THIS  NOTE HAS NOT BEEN  REGISTERED  UNDER  THE  SECURITIES  ACT OF 1933 OR
APPLICABLE  STATE  SECURITIES LAWS AND MAY NOT BE SOLD,  TRANSFERRED OR ASSIGNED
UNLESS IT IS SO REGISTERED OR AN EXEMPTION FROM  REGISTRATION IS AVAILABLE UNDER
SAID ACT AND LAWS.  THIS NOTE IS  SUBORDINATE  AND JUNIOR IN RIGHT OF PAYMENT TO
SENIOR  INDEBTEDNESS  DUE TO  NATIONSBANK,  N.A.  AND/OR  CERTAIN OTHER BANKS OR
FINANCIAL INSTITUTIONS.

                                                             Ashburn, Virginia
                                                             November 20, 1998


         SERIES D SENIOR SUBORDINATED UNSECURED NOTE DUE OCTOBER 1, 2000

     FOR VALUE RECEIVED, Telos Corporation, a Maryland corporation, with offices
at 19886 Ashburn Road, Ashburn,  Virginia 20147 (hereinafter referred to as "the
Borrower" or the "Company"),  promises to pay to the order of Foreign & Colonial
Enterprise Trust PLC,  (hereinafter referred to as "F&C Enterprise Trust PLC" or
"Lender"),  at c/o  Berkeley  Square  House,  Berkeley  Square,  London W1X 5PA,
England, or at such other offices or at such other place or places as the holder
hereof may from time to time  designate  in writing,  the  principal  sum of One
Million Four Hundred  Forty  Thousand  Dollars  ($1,440,000)  on October 1, 2000
together  with  interest  on the  principal  amount  hereof  from  time  to time
outstanding at the rate hereinafter provided until paid in full.

     This is one of a series of the Company's Notes known as its Series D Senior
Subordinated  Unsecured  Notes Due  October 1, 2000  (collectively  referred  to
herein as the "Series D Notes", all of like tenor,  except as to the identifying
number and principal amount thereof.  The Series D Notes have been issued in the
aggregate principal amount of $1,800,000.

                                I. GENERAL TERMS

     1.1 Interest  only shall be payable at the rate of fourteen  percent  (14%)
per annum, on the principal  balance of this Note from time to time  outstanding
from and after the date hereof,  and shall be due and payable  quarterly,  until
the principal has been paid in full, on the first day of April,  July,  October,
and January in each year.  Interest  shall accrue from the date hereof,  but the
first interest  payment shall not be due until April 1, 1999. Such payment shall
include  all  interest  accrued  from the  date  hereof  until  the date of such
interest payment.

     1.2 If not sooner paid, the outstanding and unpaid principal  balance shall
be paid on October 1, 2000,  together  with accrued and unpaid  interest on this
Note. In addition, interest shall be payable at the rate provided in Section 1.1
hereof on any Payment  Premium  from the date such  premium is due until paid in
full.

     1.3  Principal,  premium,  if any, and interest on this Note are payable in
lawful money of the United States.  The principal of this Note may be prepaid at
any time after ten (10) days' written notice to the Lender, in whole or in part,
and shall be accompanied  by payment in cash of all accrued and unpaid  interest
on the  amount so  prepaid,  together  with,  to the extent  not  prohibited  by
applicable law, a Payment Premium.

     1.4 In the event of a Public  Offering of the common  stock of the Company,
or in the event of a Refinancing,  the principal then  outstanding  shall become
immediately due and payable, together with, accrued and unpaid interest thereon,
and, to the extent not  prohibited  by applicable  law, a Payment  Premium in an
amount  equal to the lesser of (i) the Net  Proceeds of such Public  Offering or
Refinancing,  or (ii) the amount determined in accordance with 1.6(iv). The Net
Proceeds  shall be applied  toward the  payment  of the  outstanding  and unpaid
principal balance of the Notes,  accrued and unpaid interest thereon and, to the
extent not prohibited by applicable law, such Payment Premium.

     1.5 In the event of a Merger or Dissolution, the principal then outstanding
shall  become  immediately  due and  payable,  together  with accrued and unpaid
interest  thereon and, to the extent not prohibited by applicable law, a Payment
Premium in the amount determined in accordance with 1.6(iv).

    1.6      Definitions.

     (i) "Public Offering" shall mean the distribution and sale of the Company's
common stock (some of the  proceeds of which sale are  available to the Company)
pursuant to a registration  statement  (other than a  registration  statement on
Form S-4 or Form S-8) which has been filed with the U.S. Securities and Exchange
Commission and become effective.

     (ii)  "Refinancing"  shall mean a sale of  securities  of the Company which
results in Net Proceeds to the Company in excess of $10,000,000,  other than (a)
obligations  for  borrowed  money due and payable  within one year which are not
extended,  renewed or refinanced  beyond such due date; or (b) other obligations
for money borrowed money from NationsBank and/or its successors, substitutes and
participants and their respective assigns and any refinancing thereof.

     (iii) "Net Proceeds"  shall mean the proceeds to the Company after expenses
of sale and  distribution,  including  discounts,  commissions and brokerage and
legal fees.

     (iv) "Payment Premium" shall, except as otherwise provided in 1.4, mean an
amount equal to 13.5% per annum, compounded semiannually from and after the date
hereof until paid, on the principal amount of this Note outstanding from time to
time until the time of payment.

     (v) "Merger"  shall mean a merger,  consolidation  or other  combination to
which the Company or any subsidiary is a party,  in which the Company is not the
surviving  corporation  or  which  results  in the  acquisition  of  "beneficial
ownership" of securities  of the Company  representing  50% or more of the total
number of votes that may be cast for the  election of  directors by any "person"
or "group"  (as such  terms are  defined  in Rule  13(d)  promulgated  under the
Securities Exchange Act of 1934, as amended), or a sale by the Company of all or
substantially all of its assets.

     (vi) "Dissolution" shall mean the adoption by the Board of Directors and/or
the  shareholders  of the Company of a  resolution  to dissolve  the Company and
liquidate its assets,  the filing by the Company of articles of dissolution or a
similar application for dissolution with the appropriate officer of the state of
incorporation  of the  Company,  the  entry of an order or other  action by such
state  dissolving the Company,  or the adoption by the Board of Directors or the
shareholders of the Company of a plan of liquidation or a resolution approving a
liquidating distribution of the Company's assets, whichever shall first occur.

     1.7 At any time after the issuance of this Note,  the holders of a majority
in outstanding  principal  amount of the Series D Notes,  the Series C Notes and
the Series B Senior Secured Notes issued by the Company may request, in writing,
that the Company  effect a Public  Offering,  at the Company's cost and expense.
Upon  receipt of any such  request,  the  Company  shall,  as  expeditiously  as
possible,  use its best efforts to effect a Public Offering,  with the objective
of  realizing  Net Proceeds  sufficient  to pay the  then-outstanding  principal
balance  of the  Series D Notes,  the  Series  C Notes  and the  Series B Senior
Secured Notes together with accrued, unpaid interest thereon, and, to the extent
not prohibited by applicable law, a Payment  Premium in an amount  determined in
accordance with 1.4.

     1.8 If any payment of  principal  or interest on this Note shall become due
on a Saturday,  Sunday,  or legal holiday under the laws of the  Commonwealth of
Virginia,  or any other day on which banking institutions in the Commonwealth of
Virginia are obligated or authorized  by law or executive  order to close,  such
payment  shall be made on the next  succeeding  business day in Virginia and any
such  extended  time of the  payment  of  principal  shall  not be  included  in
computing compound interest in connection with such payment.

     1.9 Upon receipt by the Borrower of evidence reasonably  satisfactory to it
of the  mutilation,  destruction,  loss or theft of this Note, the Borrower will
make and  deliver  to the owner a new note of like tenor in lieu of this Note so
mutilated, destroyed, lost or stolen.

     1.10 Payments made on account  hereof shall be applied first to accrued and
unpaid interest, then to principal, and then to the Payment Premium, if any.

     1.11 All  payments  made by the Company on account of the Series D Notes or
any of them shall be made pro rata, in proportion to the  outstanding  principal
balance  of each of the  Series  D Notes  outstanding  at the  time of any  such
payment.

<PAGE>
                                           II. DEFAULT

     2.1 It is expressly  agreed by Borrower that the following  shall be deemed
to be Events of Default  under this Note:  (a) the failure to pay, when due, any
amount of principal,  or not more than five days after due date of any amount of
premium,  if any, or interest on this Note or the Series B or Series C Notes, or
(b) in the event the  Borrower  files any  petition,  or any  petition  is filed
against it and not  dismissed  within sixty (60) days,  under any  bankruptcy or
insolvency law or for the  appointment of a receiver for  substantially  all its
assets or in the event the Borrower  makes a general  assignment for the benefit
of  creditors,  (c) or any failure by the  Borrower to perform or observe any of
the other covenants,  agreements or provisions to be performed or observed by it
under this Note or the Series B or Series C Notes, and such default shall not be
rectified or cured within 10 days after written  notice thereof by the Lender to
the  Company,  and (d) an event of  default  as  specified  in the  Amended  and
Restated  Credit  Agreement,  as amended  from time to time,  among the Company,
Telos Corporation (a California corporation) and NationsBank,  N.A. (the "Credit
Agreement")  shall have occurred and be continuing,  if (and only if) such event
results in  acceleration of the maturity of the  indebtedness  under such Credit
Agreement and such acceleration continues in effect.

     2.2  If an  Event  of  Default  occurs,  the  Lender,  at his  option,  may
accelerate  this Note and may by written  notice to Borrower  declare the entire
unpaid principal amount of this Note and all interest accrued and unpaid thereon
to be immediately due and payable  whereupon the unpaid principal amount and all
such accrued  interest  shall become and be forthwith  due and payable,  without
presentment,  demand,  protest or further notice of any kind. The failure of the
Lender to give such notice shall,  in no event, be deemed a waiver of any of the
Lender rights hereunder as long as the Event of Default continues.

     2.3 Upon default in the payment of the  principal of this Note or any other
sum  payable  hereunder  when due upon  demand,  at  maturity  or by  reason  of
acceleration  of maturity,  or upon the occurrence of any other Event of Default
hereunder Borrower agrees to pay all reasonable costs of collection  incurred by
the holder of the Note,  including  reasonable  attorneys' fees, whether suit is
brought or not,  and all other  costs and  expenses  reasonably  connected  with
collection of the indebtedness evidenced hereby.

                                  III. SUBORDINATION

     3.1 Payment of the principal,  or interest and Payment Premium on this Note
are  subordinate  and  subject  in right of  payment  to the prior  indefeasible
payment in full in cash or cash equivalents of all Senior Indebtedness, and each
holder  of this  Note by  such  holder's  acceptance  hereof,  acknowledges  and
confirms such subordination.  "Senior Indebtedness" means all present and future
obligations,  liabilities  and  indebtedness  of the  Company  of every type and
nature,  currently or hereafter  due,  incurred or created,  arising under or in
connection  with  the  Credit  Agreement  or  any  refinancing  loan  documents,
including,  without  limitation  (i) all  Obligations  (as defined in the Credit
Agreement) and any refinancing  thereof,  (ii) all interest  provided for in the
Credit  Agreement,  or  any  refinancing  loan  documents  (including,   without
limitation,  interest  arising  prior  to  and  after  the  commencement  of any
bankruptcy or similar proceeding in which the Company is the debtor,  whether or
not such interest is an allowed claim in such proceeding) at the rates specified
in the Credit Agreement or any refinancing  loan documents;  and (iii) all fees,
charges, expenses,  indemnities and other amounts payable under or incidental to
the Credit Agreement  (excluding any such amounts payable in respect of warrants
or other equity-related obligations or earning participations that may be issued
by  the  Company).  Notwithstanding  the  foregoing,  Senior  Indebtedness  held
(whether as a result of  subrogation  or otherwise)  by the Company,  any of the
subsidiaries  or any other  affiliate  of the  Company  (whether  as a result of
subrogation or otherwise)  (Telos,  the subsidiaries and any other affiliates of
the Company being collectively referred to herein as "Affiliated Parties") or by
any person who has acquired Senior Indebtedness,  directly or indirectly,  which
has been held by any of the Affiliated  Parties,  shall not  constitute  "Senior
Indebtedness"  under this Agreement  (other than under this sentence) until such
time as all Senior  Indebtedness  held by Persons other than Affiliated  Parties
has  been  indefeasibly  paid  in full  in  cash  or  cash  equivalents,  and no
Affiliated  Party or Person  acquiring  Senior  Indebtedness  from an Affiliated
Party  shall  acquire  any rights  hereunder  by virtue of holding  such  Senior
Indebtedness.
<PAGE>

     This Note shall be construed and enforced in accordance  with, and governed
by the laws of, the  Commonwealth of Virginia  without giving effect to conflict
of laws principles.

     The parties hereto,  including the undersigned  Borrower and all guarantors
and endorsers,  hereby waive presentment,  demand, notice, protest and all other
demands and notices in connection with the delivery, acceptance, performance and
enforcement  of this  Note,  and assent to  extensions  of time of  payment,  or
forbearance or other indulgence without notice.

                                                           TELOS CORPORATION



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