105.85    $109.55    $113.54
------------------------------------------------------------------------------------------------------------------------------------
                                                          RELIABILITY/MAINTAINABILITIY     $101.82    $105.85    $109.55    $113.54
------------------------------------------------------------------------------------------------------------------------------------
                                                          SYSTEMS SAFETY                   $101.82    $105.85    $109.55    $113.54
------------------------------------------------------------------------------------------------------------------------------------
                                                          LIAISON ENGINEERING              $108.64    $112.94    $116.89    $121.15
------------------------------------------------------------------------------------------------------------------------------------

<PAGE>


------------------------------------------------------------------------------------------------------------------------------------
HARDWARE/SOFTWARE DEVEL.                                  EMC                              $106.43    $110.65    $114.51    $118.67
------------------------------------------------------------------------------------------------------------------------------------
                                                          EMI                              $106.43    $110.65    $114.51    $118.67
------------------------------------------------------------------------------------------------------------------------------------
                                                          HARDWARE ENGINEERING             $106.43    $110.65    $114.51    $118.67
------------------------------------------------------------------------------------------------------------------------------------
                                                          MSTF                             $106.43    $110.65    $114.51    $118.67
------------------------------------------------------------------------------------------------------------------------------------
                                                          SOFTWARE ENGINEERING             $106.43    $110.65    $114.51    $118.67
------------------------------------------------------------------------------------------------------------------------------------
TECHNICAL PUBLICATIONS                                    CONFIGURATION MANAGEMENT         $83.20      $86.49    $89.51     $92.78
------------------------------------------------------------------------------------------------------------------------------------
                                                          INTEGRATED LOGISTICS SUPPORT     $83.20      $86.49    $89.51     $92.78
------------------------------------------------------------------------------------------------------------------------------------
                                                          LOGISTICS SUPPORT ANALYSIS       $83.20      $86.49    $89.51     $92.78
------------------------------------------------------------------------------------------------------------------------------------
                                                          TECHNICAL PUBLICATIONS           $83.20      $86.49    $89.51     $92.78
------------------------------------------------------------------------------------------------------------------------------------
REPRO                                                     REPRODUCTION                     $52.99      $55.08    $57.01     $59.08
------------------------------------------------------------------------------------------------------------------------------------
PROGRAM MANAGEMENT                                        MATL PROGRAM MANAGER             $99.19     $103.12    $106.72    $110.61
------------------------------------------------------------------------------------------------------------------------------------
                                                          PROGRAM CONTROLS                 $99.19     $103.12    $106.72    $110.61
------------------------------------------------------------------------------------------------------------------------------------
                                                          PROGRAM MANAGEMENT               $99.19     $103.12    $106.72    $110.61
------------------------------------------------------------------------------------------------------------------------------------
PROGRAMMERS                                               PROGRAMMERS                      $98.85     $102.78    $106.36    $110.24
------------------------------------------------------------------------------------------------------------------------------------
                                         MANUFACTURING BURDEN POOL
------------------------------------------------------------------------------------------------------------------------------------
MECHANICAL FAB                                            MECHANICAL FAB/ASSY              $82.40      $85.72    $88.43     $91.66
------------------------------------------------------------------------------------------------------------------------------------
                                                          TOOLING                          $82.40      $85.72    $88.43     $91.66
------------------------------------------------------------------------------------------------------------------------------------
HANGAR,DOCK & LINE / SUPT SHOPS                           AIRCRAFT SUPPORT                 $80.52      $83.79    $86.46     $89.65
------------------------------------------------------------------------------------------------------------------------------------
                                                          A/C PAINT                        $80.52      $83.79    $86.46     $89.65
------------------------------------------------------------------------------------------------------------------------------------
                                                          HANGAR, DOCK & LINE              $70.15      $73.00    $75.32     $78.09
------------------------------------------------------------------------------------------------------------------------------------
ELECTRICAL/ELECTRONIC FAB & PILOT ASSY                    ELECTRICAL FAB/ASSY              $70.90      $73.81    $76.18     $79.01
------------------------------------------------------------------------------------------------------------------------------------
                                                          ELECTRONIC FAB                   $70.90      $73.81    $76.18     $79.01
------------------------------------------------------------------------------------------------------------------------------------
                                                          PILOT ASSY                       $70.90      $73.81    $76.18     $79.01
------------------------------------------------------------------------------------------------------------------------------------
QUALITY ASSURANCE / TEST                                  DATA SUPPORT                     $78.59      $82.07    $84.92     $88.25
------------------------------------------------------------------------------------------------------------------------------------
                                                          FLIGHT OPERATIONS                $78.59      $82.07    $84.92     $88.25
------------------------------------------------------------------------------------------------------------------------------------
                                                          FAA SUPPORT                      $78.59      $82.07    $84.92     $88.25
------------------------------------------------------------------------------------------------------------------------------------
                                                          PROCUREMENT QA                   $78.59      $82.07    $84.92     $88.25
------------------------------------------------------------------------------------------------------------------------------------
                                                          QUALITY ENGINEERING              $78.59      $82.07    $84.92     $88.25
------------------------------------------------------------------------------------------------------------------------------------
                                                          SOFTWARE QA                      $78.59      $82.07    $84.92     $88.25
------------------------------------------------------------------------------------------------------------------------------------
                                                          TEST, MFG                        $104.22    $108.79    $112.55    $116.95
------------------------------------------------------------------------------------------------------------------------------------
QUALITY CONTROL                                           NDI                              $58.61      $61.18    $63.30     $65.76
------------------------------------------------------------------------------------------------------------------------------------
PLANNING                                                  PRODUCTION PLANNING              $71.56      $74.81    $77.47     $80.56
------------------------------------------------------------------------------------------------------------------------------------
DEDICATED DEPOT / LOGISTICS                               DEDICATED DEPOT                  $53.65      $56.00    $57.92     $60.17
------------------------------------------------------------------------------------------------------------------------------------
WAREHOUSING                                               PACKING & CRATING                $48.92      $50.93    $52.58     $54.52
------------------------------------------------------------------------------------------------------------------------------------

<PAGE>

------------------------------------------------------------------------------------------------------------------------------------
                                LIMITED OVERHEAD (FRINGE ONLY) BURDEN POOL
------------------------------------------------------------------------------------------------------------------------------------
SECURITY SERVICES                                         SECURITY                         $40.25      $42.12    $43.82     $45.61
------------------------------------------------------------------------------------------------------------------------------------
CONTROL TOWER                                             CONTROL TOWER                    $52.66      $55.11    $57.33     $59.68
------------------------------------------------------------------------------------------------------------------------------------
                                            MATERIAL CATEGORIES
------------------------------------------------------------------------------------------------------------------------------------
                                       REGULAR MATERIAL BURDEN POOL
------------------------------------------------------------------------------------------------------------------------------------
REGULAR MATERIAL                                          SHOP OFFLOAD REGULAR              110%        110%      110%       109%
------------------------------------------------------------------------------------------------------------------------------------
                                                          PURCH PTS REGULAR                 110%        110%      110%       109%
------------------------------------------------------------------------------------------------------------------------------------
                                                          SUBCONTRACTS REGULAR              110%        110%      110%       109%
------------------------------------------------------------------------------------------------------------------------------------
                                                          IOT REGULAR                       110%        110%      110%       109%
------------------------------------------------------------------------------------------------------------------------------------
                                                          FOREIGN S/C REGULAR               110%        110%      110%       109%
------------------------------------------------------------------------------------------------------------------------------------
                                       SPECIAL MATERIAL BURDEN POOL
------------------------------------------------------------------------------------------------------------------------------------
SPECIAL MATERIAL                                          LETTER OF CREDIT                  103%        103%      103%       103%
------------------------------------------------------------------------------------------------------------------------------------
                                                          TREASURY COST                     103%        103%      103%       103%
------------------------------------------------------------------------------------------------------------------------------------
                                                          AGENT'S FEE                       103%        103%      103%       103%
------------------------------------------------------------------------------------------------------------------------------------
                                                          SHOP OFFLOAD SPECIAL              103%        103%      103%       103%
------------------------------------------------------------------------------------------------------------------------------------
                                                          PURCH PTS SPECIAL                 103%        103%      103%       103%
------------------------------------------------------------------------------------------------------------------------------------
                                                          SUBCONTRACTS SPECIAL              103%        103%      103%       103%
------------------------------------------------------------------------------------------------------------------------------------
                                                          IOT SPECIAL                       103%        103%      103%       103%
------------------------------------------------------------------------------------------------------------------------------------
                                                          SPECIAL MATL (I.E. A/C PURCHASE)  103%        103%      103%       103%
------------------------------------------------------------------------------------------------------------------------------------
                                                          FOREIGN S/C SPECIAL               103%        103%      103%       103%
------------------------------------------------------------------------------------------------------------------------------------
                                             OTHER CATEGORIES
------------------------------------------------------------------------------------------------------------------------------------
                                            OTHER DIRECT COSTS
------------------------------------------------------------------------------------------------------------------------------------
OTHER DIRECT COSTS                                        WARRANTY                          128%        128%      128%       128%
------------------------------------------------------------------------------------------------------------------------------------
(G&A ONLY)                                                ENGINEERING REPRO SUPPLIES        128%        128%      128%       128%
------------------------------------------------------------------------------------------------------------------------------------
                                                          TRAVEL                            128%        128%      128%       128%
------------------------------------------------------------------------------------------------------------------------------------
                                                          FIELD SERVICE ODC                 128%        128%      128%       128%
------------------------------------------------------------------------------------------------------------------------------------
                                                          ITS RENTAL AND SUPPLIES           128%        128%      128%       128%
------------------------------------------------------------------------------------------------------------------------------------
                                                          MISC. ODC                         128%        128%      128%       128%
------------------------------------------------------------------------------------------------------------------------------------
                                                          S/W LICENSE                       128%        128%      128%       128%
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>



<PAGE>

                                                   EXHIBIT C-4

                                                     ANNEX F

                                        STAGE (MILESTONE) PAYMENT SCHEME
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------
   #                   Milestone Description                     Date         Quarter      US ($) Dollars
                                                                                           (inclusive of
                                                                                              6% fee)
-----------------------------------------------------------------------------------------------------------
<S>      <C>                                                   <C>            <C>           <C>
   1     Frame Mods Fwd Fuselage Drawings issued               30/03/02          Q1             10,700,590
         DAG Structural Installation Design complete
-----------------------------------------------------------------------------------------------------------
   2     Production Enhancers Drawings issued                  30/06/02          Q2             15,584,997
         MIST CSCI Detail Design complete
-----------------------------------------------------------------------------------------------------------
   3     SIL Test Plan complete                                30/09/02          Q3             17,331,789
         SIL Group A (Systems ) Test complete
-----------------------------------------------------------------------------------------------------------
   4     LSA 300 tasks complete                                30/12/02          Q4             13,855,870
         Satcom Radome Installation complete
-----------------------------------------------------------------------------------------------------------
   5     Initial provisioning complete                         30/03/03          Q1             14,135,659
         A/C #1 ECS Installation complete
-----------------------------------------------------------------------------------------------------------
   6     SIL Integration Test complete                         30/06/03          Q2             12,352,680
         A/C Group A Test Execution complete
-----------------------------------------------------------------------------------------------------------
   7     Gnd Test Air Segment Group B Test complete            30/09/03          Q3              7,181,576
         Track Manager CSCI complete
-----------------------------------------------------------------------------------------------------------
   8     Aircraft Flight Readiness Review complete             30/12/03          Q4              6,846,090
         ASTOR Ground Segment test report complete
-----------------------------------------------------------------------------------------------------------
   9     Human Engineering Systems Analysis Report Complete    30/03/04          Q1              8,465,585
         Training Subsystem Acceptance test at MoD complete
-----------------------------------------------------------------------------------------------------------
   10    Safety Case complete                                  30/06/04          Q2              6,417,712
         Support Segment Installation and Acceptance test
         at MOB complete
-----------------------------------------------------------------------------------------------------------
   11    ASTOR System Flight Test Report                       30/09/04          Q3              2,338,443
         A/C #1 Delivery to MoD complete
-----------------------------------------------------------------------------------------------------------
   12    Support for all UK activities.                        30/12/04          Q4                 79,263
-----------------------------------------------------------------------------------------------------------

<PAGE>

-----------------------------------------------------------------------------------------------------------
   13    Support for all UK activities.                        30/03/05          Q1                 79,263
-----------------------------------------------------------------------------------------------------------
   14    Support for all UK activities.                        30/06/05          Q2                 79,263
-----------------------------------------------------------------------------------------------------------
   15    Support for all UK activities.                        30/09/05          Q3                 79,263
-----------------------------------------------------------------------------------------------------------
   16    Support for all UK activities.                        30/12/05          Q4                 79,263
-----------------------------------------------------------------------------------------------------------
   17    Support for all UK activities.                        30/03/06          Q1                 79,263
-----------------------------------------------------------------------------------------------------------
   18    Support for all UK activities.                        30/06/06          Q2                 79,263
-----------------------------------------------------------------------------------------------------------
   19    Support for all UK activities.                        30/09/06          Q3                 79,263
-----------------------------------------------------------------------------------------------------------
   20    Support for all UK activities.                        30/12/06          Q4                 79,263
-----------------------------------------------------------------------------------------------------------
   21    Support for all UK activities.                        30/03/07          Q1                 79,263
-----------------------------------------------------------------------------------------------------------
   22    Support for all UK activities.                        30/06/07          Q2                 79,263
-----------------------------------------------------------------------------------------------------------
   23    Support for all UK activities.                        30/09/07          Q3                 79,263
-----------------------------------------------------------------------------------------------------------
   24    Support for all UK activities.                        30/12/07          Q4                 79,263
-----------------------------------------------------------------------------------------------------------
   25    ISRD completed in accordance with the                 30/03/08          Q1             10,107,948
         requirements of the Authority ISRD Directive
-----------------------------------------------------------------------------------------------------------
                                                Total Price                                    126,349,358
-----------------------------------------------------------------------------------------------------------
</TABLE>

Notwithstanding anything contained in this Annex F to the contrary, the
Contractor shall have the right to decrease the amounts specified in the last
column, entitled "US ($) Dollars (inclusive of 6% fee)", to correspond to the
line items in Condition 3, as those line items may be adjusted by the
Contractor in accordance with the provisions of Condition 3; provided,
however, that the revised Total Price for the column entitled "US ($) Dollars
(inclusive of 6% fee)" shall be equal to the dollar amount indicated as the
total of the column entitled "Price" in Condition 3, as that amount may be
adjusted by the Contractor in accordance with the provisions of Condition 3.




<PAGE>



                                                         EXHIBIT C-5

                                                          ANNEX F1

                                              STAGE (MILESTONE) PAYMENT CRITERIA

This annex contains the criteria associated with each stage (milestone)
payment as identified in Annex F that the Subcontractor shall complete.

<TABLE>
<CAPTION>
===========================================================================================================================

                                                    PAYMENT MILESTONE
===========================================================================================================================
<S>                         <C>                             <C>
Ser.  No.001                Title: a) Frame Mods Fwd Fuselage Drawings issued and: b) DAG Structural Installation Design
                            complete.
--------------------------- -----------------------------------------------------------------------------------------------
Planned Completion Date: a) 28/01/02 & b) 26/02/02         Submission Date:
                                                           a) & b) 30/03/02
---------------------------------------------------------------------------------------------------------------------------
Milestone Value ($): 10,700,590
---------------------------------------------------------------------------------------------------------------------------
Milestone Description:
---------------------------------------------------------- ----------------------------------------------------------------
a) The issue of the drawings for the Frame Modifications for the Forward Fuselage and: b) the completion of the DAG
Structural Installation Design



---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------
Milestone Completion Criteria:
---------------------------------------------------------- ----------------------------------------------------------------
a) A complete set of drawings for the Frame Modifications to the Forward
Fuselage approved by the necessary authorities and entered into CM/DM and
available for use.

b) The fully complete DAG Structural Installation Design drawings issued for
review and approval by the necessary authorities.





---------------------------------------------------------------------------------------------------------------------------
 Milestone Owner:
---------------------------------------------------------------------------------------------------------------------------
Raytheon:
------------------------------- -------------------------------------------------------------------------------------------
Subcontractor:
===========================================================================================================================
</TABLE>


<PAGE>

III.


<TABLE>
<CAPTION>
===========================================================================================================================

                                                    PAYMENT MILESTONE
===========================================================================================================================
<S>                         <C>                            <C>
Ser.  No. 002               Title: a) Production Enhancers Drawings issued and: b) MIST CSCI Detail Design complete
--------------------------- -----------------------------------------------------------------------------------------------
Planned Completion Date: a) 25/04/02 & b) 01/05/04         Submission Date:
                                                           30/06/02
---------------------------------------------------------------------------------------------------------------------------
Milestone Value ($): 15,584,997
---------------------------------------------------------------------------------------------------------------------------
Milestone Description:
---------------------------------------------------------------------------------------------------------------------------
a) The issue of drawings for the Production Enhancers and: b) completion of the MIST CSCI Detail Design.




---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------
Milestone Completion Criteria:
---------------------------------------------------------- ----------------------------------------------------------------
a) A complete set of drawings for the Production Enhancers approved by the
necessary authorities and entered into CM/DM and available for use.

b) The fully complete design documentation reviewed and approved by the
necessary authorities and available to enable the software code to be
completed.




---------------------------------------------------------------------------------------------------------------------------
 Milestone Owner:
---------------------------------------------------------------------------------------------------------------------------
Raytheon:
---------------------------------------------------------------------------------------------------------------------------
Subcontractor:
===========================================================================================================================
</TABLE>


<PAGE>

IV.


<TABLE>
<CAPTION>
===========================================================================================================================

                                                    PAYMENT MILESTONE
===========================================================================================================================
<S>                         <C>                            <C>
Ser.  No. 003               Title: a) SIL Test Plan complete and: b) SIL Group A (Systems ) Test complete
--------------------------- -----------------------------------------------------------------------------------------------
Planned Completion Date: a) 26/07/02 & b) 26/08/02         Submission Date:
                                                           A0 & b) 30/09/02
---------------------------------------------------------------------------------------------------------------------------
Milestone Value ($): 17,331,789
---------------------------------------------------------------------------------------------------------------------------
Milestone Description:
---------------------------------------------------------- ----------------------------------------------------------------
a) The completion of the SIL Test Plan and: b) the completion of the SIL Group "A" Systems Test.




---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------
Milestone Completion Criteria:
---------------------------------------------------------- ----------------------------------------------------------------
a) The complete set of SIL Test Plans reviewed and approved and available for
the generation of the associated Test Procedures.

b) All Group "A" Test in accordance with the approved procedures successfully
carried out by the Subcontractor and to the satisfaction of the Contractor and
Final Test Report ready for release.




---------------------------------------------------------------------------------------------------------------------------
 Milestone Owner:
---------------------------------------------------------------------------------------------------------------------------
Raytheon:
------------------------------- -------------------------------------------------------------------------------------------
Subcontractor:
===========================================================================================================================
</TABLE>



<PAGE>

V.



<TABLE>
<CAPTION>
===========================================================================================================================

                                                    PAYMENT MILESTONE
===========================================================================================================================
<S>                         <C>                            <C>
Ser.  No. 004               Title: a) LSA 300 tasks complete and: b) Satcom Radome Installation complete

--------------------------- -----------------------------------------------------------------------------------------------
Planned Completion Date: a) 17/10/02 & b) 16/12/02         Submission Date:
                                                            a) & b) 30/12/02
----------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
Milestone Value ($): 13,855,870
---------------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------
Milestone Description:
---------------------------------------------------------- ----------------------------------------------------------------
a) The completion of all LSA 300 Tasks and: b) the completion of the installation of the Satcom Radome




---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------
Milestone Completion Criteria:
---------------------------------------------------------- ----------------------------------------------------------------
a) Formal evidence to be provided that all LSA 300 tasks have identified all
of the maintainence and operation tasks. Full visibility to be provided to
ensure that the appropriate fields have been completed in the LSA Database

b) Completion of the SATCOM Radome Installation on the Aircraft in accordance
with the fully released drawings and all inspections performed and associated
documention completed and approved.




---------------------------------------------------------------------------------------------------------------------------
 Milestone Owner:
---------------------------------------------------------------------------------------------------------------------------
Raytheon:
---------------------------------------------------------------------------------------------------------------------------
Subcontractor:
===========================================================================================================================
</TABLE>


<PAGE>

VI.


<TABLE>
<CAPTION>
===========================================================================================================================

                                                    PAYMENT MILESTONE
===========================================================================================================================
<S>                         <C>                            <C>
Ser.  No. 005               Title: a) Initial provisioning complete and: b) A/C #1 ECS Installation complete
--------------------------- -----------------------------------------------------------------------------------------------
Planned Completion Date: a) 14/02/03 & 20/02/03            Submission Date:
                                                           a) & b) 30/03/03
---------------------------------------------------------------------------------------------------------------------------
Milestone Value ($): 14,135,659
---------------------------------------------------------------------------------------------------------------------------
Milestone Description:
---------------------------------------------------------- ----------------------------------------------------------------
a) The completion of the Initial Provisioning Tasks and: b)  the completion of Aircraft #1 ECS Installation




---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------
Milestone Completion Criteria:
---------------------------------------------------------- ----------------------------------------------------------------
a) A fully defined Initial Spares Package and all associated items placed on
order. Evidence to be supplied for items to be procured by the Subcontractor.

b) Completion of the ECS Installation for Aircraft #1 in accordance with the
fully released drawings and all inspections performed and associated
documention completed and approved.




---------------------------------------------------------------------------------------------------------------------------
 Milestone Owner:
---------------------------------------------------------------------------------------------------------------------------
Raytheon:
---------------------------------------------------------------------------------------------------------------------------
Subcontractor:
===========================================================================================================================
</TABLE>


<PAGE>

VII.



<TABLE>
<CAPTION>
===========================================================================================================================

                                                    PAYMENT MILESTONE
===========================================================================================================================
<S>                         <C>                            <C>
Ser.  No. 006               Title: a) SIL Integration Test complete and: b) A/C Group A Test Execution complete.
--------------------------- -----------------------------------------------------------------------------------------------
Planned Completion Date: a) 25/04/03 & b) 12/05/03         Submission Date:
                                                           A) & b) 30/06/03
---------------------------------------------------------------------------------------------------------------------------
Milestone Value ($): 12,352,680
---------------------------------------------------------------------------------------------------------------------------
Milestone Description:
---------------------------------------------------------- ----------------------------------------------------------------
a) The completion of the SIL Integration Test and: b) the completion of the Execution of the Aircraft Group "A"
Test



---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------
Milestone Completion Criteria:
---------------------------------------------------------- ----------------------------------------------------------------
a) Complete performance by the Subcontractor to the satisfaction of the
Contractor of the SIL Integration Acceptance Test in accordance with the
approved procedures. The completion of the associated Test Report and
availability for review.

b) Complete performance by the Subcontractor to the satisfaction of the
Contractor of the Aircraft Group "A" Test in accordance with the approved
procedures. The completion of the associated Test Report and availability for
review.



---------------------------------------------------------------------------------------------------------------------------
 Milestone Owner:
---------------------------------------------------------------------------------------------------------------------------
Raytheon:
------------------------------- -------------------------------------------------------------------------------------------
Subcontractor:
===========================================================================================================================
</TABLE>



<PAGE>


VIII.


<TABLE>
<CAPTION>
===========================================================================================================================

                                                    PAYMENT MILESTONE
===========================================================================================================================
<S>                         <C>                            <C>
Ser.  No. 007               Title: a) Gnd Test Air Segment Group B Test complete and: b) Track Manager CSCI complete
--------------------------- -----------------------------------------------------------------------------------------------
Planned Completion Date: a) 20/08/03 & b) 19/09/03         Submission Date:
                                                           a) & b) 30/09/03
---------------------------------------------------------------------------------------------------------------------------
Milestone Value ($): 7,181,576
---------------------------------------------------------------------------------------------------------------------------
Milestone Description:
---------------------------------------------------------- ----------------------------------------------------------------
a) The completion of the Ground Test Air Segment Group "B" Test and: b) the completion of the Track Manager
CSCI.



---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------
Milestone Completion Criteria:
---------------------------------------------------------- ----------------------------------------------------------------
a) Complete performance by the Subcontractor to the satisfaction of the
Contractor of the Ground Test Air Segment Group "B" Acceptance Test in
accordance with the approved procedures. The completion of the associated Test
Report and availability for review.

b) Fully functional Track Manager CSCI software completed tested, accepted and
available for delivery to the SIL.




---------------------------------------------------------------------------------------------------------------------------
 Milestone Owner:
---------------------------------------------------------------------------------------------------------------------------
Raytheon:
------------------------------- -------------------------------------------------------------------------------------------
Subcontractor:
===========================================================================================================================
</TABLE>



<PAGE>

IX.


<TABLE>
<CAPTION>
===========================================================================================================================

                                                    PAYMENT MILESTONE
===========================================================================================================================
<S>                         <C>                            <C>
Ser.  No. 008               Title: a) Aircraft Flight Readiness Review complete and: b) Gnd Test Gnd Seg Group B test
                            complete
--------------------------- -----------------------------------------------------------------------------------------------
Planned Completion Date: a) 19/11/03 & b) 22/12/03         Submission Date:
                                                           a) & b) 30/12/03
---------------------------------------------------------------------------------------------------------------------------
Milestone Value ($): 6,846,090
---------------------------------------------------------------------------------------------------------------------------
Milestone Description:
---------------------------------------------------------- ----------------------------------------------------------------
a) The completion of the Aircraft Flight Readiness Review and: b) the completion of the Ground Test Ground Segment
Group "B" Test



---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------
Milestone Completion Criteria:
---------------------------------------------------------- ----------------------------------------------------------------
a) The successful completion of all Ground Test Ground Segment Group "B" Tests
in accordance with the test procedures Test Reports produced, approved and
issued for review.

b) Aircraft Flight Readiness Review complete and all documentation available
for signature to allow the Aircraft to fly.





---------------------------------------------------------------------------------------------------------------------------
 Milestone Owner:
---------------------------------------------------------------------------------------------------------------------------
Raytheon:
------------------------------- -------------------------------------------------------------------------------------------
Subcontractor:
===========================================================================================================================
</TABLE>


<PAGE>

X.



<TABLE>
<CAPTION>
===========================================================================================================================

                                                    PAYMENT MILESTONE
===========================================================================================================================
<S>                         <C>                            <C>
Ser.  No. 009               Title: a) Human Engineering Systems Analysis Report Complete and: b) Training Subsystem
                            Acceptance test at MoD complete.
--------------------------- -----------------------------------------------------------------------------------------------
Planned Completion Date: a) 05/01/04 & b) 14/01/04         Submission Date:
                                                           A0 & b) 30/03/04
---------------------------------------------------------------------------------------------------------------------------
Milestone Value ($): 8,465,585
---------------------------------------------------------------------------------------------------------------------------
Milestone Description:
---------------------------------------------------------- ----------------------------------------------------------------
a) The completion of the Human Engineering Systems Analysis Report and: b) the completion at the MoD of the
Training Subsystem Acceptance Test.



---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------
Milestone Completion Criteria:
---------------------------------------------------------- ----------------------------------------------------------------
a) The completion of the Human Engineering Systems Analysis Report, approved
and available for release, incorporating all the requirements of the Human
Engineering Test Plan.

b) The successful completion at the MoD by the Subcontractor to the
satisfaction of the Contractor of the Training Subsystems Acceptance Test in
accordance with the Test Procedures. Test Reports produced, approved and
issued for review.



---------------------------------------------------------------------------------------------------------------------------
 Milestone Owner:
---------------------------------------------------------------------------------------------------------------------------
Raytheon:
------------------------------- -------------------------------------------------------------------------------------------
Subcontractor:
===========================================================================================================================
</TABLE>



<PAGE>


XI.


<TABLE>
<CAPTION>
===========================================================================================================================

                                                    PAYMENT MILESTONE
===========================================================================================================================
<S>                         <C>                            <C>
Ser.  No. 010               Title: a) Safety Case complete and Support Segment Installation and: b) Acceptance test at
                            MOB complete
--------------------------- -----------------------------------------------------------------------------------------------
Planned Completion Date: a) 09/04/04 & b) 04/05/04         Submission Date:
                                                           a) & b) 30/06/04
---------------------------------------------------------------------------------------------------------------------------
Milestone Value ($): 6,417,712
---------------------------------------------------------------------------------------------------------------------------
Milestone Description:
---------------------------------------------------------- ----------------------------------------------------------------
a) The completion of the Safety Case and : b) the completion at the MOB of the
acceptance test for the Support Segment Installation.



---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------
Milestone Completion Criteria:
---------------------------------------------------------- ----------------------------------------------------------------
a) The completion of the Safety Case, approved and released documentation that
fully meets the requirements of the Safety Plan by the Subcontractor to the
satisfaction of the Contractor.

b) The successful completion at the MOB by the Subcontractor to the
satisfaction of the Contractor of the Support Segment Installation and
Acceptance Test in accordance with the Test Procedures. Test Reports produced,
approved and issued for review.



---------------------------------------------------------------------------------------------------------------------------
 Milestone Owner:
---------------------------------------------------------------------------------------------------------------------------
Raytheon:
------------------------------- -------------------------------------------------------------------------------------------
Subcontractor:
===========================================================================================================================
</TABLE>



<PAGE>


XII.


<TABLE>
<CAPTION>
===========================================================================================================================

                                                    PAYMENT MILESTONE
===========================================================================================================================
<S>                         <C>                            <C>
Ser.  No. 011               Title: a) ASTOR System Flight Test Report and: b) A/C #1 Delivery to MoD complete
--------------------------- -----------------------------------------------------------------------------------------------
Planned Completion Date: a) 27/04/04 & b) 09/04/04         Submission Date:
                                                           a) & b) 30/09/04
---------------------------------------------------------------------------------------------------------------------------
Milestone Value ($): 2,338,443
---------------------------------------------------------------------------------------------------------------------------
Milestone Description:
---------------------------------------------------------- ----------------------------------------------------------------
a) The release of the ASTOR System Flight Test Report and: b) the delivery to the MoD of Aircraft #1.




---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------
Milestone Completion Criteria:
---------------------------------------------------------- ----------------------------------------------------------------
a) The completion of the ASTOR System Flight Report, approved and released
fully meeting the requirements of the Subcontract, by the Subcontractor to the
satisfaction of the Contractor.

b) Completion of the Delivery of Aircraft #1 and susquent acceptance by the Authority of the Aircraft.





---------------------------------------------------------------------------------------------------------------------------
 Milestone Owner:
---------------------------------------------------------------------------------------------------------------------------
Raytheon:
------------------------------- -------------------------------------------------------------------------------------------
Subcontractor:
===========================================================================================================================
</TABLE>


<PAGE>

XIII.


<TABLE>
<CAPTION>
===========================================================================================================================

                                                    PAYMENT MILESTONE
===========================================================================================================================
<S>                         <C>                            <C>
Ser.  No. 012               Title: Support for all UK activities.
--------------------------- -----------------------------------------------------------------------------------------------
Planned Completion Date:                                   Submission Date:
30/12/04                                                   30/12/04
----------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
Milestone Value ($): 79,263
---------------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------
Milestone Description:
---------------------------------------------------------- ----------------------------------------------------------------
The continuous provision by the Subcontractor of Programme Management, Design,
Engineering, Acceptance, Design Authority Liaison & Support for all activities
associated with Transition and the Aircraft Modifications for Aircraft 2 - 5.


---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------
Milestone Completion Criteria:
---------------------------------------------------------- ----------------------------------------------------------------
The Subcontractor shall have provided the continuous support to the
satisfaction of the Contractor to ensure that all activities described above
have resulted in the Contractor meeting its delivery and acceptance
obligations of Aircraft 2 - 5 to the Authority.






---------------------------------------------------------------------------------------------------------------------------
 Milestone Owner:
---------------------------------------------------------------------------------------------------------------------------
Raytheon:
------------------------------- -------------------------------------------------------------------------------------------
------------------------------- -------------------------------------------------------------------------------------------
Subcontractor:
===========================================================================================================================
</TABLE>


<PAGE>

XIV.


<TABLE>
<CAPTION>
===========================================================================================================================

                                                    PAYMENT MILESTONE
===========================================================================================================================
<S>                         <C>                            <C>
Ser.  No. 013               Title: Support for all UK activities.
--------------------------- -----------------------------------------------------------------------------------------------
Planned Completion Date:                                   Submission Date:
30/03/05                                                   30/03/05
---------------------------------------------------------------------------------------------------------------------------
Milestone Value ($):79,263
---------------------------------------------------------------------------------------------------------------------------
Milestone Description:
---------------------------------------------------------- ----------------------------------------------------------------
The continuous provision by the Subcontractor of Programme Management, Design,
Engineering, Acceptance, Design Authority Liaison & Support for all activities
associated with Transition and the Aircraft Modifications for Aircraft 2 - 5.


---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------
Milestone Completion Criteria:
---------------------------------------------------------- ----------------------------------------------------------------
The Subcontractor shall have provided the continuous support to the
satisfaction of the Contractor to ensure that all activities described above
have resulted in the Contractor meeting its delivery and acceptance
obligations of Aircraft 2 - 5 to the Authority.






---------------------------------------------------------------------------------------------------------------------------
 Milestone Owner:
---------------------------------------------------------------------------------------------------------------------------
Raytheon:
------------------------------- -------------------------------------------------------------------------------------------
Subcontractor:
===========================================================================================================================
</TABLE>



<PAGE>


XV.


<TABLE>
<CAPTION>
===========================================================================================================================

                                                    PAYMENT MILESTONE
===========================================================================================================================
<S>                         <C>                            <C>
Ser.  No. 014               Title: Support for all UK activities.
--------------------------- -----------------------------------------------------------------------------------------------
Planned Completion Date:                                   Submission Date:
30/06/05                                                   30/06/05
---------------------------------------------------------------------------------------------------------------------------
Milestone Value ($):79,263
---------------------------------------------------------------------------------------------------------------------------
Milestone Description:
---------------------------------------------------------- ----------------------------------------------------------------
The continuous provision by the Subcontractor of Programme Management, Design,
Engineering, Acceptance, Design Authority Liaison & Support for all activities
associated with Transition and the Aircraft Modifications for Aircraft 2 - 5.


---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------
Milestone Completion Criteria:
---------------------------------------------------------- ----------------------------------------------------------------
The Subcontractor shall have provided the continuous support to the
satisfaction of the Contractor to ensure that all activities described above
have resulted in the Contractor meeting its delivery and acceptance
obligations of Aircraft 2 - 5 to the Authority.






---------------------------------------------------------------------------------------------------------------------------
 Milestone Owner:
---------------------------------------------------------------------------------------------------------------------------
Raytheon:
------------------------------- -------------------------------------------------------------------------------------------
Subcontractor:
===========================================================================================================================
</TABLE>


<PAGE>


XVI.


<TABLE>
<CAPTION>
===========================================================================================================================

                                                    PAYMENT MILESTONE
===========================================================================================================================
<S>                         <C>                            <C>
Ser.  No. 015               Title: Support for all UK activities.
--------------------------- -----------------------------------------------------------------------------------------------
Planned Completion Date:                                   Submission Date:
30/09/05                                                   30/09/05
---------------------------------------------------------------------------------------------------------------------------
Milestone Value ($):79,263
---------------------------------------------------------------------------------------------------------------------------
Milestone Description:
---------------------------------------------------------- ----------------------------------------------------------------
The continuous provision by the Subcontractor of Programme Management, Design,
Engineering, Acceptance, Design Authority Liaison & Support for all activities
associated with Transition and the Aircraft Modifications for Aircraft 2 - 5.


---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------
Milestone Completion Criteria:
---------------------------------------------------------- ----------------------------------------------------------------
The Subcontractor shall have provided the continuous support to the
satisfaction of the Contractor to ensure that all activities described above
have resulted in the Contractor meeting its delivery and acceptance
obligations of Aircraft 2 - 5 to the Authority.






---------------------------------------------------------------------------------------------------------------------------
 Milestone Owner:
---------------------------------------------------------------------------------------------------------------------------
Raytheon:
------------------------------- -------------------------------------------------------------------------------------------
Subcontractor:
===========================================================================================================================
</TABLE>


<PAGE>

XVII.



<TABLE>
<CAPTION>
===========================================================================================================================

                                                    PAYMENT MILESTONE
===========================================================================================================================
<S>                         <C>                            <C>
Ser.  No. 016               Title: Support for all UK activities.
--------------------------- -----------------------------------------------------------------------------------------------
Planned Completion Date:                                   Submission Date:
30/12/05                                                   30/12/05
---------------------------------------------------------------------------------------------------------------------------
Milestone Value ($):79,263
---------------------------------------------------------------------------------------------------------------------------
Milestone Description:
---------------------------------------------------------- ----------------------------------------------------------------
The continuous provision by the Subcontractor of Programme Management, Design,
Engineering, Acceptance, Design Authority Liaison & Support for all activities
associated with Transition and the Aircraft Modifications for Aircraft 2 - 5.


---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------
Milestone Completion Criteria:
---------------------------------------------------------- ----------------------------------------------------------------
The Subcontractor shall have provided the continuous support to the
satisfaction of the Contractor to ensure that all activities described above
have resulted in the Contractor meeting its delivery and acceptance
obligations of Aircraft 2 - 5 to the Authority.






---------------------------------------------------------------------------------------------------------------------------
 Milestone Owner:
---------------------------------------------------------------------------------------------------------------------------
Raytheon:
------------------------------- -------------------------------------------------------------------------------------------
Subcontractor:
===========================================================================================================================
</TABLE>


<PAGE>


XVIII.


<TABLE>
<CAPTION>
===========================================================================================================================

                                                    PAYMENT MILESTONE
===========================================================================================================================
<S>                         <C>                            <C>
Ser.  No. 017               Title: Support for all UK activities.
--------------------------- -----------------------------------------------------------------------------------------------
Planned Completion Date:                                   Submission Date:
30/03/06                                                   30/03/06
---------------------------------------------------------------------------------------------------------------------------
Milestone Value ($):79,263
---------------------------------------------------------------------------------------------------------------------------
Milestone Description:
---------------------------------------------------------- ----------------------------------------------------------------
The continuous provision by the Subcontractor of Programme Management, Design,
Engineering, Acceptance, Design Authority Liaison & Support for all activities
associated with Transition and the Aircraft Modifications for Aircraft 2 - 5.


---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------
Milestone Completion Criteria:
---------------------------------------------------------- ----------------------------------------------------------------
The Subcontractor shall have provided the continuous support to the
satisfaction of the Contractor to ensure that all activities described above
have resulted in the Contractor meeting its delivery and acceptance
obligations of Aircraft 2 - 5 to the Authority.






---------------------------------------------------------------------------------------------------------------------------
 Milestone Owner:
---------------------------------------------------------------------------------------------------------------------------
Raytheon:
------------------------------- -------------------------------------------------------------------------------------------
Subcontractor:
===========================================================================================================================
</TABLE>

<PAGE>


XIX.


<TABLE>
<CAPTION>
===========================================================================================================================

                                                    PAYMENT MILESTONE
===========================================================================================================================
<S>                         <C>                            <C>
Ser.  No. 018               Title: Support for all UK activities.
--------------------------- -----------------------------------------------------------------------------------------------
Planned Completion Date:                                   Submission Date:
30/06/06                                                   30/06/06
---------------------------------------------------------------------------------------------------------------------------
Milestone Value ($):79,263
---------------------------------------------------------------------------------------------------------------------------
Milestone Description:
---------------------------------------------------------- ----------------------------------------------------------------
The continuous provision by the Subcontractor of Programme Management, Design,
Engineering, Acceptance, Design Authority Liaison & Support for all activities
associated with Transition and the Aircraft Modifications for Aircraft 2 - 5.


---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------
Milestone Completion Criteria:
---------------------------------------------------------- ----------------------------------------------------------------
The Subcontractor shall have provided the continuous support to the
satisfaction of the Contractor to ensure that all activities described above
have resulted in the Contractor meeting its delivery and acceptance
obligations of Aircraft 2 - 5 to the Authority.






---------------------------------------------------------------------------------------------------------------------------
 Milestone Owner:
---------------------------------------------------------------------------------------------------------------------------
Raytheon:
------------------------------- -------------------------------------------------------------------------------------------
Subcontractor:
===========================================================================================================================
</TABLE>



<PAGE>


XX.


<TABLE>
<CAPTION>
===========================================================================================================================

                                                    PAYMENT MILESTONE
===========================================================================================================================
<S>                         <C>                            <C>
Ser.  No. 019               Title: Support for all UK activities.
--------------------------- -----------------------------------------------------------------------------------------------
Planned Completion Date:                                   Submission Date:
30/09/06                                                   30/09/06
---------------------------------------------------------------------------------------------------------------------------
Milestone Value ($):79,263
---------------------------------------------------------------------------------------------------------------------------
Milestone Description:
---------------------------------------------------------- ----------------------------------------------------------------
The continuous provision by the Subcontractor of Programme Management, Design,
Engineering, Acceptance, Design Authority Liaison & Support for all activities
associated with Transition and the Aircraft Modifications for Aircraft 2 - 5.


---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------
Milestone Completion Criteria:
---------------------------------------------------------- ----------------------------------------------------------------
The Subcontractor shall have provided the continuous support to the
satisfaction of the Contractor to ensure that all activities described above
have resulted in the Contractor meeting its delivery and acceptance
obligations of Aircraft 2 - 5 to the Authority.






---------------------------------------------------------------------------------------------------------------------------
 Milestone Owner:
---------------------------------------------------------------------------------------------------------------------------
Raytheon:
------------------------------- -------------------------------------------------------------------------------------------
Subcontractor:
===========================================================================================================================
</TABLE>

<PAGE>

XXI.


<TABLE>
<CAPTION>
===========================================================================================================================

                                                    PAYMENT MILESTONE
===========================================================================================================================
<S>                         <C>                            <C>
Ser.  No. 020               Title: Support for all UK activities.
--------------------------- -----------------------------------------------------------------------------------------------
Planned Completion Date:                                   Submission Date:
30/12/06                                                   30/12/06
---------------------------------------------------------------------------------------------------------------------------
Milestone Value ($):79,263
---------------------------------------------------------------------------------------------------------------------------
Milestone Description:
---------------------------------------------------------- ----------------------------------------------------------------
The continuous provision by the Subcontractor of Programme Management, Design,
Engineering, Acceptance, Design Authority Liaison & Support for all activities
associated with Transition and the Aircraft Modifications for Aircraft 2 - 5.


---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------
Milestone Completion Criteria:
---------------------------------------------------------- ----------------------------------------------------------------
The Subcontractor shall have provided the continuous support to the
satisfaction of the Contractor to ensure that all activities described above
have resulted in the Contractor meeting its delivery and acceptance
obligations of Aircraft 2 - 5 to the Authority.






---------------------------------------------------------------------------------------------------------------------------
 Milestone Owner:
---------------------------------------------------------------------------------------------------------------------------
Raytheon:
------------------------------- -------------------------------------------------------------------------------------------
Subcontractor:
===========================================================================================================================
</TABLE>



<PAGE>


XXII.


<TABLE>
<CAPTION>
===========================================================================================================================

                                                    PAYMENT MILESTONE
===========================================================================================================================
<S>                         <C>                            <C>
Ser.  No. 021               Title: Support for all UK activities.
--------------------------- -----------------------------------------------------------------------------------------------
Planned Completion Date:                                   Submission Date:
30/03/07                                                   30/03/07
---------------------------------------------------------------------------------------------------------------------------
Milestone Value ($):79,263
---------------------------------------------------------------------------------------------------------------------------
Milestone Description:
---------------------------------------------------------- ----------------------------------------------------------------
The continuous provision by the Subcontractor of Programme Management, Design,
Engineering, Acceptance, Design Authority Liaison & Support for all activities
associated with Transition and the Aircraft Modifications for Aircraft 2 - 5.


---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------
Milestone Completion Criteria:
---------------------------------------------------------- ----------------------------------------------------------------
The Subcontractor shall have provided the continuous support to the
satisfaction of the Contractor to ensure that all activities described above
have resulted in the Contractor meeting its delivery and acceptance
obligations of Aircraft 2 - 5 to the Authority.






---------------------------------------------------------------------------------------------------------------------------
 Milestone Owner:
---------------------------------------------------------------------------------------------------------------------------
Raytheon:
------------------------------- -------------------------------------------------------------------------------------------
Subcontractor:
===========================================================================================================================
</TABLE>


<PAGE>

XXIII.


<TABLE>
<CAPTION>
===========================================================================================================================

                                                    PAYMENT MILESTONE
===========================================================================================================================
<S>                         <C>                            <C>
Ser.  No. 022               Title: Support for all UK activities.
--------------------------- -----------------------------------------------------------------------------------------------
Planned Completion Date:                                   Submission Date:
30/06/07                                                   30/06/07
---------------------------------------------------------------------------------------------------------------------------
Milestone Value ($):79,263
---------------------------------------------------------------------------------------------------------------------------
Milestone Description:
---------------------------------------------------------- ----------------------------------------------------------------
The continuous provision by the Subcontractor of Programme Management, Design,
Engineering, Acceptance, Design Authority Liaison & Support for all activities
associated with Transition and the Aircraft Modifications for Aircraft 2 - 5.


---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------
Milestone Completion Criteria:
---------------------------------------------------------- ----------------------------------------------------------------
The Subcontractor shall have provided the continuous support to the
satisfaction of the Contractor to ensure that all activities described above
have resulted in the Contractor meeting its delivery and acceptance
obligations of Aircraft 2 - 5 to the Authority.






---------------------------------------------------------------------------------------------------------------------------
 Milestone Owner:
---------------------------------------------------------------------------------------------------------------------------
Raytheon:
------------------------------- -------------------------------------------------------------------------------------------
Subcontractor:
===========================================================================================================================
</TABLE>



<PAGE>

XXIV.



<TABLE>
<CAPTION>
===========================================================================================================================

                                                    PAYMENT MILESTONE
===========================================================================================================================
<S>                         <C>                            <C>
Ser.  No. 023               Title: Support for all UK activities.
--------------------------- -----------------------------------------------------------------------------------------------
Planned Completion Date:                                   Submission Date:
30/09/07                                                   30/09/07
---------------------------------------------------------------------------------------------------------------------------
Milestone Value ($):79,263
---------------------------------------------------------------------------------------------------------------------------
Milestone Description:
---------------------------------------------------------- ----------------------------------------------------------------
The continuous provision by the Subcontractor of Programme Management, Design,
Engineering, Acceptance, Design Authority Liaison & Support for all activities
associated with Transition and the Aircraft Modifications for Aircraft 2 - 5.


---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------
Milestone Completion Criteria:
---------------------------------------------------------- ----------------------------------------------------------------
The Subcontractor shall have provided the continuous support to the
satisfaction of the Contractor to ensure that all activities described above
have resulted in the Contractor meeting its delivery and acceptance
obligations of Aircraft 2 - 5 to the Authority.






---------------------------------------------------------------------------------------------------------------------------
 Milestone Owner:
---------------------------------------------------------------------------------------------------------------------------
Raytheon:
------------------------------- -------------------------------------------------------------------------------------------
Subcontractor:
===========================================================================================================================
</TABLE>


<PAGE>


XXV.



<TABLE>
<CAPTION>
===========================================================================================================================

                                                    PAYMENT MILESTONE
===========================================================================================================================
<S>                         <C>                            <C>
Ser.  No. 024               Title: Support for all UK activities.
--------------------------- -----------------------------------------------------------------------------------------------
Planned Completion Date:                                   Submission Date:
30/12/07                                                   30/12/07
---------------------------------------------------------------------------------------------------------------------------
Milestone Value ($):79,263
---------------------------------------------------------------------------------------------------------------------------
Milestone Description:
---------------------------------------------------------- ----------------------------------------------------------------
The continuous provision by the Subcontractor of Programme Management, Design,
Engineering, Acceptance, Design Authority Liaison & Support for all activities
associated with Transition and the Aircraft Modifications for Aircraft 2 - 5.


---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------
Milestone Completion Criteria:
---------------------------------------------------------- ----------------------------------------------------------------
The Subcontractor shall have provided the continuous support to the
satisfaction of the Contractor to ensure that all activities described above
have resulted in the Contractor meeting its delivery and acceptance
obligations of Aircraft 2 - 5 to the Authority.






---------------------------------------------------------------------------------------------------------------------------
 Milestone Owner:
---------------------------------------------------------------------------------------------------------------------------
Raytheon:
------------------------------- -------------------------------------------------------------------------------------------
Subcontractor:
===========================================================================================================================
</TABLE>




<PAGE>


<TABLE>
<CAPTION>
===========================================================================================================================

                                                    PAYMENT MILESTONE
===========================================================================================================================
<S>                         <C>                            <C>
Ser.  No. 025               Title: ISRD completed in accordance with the requirements of the Authority ISRD Directive
--------------------------- -----------------------------------------------------------------------------------------------
Planned Completion Date:                                   Submission Date:
30/03/08                                                   30/03/08
---------------------------------------------------------------------------------------------------------------------------
Milestone Value ($): 10,107,948
---------------------------------------------------------------------------------------------------------------------------
Milestone Description:
---------------------------------------------------------- ----------------------------------------------------------------
The completion by the Subcontractor of his support and responsibilities
associated with ISRD in accordance with the requirements of the MoD ISRD
Directive, the Master Test Plan and the Acceptance Specification.



---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------

---------------------------------------------------------------------------------------------------------------------------
Milestone Completion Criteria:
---------------------------------------------------------- ----------------------------------------------------------------
All responsibilities and support required by the Contractor from the
Subcontractor to ensure that System reliability has Been fully characterised
and has been demonstrated to meet or exceed reliability requirements. Any
system reliability models have been updated to reflect additional data
collected during the conduct of ISRD.






---------------------------------------------------------------------------------------------------------------------------
 Milestone Owner:
---------------------------------------------------------------------------------------------------------------------------
Raytheon:
------------------------------- -------------------------------------------------------------------------------------------
Subcontractor:
===========================================================================================================================
</TABLE>








<PAGE>


                                  EXHIBIT C-6


                           REVISED STATEMENT OF WORK




<PAGE>



                                  EXHIBIT C-7


The Secrets Matter Letter is to be sent by the security controller of the
Contractor to the security controller of the Subcontractor under separate
cover. For the purposes of this Subcontract the reference for the Secrets
Matters Letter is JLK/L3/LET001.










<PAGE>



                                                         EXHIBIT C-8

                                                   ANNEX P - KEY PERSONNEL

<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------
                                         RECOGNISED KEY ASTOR PERSONNEL
----------------------------------------------------------------------------------------------------------------
                          INDIVIDUAL                                       INTEGRATED PROJECT TEAM
----------------------------------------------------------------------------------------------------------------
<S>                                                                      <C>
ANDERSON, HELEN L.                                             PROG MGMT 11
----------------------------------------------------------------------------------------------------------------
ARLEDGE, ROBERT G.                                             AERO SCI 11
----------------------------------------------------------------------------------------------------------------
BLOW, WILLIE L.                                                SYST ENG 11
----------------------------------------------------------------------------------------------------------------
BURGESS, FLOYD (KEN)                                           ENG SERV 11
----------------------------------------------------------------------------------------------------------------
BURKS, MIKE W.                                                 SYST ENG 11
----------------------------------------------------------------------------------------------------------------
CANANT, ROSS L.                                                SYST ENG 11
----------------------------------------------------------------------------------------------------------------
COLE, RONALD (CHIP)                                            SYST ENG 11
----------------------------------------------------------------------------------------------------------------
DELAGUARDIA, CARLOS A.                                         AERO SCI 11
----------------------------------------------------------------------------------------------------------------
DICK, DAVID                                                    SYST ENG 11
----------------------------------------------------------------------------------------------------------------
DONOVAN, JOHN (CLAY)                                           PROG MGMT 11
----------------------------------------------------------------------------------------------------------------
DUNCAN, GARNER (LEE)                                           PROG MGMT 11
----------------------------------------------------------------------------------------------------------------
DUVAL, CHARLES                                                 SYST ENG 11
----------------------------------------------------------------------------------------------------------------
EAMIGH, LAWRENCE                                               TECH PUB 11
----------------------------------------------------------------------------------------------------------------
ELWELL, KEITH                                                  AERO 11
----------------------------------------------------------------------------------------------------------------
EVANS, DARREN
----------------------------------------------------------------------------------------------------------------
FELPS, LOWELL (DOUG)                                           PROG MGMT 11
----------------------------------------------------------------------------------------------------------------
FORD, MIKE
----------------------------------------------------------------------------------------------------------------
FOWLER, BERT                                                   PROG MGMT 11
----------------------------------------------------------------------------------------------------------------
FRAZIER, WAYNE                                                 AERO SCI 11
----------------------------------------------------------------------------------------------------------------
FREELEN, DARYL                                                 H/D/L 11
----------------------------------------------------------------------------------------------------------------
GAROFALO, LYNNORE                                              SYST ENG 11
----------------------------------------------------------------------------------------------------------------
GAUTHIER, EVANS                                                ENG SERV 11
----------------------------------------------------------------------------------------------------------------
GLUCK, BARRY
----------------------------------------------------------------------------------------------------------------
GRAHAM, DENNIS                                                 TECH PUB 11
----------------------------------------------------------------------------------------------------------------
GRAMLEY, HARRY                                                 PROG MGMT 11
----------------------------------------------------------------------------------------------------------------
GRAY, RONALD                                                   QUAL ASSUR 11
----------------------------------------------------------------------------------------------------------------
</TABLE>


<PAGE>



<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------
                                        RECOGNISED KEY ASTOR PERSONNEL
----------------------------------------------------------------------------------------------------------------
                          INDIVIDUAL                                       INTEGRATED PROJECT TEAM
----------------------------------------------------------------------------------------------------------------
<S>                                                                      <C>
GREEN, BARRY                                                   ENG SERV 11
----------------------------------------------------------------------------------------------------------------
GWIN, CONNIE                                                   AERO 11
----------------------------------------------------------------------------------------------------------------
HARKSEN, STEVEN                                                SYST ENG 11
----------------------------------------------------------------------------------------------------------------
HOFF, JOHNNIE (LAVERNE)                                        PROG MGMT 11
----------------------------------------------------------------------------------------------------------------
HOTSKO, ANTHONY (TONY)                                         PROG MGMT 11
----------------------------------------------------------------------------------------------------------------
KAMEYER, DARREN                                                AERO SCI 11
----------------------------------------------------------------------------------------------------------------
KING, JAMES                                                    SYST ENG 11
----------------------------------------------------------------------------------------------------------------
KJELLANDER, JON                                                SYST ENG 11
----------------------------------------------------------------------------------------------------------------
KLEIN, DAVID                                                   SYST ENG 11
----------------------------------------------------------------------------------------------------------------
KUSMANOFF, ANTONE                                              SYST ENG 11
----------------------------------------------------------------------------------------------------------------
LARSEN, JR ROY                                                 SYST ENG 11
----------------------------------------------------------------------------------------------------------------
LAWLESS, JIMMY                                                 SYST ENG 11
----------------------------------------------------------------------------------------------------------------
LEVAN, TIMOTHY                                                 TECH PUB 11
----------------------------------------------------------------------------------------------------------------
MABURY, SAM
----------------------------------------------------------------------------------------------------------------
MOORE, R.C.
----------------------------------------------------------------------------------------------------------------
MURPHEY, BETTY
----------------------------------------------------------------------------------------------------------------
MURTHI, ARUN                                                   ENG SERV 11
----------------------------------------------------------------------------------------------------------------
NEEL, DIANNE                                                   SOFTWARE 11
----------------------------------------------------------------------------------------------------------------
ODOM, BARRY                                                    ENG SERV 11
----------------------------------------------------------------------------------------------------------------
PARKER, DONALD                                                 SYST ENG 11
----------------------------------------------------------------------------------------------------------------
PENDERGRASS, GARY                                              SOFTWARE 11
----------------------------------------------------------------------------------------------------------------
PRELLER, R F. (FRED)                                           SYST ENG 11
----------------------------------------------------------------------------------------------------------------
RADFORD, GARY                                                  SYST ENG 11
----------------------------------------------------------------------------------------------------------------
RAZIK, MOHAMED                                                 SYST ENG 11
----------------------------------------------------------------------------------------------------------------
REDUS, WESLEY                                                  SYST ENG 11
----------------------------------------------------------------------------------------------------------------
SANDOVAL, FRANK
----------------------------------------------------------------------------------------------------------------
SCOTT, TRUMAN                                                  SYST ENG 11
----------------------------------------------------------------------------------------------------------------
SIEFFERT, JON                                                  PROG MGMT 11
----------------------------------------------------------------------------------------------------------------
STAES, TRAVIS                                                  SYST ENG 11
----------------------------------------------------------------------------------------------------------------
STAFFORD, JOSEPH                                               AERO 11
----------------------------------------------------------------------------------------------------------------
</TABLE>


<PAGE>



<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------
                                        RECOGNISED KEY ASTOR PERSONNEL
----------------------------------------------------------------------------------------------------------------
                          INDIVIDUAL                                       INTEGRATED PROJECT TEAM
----------------------------------------------------------------------------------------------------------------
<S>                                                                      <C>
STEPHENS, GARY                                                 PROG MGMT 11
----------------------------------------------------------------------------------------------------------------
STRANO, ANGELO S.
----------------------------------------------------------------------------------------------------------------
SUTTON, WILLIAM                                                TECH PUB 11
----------------------------------------------------------------------------------------------------------------
TURNER, RANDY                                                  AERO SCI 11
----------------------------------------------------------------------------------------------------------------
UNDERWOOD, RICHARD                                             PROG MGMT 11
----------------------------------------------------------------------------------------------------------------
VAUGHN, KATHRYN                                                SOFTWARE 11
----------------------------------------------------------------------------------------------------------------
VILLANUEVA, JR JOSE                                            PROG MGMT 11
----------------------------------------------------------------------------------------------------------------
WATTS, WILLIAM (MARK)                                          AERO 11
----------------------------------------------------------------------------------------------------------------
WHITE, JOHN                                                    TECH PUB 11
----------------------------------------------------------------------------------------------------------------
WIRT, CHARLES (CHUCK)                                          TECH PUB 11
----------------------------------------------------------------------------------------------------------------
WOODRUFF, ROBERT                                               SYST ENG 11
----------------------------------------------------------------------------------------------------------------
WOOTEN, ANGELA                                                 SOFTWARE 11
----------------------------------------------------------------------------------------------------------------
YEAGER, THOMAS                                                 SYST ENG 11
----------------------------------------------------------------------------------------------------------------
</TABLE>





<PAGE>


                                  EXHIBIT C-9

                             ANNEX R - ASSUMPTIONS

GENERAL

The ASTOR Air Segment peace time utilisation rate will be a maximum of three
thousand two hundred (3,200) flying hours per annum.

The ASTOR Air Segment usage during crisis and war utilisation rate will be a
maximum of two thousand three hundred and ten (2,310) flying hours over a 90
day period.

The combined Ground Segment peace time utilisation rate will be a maximum of
twenty one thousand, two hundred (21,200) operating hours per annum.

The combined Ground Segment utilisation rate during crisis and war will be a
maximum of thirteen thousand eight hundred (13,800) operating hours over a 90
day period.

The term 'in-service and supported' means any equipment in the MoD inventory
that has an in-service Equipment Support Manager (ESM) and that spares
provisioning, technical publications, training and PDS exist and are in place.
That said, any element of support that is not already provided is excluded
from this definition.

A maximum deployment scenario consists of two (2) simultaneous independent Air
Platform deployments and four (4) simultaneous independent Ground Station
deployments, whilst continuing to maintain the remainder of the ASTOR System
at the Main Operating Base.

TRAINING

The training courses to be developed by the Subcontractor and delivered by the
Contractor are based on the manpower establishment as advised by the Authority
in the Scoping Study (Issue 2.0) dated 7 Dec 99 (Once reviewed by RSL) - Phase
One of the Training Needs Analysis.

The training output standards for ASTOR personnel are of a comparable standard
to current in-service courses. For example, pilots shall achieve a 100%
overall pass mark for all AP safety related issues or electronic technicians
are to be capable of carrying out repairs in accordance with the repair policy
in that level 1 and 2 tasks should be completed within 30 mins and level 3
within 2 hours.

During the design of the training systems, the Subcontractor will make best
use of the knowledge available to enable the capability to link the ASTOR TSS
to external training systems and equipment for real-time, realistic,
interactive training.

INITIAL PROVISIONING

The Subcontractor is responsible for recommending deciding the content of the
Initial Provisioning spares package. Initial Provisioning package, spares used
by the Subcontractor to


<PAGE>

support the Integration and Test phase may be used and will be accepted by the
Authority provided each such spare:

     a)   is of the accepted build standard,

     b)   has not been subject to environmental stressing beyond design
          limits, and

     c)   has been appropriately refurbished.

The OLGS AOS shall support both the JFACC and JFHQ, ie all 5 workstation
containers and associated communications.

Admin and Logistics Delay Times that affect the Supply Chain Pipeline when
supporting deployed operations, including during sustained operations in
Crisis, Tension and War have been taken into account.

All spares supplied are capable of being identified when removed from their
packaging.

TECHNICAL DOCUMENTATION AND DATA

By the System CDR the Contractor will either provide the Subcontractor with a
Technical Documentation and Data (TD&D) viewer or confirm the specification of
the TD&D viewer.














<PAGE>



                                                                  Exhibit D to
                                                                  ------------
                                                              Letter Agreement
                                                              ----------------














<PAGE>




                                                                  Exhibit E to
                                                                  ------------
                                                              Letter Agreement
                                                              ----------------












<PAGE>


                                                                  Exhibit F to
                                                                  ------------
                                                              Letter Agreement
                                                              ----------------

                STAMP DUTY, GST AND SUPERANNUATION (AUSTRALIA)

1.       STAMP DUTY

         The Sellers, L-3 Australian Subsidiary and Buyer agree to prepare a
         schedule within 75 days of Closing containing a description of the
         Australian Acquired Assets, their location within Australia and an
         allocation of their value to enable the L-3 Australian Subsidiary to
         lodge that schedule with relevant Australian Governmental Entities
         for stamp duty purposes, provided however that such allocation shall
         conform with the Allocation Schedule prepared in accordance with
         clause 1.4 of the Asset Purchase Agreement.

2.       GST

2.1      SUPPLY OF A GOING CONCERN

         Raytheon Australia and L-3 Australian Subsidiary acknowledge and
agree that:

               (a)  the sale of the Australian AIS Business is a supply of a
                    going concern for the purposes of the A New Tax System
                    (Goods and Services Tax) Act 1999 (Cwlth);

               (b)  Raytheon Australia will supply to L-3 Australian
                    Subsidiary all of the things that are necessary for the
                    continued operation of the Australian AIS Business as
                    provided by Article 1.1 of the Asset Purchase Agreement;

               (c)  L-3 Australian Subsidiary warrants that it is Registered
                    or is Required to be Registered at the date of Closing;
                    and

               (d)  Raytheon Australia will carry on the Australian AIS
                    Business until the date of the supply of the Australian
                    AIS Business to L-3 Australian Subsidiary.

2.2      GST

         If any Supply made by a party under this Agreement is subject to GST,
         including if the supply of the Australian AIS Business is not a
         supply of a going concern for the purposes of the A New Tax System
         (Goods and Services Tax) Act 1999 (C'th), the Supplier may, in
         addition to the consideration for the Supply, recover an additional
         amount on account of GST from the Recipient. The parties agree, that
         this clause overrides the effect that clause 8.1(d) of the Asset
         Purchase Agreement would otherwise have in respect of the manner in
         which the GST cost is to be borne between the parties.

2.3      ADDITIONAL AMOUNT

         The additional amount on account of GST referred to in clause 2.2
("GST"):


<PAGE>

               (a)  is equal to the GST exclusive consideration payable by the
                    Recipient for the relevant Supply multiplied by the
                    prevailing GST rate; and

               (b)  subject to clause 2.4, is payable not later than 14 days
                    from the day the Supplier gives notice to the Recipient
                    that the Supply is subject to GST.

2.4      TAX INVOICE

         The Supplier must provide a tax invoice to the Recipient in a form
         that complies with the GST Law when the Supplier gives notice to the
         Recipient that the Supply is subject to GST.

3.       SUPERANNUATION

3.1      L-3 AUSTRALIAN SUBSIDIARY'S OBLIGATION

         Prior to Closing and with effect from the Closing, the L-3 Australian
         Subsidiary must establish or identify a superannuation fund or funds
         which will provide benefits for the Transferring Employees on terms
         no less favourable than those of the Australian Disclosed Funds that
         applied to the AIS Employees immediately before Closing and the Buyer
         must ensure that L-3 Australian Subsidiary offers to Transferring
         Employees, membership of such superannuation fund which provides to
         the particular Transferring Employee benefits on terms no less
         favourable than that Transferring Employee had in respect of the
         particular Australian Disclosed Funds of which it was a member.

3.2      WARRANTIES AND INDEMNITIES - SUPERANNUATION - AUSTRALIA

               (a)  Except in relation to the Australian Disclosed Funds and
                    the AIS Benefit Plans , the Sellers do not make payments
                    to any funds, schemes or arrangements relating to
                    retirement, death or disablement benefits, and there is no
                    contract, agreement, arrangement or proposal in force or
                    promised whereby the Sellers could become so liable at any
                    time for the Transferred Employees.

               (b)  Prior to Closing, the Sellers have disclosed full details,
                    in relation to the Transferring Employees, of:

                    (i)  the level of benefits payable; and

                    (ii) the rate at which employer contributions are
                         currently paid to the Australian Disclosed Funds, the
                         basis on which those contributions are calculated and
                         whether those contributions are paid in advance or in
                         arrears.

               (c)  All amounts due to the Australian Disclosed Funds
                    (including all contributions, taxes and expenses) have
                    been paid and no services have been rendered or


<PAGE>

                    requested in relation to the Australian Disclosed Funds
                    which have not been paid for.

               (d)  In respect of the Australian Disclosed Funds, the Sellers
                    have given the L-3 Australian Subsidiary true, correct and
                    up to date copies of:

                    (i)   all trust deeds and rules;

                    (ii)  all explanatory booklets, announcements and notices
                          of current effect;

                    (iii) all relevant accounts; and

                    (iv)  the most recent actuarial valuations.

4.       DEFINITIONS

         All other capitalised terms used in this clause and not defined have
         the meaning given to them in the Asset Purchase Agreement. In this
         Exhibit F, these meanings apply unless the contrary intention
         appears.

         AUSTRALIAN ACQUIRED ASSETS means the Australian assets utilized
         exclusively or primarily in the Australian AIS Business.

         AUSTRALIAN AIS BUSINESS means the Maritime Aircraft Patrol Division
         of the Sellers located at Avalon, Victoria and Adelaide, South
         Australia.

         AUSTRALIAN DISCLOSED FUNDS means Westpac Business Superannuation -
         Raytheon Systems Company Australia Superannuation Fund, The
         Superannuation Trust of Australia and Raytheon Superannuation Fund.

         GST has the same meaning as in the A New Tax System (Goods &
         Services Tax) Act 1999 (Cwlth).

         GST-FREE has the same meaning as in the A New Tax System (Goods and
         Services Tax) Act 1999 (Cwlth).

         GST LAW has the same meaning as in the A New Tax System (Goods and
         Services Tax) Act 1999 (Cwlth).

         SUPPLY means any supply (as defined in the A New Tax System (Goods
         and Services Tax) Act 1999 (Cwlth) and includes the sale of the
         Business) made by a party under this agreement.

         SUPPLIER means any party making a Supply under this agreement.

         RECIPIENT means the recipient of any Supply under this agreement.


<PAGE>



         REGISTERED OR REQUIRED TO BE REGISTERED has the same meaning as in
         the A New Tax System (Goods and Services Tax) Act 1999 (Cwlth).
















<PAGE>


                                                                  Exhibit G to
                                                                  ------------
                                                              Letter Agreement
                                                              ----------------


                                  APPENDIX D

                    THALES-RAYTHEON SYSTEMS LLC (SUPPLIER)

                                    PAGE 1


Prime Contractor (Customer):  Buyer

Subcontractor (Supplier): Thales-Raytheon Systems LLC (TRS)

Prospective Program Customer and Program Name:  Korean Air Force AEW&C

Existing Work:   None.

IOT:  None.

Proposed Activities:

The parties shall cooperate in joint marketing for the Program to the
prospective Program Customer particularly promoting the use of the SAADS MCRC
software and related Operational capabilities, and the advantages of this
being both at the ground sites and in the AEW. In event that the contract for
the Program is awarded to Buyer, TRS LLC shall supply and support the
implementation of the SAADS-based software into the AEW&C aircraft.

Exclusivity:

The teaming arrangement shall be exclusive with respect to both Parties.




<PAGE>


                                                                  Exhibit H to
                                                                  ------------
                                                              Letter Agreement
                                                              ----------------


             Appendix F of Supply Agreement (Raytheon as Supplier)
             -----------------------------------------------------








<PAGE>


                                                                  Exhibit I to
                                                                  ------------
                                                              Letter Agreement
                                                              ----------------


    Appendix D of Supply Agreement (Raytheon Technical Services Company as
                                  Customer)
 -------------------------------------------------------------------------------







<PAGE>


                                                                  Exhibit J to
                                                                  ------------
                                                              Letter Agreement
                                                              ----------------


(a)(ii)
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------------------------
       BUS.               PROGRAM             ORDER              TECH                                   SUPPLIER
       AREA                NAME               NUMBER             AREA           ITEM/SYSTEM               NAME         ULO ($)
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
<S>                 <C>                  <C>              <C>              <C>                   <C>                   <C>
G&C                 ARP 130/141         WLR9303201         Nav/Comm         AFCS-single;         Honeywell              17,689,982
                                                                            data;support;NRE
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
TRS                 EAU                 4500104497         Sensors          Up/Down Converter    Remec                   7,388,984
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
ASTOR               ASTOR                                  A/C Systems      Fab A/C parts        AIS Greenville          7,000,000
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
G&C                 MCS/SAM             4500110434         Sensors          Tech Spt             Rockwell Collins        4,733,306
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
G&C                 Sea Sentinal        4500051453         A/C Systems      Engineering Support  Lockheed Martin         3,394,000
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
G&C                 Big Safari          4500113507         A/C Systems      Computers and        Safe Flight             2,450,080
                                                                            Computer parts
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
G&C                 Big Safari          4500117859         A/C Systems      Radio Switches       Herley New England      2,440,000
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
G&C                 SRP                 G199910001         A/C Systems      Horizontal           Middle River Aircraft   2,089,566
                                                                            (E-1KA)
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
TRS                 Cobra Ball Spares   4500115808         Sensors          Demod Chassis, RCU,  Condor                  1,953,368
                                                                            Displays
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
TRS                 EAU Spares          4500116619         Sensors          Dual Downconverters  Remec                   1,781,254
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
                    ARP 130/141                            Nav/Comm         OFP3 software        Honeywell- Alb          1,657,495
                                                                            upgrade
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
G&C                 Navy                4500117638         Sensors          Pathfinder System    BAE Systems             1,586,496
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
G&C                 EJI                 4500069362         SDRI             Cabinets             BomHoff                 1,548,307
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
G&C                 Spares              4500118216         A/C Systems      Tailpipes            AHL                     1,457,595
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
G&C                 Navy                4500105113         Nav/Comm         Wideband Receiver    BTG                     1,411,969
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
                    ARP 130/141                            Nav/Comm         OFP3 software        Honeywell-Teterboro     1,388,403
                                                                            upgrade
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
ASTOR               ASTOR                                  A/C Systems      Testing              Eglin AFB               1,370,000
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
ASTOR               ASTOR               4500102176         Nav/Comm         Interface            American Nucl           1,246,000
                                                                            Cancellation Unit
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
G&C                 SRP                 G199940004         A/C Systems      Upper Longerons      Middle River Aircraft   1,146,619
                                                                            (n-1 Kit)
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
G&C                 MSC SAM             4500050991         Nav/Comm         MCS SAM Areas of     Rockwell Collins        1,102,526
                                                                            Concern
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
G&C                 ARP 130/141         WLR9617201         Nav/Comm         Autopilot, CDS       Honeywell               1,086,016
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
G&C                 Alfa Sierra         4500018631         SDRI             Cabinets / Moved to  DeCrane Aircraft          967,000
                                                                            G21
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
G&C                 SOFIA               4500075643         A/C Systems      Aperture             Scaled Technology         884,000
                                                                                                 Works
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
TRS                 Peace Pioneer       4500035066         Sensors          Training & Materials L-3 Comm                  863,472
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
ASTOR*              ASTOR               4500092659         Sensors          IFF Transponder      Raytheon (RSL UK)         492,000
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
TRS                 Peace Pioneer       G199712012         Nav/Comm         Data Link            ELTA Electronics          786,000
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
G&C                 Big Safari          4500097917         A/C Systems      Radio Switches       Sun Moon/ Herley          754,910
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
ASTOR               ASTOR               4300001329         SDRI             Struct Monitor       Sys & Elect Inc           746,978
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
TRS                 Proj. Underdog      4500108820         Sensors          Eng Support          Raytheon                  709,755
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
TRS                 Extract             4500111215         Sensors          Synthesizer          ITT Industries            705,900
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
G&C                 GPSENS              4500059226         Nav/Comm         Autopilot,CDS        Honeywell                 675,120
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
G&C                 MSC SAM             HG11000001         Nav/Comm         MCS SAM Support      Rockwell Collins          673,127
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
G&C                 August Moon         4500026160         SDRI             Flat Panel Displays  Astronautics              669,653
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
G&C                 Alfa Sierra         4500086868         SDRI             Dance / Moved to W63 Jerry Fain                665,000
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
G&C                 E6B                 4500106770         Nav/Comm         AN/ARQ-57 KIT        Rockwell Collins          658,856
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
G&C                 GPSENS OFP 2        4500098650         Nav/Comm         GPS                  Honeywell                 644,525
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
ASTOR               ASTOR                                  SDRI             Tactical Ctl. Disp.  TBD                     1,500,000
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
G&C                 GPSENS              WLR9534701         Nav/Comm         Autopilot,CDS        Honeywell                 598,065
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
G&C                 Tango/Dallah        4500046400         SDRI             Cabinets/Tables/Misc JCP                       591,327
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
G&C                 ARP 130/141         WLR9320701         Nav/Comm         GPS                  Honeywell                 586,277
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
TRS                 Big Safari          4500098295         Nav/Comm         Cosite Array phase1  ANC                     1,076,316
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
G&C                 Navy                4500112979         Sensors          CCU                  Palomar                   572,850
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
TRS                 TRS                 4500054934         Sensors          Support Services     Pacific Sierra (PSR)      539,000
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
Airlift/Avionics    LC-130R             4500039530         A/C Systems      Kits & Flt Test      Smiths Industries         514,000
                                                                            Support LC130-R
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
ASTOR               ASTOR                                  A/C Systems      Testing              Edwards AFB               512,828
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
G&C                 Executive Jet       4500054114         SDRI             various audio/video  Pacific Systems         (564,000)
                                                                            comp
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
Not available       Not available       4700006439         153              Aircraft             Gulfstream             32,800,000
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
Not available       Not available       4700005790         153              Engine Rep.          Texas Aero              1,000,000
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
AMM                 C 141               4500126092         Nav/Comm         Software             Honeywell               1,657,495
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
AMM                 C 141               4500126380         Nav/Comm         Software             Honeywell               1,388,404
-----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

*Upon the mutual agreement of the Buyer and Raytheon Systems Limited, the
requirement to purchase IFF Transponders under Order No. 4500092659 may be
amended and the corresponding value of the ULO($) may be reduced after the
Closing to reflect a reduction in the quantity of deliverable units.