EXHIBIT          10.91

                            ASSET PURCHASE AGREEMENT

         This asset purchase  agreement  (this  "agreement") is made and entered
into as of this 29th day of september,  1999, by and among telos corporation,  a
maryland  corporation  ("telos"),  telos corporation,  a california  corporation
("shareholder"),   telos  field  engineering,   inc.,  a  delaware   corporation
("seller"),  and tfe  technology  holdings,  llc, a delaware  limited  liability
company ("purchaser").

                                   WITNESSETH

         Whereas, seller is the owner of all right, title and interest in and to
the assets  described  on schedule 2.1 hereto (the  "assets"),  with such assets
being  substantially  all of the  assets  currently  used  in  the  telos  field
engineering, inc., business operated by the seller (the "business");

         WHEREAS,  Telos is the owner of all the  outstanding  capital  stock of
Shareholder,  and  Shareholder  is the owner of all of the  outstanding  capital
stock of Seller,  and each of Telos and Shareholder  are reasonably  expected to
benefit from the transactions contemplated by this Agreement;

         WHEREAS,  Seller  desires to sell the Assets to Purchaser and Purchaser
desires to acquire the Assets from  Seller,  all  pursuant to this  Agreement as
hereinafter provided; and

         WHEREAS,   the   parties   hereto   desire   to   set   forth   certain
representations,  warranties  and  covenants  made by each  to the  other  as an
inducement  to the execution  and delivery of this  Agreement,  and to set forth
certain additional agreements related to the transactions contemplated hereby.

                                    AGREEMENT

         NOW,  THEREFORE,  for and in consideration of the premises,  the mutual
representations,  warranties and covenants  herein  contained and other good and
valuable  consideration,  the  receipt  and  sufficiency  of  which  are  hereby
acknowledged, the parties hereby agree as follows:

     1. GENERAL DEFINITIONS. For purposes of this Agreement, the following terms
shall have the respective meanings set forth below:

     1.1 "AFFILIATE" of any Person shall mean any Person Controlling, Controlled
by or under common Control with such Person.

     1.2 "BEST  KNOWLEDGE"  of Seller means  actual  knowledge of any of Seller,
Shareholder or Telos after reasonable inquiry and investigation.

     1.3 "CONTROL" and all derivations thereof shall mean the possession, direct
or indirect,  of either (i) the ownership of or ability to direct the voting of,
as the case may be,  fifty-one  percent  (51%) or more of the equity  interests,
value or voting  power in any  Person,  or (ii) the power to direct or cause the
direction  of the  management  and  policies  of a Person,  whether  through the
ownership of voting securities, by contract or otherwise.

     1.4 "GOVERNMENTAL AUTHORITY" shall mean any and all foreign, federal, state
or  local  governments,   governmental  institutions,   public  authorities  and
governmental entities and courts.

     1.5 "GOVERNMENTAL REQUIREMENT" shall mean any and all laws (including, but.
not limited to, applicable common law principles),  statutes, ordinances, codes,
rules, regulations, orders, judgments, writs, injunctions, decrees, decisions or
pronouncements,  promulgated,  issued,  passed or set forth by any  Governmental
Authority.

     1.6 "PERSON" shall mean any natural person, any Governmental  Authority and
any entity the separate  existence of which is  recognized  by any  Governmental
Authority  or  Governmental   Requirement,   including,   but  not  limited  to,
corporations,  partnerships,  joint  ventures,  joint stock  companies,  trusts,
estates, companies and associations, whether organized for profit or otherwise.

     1.7 "POST  CLOSING  TAX PERIOD"  shall mean any taxable  period (or portion
thereof) that begins on or after the Closing Date.

     1.8 "PRE  CLOSING  TAX PERIOD"  shall mean any  taxable  period (or portion
thereof) ending before the Closing Date.


     1.9 "TAX" OR TAXES" mean all  Federal,  state,  county,  local,  municipal,
foreign  and other  taxes,  assessments,  duties or similar  charges of any kind
whatsoever,  including all corporate franchise,  income, sales, use, ad valorem,
receipts,  value added,  profits,  license,  withholding,  payroll,  employment,
excise, premium,  property,  customs, net worth, capital gains, transfer, stamp,
documentary,  social security,  environmental,  alternative minimum, occupation,
recapture and other taxes,  and including all interest,  penalties and additions
imposed with respect to such amounts,  and all amounts  payable  pursuant to any
agreement or arrangement with respect to Taxes.

     1.10  "TAXING  AUTHORITY"  shall  mean  any  domestic,   foreign,  federal,
national, state, county or municipal or other local government, any subdivision,
agency,   commission  or  authority  thereof,  or  any  quasi-governmental  body
exercising tax regulatory authority.

     1.11 "TAX RETURN" OR "TAX RETURNS" shall mean all returns,  declarations of
estimated tax payments, reports, estimates,  information returns and statements,
including  any  related or  supporting  information  with  respect to any of the
foregoing, filed or to be filed with any Taxing Authority in connection with the
determination, assessment, collection or administration of any Taxes.

     2. PURCHASE AND SALE OF THE ASSETS; CLOSING DATE.

     2.1 PURCHASE AND SALE. Seller shall, upon Closing  (hereinafter  defined in
Section 2.3), sell,  assign,  transfer and deliver to purchaser all right, title
and  interest  in and to the assets (as more fully  described  on  schedule  2.1
hereto),  free and clear of any liens or encumbrances  of any nature  whatsoever
(except for any liens, encumbrances or obligations, if any, expressly assumed by
Purchaser  hereunder).  Purchaser shall, upon Closing,  purchase from Seller the
Assets in consideration for the Purchase Price (as hereinafter  defined) payable
as set forth in Section 3 below.

     2.2 DELIVERY OF ASSETS AND TRANSFER DOCUMENTS. At the Closing, Seller shall
have taken all steps  necessary to put  Purchaser in  possession  of the Assets,
free and clear of any liens or encumbrances of any nature whatsoever (except for
liens,  encumbrances  or  obligations,  if any,  expressly  assumed by Purchaser
hereunder), and have delivered to Purchaser (i) a duly executed general warranty
bill of sale covering the Assets,  in the form of and  containing the same terms
and provisions as the General  warranty bill of sale attached  hereto as exhibit
a,  (ii)  duly  executed  assignments  for  all  accounts  receivable,  patents,
trademarks,  trade names and similar intangible property included in the assets,
in  form  and  substance  acceptable  to  purchaser  and in  recordable  form as
appropriate,  and (iii) such other duly executed  transfer and release documents
which purchaser has reasonably  requested to evidence the transfer of the assets
to  purchaser  free  and  clear  of any  liens  or  encumbrances  of any  nature
whatsoever  (except for liens,  encumbrances or obligations,  if any,  expressly
assumed purchaser hereunder);  provided, however, that certain assets may not be
transferred  to  purchaser  at the  closing  due to the  need  for  consents  to
assignment,  novation or  subcontracting  that have not been  obtained as of the
Closing Date.

     2.3 CLOSING DATE. subject to the terms and conditions herein contained, the
consummation  of the  transactions  referred  to above  shall  take  place  (the
"closing") at the offices of seller, c/o telos corporation,  19886 ashburn road,
ashburn,  virginia  20147,  commencing at 9:00 a.m.  local time on september 29,
1999,  or such other date as the parties may mutually  determine  (the  "closing
date").

     3. PURCHASE PRICE.

     3.1 PRICE AND PAYMENT.  The aggregate  consideration for the assets and the
non-competition  agreements  (set forth in section 13 below)  shall be an amount
equal to  $10,000,000.00  (the  "purchase  price"),  based on the net  assets of
seller being equal to  $2,500,000  at the closing date and subject to adjustment
as  provided  in section  3.2  below,  payable  by wire  transfer  to an account
specified in writing by seller or delivery of other immediately  available funds
at the  closing  to seller or its  designee;  provided,  however,  that if it is
necessary  or advisable  under the bank  release (as defined in section  7.1(t))
that the  purchase  price be paid to an account  for the benefit of the bank (as
defined  in  section  7.1(t)),  then the  purchase  price  shall be paid to such
account.

     3.2  PURCHASE  PRICE  ADJUSTMENT.  (a) the net  assets of  seller  shall be
initially  determined  at the time of  closing  as being  equal to the pro forma
total net assets of seller as of august 31,  1999,  as presented on schedule 3.2
attached hereto (the "closing estimate").  the purchase price shall be increased
or decreased on a dollar-for-dollar  basis by the amount by which the actual net
assets of seller as of the close of  business on the day  immediately  preceding
the closing  date is more or less than the closing  estimate  (such  increase or
decrease, the "net asset adjustment").

     (B) THE "NET  ASSETS OF  SELLER"  shall mean the sum of the value of all of
the assets less the sum of the value of all of the assumed liabilities of seller
as of closing,  determined  in accordance  with past  practices of seller (which
past practices are in accordance with generally accepted accounting  principles,
consistently applied ("gaap")),  as shown on statement of net assets on schedule
3.2 attached.

     (c)  following  the  closing,  the  actual  net  assets of seller as of the
closing date shall be subsequently  determined within forty-five (45) days after
the closing date by seller,  in accordance  with the terms of this agreement (at
the expense of  seller),  which  determination  (the  "determination")  shall be
submitted in writing to seller and purchaser no later than  forty-five (45) days
after the closing.  if within ten (10) days after receipt of the  determination,
purchaser  delivers  written notice to seller that purchaser  disagrees with the
determination  (the  "disagreement  notice"),  then seller and  purchaser  shall
attempt in good faith to mutually determine the correct amount of the net assets
of seller  within ten (10) days  after the  disagreement  notice.  if seller and
purchaser  cannot in good faith mutually agree upon the correct actual amount of
the net  assets of seller  within  such ten (10) day  period,  then  seller  and
purchaser shall, within the immediately following five (5) day period,  mutually
agree upon an accounting firm, to be a "big five" accounting firm (or, if seller
and purchaser are unable to agree within such period, then arthur andersen & co.
shall be hereby  selected as such  accounting  firm),  to compute the actual net
assets  of  seller  as of  the  closing  date,  which  computation  (the  "final
computation") shall be final, conclusive and binding on the parties hereto.

     (d) In the event of a Final Computation, Purchaser and Seller shall jointly
pay the  expense of the Final  Computation.  If  Purchaser  does not deliver the
Disagreement  Notice on a timely basis to Seller, then Purchaser shall be deemed
to agree with and accept the Determination,  which shall be final and conclusive
against  Purchaser  and Seller.  Any required  payment by Seller or Purchaser by
virtue of a Net Asset  Adjustment  shall be made by Seller or Purchaser,  as the
case may be,  within ten (10) days of the  receipt of the  Determination  or the
Final Computation.

     3.3 EXCLUDED ASSETS.  the assets shall not include any of the assets listed
on schedule 3.3 hereto (collectively, the "excluded assets").

     3.4 ASSUMED  LIABILITIES AND OBLIGATIONS.  on the closing date,  subject to
the  satisfaction  or waiver of all of the  conditions set forth in section 7.1,
purchaser  shall  assume the  liabilities  and  obligations  of seller under all
contracts and agreements  transferred by seller to purchaser at the closing that
are listed and  described on schedule 2.1 hereto and the other  liabilities  and
obligations set forth on schedule 3.4 hereto; provided,  however, that purchaser
shall only assume the  liabilities  and  obligations  under such  contracts  and
agreements  set forth on schedule 2.1 that arise after,  and relate to or result
from  acts,   events,   omissions  or  time  periods  after,  the  closing  date
(collectively,  such liabilities and obligations  described on schedules 2.1 and
3.4, the "assumed liabilities and obligations");  and provided further, however,
that purchaser  specifically  shall not assume any liabilities or obligations of
seller under such contracts or agreements with respect to any matter (including,
without  limitation,  damages to third  parties)  relating to or resulting  from
acts,  events,  omissions,  or time  periods  occurring on or before the closing
date.
     3.5 EXCLUDED LIABILITIES AND OBLIGATIONS.

     (a) Except as expressly set forth in Section 3.4 above, Purchaser shall not
assume  and  shall  not be liable or  responsible  for any debt,  obligation  or
liability of the Business, Seller, Shareholder,  Telos or any other Affiliate of
Seller, or any claim against any of the foregoing parties,  of any kind, whether
known or unknown, contingent, absolute or otherwise.

     (b) Except for the Assumed  Liabilities and Obligations  expressly provided
for in Section  3.4 hereof,  Seller,  Shareholder  and Telos  shall  jointly and
severally forever defend, indemnify and hold harmless Purchaser from and against
any  and  all  liabilities,  obligations,  losses,  claims,  damages  (including
incidental and consequential damages), costs and expenses (including court costs
and reasonable  attorney's  fees) related to or arising from the Business or any
contract or agreement that is, or should be, listed on SCHEDULE 4.8 prior to the
Closing Date.

         (c) Purchaser shall forever defend, indemnify and hold harmless Seller,
Shareholder  and Telos from and  against any and all  liabilities,  obligations,
losses, claims, damages (including incidental and consequential damages),  costs
and expenses  (including court costs and reasonable  attorney's fees) related to
or arising  from the  Business or any  contract or  agreement  that is listed on
SCHEDULE 4.8 AFTER THE CLOSING DATE; PROVIDED,  HOWEVER, that no indemnification
shall be required of Purchaser hereunder for any such liabilities,  obligations,
losses, claims,  damages, etc., if they were caused by the action or inaction of
either of Seller,  Shareholder and Telos or any employee or officer thereof,  or
if they  relate to a  contract  which has not been  assigned,  subcontracted  or
novated to Purchaser.

     3.6 TRANSFER  TAXES.  Purchaser and Seller  acknowledge  and agree that the
consideration  (including,  without  limitation,  the  Purchase  Price  and  any
adjustments  thereto) does not include any sales, use, transfer or other similar
tax payments by Purchaser to Seller pursuant to this Agreement, and is exclusive
of any and all sales,  use, transfer or other similar tax imposed as a result of
the  consummation of the  transactions  contemplated  by this Agreement.  Telos,
Shareholder and Seller each hereby agree to pay and discharge,  and to indemnify
Purchaser  against,  and protect,  save and hold  Purchaser  harmless  from, any
liability,   obligation,   claim,  assessment  or  deficiency  (whether  or  not
ultimately  successful)  for any and all sales,  use,  transfer or other similar
taxes (and any and all interest,  penalties,  additions to tax and fines thereon
or related thereto) resulting or arising from or incurred in connection with the
consummation of the actions contemplated by this Agreement.

     3.7 ALLOCATION OF PURCHASE  PRICE.  within 120 days after the closing date,
purchaser  and seller shall agree  (subject to the approval of telos,  which may
not be  unreasonably  withheld  or  delayed)  upon a schedule  (the  "allocation
schedule") to be attached hereto as schedule 3.7,  allocating the purchase price
(and the value of the assumption of the assumed  liabilities and obligations) to
be paid by purchaser  among the purchased  assets  transferred as of the closing
date by  seller.  the  allocation  schedule  shall be  reasonable  and  shall be
prepared in accordance with section 1060 of the code, the regulations thereunder
and the preceding sentence.  promptly after agreeing to the allocation schedule,
seller and purchaser  shall sign the allocation  schedule and return an executed
copy thereof to purchaser  and seller,  respectively.  the  purchaser and seller
each agrees to file irs form 8594, and all federal, state, local and foreign tax
returns, in accordance with the allocation schedule.  purchaser and seller agree
to promptly  provide the other with any other  information  required to complete
irs form  8594 and all  federal,  state,  local and  foreign  tax  returns.  any
allocation of the purchase  price shall take into account any implicit  value of
any other  agreements  between the parties  hereto,  and the  purchase  price so
allocated shall be adjusted to account for such value.

     4. REPRESENTATIONS AND WARRANTIES OF TELOS, SELLER AND SHAREHOLDER.  Telos,
Seller and  Shareholder  hereby  jointly and severally  represent and warrant to
Purchaser as follows:

     4.1  ORGANIZATION.  Shareholder is a corporation  duly  organized,  validly
existing and in good standing under the laws of the State of California,  and is
duly  authorized,  qualified  and  licensed  under all  applicable  Governmental
Requirements  to carry on its  business  in the  places and in the manner as now
conducted except where any such failure would not reasonably be expected to have
a material adverse effect on the financial condition, operating results, assets,
or business  prospects of the Business.  Seller is a corporation duly organized,
validly  existing and in good standing  under the laws of the State of Delaware,
and is duly authorized, qualified and licensed under all applicable Governmental
Requirements  to carry on its  business  in the  places and in the manner as now
conducted except where any such failure would not reasonably be expected to have
a material adverse effect on the financial condition, operating results, assets,
or business  prospects  of the  Business.  Seller is qualified to do business in
every  jurisdiction  in which the  failure to so  qualify  might  reasonably  be
expected to have a material adverse effect on the financial condition, operating
results, assets, or business prospects of the Business.

     4.2  OWNERSHIP.  Seller owns all of the Assets  constituting  the Business,
except the government  furnished equipment ("gfe") listed in schedule 4.2. There
are no options, rights or other grants currently outstanding for the acquisition
or purchase of any of the Assets. All of the outstanding capital stock of Seller
is owned by Shareholder.  All of the outstanding capital stock of Shareholder is
owned by Telos.

     4.3 FINANCIAL  STATEMENTS.  seller has delivered to purchaser copies of the
following  financial  statements for the business,  all of which are included in
schedule 4.3 hereto:

     (a) UNAUDITED  STATEMENT OF NET ASSETS OF THE BUSINESS  (the  "statement of
net assets") as of august 31, 1999 (the "statement date"), and the unaudited pro
forma  statement  of  operations  of the business for the eight (8) month period
ended on the Statement Date;

     (b) UNAUDITED PRO FORMA STATEMENT OF OPERATIONS of the Business from Seller
for Seller's two (2) most recent fiscal years.

     (c)  Management  Operations  Summaries  of the  Business  for the eight (8)
months ended August 31, 1999, and Seller's two (2) most recent fiscal years.

     ALL  FINANCIAL  STATEMENTS  SUPPLIED TO  PURCHASER  BY SELLER,  INCLUDED IN
SCHEDULE 4.3(A) hereto, are true and accurate in all respects and, except as set
forth on schedule  4.3(B)  hereto,  have been prepared in  accordance  with past
practices of Seller  (which past  practices are in  accordance  with GAAP),  and
present  fairly the financial  condition of the Business as of the dates and for
the periods indicated thereon.  The Statement of Net Assets reflects,  as of the
Statement  Date,  all  material  liabilities,  debts and  obligations  of Seller
related to the Assets, whether accrued,  absolute,  contingent or otherwise, and
whether due, or to become due, including, but not limited to, liabilities, debts
or obligations on account of taxes or other governmental  charges, or penalties,
interest or fines thereon or in respect thereof.

     4.4 EVENTS SINCE THE  STATEMENT  DATE.  EXCEPT AS SET FORTH ON SCHEDULE 4.4
hereto, since August 31, 1999, there has not been:

     (a)  any  change  in  the  condition  (financial  or  otherwise)  or in the
properties,  assets, liabilities,  business or prospects of the Business, except
normal and usual changes in the ordinary  course of business,  none of which has
been adverse and all of which in the aggregate have not been adverse;

     (b) any labor trouble,  strike or any other occurrence,  event or condition
affecting  the employees of the Business  that  adversely  affects the condition
(financial or otherwise) of the Assets or the Business;

     (c) any  breach or default by Seller or  Shareholder  or Telos,  or, to the
Best Knowledge of Seller, by any other party,  under any agreement or obligation
included in the Assets or by which any of the Assets are bound;

     (d) any damage,  destruction  or loss (whether or not covered by insurance)
adversely affecting the Assets or the Business;

     (e) any change in the types, nature, composition or quality of the services
of the Business,  any adverse change in the  contributions of any of the service
lines of the  Business to the  revenues or net income of such  Business,  or any
adverse change in the sales, revenue or net income of the Business;

     (f) any  transaction  related to or  affecting  the Assets or the  Business
other than transactions in the ordinary course of business of Seller; or

     (g) any other  occurrence,  event or condition that has adversely  affected
(or can reasonably be expected to adversely affect) the Assets or the Business.

     4.5 COMPETING INTERESTS. None of Seller, Shareholder, or Telos, nor, to the
Best  Knowledge of Seller,  any  shareholder or officer of any of the foregoing,
and no Associate (as hereinafter defined) of any of the foregoing:

     (a)  owns,  directly  or  indirectly,  any  equity  interests  in,  or is a
director,  officer or  employee  of, or  consultant  to,  any entity  which is a
competitor,  supplier or customer of the Business,  or, to the Best Knowledge of
Seller,  a  competitor,  supplier or customer of  Purchaser  or an  Associate of
Purchaser (except for ownership,  if any, of less than one percent (1%) by value
of the  outstanding  capital stock of any corporation the capital stock of which
is traded on a nationally recognized securities exchange); or,

     (b) owns, directly or indirectly,  in whole or in part, any property, asset
or right which is associated with the Assets or the Business, or which Seller is
presently operating or using in connection with or the use of which is necessary
for or material to the operation of the Business.

     FOR  PURPOSES  OF THIS  AGREEMENT,  THE TERM  "ASSOCIATE"  shall  mean with
respect  to a  Person  (other  than  an  individual),  any  Person  Controlling,
Controlled  by or under common  Control  with such  Person,  and any director or
officer of such Person and any Associate of any such Person.

     4.6 NOTES AND ACCOUNTS  RECEIVABLE.  All notes and accounts  receivable  of
Seller which are part of the Assets are reflected properly on Seller's books and
records,  are valid  receivables  subject to no setoffs  or  counterclaims,  are
presently  current and  collectible,  and will be collected in  accordance  with
their terms at their recorded  amounts,  subject only to a reserve for bad debts
set forth in the Statement of Net Assets  through the Closing Date in accordance
with the past customs and practices of the Business.

     4.7  EMPLOYEE  MATTERS.  SCHEDULE  4.7(A)  hereto,  sets  forth a true  and
complete  list of the  names of and  current  annual  compensation  paid to each
non-temporary  employee who is employed in connection  with the operation of the
business  (each a "business  employee").  except as  specifically  described  on
schedule  4.7(b)  hereto,  none of  seller,  shareholder  or telos  maintain  or
contribute to any employee benefit plans,  programs or arrangements  (including,
but not  limited  to,  pension  plans and  welfare  plans  within the meaning of
section 3(2) and 3(1), respectively,  of the employee retirement income security
act of 1974, as amended  ("erisa")),  whether  written or  unwritten,  formal or
informal  under which any current or former  business  employee is or may become
entitled to benefits.  none of seller,  shareholder or telos now  contributes or
has ever contributed to a "multi-employer plan" as defined in section 4001(a)(3)
of erisa.  none of  seller,  shareholder  or telos is a party to any  collective
bargaining or other union  agreements,  or has,  within the last five (5) years,
had or been threatened with any union activities,  work stoppages or other labor
trouble  with respect to  employees  engaged in the business  which had or might
have had a material adverse effect on the business. other than wage increases in
the  ordinary  course of business,  since the  statement  date,  none of seller,
shareholder  or telos has  implemented  or made any  commitment  or agreement to
implement,  any increase in the wages or modification of the conditions or terms
of employment of any of the corporate or administrative (non-temporary) business
employees,  or of any  business  employee  who is  expected  to  receive  annual
compensation for 1999 of $40,000 or more.
     4.8  CONTRACTS  AND  AGREEMENTS.  SCHEDULE 4.8 hereto sets forth a true and
complete list of and briefly describes  (including  termination date) all of the
following  contracts,  agreements,  leases,  licenses,  plans,  arrangements  or
commitments,  written  or  oral,  that  relate  to the  Assets  or the  Business
(including all amendments, supplements and modifications thereto):

     (a) all  contracts,  agreements,  or  commitments in respect of the sale of
services;

     (b) all  offers,  tenders  or the like  outstanding  and  capable  of being
converted  into an obligation of Seller or by an acceptance or other act of some
other person or entity or both;

     (c) all sales or agency  agreements or  franchises  or legally  enforceable
commitments or obligations with respect thereto;

     (d) all collective  bargaining  agreements,  union  agreements,  employment
agreements, consulting agreements or agreements providing for the services of an
independent contractor;

     (e) all profit-sharing,  pension, stock option,  severance pay, retirement,
bonus, deferred compensation,  group life and health insurance or other employee
benefit plans, agreements, arrangements or commitments of any nature whatsoever,
whether or not legally  binding,  and all agreements  with any present or former
officers or employees of Telos, Shareholder or Seller;

     (f) all loan or  credit  agreements,  indentures,  guarantees  (other  than
endorsements  made for collection),  mortgages,  pledges,  conditional  sales or
other title retention agreements, and all equipment financing obligations, lease
and  lease-purchase  agreements  relating  to or  affecting  the  Assets  or the
Business;

     (g) all  leases  related  to the  Assets  or the  Business,  and all  other
contracts,   agreements  or  legally  enforceable  commitments  relating  to  or
affecting the Assets or the Business;

     (h) all performance  bonds,  surety bonds,  letters of credit and the like,
all  contracts  and bids  covered by such  bonds,  and all letters of credit and
guaranties,  with a list of all such performance bonds and the like specified on
schedule 4.8 hereto.

     (i) all consent decrees and other judgments,  decrees or orders, settlement
agreements  and  agreements  relating to  competitive  activities,  requiring or
prohibiting any future action;

     (j) all accounts, notes and other receivables,  and all security therefore,
and all documents and agreements related thereto;

     (k) all  contracts  or  agreements  of any  nature  with any 5% or  greater
stockholder of Seller, or any Associate (as defined in Section 4.5 above) of any
such stockholder;

     (l) all  contracts,  commitments  and  agreements  entered into outside the
ordinary course of the operation of the Business; and

     (m) any agreements relating to the sharing or allocation of Taxes.

     All of such contracts,  agreements,  leases, licenses, plans, arrangements,
and  commitments  and all other  such  items  included  in the  assets,  but not
specifically described above, (collectively, the "contracts") are valid, binding
and in full force and effect in accordance  with their terms and  conditions and
there is no existing default thereunder or breach thereof by telos,  shareholder
or seller,  or, to the best knowledge of telos,  shareholder and seller,  by any
other party to the contracts,  or any conditions  which will  constitute  such a
default by telos,  shareholder  or seller,  or, to the best  knowledge of telos,
shareholder and seller,  by any other party to the contracts,  and the contracts
will not be  breached  by or give any other  party a right of  termination  as a
result of the transactions contemplated by this agreement.  copies of all of the
documents  (or in the case of oral  commitments,  descriptions  of the  material
terms  thereof)  relevant to the contracts  listed in schedule 4.8 hereto,  have
been delivered by telos,  shareholder  and seller to purchaser,  and such copies
and  descriptions  are true,  complete and accurate and include all  amendments,
supplements  or  modifications  thereto.  no one has advised or notified  telos,
shareholder  or seller that any  contract to be assigned to  purchaser by telos,
shareholder  or  seller  pursuant  to  the  transactions  contemplated  by  this
agreement  will be terminated by any customer  prior to, on or after the closing
date or that any  existing  relationship  with any  customer  will  expire  upon
termination  of any  existing  contract.  except as set forth on  schedule  4.8a
hereto,  all of the contracts may be assigned to purchaser  without the approval
or consent of any person.

     4.9 EFFECT OF AGREEMENT. EXCEPT AS SET FORTH ON SCHEDULE 4.9, the execution
and  delivery  of  this  Agreement  and  the  consummation  of the  transactions
contemplated  hereby  will not (i)  result in any  breach of any of the terms or
conditions of, or constitute a default under,  the Certificate of  Incorporation
or Bylaws of Seller or Shareholder or Telos, or any commitment,  mortgage, note,
bond, debenture, deed of trust, contract, agreement, license or other instrument
or obligation to which none of Seller, Shareholder or Telos is now a party or by
which Seller or Shareholder or Telos or any of their properties or assets may be
bound or affected; (ii) result in any violation of any Governmental Requirement;
(iii) cause Purchaser to lose the benefit of any right or privilege  included in
the Assets;  (iv) relieve any Person of any obligation  (whether  contractual or
otherwise) or enable any Person to terminate any such obligation or any right or
benefit  enjoyed by Seller or to  exercise  any' right  under any  agreement  in
respect of the Assets or the Business;  or (v) require notice to or the consent,
authorization, approval or order of any Person (except as may be contemplated by
the last sentence of Section 4.8 hereof).  To the Best Knowledge of Seller,  the
business relationships of clients,  customers and suppliers of the Business will
not be adversely affected by the execution and delivery of this Agreement or the
consummation of the transactions contemplated hereby.

     4.10  PROPERTIES,  ASSETS  AND  LEASEHOLD  ESTATES.  Seller  has  good  and
marketable  title to all the  Assets,  free and clear of all  mortgages,  liens,
pledges,   conditional  sales   agreements,   charges,   easements,   covenants,
assessments,  options,  restrictions and encumbrances of any nature  whatsoever.
All leases to which real property is leased in connection  with the Business are
in good standing, valid and enforceable with respect to their terms.

     4.11 INTANGIBLE PROPERTY.  except as set forth on schedule 4.11 hereto, the
operation of the business as now conducted by seller does not require the use of
or consist of any rights under any patents, inventions, trademarks, trade names,
brand names or copyrights.  seller owns and has the full and exclusive  right to
use in  connection  with the business  all of the items listed on schedule  4.11
hereto (which  schedule  includes,  without  limitation,  all computer  software
(whether from third parties or produced internally by seller, shareholder, telos
or any  affiliate of any of the  foregoing)  and licenses  used by seller in the
business  or for  administration  purposes),  which  items are in full force and
effect.  seller has not  transferred,  encumbered  or licensed to any person any
rights to own or use any portion of the items listed on schedule  4.11 hereto or
any other  intangible  property  included in the  assets.  none of (i) the items
listed on schedule  4.11,  (ii) any other  intangible  property  included in the
assets, or (iii) the operation of the business as presently conducted,  violates
or infringes upon any patents, inventions,  trademarks, trade names, brand names
or  copyrights  owned by others.  to the best  knowledge of seller,  none of the
items listed on schedule 4.11 hereto or any other intangible  property  included
in the assets is being infringed upon by any person.

     4.12  SUITS,  ACTIONS  AND  CLAIMS.  EXCEPT AS SET FORTH IN  SCHEDULE  4.12
hereto, (i) there are no suits, actions,  claims, inquiries or investigations by
any Person, or any legal, administrative or arbitration proceedings in which the
Business is engaged or which are pending  or, to the Best  Knowledge  of Seller,
threatened against or affecting the Business or Assets or any of its properties,
or which  question  the  validity or legality of the  transactions  contemplated
hereby,  (ii) no basis or grounds  for any such suit,  action,  claim,  inquiry,
investigation  or proceeding  exists,  and (iii) there is no outstanding  order,
writ,  injunction or decree of any Governmental  Authority  against or affecting
Seller with respect to the Business or Assets.  Without  limiting the foregoing,
Seller has no  knowledge  of any state of facts or the  occurrence  of any event
forming the basis of any present or potential claim against Seller,  Shareholder
or Telos with respect to the Business or the Assets.

     4.13  LICENSES  AND  PERMITS;  COMPLIANCE  WITH  GOVERNMENTAL  REGULATIONS.
SCHEDULE  4.13 hereto,  sets forth a true and complete  list of all licenses and
permits necessary for the conduct of the business.  seller has all such licenses
and permits  validly  issued to it and in its name,  and all such  licenses  and
permits  are in full  force  and  effect.  true and  correct  copies of all such
licenses and permits are included in schedule 4.13 hereto.  no violations are or
have been  recorded in respect of such  licenses or permits and no proceeding is
pending or, to the best knowledge of seller,  threatened  seeking the revocation
or limitation of any of such licenses or permits.  all such licenses and permits
that are subject to transfer are included in the assets.  to the best  knowledge
of seller, seller has complied with all governmental  requirements applicable to
the business, and all governmental requirements with respect to the distribution
and sale of products and services by the business.

     4.14  AUTHORIZATION.  Each of Seller,  Shareholder and Telos has full legal
right,  power and  authority  to enter into and deliver  this  Agreement  and to
consummate  the  transactions  set forth herein and to perform all the terms and
conditions  hereto to be  performed  by it. The  execution  and delivery of this
Agreement by each of Seller,  Shareholder  and Telos and the performance by them
of the transactions  contemplated herein has been duly and validly authorized by
all  requisite  corporate  action of Seller,  Shareholder  and  Telos,  and this
Agreement  has  been  duly  and  validly   executed  and  delivered  by  Seller,
Shareholder and Telos and is the legal,  valid and binding obligation of each of
Seller,  Shareholder and Telos,  enforceable against them in accordance with its
terms,  except as limited by applicable  bankruptcy,  moratorium,  insolvency or
other similar laws affecting  generally the rights of creditors or by principles
of equity.

     4.15 NO UNTRUE STATEMENTS. To the Best Knowledge of Seller, the statements,
representations  and  warranties of Seller,  Shareholder  and Telos set forth in
this Agreement and the Schedules hereto and in all other documents  furnished to
Purchaser  and its  representatives  in  connection  herewith do not include any
untrue statement of a material fact or omit to state any material fact necessary
to make the  statements,  representations  and warranties  made not  misleading.
There is no fact that is not  disclosed to  Purchaser  in this  Agreement or the
Schedules  hereto that  adversely  affects or, so far as Seller,  Shareholder or
Telos can now  reasonably  foresee,  could  adversely  affect the  condition  or
prospects  (in each case,  financial or  otherwise)  of any of the Assets or the
Business  or the  ability  of  Seller,  Shareholder  or Telos to  perform  their
obligations under the Agreement.

     4.16 RECORDS.  The books,  records and minutes kept by Seller,  Shareholder
and Telos  with  respect  to the Assets  and the  Business,  including,  but not
limited to, all customer files, service agreements  quotations,  correspondence,
historical  revenue data and other  financial data of the Business since January
1, 1997, have been kept properly and contain records of all matters  required to
be included therein by any Governmental Requirement, and such books, records and
minutes are true,  accurate and complete and (except for corporate  minute books
and stock  records)  are included in the assets,  as reflected in schedule  2.1;
provided,  however,  that  for as  long as  seller  is  required  to keep in its
possession such books and records as a result of any  Governmental  Requirement,
Seller may do so if it promptly after the Closing  submits a true,  accurate and
complete copy of such books and records to Purchaser.  Seller,  Shareholder  and
Telos  agree to store for a period of at least  seven (7) years from the Closing
Date all of Seller's  tax and  accounting  books and records with respect to any
Tax of Seller or the  Business  (other  than those  solely  with  respect to the
Business  which are  included in the Assets) for the seven (7) year period prior
to the Closing Date.  Such records shall be made  available for  inspection  and
copying by  Purchaser  upon  reasonable  advance  notice  and during  reasonable
business  hours.  In the event  that  Shareholder,  Seller or Telos  intends  to
destroy or dispose of any such tax or  accounting  books and  records  after the
seven  (7)  year  period,  then  notice  of such  intention  shall  be  given to
Purchaser,  and such books and records will be  delivered to Purchaser  promptly
upon Purchaser's request and at Purchaser's expense.

     4.17 WORK-IN-PROCESS.  EXCEPT AS SET FORTH ON SCHEDULE 4.17 hereto, none of
Seller,  Shareholder  or Telos has  received  any  payments  with respect to any
work-in-process with respect to the Business.

     4.18 BROKERS AND FINDERS.  EXCEPT AS SET FORTH ON SCHEDULE 4.18 hereto,  no
broker or finder has acted for Seller,  Shareholder or Telos in connection  with
this Agreement or the transactions  contemplated by this Agreement and no broker
or finder is entitled to any  brokerage or finder's fee or to any  commission in
respect thereof based in any way on agreements,  arrangements or  understandings
made by or on behalf of Seller, Shareholder or Telos.

     4.19 ADVERSE  FACTS.  None of Seller,  Shareholder or Telos is aware (after
having made all  reasonable  inquiries)  of any fact or matter not  disclosed in
this Agreement or in the Schedules hereto which might be reasonably  expected to
materially adversely affect the Assets or the Business after Closing.

     4.20 DEPOSITS.  None of Seller,  Shareholder  or Telos now holds,  nor does
either of Seller, Shareholder or Telos expect to receive between the date hereof
and the Closing Date, any deposits or prepayments by third parties in respect to
any of the Assets or the Business  which are not reflected as liabilities on the
Statement of Net Assets.

     4.21  WORKERS'  COMPENSATION  DATA.  All  data set  forth  in the  workers'
compensation  report of Seller attached hereto as schedule 4.21 is true, correct
and complete as of the date thereof.

     4.22  CUSTOMER  LIST.  SCHEDULE  4.22  hereto  sets  forth a true,  correct
complete  list of all  customers  of the  Business  to which  Seller has sold or
provided  services  in excess of  $100,000.00  in each of the twelve  (12) month
periods ended  December 31, 1997,  and December 31, 1998.  This list provides an
accurate statement of the gross revenues received from each such customer by the
Business  during each of the twelve (12) month periods ended  December 31, 1997,
and December 31, 1998, and also provides the gross  revenues  received from each
such  customer for the eight (8) month  period ended August 31, 1999.  Except as
contractually  provided, to the best knowledge of seller, no current customer of
the  business  listed on schedule  4.22 hereto will stop or decrease its rate of
buying  services (on an annual  basis) from Seller prior to the Closing Date, or
to the extent any such customer becomes a customer of Purchaser  pursuant to the
transactions  contemplated by this  Agreement,  from Purchaser after the Closing
Date.

     4.23 NO ROYALTIES. No royalty or similar item or amount is being paid or is
owing by Seller,  nor is any such item accruing,  with respect to the operation,
ownership or use of the Business or the Assets.

     4.24  SUBSIDIARIES.  EXCEPT AS SET FORTH ON SCHEDULE 4.24,  Seller does not
own any Subsidiaries. As used in this agreement, the word "subsidiary" means any
corporation or other organization,  whether  incorporated or unincorporated,  of
which such party or any other Subsidiary of such party is a general partner,  or
at least a majority of the securities or other  interests  having by their terms
ordinary  voting  power to elect a majority of the Board of  Directors or others
performing   similar  functions  with  respect  to  such  corporation  or  other
organization  is directly or indirectly  owned or controlled by such party or by
any one or more of its  Subsidiaries,  or by such  party  and one or more of its
Subsidiaries.

     4.25  SUCCESSION.  In the event that  Seller is merged,  obligations  owing
hereunder to Seller by Purchaser  will be obligations of Purchaser to the person
succeeding  by operation  of law to Seller,  in the event of merger of Seller in
which Seller is not the surviving entity, or Shareholder (Telos, as the case may
be) in the event that  Seller (or  Shareholder,  as the case may be, or both) is
dissolved.  The  obligations  owing hereunder to Purchaser by Seller will be the
obligations of Seller to the person succeeding by operation of law to Purchaser.

     4.26  TAXES.  (A)  EXCEPT  AS SET  FORTH  ON  SCHEDULE  4.26A,  to the Best
Knowledge of Seller,  (i) Seller and any affiliated group,  including within the
meaning of  section  1504 of the code,  of which  seller is or has been a member
(any such group, a "seller group"),  has filed or caused to be filed in a timely
manner  (within any  applicable  extension  periods)  all  material  Tax Returns
relating  to the  Business  or  Seller  required  to be  filed by the Code or by
applicable  state,  local or foreign tax laws and all such Tax Returns are true,
complete  and correct in all material  respects,  (ii) all Taxes with respect to
taxable  periods  covered  by such Tax  Returns,  and all other  Taxes for which
Seller is liable,  have been timely paid in full, or will be timely paid in full
by the due date  thereof,  and (iii) there are no material  liens for Taxes with
respect to any of the assets or  properties  of the Seller  except for any Taxes
not yet due and payable.

     (b) Any  deficiency  relating to the Business or Seller  resulting from any
audit or examination  relating to Taxes by any Taxing  Authority has been timely
paid.

     (c)  Seller,  Shareholder  and Telos  have each  complied  in all  material
respects with all  applicable  laws relating to the payment and  withholding  of
Taxes and have,  within the time and in the manner prescribed by applicable law,
withheld  from  and paid  over to the  proper  Taxing  Authorities  all  amounts
required to be so withheld and paid over under such laws.

     (d)  SCHEDULE  4.26B sets forth each state,  county,  local,  municipal  or
foreign  jurisdiction in which Seller files, or is or has been required to file,
a Tax Return relating to state and local income, franchise, license, excise, net
worth, property or sales and use taxes or is or has been liable for any Taxes on
a "nexus" basis.

     (e) Seller is not a "foreign  person" within the meaning of Section 1445 of
the Code.

     5. PURCHASER REPRESENTS AND WARRANTS TO SELLER AS FOLLOWS:

     5.1 FORMATION.  Purchaser is a limited  liability  company duly  organized,
validly existing and in good standing under the laws of the State of Delaware.

     5.2  AUTHORIZATION.  Purchaser has full legal right and corporate  power to
enter into and deliver this  Agreement and to consummate  the  transactions  set
forth herein and to perform all the terms and conditions  hereof to be performed
by it. This Agreement has been duly executed and delivered by Purchaser and is a
legal, valid and binding obligation of Purchaser  enforceable in accordance with
its terms, except as limited by applicable bankruptcy,  moratorium,  insolvency,
or other laws  affecting  generally the rights of the creditors or by principals
of equity.  The  execution  and delivery of this  Agreement by Purchaser and the
performance by Purchaser of the transactions  contemplated herein have been duly
and validly authorized by all requisite corporate action of Purchaser.

     5.3 BROKERS AND  FINDERS.  No broker or finder has acted for  Purchaser  in
connection  with  this  Agreement  or  the  transactions  contemplated  by  this
Agreement  and, no broker or finder is entitled to any brokerage or finder's fee
or to  any  commission  in  respect  thereof  based  in any  way on  agreements,
arrangements or understandings made by or on behalf of Purchaser.

     6. PRE-CLOSING COVENANTS.  The parties agree as follows with respect to the
period between the execution of this Agreement and the Closing.

     6.1  GENERAL.  Each of the  parties  will use its best  efforts to take all
action and to do all things  necessary,  proper,  or advisable to consummate and
make  effective  the  transactions  contemplated  by this  Agreement  (including
satisfying the closing conditions set forth in Section 7 below).
     6.2 NOTICES AND  CONSENTS.  Seller will give any notices to third  parties,
and Seller,  Telos and Shareholder  will each use its best efforts to obtain any
third party  consents  that the  Purchaser  may request in  connection  with the
matters  pertaining  to the Seller or  Shareholder  disclosed  or required to be
disclosed by this Agreement. Each of the parties will take any additional action
that may be necessary,  proper or advisable in connection with any other notices
to, filings with, and  authorizations,  consents,  and approvals of governments,
governmental  agencies,  and third parties that it may be required to give, make
or obtain.

     6.3 OPERATION OF BUSINESS. Seller will not engage in any practice, take any
action,  embark on any course of inaction, or enter into any transaction outside
the  ordinary  course  of  business.  Without  limiting  the  generality  of the
foregoing,  Seller will not engage in any practice,  take any action,  embark on
any course of inaction,  or enter into any  transaction of the sort described in
Section 4.4 hereof.

     6.4 PRESERVATION OF BUSINESS.  Except for changes occurring in the ordinary
course of business, Seller will keep the business and properties of the Business
intact,   including  its  present  operations,   physical  facilities,   working
conditions, and relationships with lessors, licensors, suppliers, customers, and
employees.

     6.5 FULL ACCESS. Seller,  Shareholder and Telos will permit representatives
of Purchaser to have full access at all reasonable  times, and in a manner so as
not to interfere with the normal business operations of Seller,  Shareholder, or
Telos, to all premises,  properties, books, records, contracts, tax records, and
documents of or pertaining to the Business.

     6.6 NOTICE OF  DEVELOPMENTS.  Seller  will give  prompt  written  notice to
Purchaser  of  any  material  development  affecting  the  assets,  liabilities,
business,  financial  condition,  operations,  results of operations,  or future
prospects of the  Business.  Each party will give prompt  written  notice to the
other parties  hereto of any material  development  affecting the ability of the
parties to  consummate  the  transactions  contemplated  by this  Agreement.  No
disclosure by any party pursuant to this Section 6.6,  however,  shall be deemed
to amend or supplement the Schedules or Exhibits  hereto,  or to prevent or cure
any misrepresentation, breach of warranty, or breach of covenant.

     6.7 EXCLUSIVITY. None of Seller, Shareholder or Telos will, with respect to
the Business or the Assets, (i) solicit,  initiate,  or encourage the submission
of any  proposal  or offer  from any  person  relating  to any (A)  liquidation,
dissolution, or recapitalization,  (B) merger or consolidation,  (C) acquisition
or purchase of  securities  or assets,  or (D) similar  transaction  or business
combination  involving  Seller,  or  (ii)  participate  in  any  discussions  or
negotiations  regarding,  furnish any  information  with  respect to,  assist or
participate  in, or  facilitate in any other manner any effort or attempt by any
person  to do or  seek  any of  the  foregoing.  Seller  will  notify  Purchaser
immediately if any person makes any proposal, offer, inquiry, or with respect to
any of the foregoing.

     6.8 UPDATED  SCHEDULES.  Purchaser  acknowledges  that the  preparation and
delivery of the Schedules to the  Agreement may not be prepared  and/or final at
the time of the execution and delivery of this  Agreement.  As such, the parties
hereto agree as follows:

     (a)  Seller  shall  have the  right to amend,  restate  or  supplement  the
Schedules to the Agreement at any time on or prior to the Closing Date;

     (b) At the  Closing,  Seller shall  deliver to  Purchaser  two (2) complete
copies  of the  proposed  final  Schedules  to the  Agreement  together  with an
additional two (2) complete copies marked to show the changes from the Schedules
last provided to Purchaser; and

     (c) Purchaser shall notify Seller in writing at the Closing that either (i)
Purchaser  accepts such final Schedules,  in which case they shall become a part
of this  Agreement  as if such  Schedules  were in  existence  on the date  this
Agreement  was  originally  executed  and  all  such  disclosures  made  in such
Schedules shall be deemed to be disclosed as if such Schedules have been made as
of the date of this Agreement,  or (ii) Purchaser reasonably  determines in good
faith that the information  disclosed in such Schedules and/or amended Schedules
would  result in a material  adverse  change or material  adverse  effect on the
Business,  Assets or future  prospects of the Business and  therefore  elects to
terminate  this  Agreement  pursuant  to the  provisions  of  Section  8 of this
Agreement without any liability to Purchaser.

     6.9 SELLER TAX COVENANTS.  Seller shall deliver to Purchaser at or prior to
the Closing a  certificate,  in form and  substance  satisfactory  to Purchaser,
certifying  that the  Acquisition  is exempt  from  withholding  pursuant to the
Foreign Investment in Real Property Tax Act.

     7. CONDITIONS TO OBLIGATION TO CLOSE.

     7.1 CONDITIONS TO OBLIGATION OF PURCHASER.  The obligations of Purchaser to
consummate the transactions to be performed by it in connection with the Closing
is subject to satisfaction of the following conditions:  (a) the representations
and  warranties  set forth in Section 4 hereof  shall be true and correct in all
material  respects at and as of the Closing Date;  (b) Seller,  Shareholder  and
Telos shall have performed and complied with all of their covenants hereunder in
all material  respects  through the Closing;  (c) Seller,  Shareholder and Telos
shall have (i) procured all of the third party  consents  necessary for Closing,
including,  without limitation,  the consents to assignment of the contracts set
forth on  schedule  7.1(c)  hereto  under the  heading  "major  contracts  to be
assigned,"  and (ii)  sub-contracted  to purchaser  the  contracts  set forth on
schedule 7.1(c) hereto under the heading "major contracts to be sub-contracted;"
(d) no action,  suit,  or proceeding  shall be pending or threatened  before any
court or  quasi-judicial  or  administrative  agency of any federal,  state,  or
local, or foreign jurisdiction wherein an unfavorable  judgment,  order, decree,
stipulation,  injunction, or charge would (i) prevent consummation of any of the
transactions  contemplated by this Agreement, (ii) cause any of the transactions
contemplated by this Agreement to be rescinded following consummation,  or (iii)
affect  adversely.  the right of the Purchaser to own,  operate,  or control the
Assets (and no such judgment, order decree,  stipulation,  injunction, or charge
shall be in effect);  (e) Seller shall have delivered to Purchaser a certificate
(without  qualification  as to knowledge or  materiality  or  otherwise)  to the
effect that each of the conditions  specified above in Section 7.1(a)-(d),  (g),
and (k)-(m) is satisfied in all respects;  (f) Purchaser shall have received all
other  authorizations,  consents,  and approvals of governments and governmental
agencies set forth in this Agreement;  (g) all actions and approvals to be taken
by  Seller,  Shareholder  or  Telos  in  connection  with  consummation  of  the
transactions   contemplated   hereby   (including   approval   of   Seller's  or
Shareholder's  or Telos'  stockholders if required by law or by their respective
articles  of   incorporation   or  bylaws)  and  all   certificates,   opinions,
instruments,   and  other   documents   required  to  effect  the   transactions
contemplated hereby will be satisfactory in form and substance to Purchaser; (h)
Purchaser  shall have received  from Seller all necessary  documents to evidence
Seller's  release of the  persons  listed on Schedule  16.2(B)  from any and all
obligations  regarding  confidentiality,  non-disclosure,  non-solicitation  and
non-competition;  (i)  Purchaser  shall have  received  from  counsel to Seller,
Shareholder  and Telos an  opinion  in such  form as  Purchaser  may  reasonably
request;  (j) Purchaser shall have received from Seller its Financial Statements
specified in Section 4.3 hereof; (k) [Intentionally  Deleted];  (l) Since August
31, 1999, except as permitted by this Agreement,  Seller shall not have made any
distribution  or dividend  (other than the cash of the Business),  consulting or
other payment from the income generated by the Business to Seller or to Seller's
employees,  except for employment  salaries (not to exceed current  compensation
levels);  (m) Seller shall not have  experienced any material  adverse change in
the Business;  (n) Purchaser  shall have  received from Telos,  Shareholder  and
Seller an  executed  Corporate  Administrative  Services  Agreement  in form and
substance to be mutually agreed upon by Purchaser and Telos; (o) Purchaser shall
have received  from Telos,  Shareholder  and Seller an executed GSA  Subcontract
Agreement  in form and  substance to be mutually  agreed upon by  Purchaser  and
Telos;  (p) Purchaser shall have received from Telos,  Shareholder and Seller an
executed  Repair/Maintenance  Subcontract  Agreement in form and substance to be
mutually  agreed upon by Purchaser and Telos;  (q) Purchaser shall have received
from Telos,  Shareholder and Seller an executed Commercial Subcontract Agreement
in form and  substance to be mutually  agreed upon by Purchaser  and Telos;  (r)
Purchaser  shall have  received from Telos,  Shareholder  and Seller an executed
Government  Subcontract  Agreement in form and  substance to be mutually  agreed
upon by Purchaser  and Telos;  (s)  Purchaser  shall have  received  from Telos,
Shareholder and Seller an executed GSA Distribution  Point Agreement in form and
substance to be mutually agreed upon by Purchaser and Telos; (t) Purchaser shall
have  received  from  Telos,  Shareholder  and  Seller  an  executed  Help  Desk
Subcontract  Agreement  in form and  substance  to be  mutually  agreed  upon by
Purchaser and Telos; (u) Purchaser shall have entered into employment agreements
satisfactory  in form and substance to Purchaser with certain  senior  operating
management personnel of Seller, as selected by Purchaser in its sole discretion;
(v) Purchaser  shall be satisfied that Seller,  Shareholder  and Telos have made
appropriate  arrangements  concerning  their lockbox  account to separate  their
receivables  from  receivables  of  Purchaser  after  the  Closing.  Receivables
received by Telos,  Shareholder  or Seller for any contracts not yet assumed by,
or subcontracted  or novated to,  Purchaser,  shall be immediately  transferred,
within  twenty-four  (24) hours,  from Telos',  Shareholder's  or Seller's  bank
account  directly to Purchaser's  designated  lockbox or account.  For contracts
that are subcontracted to Purchaser, Telos shall, within three (3) business days
after the Closing Date,  send out the  appropriate  applications or forms to the
appropriate  billing  customers  to  modify  the  billing  instructions  of such
contracts  to allow for direct  payment  to  Purchaser's  designated  lockbox or
account;  (w)  Shareholder  and Telos  shall  have  received  and  delivered  to
Purchaser, for the benefit of Purchaser, an executed release and waiver, in form
and substance satisfactory to Purchaser, under that certain Amended and Restated
Credit  Agreement  dated as of July 1,  1997  (the  "credit  agreement"),  among
Shareholder,  Telos,  and Bank of America,  N.A. (as  successor to  NationsBank,
N.A., which was Successor to American Security Bank, N.a.) (The "Bank"), whereby
the bank  releases  all of the  assets  from all of the bank's  liens,  security
interests,  and  other  encumbrances  which  may cover  the  assets  (the  "bank
release").  the bank release shall be, at the closing, in full force and effect,
and neither Seller, Shareholder nor Telos shall take any action, or fail to take
any action, which would violate or breach the Bank Release.

     Purchaser  may  waive  any  condition  specified  in this  Section  7 if it
executes a writing so stating at or prior to the Closing.

     7.2  CONDITIONS  TO  OBLIGATIONS  OF SELLER,  SHAREHOLDER  AND  TELOS.  The
obligations of Seller,  Shareholder and Telos to consummate the  transactions to
be performed by it in connection with the Closing are subject to satisfaction of
the following conditions:

     (a) the  representations  and warranties set forth in Section 5 above shall
be true and correct in all material respects at and as of the Closing Date;

     (b) Purchaser  shall have  performed and complied with all of its covenants
hereunder in all material respects through the Closing;

     (c) no action,  suit,  or proceeding  shall be pending  before any court or
quasi-judicial or administrative agency of any federal, state, local, or foreign
jurisdiction  wherein  an  unfavorable  judgment,  order,  decree,   stipulation
injunction,  or charge would (i) prevent consummation of any of the transactions
contemplated  by  this  Agreement,   or  (ii)  cause  any  of  the  transactions
contemplated by this Agreement to be rescinded  following  consummation  (and no
such judgment, order, decree, stipulation, injunction, or charge shall be in
effect);

     (d) Purchaser  shall have delivered to Seller and Shareholder a certificate
(without  qualification  as to knowledge or  materiality  or  otherwise)  to the
effect that each of the  conditions  specified  above in Section  7.2(a)-(c)  is
satisfied in all respects;

     (e) Seller shall have  obtained the approval of its Board of Directors  for
the transactions contemplated by this Agreement; and

     (f) Seller shall have received from counsel to Purchaser an opinion in such
form as Seller may reasonably request.

     Seller or Shareholder  may waive any condition  specified in this Section 7
if it executes a writing so stating at or prior to the Closing.

     7A. ALLOCATION OF TAX LIABILITIES AND INCOME

     7A.1 LIABILITY FOR TAXES. (a) Seller, Shareholder and Telos shall be liable
for and pay, and pursuant to Article 11 (and subject to the limitations thereof)
shall indemnify and hold harmless Purchaser from and against, all Taxes (whether
assessed or  unassessed)  applicable to the Business,  the Assets or the Assumed
Liabilities  and  Obligations,  in each case  attributable  to  Pre-Closing  Tax
Periods.

     (b)  Purchaser  shall be liable for and pay, and shall  indemnify  and hold
harmless Seller against,  all Taxes (whether assessed or unassessed)  applicable
to the Business, the Assets or the Assumed Liabilities and Obligations,  in each
case  attributable to  Post-Closing  Tax Periods.  Except as otherwise  provided
herein,  Purchaser  shall be  entitled  to any refund of (or  credit  for) Taxes
attributable to Post-Closing Tax Periods.

     7A.2 ALLOCATION OF TAXABLE  INCOME.  FOR PURPOSES OF SECTION 7A(A) AND (B),
whenever it is necessary to determine the liability  for Taxes  attributable  to
Pre-Closing Tax Periods, on one hand, and Post-Closing Tax Periods, on the other
hand,  such  determination  shall be made on a "closing  of the books  basis" by
assuming that the relevant books were closed at 11:59 p.m. on the day before the
day  on  which  the  closing  actually  occurs;  provided,   however,  that  (i)
transactions occurring on the date on which the closing actually occurs that are
properly  allocable  (based on, among other  relevant  factors,  the factors set
forth in treasury regulation ss.  1.1502-76(b)(1)(ii)(b))  to the portion of the
date on which the Closing actually  occurs,  but before the time of the Closing,
shall be allocated to Pre-Closing Tax Periods.

     8. TERMINATION.

     8.1  TERMINATION  OF AGREEMENT.  Certain of the parties may terminate  this
Agreement as provided below:

     (a) Purchaser,  Seller,  Shareholder and Telos may terminate this Agreement
by mutual written consent at any time prior to the Closing;

     (b) Purchaser  may terminate  this  Agreement by giving  written  notice to
Seller at any time prior to the  Closing if Seller,  Shareholder  or Telos is in
material breach of this Agreement;

     (c) Seller,  Shareholder  or Telos may terminate  this  Agreement by giving
written  notice to  Purchaser  at any time prior to the  Closing if the  Closing
shall  not have  occurred  on or before  September  30,  1999,  by reason of the
failure of any condition  precedent  under Section 7 hereof  (unless the failure
results   primarily   from   Seller,   Shareholder   or  Telos   breaching   any
representation, warranty, or covenant contained in this Agreement);

     (d)  Purchaser  shall  have  the  right in its good  faith  discretion,  to
terminate  this  Agreement at any time prior to Closing if any material  adverse
change in the Business or Assets occurs or if any  information  is  subsequently
disclosed in the Schedules to be delivered by Seller hereunder after the date of
execution of this Agreement which information may reasonably be expected to have
a material  adverse  effect on the  Business  or the Assets  following  the date
hereof.

     8.2 EFFECT OF TERMINATION.  If any party terminates this Agreement pursuant
to Section  8.1 above,  then all  obligations  of the  parties  hereunder  shall
terminate  without any liability of any party to any other party (except for any
liability of any party then in breach of this Agreement).

     9. NATURE OF STATEMENTS OF  INDEMNIFICATIONS,  GUARANTEES,  REPRESENTATIONS
AND  WARRANTIES  OF  TELOS,  SELLER  AND  SHAREHOLDER.  All  statements  of fact
contained in this  Agreement or in any written  statement  (including  financial
statements),  certificate,  schedule or other document delivered by or on behalf
of Telos, Seller or Shareholder pursuant to this Agreement or in connection with
the  transactions  contemplated  hereby  shall  be  deemed  representations  and
warranties of Telos, Seller and Shareholder hereunder.

     10. SPECIAL CLOSING AND POST-CLOSING COVENANTS.

     10.1 DELIVERY OF FUNDS AND OTHER ASSETS  COLLECTED BY  PURCHASER;  POWER OF
ATTORNEY.  To the extent Purchaser receives any funds or other assets in payment
of  receivables  for  work-in-process  incurred prior to the Closing Date or the
other Excluded Assets,  then Purchaser shall immediately  deliver such funds and
assets to Seller  and take all steps  necessary  to vest title to such funds and
assets in Seller.  Purchaser  hereby  designates  Seller as Purchaser's true and
lawful attorney-in-fact,  with full power of substitution, to execute or endorse
for the  benefit of Seller any  checks,  notes or other  documents  received  by
Purchaser in payment of or in  substitution  or exchange for any of the Excluded
Assets.  Purchaser hereby acknowledges and agrees that the power of attorney set
forth in the preceding sentence is coupled with an interest,  and further agrees
to execute and deliver to Seller from time to time any documents or  instruments
reasonably requested by Seller to evidence such power of attorney.

     10.2 DELIVERY OF FUNDS AND OTHER ASSETS COLLECTED BY SELLER, SHAREHOLDER OR
TELOS;  POWER OF ATTORNEY.  To the extent Seller,  Shareholder or Telos receives
any funds or other assets in payment of receivables or work-in-process  incurred
on or after the Closing Date, or in connection  with any other Assets being sold
to Purchaser  hereto,  each of Seller,  Shareholder and Telos shall  immediately
deliver such funds and assets to Purchaser and take all steps  necessary to vest
title to such funds and assets in  Purchaser.  Each of Seller,  Shareholder  and
Telos  hereby  designates  Purchaser  and its  officers  as its true and  lawful
attorney-in-fact, with full power of substitution, to execute or endorse for the
benefit of Purchaser any checks,  notes or other documents received by Seller or
Stockholder or Telos in payment of or in substitution or exchange for any of the
Assets.  Seller  hereby  acknowledges  and agrees that the power of attorney set
forth in the preceding sentence is coupled with an interest,  and further agrees
to  execute  and  deliver  to  Purchaser  from  time to time  any  documents  or
instruments  reasonably  requested  by  Purchaser  to  evidence  such  power  of
attorney.

     10.3 CONSENTS OF THIRD PARTIES.

     (A) LANDLORDS.  Within sixty (60) days following the Closing,  Seller shall
have used its best efforts to obtain  consents from all lessors of real property
leased by Seller to the  assignment  of such  leases to  Purchaser  without  any
amendment, modification or change in the terms of any of such leases.

     (B) CUSTOMERS.  Seller,  Shareholder and Telos shall use their best efforts
to obtain, as soon as is practicable, a consent to assignment or novation of all
of the  contracts  comprising  part  of the  Assets  to  Purchaser  without  any
amendment, modification or change in the terms of such contracts.

     10.4 USE OF TELOS  NAME.  For a period  of two (2) years  from the  Closing
Date,  Purchaser  shall have an exclusive  license to use the names "Telos Field
Engineering" and "TFE" in the operation of the Business post-Closing, including,
without  limitation,  the use of such names on, in or  relating  to  letterhead,
invoices, business cards, marketing materials,  advertisements,  press RELEASES,
PACKAGING MATERIALS,  AND VERBAL  COMMUNICATIONS;  PROVIDED,  HOWEVER, that such
license does not include the use of the name "Telos" by itself or in  connection
with any other words other than expressly set forth above.

     10.5 TAXES.

         (A) TAX RETURN  FILINGS.  Seller shall timely prepare and file with the
     relevant  Taxing  Authorities  all Tax  Returns  of Seller the due date for
filing of which, determined taking into account extensions, is after the Closing
Date. Seller shall timely prepare and file with the relevant Taxing  Authorities
all Tax  Returns  for any  taxable  periods of Seller the due date for filing of
which,  determined taking into account  extensions,  is on or before the Closing
Date. Any Tax Returns described in the preceding sentence shall be prepared on a
basis  consistent  with the past  practices of Seller.  Seller  shall  reimburse
Purchaser (in  accordance  with Section 11.6) for any amount owed by Seller with
respect to the taxable periods covered by such Tax Returns.  All Tax Returns for
a taxable period including the Closing Date shall be filed on the basis that the
relevant  taxable  period ended as of the close of business on the Closing Date,
unless the relevant Taxing Authority will not accept such a Tax Return.

     (B) STRADDLE PERIODS.  In the case of any taxable period that includes (but
does not end on) the Closing Date (a "Straddle Period"):  (I) Real, Personal and
Intangible  Property Taxes ("Property  Taxes") of Seller for the Pre-closing Tax
Period shall equal the Property Taxes for such Period  multiplied by a fraction,
the numerator of which is the number of days during the Straddle Period that are
in the Pre-Closing Tax Period and the denominator of which is the number of days
in the Straddle Period; and (ii) the Taxes of Seller (other than Property Taxes)
for the  Pre-Closing  Tax Period  shall be  computed  as if the entire  Straddle
Period ended as of the close of business on the day before the Closing Date.

     (C) COOPERATION. Seller and Purchaser shall reasonably cooperate, and shall
cause their respective affiliates,  officers,  employees,  agents,  auditors and
representatives  reasonably  to  cooperate,  in  preparing  and  filing  all Tax
Returns,  including  maintaining and making  available to each other all records
necessary in  connection  with Taxes,  and in resolving  all disputes and audits
with respect to all taxable periods relating to Taxes,  including all Tax Claims
(as defined below).

     (D)  REFUNDS AND  CREDITS.  Any refund or credit of Taxes of Seller for any
taxable  period  ending  before the  Closing  Date  shall be for the  account of
Seller.  Notwithstanding the foregoing, however, any such refund or credit shall
be for the account of  Purchaser  to the extent that such refunds or credits are
attributable   (determined  on  a  marginal  basis)  to  the  carryback  from  a
Post-Closing  Tax Period (or the portion of a Straddle Period that begins on the
Closing  Date) of items of loss,  deductions or other Tax items of Purchaser (or
any of its  affiliates).  Any  refund or credit  of Taxes of  Purchaser  for any
Post-Closing  Tax Period  shall be for the account of  Purchaser.  Any refund or
credit  of  Taxes of  Purchaser  for any  Straddle  Period  shall  be  equitably
apportioned  between Seller and Purchaser.  Each party shall, or shall cause its
affiliates to, forward to any other party entitled under this Section 10.5(d) to
any refund or credit of Taxes any such  refund  within 10 days after such refund
is received  or  reimburse  such other party for any such credit  within 10 days
after the credit is allowed or applied  against other tax  liability;  provided,
however,  that any such  amounts  shall be net of any tax cost or benefit to the
payor party  attributable  to the  receipt of such refund  and/or the payment of
such amounts to the payee party.  Notwithstanding the foregoing,  the control of
the  prosecution  of a claim for refund of Taxes paid  pursuant to a  deficiency
assessed  subsequent  to the  Closing  Date as a  result  of an  audit  shall be
governed by the provisions of Section 10.5(e).

     (E) PROCEDURES RELATING TO INDEMNIFICATION OF TAX CLAIMS.

     (I) NOTICE.  If a claim shall be made by any Taxing  Authority,  which,  if
successful,  might result in an indemnity  payment to any  Purchaser  Indemnitee
pursuant to Section 11, Purchaser shall promptly notify Seller or Shareholder in
writing OF SUCH CLAIM (A "TAX CLAIM").  Failure to give notice of a Tax Claim to
Seller or  Shareholder  within a  sufficient  period  of time and in  reasonably
sufficient  detail to allow Seller to  effectively  contest such Tax Claim shall
affect the  liability of Seller to any Purchaser  Indemnitee  only to the extent
that  Seller's  position  is  actually  and  materially  prejudiced  as a result
thereof.

     (II) CONTROL OF PROCEEDINGS.  Seller shall control all proceedings taken in
connection  with  any Tax  Claim  relating  solely  to  Taxes  of  Seller  for a
Pre-Closing  Tax Period,  and may make all decisions in connection with such Tax
Claim.  Seller and Purchaser  shall  jointly  control all  proceedings  taken in
connection  with any Tax Claim relating solely to Taxes of Seller for a Straddle
Period,  and neither  party shall settle any such Tax Claim  without the written
consent of the other party. Purchaser shall control all proceedings with respect
to all other Tax Claims.

     10.6  PERFORMANCE  BONDS.  As  to  contracts  which  are  subcontracted  to
Purchaser  at the  Closing,  Purchaser  agrees to pay  Seller's  premiums on the
outstanding  performance  bonds related to such  subcontracted  contracts  until
Purchaser replaces such bonds within thirty (30) days after the Closing Date. As
to  contracts  not  assigned  or  subcontracted  to  Purchaser  at the  Closing,
Purchaser  agrees to pay Seller's premium on the outstanding  performance  bonds
until  Purchaser  replaces  such  performance  bonds at the  time at which  such
contracts are assigned to Purchaser. If such bonds are not replaced by Purchaser
within a thirty (30) day period for contracts which have been  subcontracted  to
Purchaser  at the  Closing  or within the  period to assign  the  contracts  not
subcontracted to Purchaser at the Closing,  then Purchaser agrees to establish a
cash escrow for the amount of such performance  bonds of Seller then outstanding
and shall allow Seller to draw the respective funds from such escrow.

     11. INDEMNITY BY SELLER, SHAREHOLDER AND TELOS.

     11.1  INDEMNITY.   SELLER,   SHAREHOLDER  AND  TELOS   (collectively,   the
"indemnifying  parties") shall and hereby do, jointly and severally,  indemnify,
hold  harmless  and  defend  purchaser,   its  affiliates  and  their  officers,
directors,  shareholders,  employees,  agents,  representatives  and consultants
(collectively,  the "indemnified  parties") at all times from and after the date
of this  agreement,  from and against any and all penalties,  demands,  damages,
punitive damages, losses, loss of profits,  liabilities,  suits, costs, costs of
any  settlement  or judgment,  claims of any and every kind  whatsoever,  refund
obligations  (including,  without  limitation,  interest and penalties thereon),
remediation  costs  and  expenses  (including,  without  limitation,  reasonable
attorneys' fees), of or to any of the indemnified parties ("damages"), which may
now or in the future be paid,  incurred or  suffered by or asserted  against the
Indemnified  Parties by any Person  resulting  or arising  from or  incurred  in
connection with any one or more of the following  (provided that this Section 11
shall not apply to any items that have been expressly assumed by Purchaser under
this Agreement):

     (a) any liability (whether in contract,  in tort or otherwise,  and whether
or not successful) of or against Seller,  Shareholder or Telos or related in any
way to the Business or Assets of any of them (including any liability of Seller,
Shareholder or Telos under all ERISA laws);

     (b) any liability (whether in contract,  in tort or otherwise,  and whether
or not  successful)  related  in any way to the  Assets or the  Business  to the
extent such liability  arises in connection  with any action,  omission or event
occurring on or prior to the Closing Date;

     (c) any liability (whether in contract,  in tort or otherwise,  and whether
or not  successful)  related to any liens,  obligations or  encumbrances  of any
nature  whatsoever  against or in any way related to the Assets or the  Business
which have not been expressly assumed by the Purchaser hereunder;

     (D) (I) ALL  LIABILITY  FOR  TAXES of Seller  and each  Seller  Group  with
respect to any  Pre-Closing  Tax Period,  (ii) all  liability  for Taxes of such
Seller or any other  corporation  which is or has ever been affiliated with such
Seller or with whom Seller otherwise  joins, has ever joined,  or is or has ever
been required to join in filing any consolidated, combined or unitary Tax Return
prior to the Closing Date, (iii) all liability for Taxes of Seller or any Seller
Group arising  (directly or indirectly) as a result of the sale of the Assets or
the  other   transactions   contemplated   hereby,   (iv)  any   breach  of  any
representation  or warranty  contained in Section 4, and (v) all  liability  for
reasonable  legal fees and expenses  attributable  to any item in the  foregoing
clauses.

     (e) any  liability  (whether or not  successful)  related to any lawsuit or
threatened  lawsuit or claim involving Seller,  Shareholder or Telos,  Including
But Not Limited To, Those Items Listed On Schedule 4.12 Hereto;

     (f) any  misrepresentation,  breach of warranty or  non-fulfillment  of any
covenant or  agreement  on the part of Seller,  Shareholder  or Telos under this
Agreement or from any  misrepresentation in or omission from any list, schedule,
certificate  or other  instrument  furnished  or to be  furnished  to  Purchaser
pursuant to the terms of this Agreement;

     (g) all actions, suits,  proceedings,  demands,  assessments,  adjustments,
costs and expenses (including costs of court and reasonable  attorneys' fees and
expenses) incident to any of the foregoing.

     11.2 AMOUNT OF LOSS.  The amount of any Loss for which  indemnification  is
provided  under this Article 11 shall be net of any amounts  recoverable  by the
indemnified  party under insurance  policies with respect to such Loss and shall
be (i)  increased to take account of any net Tax cost to the  indemnified  party
arising from the receipt of indemnity  payments  hereunder  (grossed up for such
increase),  and (ii) reduced to take account of any net Tax benefit  realized by
the  indemnified  party arising from the incurrence or payment of any such Loss.
Any indemnity  payment under this Agreement shall be treated as an adjustment to
the Purchase Price for Tax purposes,  unless a final determination  (which shall
include the  execution  of a Form 870AD or  successor  form) with respect to the
indemnified  party or any of its  affiliates  causes any such  payment not to be
treated as an adjustment to the Purchase  Price for United States Federal income
tax purposes.

     11.3 LIMITATION OF CERTAIN LIABILITY. To the extent the Indemnified Parties
incur or suffer  Damages  for any matter for which  Seller and  Shareholder  and
Telos are  obligated to  indemnify,  hold  harmless and defend  Purchaser  under
Section 11.1(f) above,  Seller and Shareholder  shall not be liable for any such
Damages  until  Purchaser  has suffered  aggregate  losses by reason of all such
misrepresentations, breaches of warranty and/or non-fulfillments of covenants or
agreements  on the part of Seller and/or  Shareholder  And/or Telos in Excess of
$150,000.00; Provided, However, That the Limitation Set Forth Above Specifically
Shall Not Apply to Damages (Y) Resulting  From or  Attributable  to  Intentional
fraud or any willful misconduct by Seller,  Shareholder or Telos, or (z) for any
matter or matters (other than those set out in Section  11.1(f) above) for which
Seller, Shareholder or Telos is obligated to indemnify, hold harmless and defend
Purchaser.  The  provisions  of this Section  11.3 will  terminate on the second
anniversary of the Closing Date, except for Damages relating to any Taxes, which
shall  not  terminate  until  the  expiration  of  the  applicable   statute  of
limitations.

         11.4 NOTICE OF CLAIM. Purchaser agrees that upon its discovery of facts
     giving  rise  to a  claim  for  indemnity  under  the  provisions  of  this
Agreement,  including  receipt by it or any  Indemnified  Party of notice of any
demand,  assertion,  claim, action or proceeding,  judicial or otherwise, by any
person with respect to any matter as to which any of the Indemnified Parties are
entiTled to Indemnity Under the Provisions of This Agreement (Such Actions Being
Collectively Referred to in This Section 11 as the "Claim"), Purchaser Will Give
Prompt Notice Thereof in Writing to Telos; Provided,  However, That Any delay in
giving or failure to give such notice shall not limit the rights of Purchaser or
any  Indemnified  Party to  indemnity  hereunder,  and  Purchaser  shall have no
liability for such delay or failure, except to the extent that Telos is shown to
have been materially damaged by such delay or failure.

     11.5 RIGHT TO DEFEND. Any Indemnifying Party shall be entitled, at its sole
cost and expense, to contest and defend by all appropriate legal proceedings any
Claim  with  respect  to which any such  indemnifying  party is  called  upon to
indemnify any of the indemnified parties under the provisions of this agreement;
provided, however, that notice of the intention so to contest shall be delivered
by such  indemnifying  party to  purchaser  within  twenty  (20)  days  from the
effective  date of notice to telos by purchaser  of the  assertion of the claim;
and provided further, however, that such right to contest and defend shall exist
only if such  Indemnifying  Party have (i) admitted in writing to Purchaser  the
obligation of such Indemnifying Party to pay the indemnified  obligations to the
Indemnified  Parties  with  respect to the  Claim,  and (ii) have  provided  the
Indemnified  Parties  with  satisfactory  evidence  of it's  ability  to pay any
indemnity obligation that reasonably may arise under the Claim. Any such contest
may be conducted in the name and on behalf of  Purchaser.  Such contest shall be
conducted  by  reputable  attorneys  employed  by such  Indemnifying  Party  and
reasonably  acceptable  to  Purchaser,  but  Purchaser  shall  have the right to
participate  in such  proceedings  and to be represented by attorneys of its own
choosing at its cost and expense.  If, after such opportunity,  any Indemnifying
Party have not  satisfied  all  requirements  for the contest of a claim by them
(i.e.,  timely election,  admission of liability and proof of ability  regarding
payment),  then such Indemnifying  Party shall (i) at their expense,  except for
travel expenses requested to be incurred by Purchaser, reasonably cooperate with
Purchaser with respect to defense of the Claim,  and (ii) be bound by the result
obtained  with  respect  to the  Claim  by  Purchaser.  At any  time  after  the
commencement  of defense  of any  Claim,  such  Indemnifying  Party may  request
Purchaser to accept a bona fide offer from the other  parties to the Claim for a
cash  settlement  payable solely from such  Indemnifying  Party (which places no
burdens  or  restrictions   on  Purchaser  and  does  not  otherwise   prejudice
Purchaser),  whereupon  such action shall be taken unless  Purchaser  determines
that the contest should be continued, and so notifies such Indemnifying Party in
writing within fifteen (15) days of such request from such  Indemnifying  Party.
In the  event  that,  after  such a  request  by  such  Indemnifying  Party  for
acceptance of a bona fide cash settlement offer,  Purchaser  determines that the
contest  should be  continued,  such  Indemnifying  Party  shall be  liable  for
indemnity hereunder only to the extent of the lesser of (i) the amount which the
other party to the contested  Claim had agreed to accept in settlement as of the
time the such  Indemnifying  Party made its request  therefore to Purchaser,  or
(ii) such amount for which such Indemnifying Party may be liable with respect to
such Claim by reason of the provisions hereof.

     11.6  COOPERATION  BY PURCHASER.  If requested by any  Indemnifying  Party,
Purchaser and its officers and employees  shall  reasonably  cooperate with such
Indemnifying Party and its counsel in contesting any Claim with respect to which
such Indemnifying Party Have Satisfied All Requirements for a Contest by Them as
Set Forth in Section 12 Above;  Provided,  However, That Such Indemnifying Party
shall reimburse Purchaser for any actual  out-of-pocket  expenses incurred by it
in so cooperating.

     11.7 PAYMENT.  The Indemnifying  Parties shall promptly pay to Purchaser or
such other Indemnified  Party as may be entitled to indemnity  hereunder in cash
the  amount of any  Damages to which  Purchaser  or such  Indemnified  Party may
become entitled by reason of the provisions of this Agreement.

     12. LEASE AGREEMENT. Purchaser shall assume the leases for the office space
currently  used by Seller in  connection  with the operation of the business and
that are listed on schedule 12 hereto.  Purchaser  will, from and after Closing,
hold harmless Seller from any liability thereunder accruing after Closing.

     13. NON-COMPETITION  AGREEMENT.  As part of the inducement for Purchaser to
enter into this  Agreement and for the payment of the Purchase Price as provided
by Section 3.1, the parties  hereby agree to the  provisions of this Section 13.
For a period  commencing on the date hereof through the third anniversary of the
Closing Date,  neither Seller nor  Shareholder  nor Telos,  shall (i) within the
territorial  boundaries of the United  States,  compete  directly with Purchaser
insofar as the Assets,  Business  and  transactions  contemplated  hereby,  (ii)
solicit  directly  any of the  accounts  of Seller  regarding  the Assets or the
Business,  or (iii) solicit for employment by Seller or Shareholder or Telos any
of the employees of the Business.  Each of Seller,  Shareholder and Telos agrees
that the limitations  set forth herein on the rights of Seller,  Shareholder and
Telos to compete with  Purchaser are reasonable and necessary for the protection
of Purchaser.  In that regard, Seller,  Shareholder and Telos specifically agree
that the  limitations as to period of time and  geographic  area, as well as all
other  restrictions  on its  activities  specified  herein,  are  reasonable and
necessary for the protection of the  Purchaser.  Seller,  Shareholder  and Telos
each  further  recognize  and  agree  that  violation  of any of the  agreements
contained  in this  Section  13 will  cause  irreparable  damage  or  injury  to
Purchaser,  the exact amount of which may be impossible to ascertain,  and that,
for such reason,  among others,  Purchaser  shall be entitled to an  injunction,
without  the  necessity  of  posting a bond,  regarding  any  violation  of such
agreements.  Such rights to any  injunction  shall be in addition to, and not in
limitation of, any other rights and remedies  Purchaser may have against Seller,
Shareholder  or Telos,  including,  but not limited to, the recovery of damages.
Further,  it is agreed by  Seller,  Shareholder  and Telos that in the event the
provisions  of this  Agreement  should  ever be deemed  by a court of  competent
jurisdiction to exceed the geographic  limitations  permitted by applicable law,
then the  provisions  shall be reformed to the  maximum  geographic  limitations
permitted. Notwithstanding the foregoing, Purchaser recognizes and hereby agrees
that any of Telos, Shareholder or Seller engaging in the activities described ON
SCHEDULE 13 hereto  shall not be deemed to be a violation of the  provisions  of
this Section 13.

     14.  NONDISCLOSURE  OF CONFIDENTIAL  INFORMATION.  Seller,  Shareholder and
Telos  each  recognizes  and  acknowledges  that it has and will have  access to
certain  confidential  information  of Seller  that is  included  in the  Assets
(including,  but not  limited  to, list of  customers,  and costs and  financial
information) that after the consummation of the transactions contemplated hereby
will be valuable, special and unique property of Purchaser.  Seller, Shareholder
and Telos each agree that it will not disclose, and it will use its best efforts
to prevent disclosure by any other Person of, any such confidential  information
to any  Person,  except to  authorized  representatives  of  Purchaser.  Seller,
Shareholder  and Telos each recognize and agree that the violation of any of the
agreements  contained in this Section 14 will cause irreparable damage or injury
to Purchaser,  the exact amount of which may be  impossible  to  ascertain,  and
that,  for  such  reason,  among  others,  Purchaser  shall  be  entitled  to an
injunction,  without the necessity of posting bond,  therefore,  restraining any
violation of such agreements. Such rights to any injunction shall be in addition
to, and not in limitation  of, any other rights and remedies  Purchaser may have
against Seller, Shareholder or Telos.

     15.  ASSIGNMENT OF CONTRACTS.  Notwithstanding  any other provision of this
Agreement,  neither this  Agreement nor any document  entered into in connection
with this Agreement or the transactions  contemplated  hereby shall be construed
as an  attempt to assign (i) any  contract  which,  as a matter of law or by its
terms, is non-assignable without the consent of the other parties thereto unless
such  consent has been given,  or (ii) any contract or claims as to which all of
the  remedies  for the  enforcement  thereof  enjoyed by Seller  would not, as a
matter of law or by its terms, pass to Purchaser as an incident of the transfers
and assignments to be made under this  Agreement.  In order,  however,  that the
full value of every contract and claim of the character described in clauses (i)
and (ii) above and all claims and demands on such  contracts may be realized for
the benefit of  Purchaser,  Seller,  at its expense and at the request and under
the  direction  of  Purchaser,  shall take all such action and do or cause to be
done all such  things as will,  in the opinion of  Purchaser,  be  necessary  or
proper in order  that the  obligations  of Seller  under such  contracts  may be
performed in such manner that the value of such  contract  will be preserved and
will  inure to the  benefit  of  Purchaser,  and  for,  and to  facilitate,  the
collection  of the  monies  due  and  payable  and to  become  due  and  payable
thereunder  to  Purchaser in and under every such  contract  and claim  incurred
after the  Closing.  Seller  shall  promptly  pay over to  Purchaser  all monies
collected by or paid to it in respect of every such contract, claim or demand to
the extent  such  monies are  earned or  accrued  by  Purchaser  on or after the
Closing Date.  Nothing in this Section 15 shall relieve  Seller,  Shareholder or
Telos of their  obligation  to obtain,  as soon as is  practicable,  any and all
consents  required for the transfer of the Assets and all rights  thereunder  to
Purchaser,  or shall relieve Seller,  Shareholder or Telos from any liability to
Purchaser for failure to obtain such consents.

     16. SPECIAL PROVISIONS REGARDING EMPLOYEES OF SELLER.

     16.1 NEW  EMPLOYEES OF PURCHASER.  It is the  intention of  Purchaser,  and
Seller  hereby  acknowledges  and agrees with such  position,  that any Business
Employees  that  Purchaser  hires will be new  employees  of Purchaser as of the
Closing Date or the date of hire,  whichever is later.  Such new employees shall
be entitled only to such  compensation and employee benefits as are agreed to by
such employees and Purchaser,  or as are otherwise provided by Purchaser, in its
sole discretion.

     16.2 HIRING OF EMPLOYEES.

     (a) Purchaser will use its reasonable  efforts to hire the current Business
Employees  (other  than  temporary  employees)  as listed on  schedule  16.2(a);
provided,  however, that purchaser shall be entitled to review employee records,
conduct employee  interviews and perform such employee  screening  procedures as
Purchaser deems appropriate,  and may refuse to offer employment to any Business
Employee for any reason.

     (B) AS A CONDITION TO THEIR EMPLOYMENT BY PURCHASER, ALL BUSINESS EMPLOYEES
LISTED IN SCHEDULE  16.2(B) may be asked to execute and deliver to  Purchaser an
Employment  Agreement,  a  confidentiality   agreement,  and  a  non-competition
agreement, each in form and substance acceptable to Purchaser

     16.3  EXISTING   EMPLOYEE  BENEFIT  PLANS.  (a)  Purchaser  shall  have  no
obligation  to continue any employee  benefit  plans,  programs or  arrangements
currently  offered  by  Seller,   Shareholder  or  Telos  to  any  of  Seller's,
Shareholder's or Telos'  employees.  Telos agrees to indemnify and hold harmless
Purchaser  from and against any claim which may arise  because of the failure to
continue any such plans, programs or arrangements.

     (b)  Notwithstanding  (a), above, it is Purchaser's present intention that,
within a  reasonable  period  after the Closing  Date,  it shall  provide to the
Business Employees hired by it employee benefits that are substantially  similar
in the aggregate to the employee  benefits  provided to such Business  Employees
immediately prior to the Closing Date.
     16.4 INDEMNITY CONCERNING ACCRUED BENEFITS.  Except as expressly assumed by
Purchaser  hereunder  and as reflected in the Statement of Net Assets of Seller,
each of Seller,  Shareholder  and Telos jointly and severally agree to indemnify
and hold harmless Purchaser from and against any and all accrued and outstanding
employee  benefits,  salary,  vacation  pay,  bonuses,   commissions  and  other
emoluments of its past or present  employees and from any other employee related
matters or liabilities with respect to Seller's, Shareholder's or Telos' past or
present employees.

     17.  EXPENSES.  Whether  or not the  transactions  contemplated  hereby are
consummated,  Seller and  Shareholder  and Telos will pay all of their costs and
expenses  and  Purchaser  will pay all of its costs and  expenses,  in each case
incurred in connection  with the  preparation of and execution of this Agreement
and the consummation of the transactions contemplated hereby.

     18. FURTHER ACTIONS. From time to time, at the request of any party hereto;
the other  parties  hereto shall execute and deliver such  instruments  and take
such  action  as  may be  reasonably  requested  to  evidence  the  transactions
contemplated hereby.

     19.  NOTICES.  All  notices,  requests,  demands  and other  communications
required or  permitted  to be given  hereunder  shall be in writing and shall be
deemed to have been duly given if delivered  personally,  given by prepaid telex
or telegram, by courier, by facsimile or other similar instantaneous  electronic
transmission  device,  or by mailing  first class,  postage  prepaid,  certified
United States mail, return receipt requested, as follows:

                  (a)      If to Purchaser, at:

                           c/o Carr & Company, LLC
                           410 Park Avenue, Suite 840
                           New York, New York  10022
                           Attention:  Peter J. Carr
                           Facsimile No.:  (212) 688-1890

                           With a copy to:

                           Cadwalader, Wickersham & Taft
                           100 Maiden Lane
                           New York, New York  10038-4892
                           Attention:  A. Curtis Greer, Esq.
                           Facsimile No.:  (212) 504-6666

                  (b)      If to Seller, Shareholder or Telos, at:

                           Telos Corporation
                           19886 Ashburn Road
                           Ashburn, Virginia  20147

                           Attention:  William L. P. Brownley, Esq.
                           Facsimile No.:  (703) 724-3855

                           With a copy to:

                           John B. Connor, Esq.
                           John B. Connor, P.L.C.
                           1033 N. Fairfax Street, Suite 310
                           Alexandria, Virginia  22314
                           Facsimile No:  (703) 836-1799

provided  that any party may change its  address for notice by giving to each of
the other parties hereto  written notice of such change.  Any notice given under
this Section 19 shall be effective (i) if delivered personally,  when delivered,
(ii) if sent by telex or telegram or by facsimile or other similar instantaneous
electronic transmission device,  twenty-four (24) hours after sending, and (iii)
if sent by certified mail, forty-eight (48) hours after mailing.

     20. GENERAL PROVISIONS.

     20.1 Governing Law; Interpretation:  Section Headings. This Agreement Shall
be Governed by and  Construed  and Enforced in  Accordance  With the Laws of the
State of Delaware,  Without Regard to  Conflict-of-laws  Rules as Applied in the
State of Delaware.  the Section  Headings  Contained  Herein are for Purposes of
Convenience Only, and Shall Not be Deemed to Constitute a Part of This Agreement
or to Affect the Meaning or  Interpretation  of This  Agreement  in Any Way. Any
Action or Proceeding Arising Under This Agreement Shall Take Place in the United
States District Court in Delaware.

     The parties irrevocably and unconditionally  agree (i) to be subject to the
jurisdiction  of the courts of the State of Delaware  and of the federal  courts
sitting in the State of  Delaware,  and (ii) that service of process may also be
made on the parties by prepaid  certified  mail with a proof of mailing  receipt
validated by the United States  Postal  Service  constituting  evidence of valid
service,  and that service so made shall have the same legal force and effect as
if served upon such party personally within the State of Delaware.

     20.2  SEVERABILITY.   Should  any  provision  of  this  Agreement  be  held
unenforceable  or invalid  under the laws of the United States of America or the
State of Delaware, or under any other applicable laws of any other jurisdiction,
then the parties hereto agree that such provision  shall be deemed  modified for
purposes of  performance of this  Agreement in such  jurisdiction  to the extent
necessary to render it lawful and enforceable,  or if such a modification is not
possible without materially  altering the intention of the parties hereto,  then
such  provision  shall be severed here from for purposes of  performance of this
Agreement in such jurisdiction. The validity of the remaining provisions of this
Agreement shall not be affected by any such  modification  or severance,  except
that if any severance  materially alters the intentions of the parties hereto as
expressed  herein (a  modification  being permitted only if there is no material
alteration),  then the parties hereto shall use their best reasonable  effort to
agree to  appropriate  equitable  amendments to this  Agreement in light of such
severance, and if no such agreement can be reached within a reasonable time, any
party  hereto  may  initiate  arbitration  under the then  current  rules of the
American  Arbitration  Association  to  determine  and effect  such  appropriate
equitable amendments.

     20.3 ENTIRE  AGREEMENT.  This Agreement sets forth the entire agreement and
understanding   of  the  parties   hereto  with  respect  to  the   transactions
contemplated  hereby  and  supersedes  all prior  agreements,  arrangements  and
understandings related to the subject matter hereof. No representation, promise,
inducement  or statement of intention has been made by any party hereto which is
not embodied in this Agreement,  and no party hereto shall be bound by or liable
for any alleged  representation,  promise,  inducement or statement of intention
not so set forth.

     20.4 BINDING EFFECT. All the terms, provisions, covenants and conditions of
this  Agreement  shall be  binding  upon  and  inure  to the  benefit  of and be
enforceable  by the  parties  hereto  and  their  respective  heirs,  executors,
administrators, representatives, successors and assigns.

     20.5  ASSIGNMENT.  This  Agreement  and the rights and  obligations  of the
parties  hereto shall not be assigned or,  delegated by any party hereto without
the prior written consent of the other parties hereto.

     20.6 AMENDMENT; WAIVER. This Agreement may be amended, modified, superseded
or  canceled,  and any of the terms,  provisions,  representations,  warranties,
covenants  or  conditions  hereof  may be waived,  only by a written  instrument
executed  by all  parties  hereto,  or,  in the case of a  waiver,  by the party
waiving  compliance.  The  failure  of any  party at time or  times  to  require
performance  of any  provision  hereof  shall in no manner  affect  the right to
enforce  the same.  No waiver by any party of any  condition  contained  in this
Agreement, or of the breach of any term, provisions, representation, warranty or
covenant  contained in this Agreement,  in any one or more  instances,  shall be
deemed  to be or  construed  as a  further  or  continuing  waiver  of any  such
condition or breach,  or as a waiver of any other  condition or of the breach of
any other term, provision, representation, warranty or covenant.

     20.7 GENDER;  NUMBERS.  All  references in this Agreement to the masculine,
feminine or neuter genders shall,  where  appropriate,  be deemed to include all
other genders.  All plurals used in this Agreement shall, where appropriate,  be
deemed to be singular, and vice versa.

     20.8 COUNTERPARTS.  This Agreement may be executed simultaneously in two or
more counterparts,  each of which shall be deemed an original,  but all of which
together shall constitute one and the same  instrument.  This Agreement shall be
binding when one or more  counterparts  hereof,  individually or taken together,
shall  bear  the  signatures  of  each  of  the  parties   reflected  hereon  as
signatories.

     20.9  TELECOPY  EXECUTION  AND  DELIVERY.  A  facsimile,  telecopy or other
reproduction  of this  Agreement may be executed by one or more parties  hereto,
and an executed  copy of this  Agreement may be delivered by one or more parties
hereto by  facsimile or similar  instantaneous  electronic  transmission  device
pursuant to which the  signature of or on behalf of such party can be seen,  and
such execution and delivery shall be considered valid, binding and effective for
all purposes.  At the request of any party hereto,  all parties  hereto agree to
execute an  original of this  Agreement  as well as any  facsimile,  telecopy or
other reproduction hereof.

     (REMAINDER OF PAGE INTENTIONALLY LEFT BLANK - SIGNATURE PAGE FOLLOWS)


<PAGE>




         IN  WITNESS  WHEREOF,  each of the  parties  hereto has  executed  this
Agreement as of the date first above written.

                                                     TELOS:

                                                          TELOS CORPORATION,
                                                          a Maryland corporation

                            By: /s/ William L.P. Brownley
                            Name:_______________________________________________
                            Title: Vice President/General Counsel


                                                     SHAREHOLDER:

                                                     TELOS CORPORATION,

                                                        a California corporation




                                                     SELLER:

                         TELOS FIELD ENGINEERING, INC.,

                                                          a Delaware corporation

                            By: /s/ William L.P. Brownley
                            Name:_______________________________________________
                            Title: Vice President/General Counsel

                                                 PURCHASER:

                                            TFE TECHNOLOGY HOLDINGS, LLC
                                          a Delaware limited liability company
                             BY: TFE TECHNOLOGY, LLC

                                           a Delaware limited liability company
                                     Manager

                               By: /s/ Peter J. Carr
                               Name: Peter J. Carr
                               Title: Manager