termination of such employment, and any and all issues which could have been or were raised byhim in connection with the foregoing. Hughes further expressly acknowledges and agrees that thesepayments by Alion are in lieu of any payments to which Hughes would otherwise be entitled to underthe terms of the Employment Agreement, the Separation Agreement and any phantom stock or otherincentive or other compensation agreements between Hughes and the Company.     In addition to the above payments, Hughes expressly acknowledges and agrees that he receivedfrom the Company all outstanding and accrued Paid Time Off (“PTO”), as well as all proceedspreviously held on his behalf in the Alion Non-Qualified Deferred Compensation Plan in accordancewith the terms of such plan. Hughes further acknowledges and agrees that, except as provided inthis Agreement or under the terms of an applicable qualified retirement or welfare employee benefitplan, no further payments shall be made to him, including any severance, phantom stock or otherpayments described in the Separation Agreement or Employment Agreement.     The parties agree that, under current federal tax law, the settlement payments hereunder shallbe reported on IRS Form W-2 and federal income tax shall be withheld at the applicable withholdingrate. The Company shall withhold such further federal, state or local tax, payroll and otheramounts from payments under this Agreement as the Company reasonably believes to be required bylaw. Hughes shall be solely responsible for payment of his own taxes, including any taxes arisingunder Internal Revenue Code Section 409A. The Company has not provided and will not provide taxadvice to Hughes.     **2. ****EMPLOYMENT BENEFITS**     (a) Hughes agrees and acknowledges that his participation in any 401(k) Plan, short-term andlong-term Disability Plans, or any other benefit plans made available to him as an Alion employee,and his participation in and entitlement to any and all other benefits in which he is currentlyenrolled, but which are not specifically addressed in this Agreement, terminated on August 15,2008.     (b) To the extent that Hughes is eligible for and elects to receive medical and/or dentalbenefits pursuant to the provisions of the Consolidated Omnibus Budget Reconciliation Act (“COBRA”)for himself and/or any qualifying beneficiaries, the Company shall pay on Hughes’ behalf, orreimburse Hughes for, the amount of the applicable COBRA that exceeds the amount of premium payableby Hughes for the same level of coverage immediately prior to the effective date of termination.Any such COBRA premium payment by the Company that constitutes taxable income to Hughes shall begrossed up by the Company, assuming an applicable income tax rate of forty percent (40%). Paymentsunder this paragraph shall cease at the earlier of (i) the end of the first month in which Hughesis no longer eligible for COBRA for any reason (other than death or eligibility for Medicare,provided that COBRA coverage continues for any qualified beneficiary), or (ii) Eighteen (18) monthsafter the Notification Date. Hughes shall notify the Company as soon as practicable after heceases to be eligible for COBRA coverage due to coverage under the group health plan of anotheremployer.
2

 
     **3. ****GENERAL RELEASE BY HUGHES**     (a) Hughes hereby releases and forever discharges Alion, its subsidiaries, affiliates,insurers, predecessors, successors, and assigns, and the directors, officers, shareholders,employees, representatives and agents of each of the foregoing (collectively “Releasees”) of andfrom the following:     (i) Any and all claims, demands, damages, liabilities, obligations, debts, and agreementswhatsoever of every name and nature (other than those arising directly out of this Agreement),including, without limitation, those with respect to Hughes’ employment by Alion, or the terms andconditions of employment, benefits or compensation including, without limitation, any and all plansin which Hughes participated, including Alion’s phantom stock plan, or termination of hisemployment, which Hughes has or ever had against Releasees; and     (ii) Without limitation, any and all claims known or unknown as of the date of execution ofthis Agreement for tortious injury, breach of contract, and/or wrongful discharge (including,without limitation, any claim for violation of public policy or constructive discharge), anypersonal gain with respect to any claim arising under the *qui tam*provisions of the False ClaimsAct, 31 U.S.C. 3730 or any other whistleblower claim, all claims for infliction of emotionaldistress, all claims for slander, libel, or defamation of character, and all claims forreinstatement, back pay, front pay, compensatory or punitive damages, severance pay, attorneys’fees, or costs, as related to Hughes’ employment by Alion, or the terms and conditions ortermination of his employment, benefits or compensation, or termination of such employment; and     (iii) Without limitation, any and all claims known or unknown based upon any allegation ofemployment discrimination, including, without limitation, discrimination on the basis of race,color, sex, sexual orientation, age (including any claim pursuant to the federal Age Discriminationin Employment Act), religion, disability, national origin or any other classification protectedunder applicable law.     (b) It is agreed and understood that this release is a GENERAL RELEASE to be construed in thebroadest possible manner consistent with applicable law.     (c) Hughes acknowledges and agrees that Hughes:     (i) has not filed or pursued any claim released hereby against any Releasee by filing alawsuit in any local, state or federal court for or on account of anything which has occurred up tothe present time as a result of Hughes’ employment or termination of employment, and Hughes shallnot seek reinstatement or future employment with, or damages of any nature, severance pay,attorneys’ fees, or costs from any Releasee; and     (ii) has been given the opportunity, if he so desires, to consider this Agreement fortwenty-one (21) days before executing it. Any change made to the Agreement during the 21-dayperiod, whether material or not, will not restart the running of the 21-day period. In the eventthat Hughes executes this Agreement within twenty-one (21) days of the date of its delivery to
3

 
him, he acknowledges that such decision was entirely voluntary and that he had the opportunityto consider this Agreement for the entire twenty-one (21) day period. For a period of seven (7)days from the date of the execution of this Agreement, Hughes shall retain the right to revoke thisAgreement in accordance with 29 U.S.C. § 626 by written notice to Alion, c/o Kathy Madaleno,Director of Human Resources, 1750 Tysons Boulevard, Suite 1300, McLean, Virginia 22102. ThisAgreement shall not become effective or enforceable until the expiration of such revocation period;and     (iii) has been and is advised to consult an attorney regarding this Agreement prior toexecuting it and that he has been given sufficient time to do so; and     (iv) has received full and adequate consideration for this General Release; and     (v) fully understands and acknowledges the significance and consequences of this Agreement andrepresents by his signature that the terms of this Agreement are fully understood and voluntarilyaccepted by him. This Agreement has been individually negotiated by Hughes and is not part of agroup exit incentive or other group employment termination program.     (d) Excluded from this General Release are any claims or rights which cannot be waived by law,including the right to challenge the enforceability of this Agreement and Hughes’ right to file acharge with an administrative agency or participate in any agency investigation where that agencyexpressly prohibits such a waiver. However, Hughes is waiving his right to recover any money or toreinstatement with any Releasee in connection with such a charge or investigation. Hughes is alsowaiving his right to recover money in connection with a charge filed by any other individual or bythe Equal Employment Opportunity Commission or any other federal, state or local agency.     (e) This General Release becoming and remaining effective shall be a condition precedent toHughes obtaining any payments or benefits under this Agreement, and shall be a condition precedentto the General Release by Alion in Paragraph 4 becoming effective.     **4. ****GENERAL RELEASE BY ALION**     (a) Alion hereby releases and forever discharges Hughes and his successors and assigns(collectively “Hughes Releasees”) of and from the following:     (i) Any and all claims, demands, and liabilities whatsoever of every name and nature (otherthan those arising directly out of this Agreement), including, without limitation, those withrespect to Hughes’ employment by Alion, which Alion has or ever had against Hughes Releasees; and     (ii) Without limitation, any and all claims known or unknown as of the date of execution ofthis Agreement for tortious injury, breach of contract, all claims for slander, libel, ordefamation of character, and all claims for punitive damages, attorneys’ fees, or costs, as relatedto Hughes’ employment by Alion.
4

 
     (b) It is agreed and understood that this release is a GENERAL RELEASE to be construed in thebroadest possible manner consistent with applicable law.     (c) Alion acknowledges and agrees that it:     (i) has not filed or pursued any claim released hereby against any Hughes Releasee by filing alawsuit in any local, state or federal court for or on account of anything which has occurred up tothe present time as a result of Hughes’ employment; and     (ii) has been and is advised to consult an attorney regarding this Agreement prior toexecuting it and that he has been given sufficient time to do so; and     (iii) has received full and adequate consideration for this General Release; and     (iv) fully understands and acknowledges the significance and consequences of this Agreement.     **5. ****SURVIVAL OF PROVISIONS OF SEPARATION AGREEMENT**     Paragraphs 4 (General Release by Employee), 5 (Nondisclosure of Information; Return ofProperty), 6 (No Detrimental Communications), 7 (Future Assistance) and 8 (Non-Competition;Non-Solicitation) of the Separation Agreement shall continue in full force and effect. Paragraphs9 through 16 of the Separation Agreement shall continue in full force and effect to the extent theyrelate to enforcement of Paragraphs 5, 6, 7, 8 or 9 (other than the last clause of the lastsentence of Paragraph 9) of the Separation Agreement.     **6. ****GOVERNING LAW; SEVERABILITY**     This Agreement is entered into and shall be construed under the laws of the Commonwealth ofVirginia. In the event any provision of this Agreement is determined to any extent to be illegalor unenforceable by a duly authorized court of competent jurisdiction, then the illegal orunenforceable provision shall be severed from this Agreement. In the event of such severance, theremainder of this Agreement shall not be affected thereby, and each remaining provision of thisAgreement shall be valid and enforceable to the fullest extent permitted by law.     **7. ****WAIVERS**     The failure of either party to require the performance of any term or obligation of thisAgreement, or the waiver by either party of any breach of this Agreement, shall not prevent anysubsequent enforcement of such term or obligation and shall not be deemed a waiver of anysubsequent breach.     **8. ****AMENDMENTS**     This Agreement may be modified or amended, in whole or in part, only by the mutual agreementof the parties in writing.
5

 
     **9. ****NO OTHER INDUCEMENTS**     This Agreement sets forth the entire understanding of the parties in connection with thesubject matter hereof. Any and all prior negotiations or discussion, either oral or written, aremerged into this Agreement. Neither of the parties has made any settlement, representation orwarranty in connection herewith (except those expressly set forth in this Agreement) which has beenrelied upon by the other party, or which acted as an inducement for the other party to enter intothis Agreement.     **10. ****PERSONS BOUND BY AGREEMENT**     This Agreement shall be binding upon and inure to the benefit of Hughes and the Releasees andthe Hughes Releasees and their respective successors.     **11. ****ASSIGNMENT OF INTERESTS**     Hughes warrants that he has not assigned, transferred or purported to assign or transfer anyclaim against the Releasees.     **12. ****PREVAILING PARTY ENTITLED TO FEES**     In the event that any action or proceeding is initiated to enforce or interpret the provisionsof this Agreement, or to recover for a violation of the Agreement, the prevailing party in any suchaction or proceeding shall be entitled to its costs (including reasonable attorneys’ fees anddisbursements).     **13. ****CONFIDENTIALITY**     Hughes agrees to keep confidential, and not to disclose to any person or entity, the terms orconditions of this Agreement, except to his attorney, financial advisors and members of hisimmediate family, provided they agree to keep confidential such terms and conditions. In the eventthat Hughes believes he is compelled by law to divulge the terms or conditions of this Agreement,he will notify Alion’s Law Department of the basis for that belief before actually divulging theinformation. Hughes hereby confirms that, as of the date of this Agreement, he has not disclosedthe terms or conditions of this Agreement, except as otherwise provided in this Agreement. Alionalso agrees to keep confidential, and not to disclose, the terms and conditions of this Agreementoutside of Releasees, its attorneys and consultants, unless Company is otherwise required todisclose such terms and conditions by operation of law or request by a governmental agency, or asrequired by any federal or state securities laws or regulations.     **IN WITNESS WHEREOF**, the parties hereby agree to the terms and conditions of this Agreement asset forth above.   EMPLOYEE:         By: /s/ John M. Hughes   Date: October 23, 2008             John M. Hughes      ALION SCIENCE AND TECHNOLOGY CORPORATION:         By: /s/ James C. Fontana James C. Fontana   Date: October 24, 2008    Senior VP and General Counsel      
6