13

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-K

 ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
                                      1934

 For the Year Ended June 30, 1999               Commission File Number 1-6560

                             THE FAIRCHILD CORPORATION
             (Exact name of Registrant as specified in its charter)

    Delaware                                             34-0728587
   (State or other jurisdiction of     (I.R.S. Employer Identification No.)
    Incorporation or organization)

                         45025 Aviation Drive, Suite 400
          Dulles, VA                                           20166
(Address of principal executive offices)                     (Zip Code)

Registrant's telephone number, including area code          (703) 478- 5800

          SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:

 Title of each class                Name of exchange on which registered
 Class  A  Common Stock, par value  New York and Pacific Stock Exchange
  $.10 per share

          SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:  None

      Indicate  by check mark whether the Registrant (1) has filed  all  reports
required  to be filed by Section 13 or 15(d) of the Securities Exchange  Act  of
1934  during  the  preceding  12 months (or for such  shorter  period  that  the
Registrant was required to file such reports), and (2) has been subject to  such
filing requirements for the past ninety (90) days [X].

      Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best  of  registrant's knowledge, in definitive proxy or information  statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K [  ].

     On September 15, 1999, the aggregate market value of the common shares held
by nonaffiliates of the Registrant (based upon the closing price of these shares
on the New York Stock exchange) was approximately $156 million (excluding shares
deemed  beneficially  owned  by affiliates of the  Registrant  under  Commission
Rules).

      As  of September 15, 1999, the number of shares outstanding of each of the
Registrant's classes of common stock were as follows:

    Class A common stock, $.10 par value               22,265,322

    Class B common stock, $.10 par value                 2,621,652


DOCUMENTS INCORPORATED BY REFERENCE:

     Portions of the registrant's definitive proxy statement for the 1999 Annual
Meeting  of  Stockholders'  to be held on November 18,  1999  (the  "1999  Proxy
Statement"), which the Registrant intends to file within 120 days after June 30,
1999, are incorporated by reference into Parts III and IV.

                            THE FAIRCHILD CORPORATION
                                    INDEX TO
                           ANNUAL REPORT ON FORM 10-K
                       FOR FISCAL YEAR ENDED JUNE 30, 1999



PART I                                                            Page

Item 1.   Business                                                  4

Item 2.   Properties                                               11

Item 3.   Legal Proceedings                                        12

Item 4.   Submission of Matters to a Vote of Stockholders          12

PART II

Item  5.  Market for Our Common Equity and Related
          Stockholder Matters                                     13

Item  6.  Selected Financial Data                                 14

Item  7.  Management's Discussion and Analysis of
          Results of Operations and Financial Condition           15

Item  7A. Quantitative and Qualitative Disclosure about
          Market Risk                                             27

Item  8.  Financial Statements and Supplementary Data             28

Item  9.  Disagreements on Accounting and Financial Disclosure    74


PART III

Item   10. Directors and Executive Officers of the Company        74

Item   11. Executive Compensation                                 74

Item  12.  Security Ownership of Certain Beneficial
           Owners and Management                                  74

Item  13.  Certain Relationships and Related Transactions         74


PART IV

Item 14.  Exhibits, Financial Statement Schedules,
          and Reports on Form 8-K                                75


                           FORWARD-LOOKING STATEMENTS

     Except  for  any  historical  information  contained  herein,  the  matters
discussed  in  this Annual Report on Form 10-K contain certain  "forward-looking
statements" within the meaning of the Private Securities Litigation  Reform  Act
of  1995  with  respect  to our financial condition, results  of  operation  and
business.  These statements relate to analyses and other information  which  are
based  on  forecasts  of  future  results  and  estimates  of  amounts  not  yet
determinable. These statements also relate to our future prospects, developments
and  business  strategies. These forward-looking statements  are  identified  by
their  use  of terms and phrases such as "anticipate," "believe," "could,"
"estimate,"   "expect,"   "intend,"   "may,"   "plan,"    "predict,"
"project,"  "will"  and similar terms and phrases, including  references  to
assumptions.  These forward-looking statements involve risks and  uncertainties,
including  current  trend information, projections for deliveries,  backlog  and
other trend projections, that may cause our actual future activities and results
of  operations to be materially different from those suggested or  described  in
this  Annual  Report  on  Form 10-K. These risks include:  product  demand;  our
dependence  on  the  aerospace  industry; reliance  on  Boeing  and  the  Airbus
consortium  of  companies;  customer  satisfaction  and  quality  issues;  labor
disputes;  competition, including recent intense price competition; our  ability
to integrate and realize anticipated cost savings relating to our acquisition of
Kaynar  Technologies Inc.; our ability to achieve and execute internal  business
plans;  worldwide political instability and economic growth; and the  impact  of
any  economic  downturns and inflation, including the recent weaknesses  in  the
currency,  banking and equity markets of countries in South America and  in  the
Asia/Pacific region.

     If  one  or  more  of  these  risks or uncertainties  materializes,  or  if
underlying  assumptions prove incorrect, our actual results may vary  materially
from those expected, estimated or projected. Given these uncertainties, users of
the information included in this Annual Report on Form 10-K, including investors
and  prospective  investors are cautioned not to place undue  reliance  on  such
forward-looking  statements.  We do not intend  to  update  the  forward-looking
statements  included  in  this Annual Report, even if  new  information,  future
events or other circumstances have made them incorrect or misleading.

                                     PART I

     All  references  in this Annual Report on Form 10-K to  the  terms  "we,"
"our,"  "us,"  the  "Company" and "Fairchild''  refer  to  The  Fairchild
Corporation  and  its subsidiaries. All references to "fiscal" in  connection
with a year shall mean the 12 months ended June 30.

Item 1.  BUSINESS

General

     We  are  a leading worldwide aerospace and industrial fastener manufacturer
and  distribution  logistics manager and, through our  wholly-owned  subsidiary,
Banner  Aerospace,  Inc., an international supplier to the  aerospace  industry,
distributing  a  wide  range  of aircraft parts and  related  support  services.
Through  internal growth and strategic acquisitions, we have become one  of  the
leading  suppliers  of  fasteners to aircraft original  equipment  manufacturers
(such  as Boeing, the Airbus consortium, Lockheed Martin, British Aerospace  and
Aerospatiale), as well as one of the leading aerospace subcontractors  to  OEMs,
independent distributors and the aerospace aftermarket.

     Our  aerospace business consists of two segments: aerospace  fasteners  and
aerospace  parts distribution. Our aerospace fasteners segment manufactures  and
markets  high  performance  fastening  systems  used  in  the  manufacture   and
maintenance  of  commercial  and military aircraft. Our  aerospace  distribution
segment  stocks and distributes a wide variety of aircraft parts  to  commercial
airlines  and  air  cargo  carriers, fixed-base  operators,  corporate  aircraft
operators and other aerospace companies.

    Our business strategy is as follows:

     Maintain Quality Leadership. The aerospace market is extremely demanding in
terms  of  precision  manufacturing and all parts  must  be  certified  by  OEMs
pursuant to the Fedral Aviation Administration's regulations and those of  other
equivalent  foreign  regulators. Substantially all of our  plants  are  ISO-9000
approved.  We have won numerous industry and customer quality awards and  are  a
preferred  supplier  for  major aerospace customers. In  order  to  be  named  a
preferred  supplier,  a  company must qualify its products  through  a  customer
specific  quality  assurance program and adhere to it  strictly.  Approvals  and
awards we have obtained include: Boeing D1 9000 Rev A; Boeing (St. Louis) Silver
Supplier;  Boeing  Source Approved; DaimlerChrysler Aerospace  Source  Approved;
General  Electric  Source Approved; Pratt & Whitney Source  Approved;  Lockheed-
Martin Star Supplier; and DISC Large Business Supplier of the Year.

     Lower Manufacturing Costs. We have invested significantly over the past few
years   in  state-of-the-art  machinery,  employee  training  and  manufacturing
techniques  to  produce  products  at the lowest  cost  while  maintaining  high
quality.  This  investment  in process superiority  has  resulted  in  increased
capacity, lower break-even levels and faster cycle times, while reducing  defect
levels  and improving turnaround times for customers. For example, the  customer
rejection rate at our aerospace fasteners segment has fallen from an average  of
18.2%  in fiscal 1995 to an average of 1.7% for fiscal 1999. In addition,  scrap
and rework costs as a percentage of net sales in our aerospace fasteners segment
have  fallen  from an average of 9.3% in fiscal 1995 to an average of  3.9%  for
fiscal  1999. Our on-time delivery rate in our aerospace fasteners  segment  has
improved significantly since fiscal 1997, to levels that are currently the  best
in  our operating history. We view these improvements as one of the keys to  our
business success that will allow us to better manage industry cycles.

    Supply Logistics Services. Our aerospace industry customers are increasingly
requiring  additional supply chain management services as they  seek  to  manage
inventory and lower their manufacturing costs. In response, we are developing  a
number  of  logistics and supply chain management services that we  expect  will
contribute to our growth and our value to our customers.

     Capitalize  on  Global  Presence.  The aerospace  industry  is  global  and
customers  increasingly seek suppliers with the ability to provide reliable  and
timely service worldwide. The acquisition of Kaynar Technologies has resulted in
increased  manufacturing and distribution capabilities in the U.S.  and  Europe,
and sales offices worldwide.

      Growth  through  Acquisitions. Despite a trend toward  consolidation,  the
aerospace components industry remains fragmented. Consolidation has been driven,
in part, by the combination of the OEMs as they seek to reduce their procurement
costs.  We  have  successfully integrated a number  of  acquisitions,  achieving
material synergies in the process, and anticipate further opportunities to do so
in the future.

     Our strategy is based on the following strengths:

      Complementary Market Share and Expanded Product Range. Kaynar Technologies
Inc.  focused on different market segments than us, although we each focused  on
segments  where  we  could achieve economies of scale  through  the  ability  to
produce high quality parts at low cost. As a result of the acquisition of Kaynar
Technologies, we greatly expanded the range of products we offer. This expansion
permits  us to provide our customers with more complete fastening solutions,  by
offering  engineering and logistics across the breadth of a customer's aerospace
needs. For example, Kaynar Technologies's internally threaded fasteners such  as
engine  nuts,  are  now  be  sold in combination with  our  externally  threaded
fasteners,  such as bolts and pins, to provide a single fastening  system.  This
will  limit  the  inventory needs of the customer, minimize handling  costs  and
reduce waste.

      Long-Term  Customer Relationships. We work closely with our  customers  to
provide  high  quality  engineering solutions accompanied  by  superior  service
levels.  As  a  result, our customer relationships are generally long-term.  For
example,  in  the Fall of 1998 we were awarded a series of long-term commitments
from  Boeing  and certain other customers to provide a significant  quantity  of
aircraft  fastening  components over the next  three  to  five  years.  We  have
benefited from the trend of OEMs in reducing their number of suppliers in recent
years  in  an  effort to lower costs and to ensure quality and availability.  We
have  become  or been retained as a key supplier to the OEMs and  increased  our
overall share of OEM business. OEMs are becoming increasingly demanding in terms
of  overall service level, including just-in-time delivery of components to  the
production line. We believe that our focus on quality and customer service  will
remain the cornerstone of our relationships with our customers.

      Diverse End Markets. Although a significant proportion of our sales are to
OEMs  in  the  commercial aerospace industry, we have significant sales  to  the
defense,  aerospace  aftermarket  and  industrial  markets.  In  addition,   our
distribution   business  has  a  very  low  OEM  component.  We   believe   this
diversification will help mitigate the effects of the OEM cycle on our results.

      Experienced Management Teams. We have management teams with many years  of
experience  in  the  aerospace components industry and a  history  of  improving
quality,  lowering costs and raising the level of customer service,  leading  to
higher  overall profitability. In addition, our management teams  have  achieved
growth by successfully integrating a number of acquisitions.

Recent  Developments

     Our  recent developments are incorporated herein by reference from  "Recent
Developments  and  Significant  Business  Combinations"  included  in   Item   7
"Management's  Discussion  and Analysis of Results of Operations  and  Financial
Condition".

Financial Information about Business Segments

     Our  business segment information is incorporated herein by reference  from
Note  19 of our Consolidated Financial Statements included in Item 8, "Financial
Statements and Supplementary Data"

Narrative Description of Business Segments

Aerospace Fasteners

     Through  our  aerospace  fasteners segment,  we  are  a  leading  worldwide
manufacturer  and  distributor  of fastening  systems,  used  primarily  in  the
construction  and maintenance of commercial and military aircraft,  as  well  as
applications in other industries, including the automotive, electronic and other
non-aerospace industries. Our April 20, 1999 acquisition of Kaynar  Technologies
has  expanded  our  product range to provide our customers  with  more  complete
fastening solutions by offering engineering and logistics across the breadth  of
a  customer's aerospace needs. In the past 20 months, we have made  a  concerted
effort to establish a substantial position in the distribution/logistics segment
of  the  aerospace  fasteners industry. Through the  acquisitions  of  Special-T
Fasteners  in  the  United States and AS+C in Europe, we have created  a  unique
capability  that  we  believe enhances dramatically our status  as  the  premier
fastening  solutions  provider in the industry. The aerospace  fastener  segment
accounted for 71.7% of our net sales in fiscal 1999.

  Products (1) (see note below)

     In general, the aerospace fasteners we produce are highly engineered, close
tolerance, high strength fastening devices designed for use in harsh,  demanding
environments.  Products  range from standard aerospace screws,  precision  self-
locking  internally threaded nuts, to more complex systems that fasten  airframe
structures, and sophisticated latching or quick disconnect mechanisms that allow
efficient   access  to  internal  parts  which  require  regular  servicing   or
monitoring.  Our aerospace fasteners segment produces and sells  products  under
various trade names and trademarks. The trademarks discussed below either belong
to  us or to third parties, which have licensed us to use such trademarks. These
trade   names  and  trademarks  include:  Voi-Shan  (fasteners  for  aerospace
structures),  Screwcorp (standard externally threaded products  for  aerospace
applications),  K-FAST nuts (anchor nuts, gang channels,  shank  nuts,  barrel
nuts,  clinch  nuts  and stake nuts for defense and aerospace applications),  K-
Sert  (inserts that include keys to lock the insert in place and  prevent  any
rotation), RAM (custom designed mechanisms for aerospace applications), Perma-
Thread and Thin Wall (inserts that create a thread inside a hole and provide
a   high   degree  of  thread  protection  and  fastening  integrity),  Camloc??
(components  for the industrial, electronic, automotive and aerospace  markets),
and  Tridair  and Rosan (fastening systems for highly-engineered  aerospace,
military  and  industrial applications). Our aerospace  fasteners  segment  also
manufactures  and  supplies fastening systems used in non-aerospace  industrial,
electronic and marine applications.

    Principal product lines of the aerospace fasteners segment include:

     Standard Aerospace Airframe Fasteners - These fasteners consist of standard
externally  threaded fasteners used in non-critical airframe applications  on  a
wide variety of aircraft.  These fasteners include Hi-Torque Speed Drive, Tri-
Wing,  Torq-Set and  Phillips.  We offer the broadest line of lightweight,
non-metallic composite fasteners, used primarily for military aircraft  as  they
are designed to reduce radar visibility, enhance resistance to lightning strikes
and  provide galvanic corrosion protection.  We also offer a variety of coatings
and  finishes  for our fasteners, including anodizing, cadmium  plating,  silver
plating,  aluminum  plating, solid film lubricants  and  water-based  cetyl  and
solvent free lubricants.

    Commercial  Aerospace  Self-Locking Nuts  -  These  precision,  self-locking
internally threaded nuts are used in the manufacture of commercial aircraft  and
aerospace  defense  products  and are designed principally  for  use  in  harsh,
demanding environments and include wrenchable nuts, K-Fast nuts, anchor  nuts,
gang channels, shank nuts, barrel nuts, clinch nuts and stake nuts.

     Commercial  Aerospace  Structural and Engine Fasteners  -  These  fasteners
consist of more highly engineered, permanent or semi-permanent fasteners used in
non-critical  but  more  sophisticated airframe and engine  applications,  which
could  involve  joining more than two materials.  These fasteners are  generally
engineered  to  specific  customer  requirements  or  manufactured  to  specific
customer  specifications  for  special applications,  often  involving  exacting
standards.   We  produce  fasteners  from  a  variety  of  materials,  including
lightweight  aluminum  and titanium nuts for airframes, to high-strength,  high-
temperature  tolerant  engine nuts manufactured from materials  such  as  A-286,
Waspaloy  and  Hastelloy.   These fasteners include  Hi-Lok,  Veri-Lite,
Eddie-Bolt and customer proprietary engine nuts.

     Proprietary Products and Fastening Systems - These very highly  engineered,
proprietary fasteners are designed by us for specific customer applications  and
include  high  performance structural latches and hold down  mechanisms.   These
fasteners  are  usually proprietary in nature and are used primarily  in  either
commercial aerospace or military applications. They include Visu-Lok??, Composi-
Lok, Keen-serts, Mark IV, Flatbeam, and Ringlock.

           Threaded Inserts - These threaded inserts are used principally in the
commercial  aerospace  and defense industries are made of high-grade  steel  and
other high-tensile metals which are intended to be installed into softer metals,
plastics and composite materials to create bolt-ready holes.

      Highly  Engineered Fastening Systems for Industrial Applications  -  These
highly  engineered fasteners are designed by us for specific niche  applications
in  the electronic, automotive and durable goods markets and are sold under  the
Camloc trade name.

     Precision  Machined Structural Components and Assemblies - These  precision
machined  structural components and assemblies are used for aircraft,  including
pylons, flap hinges, struts, wings fittings, landing gear parts, spares and many
other items

    Fastener Tools - These tools are designed primarily to install the fasteners
and inserts that we manufacture, but can also be used to attach other wrenchable
nuts, bolts and inserts.

--------------------------------------------------------------------------------
(1)  - Note on the use of registered trademarks. The trademarks discussed herein
either  belong to the Company or to third parties who have licensed the  Company
to  use  such trademarks.  Tri-Wing, Torq-set and Phillips are  registered
trademarks  of Phillips Screw Company.  Waspaloy is a trademark  of  Carpenter
Technologies  Corporation.   Hastelloy is a  registered  trademark  of  Haynes
International,  Inc.  Hi-Lok is registered trademark of Hi-Shear  Corporation.
Visul-lok  and  Composi-lok are registered trademarks of Monogram  Aerospace
Fasteners, Inc.
--------------------------------------------------------------------------------

   Sales and Markets

     The  products  of  our aerospace fasteners segment are  sold  primarily  to
domestic  and  foreign OEMs of airframes and engine assemblies, as  well  as  to
subcontractors  to  OEMs,  and  to the maintenance  and  repair  market  through
distributors.  Sixty-six  percent of its sales are  domestic.   Major  customers
include  OEMs such as Boeing, the Airbus consortium, and Aerospatiale and  their
subcontractors,  as  well as major distributors such as  AlliedSignal,  Tri-Star
Aerospace  and  Wesco  Aircraft  Hardware. In addition,  OEMs  have  implemented
programs  to reduce inventories and pursue just-in-time relationships. This  has
allowed  parts distributors to expand significantly their business due to  their
ability to better meet OEM objectives.  In response, we are expanding efforts to
provide parts through our global customer services units which include
recently acquired distributors formely know as Special-T Fasteners  in  the
United States and AS+C GmbH in Europe.  Although  no  one
customer accounted for more than 10% of our consolidated sales in fiscal 1999, a
large portion of our revenues come from customers providing parts or services to
Boeing,   including  defense  sales,  and  the  Airbus  consortium   and   their
subcontractors.  Accordingly,  we  are  dependent  on  the  business  of   those
manufacturers.

     Revenues in our aerospace fasteners segment are closely related to aircraft
production.   As  OEMs  searched  for  cost  cutting  opportunities  during  the
aerospace  industry  recession  of  1993-1995,  parts  manufacturers,  including
ourselves,  accepted  lower-priced  orders and/or  smaller  quantity  orders  to
maintain  market share, at lower profit margins.  However, during recent  years,
this  situation  has  improved  as build rates in the  aerospace  industry  have
increased  and  resulted  in capacity constraints.   Although  lead  times  have
increased,  we  have  been  able to provide our major customers  with  favorable
pricing,  while  maintaining or increasing margins  by  negotiating  for  larger
minimum lot sizes that are more economic to manufacture.

    Fasteners also have applications in the automotive/industrial markets, where
numerous  special fasteners are required, such as engine bolts, wheel bolts  and
turbo charger tension bolts.  We are actively targeting the automotive market as
a hedge against the downturn in the aerospace industry.

   Manufacturing and Production

   Our aerospace fasteners segment has fifteen primary manufacturing facilities,
of  which eight are located in the United States, six are located in Europe  and
one  is  located in Australia.  Each facility has virtually complete  production
capability, and subcontracts only those production steps which exceed  capacity.
Each  plant  is  designed to produce a specified product or group  of  products,
determined  by  the production process involved and certification  requirements.
Our  aerospace fasteners segments largest customers have recognized its  quality
and  operational controls by conferring their advanced quality systems
certifications at all of our facilities (e.g. Boeing's D1-900A).  All of its
aerospace  manufacturing facilities are "preferred suppliers".  We have
recently received all necessary quality and product approval from OEMs.

    We have a modern information system at all of our U.S. facilities, which was
expanded  to  most  of our European operations in fiscal 1999.  The  new  system
performs  detailed  and  timely  cost analysis  of  production  by  product  and
facility. Updated MIS systems also help us to better service our customers. OEMs
require each product to be produced in an OEM-qualified/OEM-approved facility.

   Competition

     Despite  intense  competition  in  the industry,  we  remain  the  dominant
manufacturer of aerospace fasteners.  Based on calendar 1998 information,
the worldwide aerospace fastener market is estimated   to   be  $1.7  billion
(before  distributor  resales).  We hold approximately 30% of the market and
compete with SPS Technologies, GFI Industries, and the  Huck International
division of the Cordant Technologies Corporation,  which we  believe hold
approximately 15%, 11% and 10% of the market, respectively.

     Quality, performance, service and price are generally the prime competitive
factors in the aerospace fasteners segment. Our broad product range allows us to
more  fully  serve each OEM and distributor. Our product array  is  diverse  and
offers customers a large selection to address various production needs. We  seek
to   maintain  our  technological  edge  and  competitive  advantage  over   our
competitors,  and have demonstrated our innovative production  methods  and  new
products to meet customer demands. We seek to work closely with OEMs and involve
ourselves  early  in  the  design process in order  that  our  products  may  be
incorporated into the design of their products.

Aerospace Distribution

     We  distribute a wide variety of aircraft parts, which we purchase  on  the
open  market  or  acquire  from OEMs as an authorized  distributor.   No  single
distributor  arrangement is material to our financial condition.  The  aerospace
distribution segment accounted for 27.3% of our total sales in fiscal 1999.

   Products

     An  extensive inventory of products and a quick response time are essential
in  providing  service to our customers.  Another key factor in selling  to  our
customers  is our ability to maintain a system that traces a part  back  to  the
manufacturer or repair facility.

     Products of the aerospace distribution segment are divided into two groups:
rotables  and  engines.   Rotables  include flight  data  recorders,  radar  and
navigation   systems,  instruments  and  hydraulic  and  electrical  components.
Engines  include  jet engines and engine parts for use on both narrow  and  wide
body  aircraft  and  smaller  engines for corporate and  regional  aircraft.  We
provide a number of services such as immediate shipment of parts in aircraft-on-
ground situations. We also buy and sell aircraft from time to time.

      Rotable  parts  are sometimes purchased as new parts,  but  are  generally
purchased in the aftermarket and are then overhauled by us or for us by  outside
contractors, including OEMs or FAA-licensed facilities.  Rotables are sold in  a
variety  of  conditions  such  as  new, overhauled,  serviceable  and  "as  is".
Rotables may also be exchanged instead of sold.  An exchange occurs when an item
in  inventory is exchanged for a customers part and the customer is  charged  an
exchange  fee  plus  the actual cost to overhaul the part.  Engines  and  engine
components are sold "as is", overhauled or disassembled for resale as parts.

   Sales and Markets

      Our aerospace distribution segment sells its products in the United States
and  abroad to commercial airlines and air cargo carriers, fixed-base operators,
corporate  aircraft  operators,  distributors  and  other  aerospace  companies.
Approximately 72.7% of our sales are to domestic purchasers, some  of  whom  may
represent offshore users.

      Our aerospace distribution segment conducts marketing efforts through  its
direct  sales  force,  outside  representatives and,  for  some  product  lines,
overseas  sales  offices.  Sales in the aviation aftermarket  depend  on  price,
service,  quality and reputation. Our aerospace distribution segment's  business
does  not  experience significant seasonal fluctuations nor depend on  a  single
customer.   No  single customer accounts for more than 10% of  our  consolidated
revenue.

      Dallas  Aerospace, Inc., our aerospace distribution's largest  subsidiary,
sells  jet  engines  and  engine parts for use on  both  narrow  and  wide  body
aircraft.  In  addition,  Dallas  Aerospace provides  engine  repair  management
services and engine leasing to a variety of airline and air cargo customers  and
has  bought  and  sold  large commercial aircraft from time  to  time.  We  have
expressed  our  intent  to sell, and are attempting to reach  agreement  with  a
possible purchaser of Dallas Aerospace.

 Competition

     The  rotables  group  competes with Air Ground Equipment  Services,  Duncan
Aviation,  Stevens Aviation, OEMs such as Honeywell, Rockwell Collins, Raytheon,
and   Litton,   and   other  fixed  based  operators  and   maintenance   repair
organizations.   The major competitors for our engine group  are  OEMs  such  as
General  Electric  Company  and Pratt & Whitney, as well  as  the  engine  parts
division  of AAR Corp., Kellstrom Industries, and Air Ground Equipment Services,
and many smaller companies.

Other Operations

    Our  other operations included a company operating under the trade  name  of
Fairchild  Gas Springs, which we sold subsequent to June 30, 1999. We  also  own
Fairchild  Technologies, a technology products unit which designs,  manufactures
and  markets high performance production equipment and systems required for  the
manufacture  of  recordable compact discs. Additionally,  we  also  own  several
parcels of developed and undeveloped land almost entirely representing residuals
of  operations previously divested or closed. Included among these is an 88-acre
site  in  Farmingdale,  New  York, on which we are  currently  developing  as  a
shopping center. We are pursuing the liquidation of the remaining components  of
Fairchild Technologies.

Foreign Operations

Our  operations  are  located throughout the world.  Inter-area  sales  are  not
significant to the total revenue of any geographic area.  Export sales are  made
by U.S. businesses to customers in non-U.S. countries, whereas foreign sales are
made by our non-U.S. subsidiaries.  For our sales results by geographic area and
export  sales, see Note 20 of our Consolidated Financial Statements included  in
Item 8, "Financial Statements and Supplementary Data".
Backlog of Orders

    Backlog is important for all our operations, due to the long-term production
requirements of our customers.  Our backlog of orders as of June 30, 1999 in the
aerospace  fasteners  segment  and aerospace distribution  segment  amounted  to
$215.3 million and $12.5 million, respectively. We anticipate that in excess  of
87%  of  the  aggregate backlog at June 30, 1999 will be delivered by  June  30,
2000.  In  the  fall of 1998, we were awarded a series of long-term  commitments
from  Boeing to provide a significant quantity of aircraft fastening  components
over  the  next three to five years, however, amounts related to such agreements
are  not  included  in  our backlog until Boeing specifies  delivery  dates  for
fasteners ordered.

Suppliers

     We  are  not materially dependent upon any one supplier, but are  dependent
upon  a wide range of subcontractors, vendors and suppliers of materials to meet
our  commitments  to our customers. From time to time, we enter  into  exclusive
supply contracts in return for logistics and price advantages. We do not believe
that any one of these contracts would impair our operations if a supplier failed
to perform.

      Nevertheless, commercial deposits of certain metals, such as titanium  and
nickel,  which are required for the manufacture of several of our products,  are
found  only in certain parts of the world. The availability and prices of  these
metals  may be influenced by private or governmental cartels, changes  in  world
politics,  unstable  governments in exporting nations or  inflation.  Similarly,
supplies of steel and other less exotic metals used by us may also be subject to
variation in availability. We purchase raw materials, which include the  various
metals,  composites, and finishes used in production, from over twenty different
suppliers.  We have recently entered into several long-term titanium  and  alloy
supply contracts. In the past, fluctuations in the price of titanium have had an
adverse effect on our sales margins.

Research and Patents

     We  own  patents relating to the design and manufacture of certain  of  our
products  and  are  licensees of technology covered  by  the  patents  of  other
companies.  We  do not believe that any of our business segments  are  dependent
upon any single patent.

Personnel

    As  of  June  30,  1999,  we had approximately 5,200  employees.  Of  these,
approximately  3,400  and of our employees are based in the  United  States  and
1,800 are based in Europe and elsewhere. Approximately 20% of our employees were
covered by collective bargaining agreements. Although we have had isolated  work
stoppages in France in the past, these stoppages have not had a material  impact
on  our business. Overall, we believe that our relations with our employees  are
good.

Environmental Matters

     A  discussion  of  our  environmental  matters  is  included  in  Note  18,
"Contingencies", to our Consolidated Financial Statements, included in Part  II,
Item 8, "Financial Statements and Supplementary Data" and is incorporated herein
by reference.

ITEM 2.   PROPERTIES

     As  of  June  30, 1999, we owned or leased buildings totaling approximately
2,100,000  square feet, of which approximately 1,246,000 square feet  was  owned
and   854,000  square  feet  was  leased.   Our  aerospace  fasteners  segment's
properties  consisted  of approximately 1,722,000 square  feet,  with  principal
operating  facilities  of approximately 1,543,000 square  feet  concentrated  in
Southern   California,  Massachusetts,  France  and  Germany.    The   aerospace
distribution  segment's  properties consisted of  approximately  233,000  square
feet,  with principal operating facilities of approximately 155,000 square  feet
located  in  Texas and Georgia.  We own our corporate headquarters  building  at
Washington-Dulles International Airport.

    The following table sets forth the location of the larger properties used in
our  continuing operations, their square footage, the business segment or groups
they serve and their primary use.  Each of the properties owned or leased by  us
is,  in  our  opinion, generally well maintained. All of our occupied properties
are maintained and updated on a regular basis.
<TABLE>
<CAPTION>

                     Owned  Square
                      or
                                        Business       Primary
     Location       Leased Footage   Segment/Group      Use
<S>                 <C>     <C>     <C>               <C>
Saint Cosme,        Owned 304,000  Aerospace
France                             Fasteners         Manufacturing
Torrance,           Owned 284,000  Aerospace
California                         Fasteners         Manufacturing
Fullerton,          Owned 255,000  Aerospace
California                         Fasteners         Manufacturing
City of Industry,   Owned 140,000  Aerospace
California                         Fasteners         Manufacturing
Carrollton, Texas  Leased 126,000  Aerospace
                                  Distribution       Distribution
Dulles, Virginia    Owned 125,000  Corporate         Office
Stoughton,         Leased 120,000  Aerospace
Massachusetts                      Fasteners         Manufacturing
Huntington Beach,   Owned  86,000  Aerospace
California                         Fasteners         Manufacturing
Montbrison, France  Owned  63,000  Aerospace
                                   Fasteners         Manufacturing
Hildesheim,         Owned  57,000  Aerospace
Germany                            Fasteners         Manufacturing
Toulouse, France    Owned  56,000  Aerospace
                                   Fasteners         Manufacturing
Kelkheim, Germany   Owned  52,000  Aerospace
                                   Fasteners         Manufacturing
Chatsworth,        Leased  36,000  Aerospace
California                         Fasteners         Distribution
Atlanta, Georgia   Leased  29,000  Aerospace
                                  Distribution       Distribution
</TABLE>

      We  have  several parcels of property which we are attempting  to  market,
lease  and/or  develop, including:  (i) an eighty-eight acre parcel  located  in
Farmingdale, New York, (ii) a six acre parcel in Temple City, California,  (iii)
an  eight acre parcel in Chatsworth, California, and (iv) several other  parcels
of real estate, located primarily throughout the continental United States.

      Information concerning our long-term rental obligations at June 30,  1999,
is  set  forth in Note 17 to our Consolidated Financial Statements, included  in
Item  8,  "Financial  Statements and Supplementary Data",  and  is  incorporated
herein by reference.

ITEM 3.   LEGAL PROCEEDINGS

      A   discussion  of  our  legal  proceedings  is  included  in   Note   18,
"Contingencies", to our Consolidated Financial Statements, included in Part  II,
Item 8, "Financial Statements and Supplementary Data", of this annual report and
is incorporated herein by reference.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF STOCKHOLDERS

There  were no matters submitted to a vote of security holders during the fourth
quarter of the fiscal year covered by this report.
PART II

ITEM 5 MARKET FOR THE COMPANY'S COMMON STOCK AND RELATED STOCKHOLDER MATTERS

Market Information

     Our  Class  A  common stock is traded on the New York  Stock  Exchange  and
Pacific  Stock Exchange under the symbol FA.  Our Class B common  stock  is  not
listed  on any exchange and is not publicly traded. Class B common stock can  be
converted to Class A common stock at any time at the option of the holder.

     Information regarding the quarterly price range of our Class A common stock
is  incorporated herein by reference from Note 21 of our Consolidated  Financial
Statements included in Item 8, "Financial Statements and Supplementary Data".

Holders of Record

     We had approximately 1,325 and 39 record holders of our Class A and Class B
common stock, respectively, at September 15, 1999.

Dividends

      Our  current  policy is to retain earnings to support the  growth  of  our
present  operations and to reduce our outstanding debt. Any  future  payment  of
dividends  will be determined by our Board of Directors and will depend  on  our
financial condition, results of operations and by restrictive covenants  in  our
credit agreement and 10 ??% senior subordinated notes that limit the payment  of
dividends  over their respective terms. See Note 8 of our Consolidated Financial
Statements included in Item 8, "Financial Statements and Supplementary Data".

Sale of Unregistered Securities

     In  fiscal  1998, we adopted a stock option deferral plan for officers  and
directors, pursuant to which recipients of stock options may elect to defer  the
gain  on  exercise of stock options.  The "gain" is the difference  between  the
market value of the shares issued to an officer or director upon exercise of the
stock option, and the price paid by the officer or director for the exercise  of
such  stock option.  An officer's or director's deferred gain is issued  in  the
form  of "deferred compensation units." Each deferred compensation unit entitles
the  recipient  to receive one share of Class A common stock upon expiration  of
the "deferral period" for the stock options exercised.

     The deferred compensation units may be deemed our securities. Only officers
and  directors  who  are accredited investors are allowed to  elect  to  receive
deferred  compensation units. The shares issued to an officer or  director  upon
expiration of the deferral period (in exchange for deferred compensation  units)
have been registered pursuant to a Registration Statement on Form S-8.

        Under  the stock option deferral plan, in fiscal 1998 J. Flynn, deferred
$85,313  in exchange for 4,027 deferred compensation units; D. Miller,  deferred
$85,313  in exchange for 4,027 deferred compensation units; E. Steiner, deferred
$573,750 in exchange for 24,545 deferred compensation units; and in fiscal  1999
D. Miller deferred $135,000 in exchange for 8,852 deferred compensation units.

ITEM 6.  SELECTED FINANCIAL DATA
<TABLE>
<CAPTION>

                           Five-Year Financial Summary
                      (In thousands, except per share data)

                                  For the years ended June 30,
Summary of Operations:           1999   1998      1997    1996    1995
<S>                             <C>     <C>       <C>     <C>     <C>
 Net sales                     617,322   741,176   680,763 349,236 220,351
 Gross profit                  112,429   186,506   181,344  74,101  26,491
 Operating income (loss)       (45,911)   45,443    33,499 (11,286)(30,333)
 Net interest expense           30,346    42,715    47,681  56,459  64,113
 Earnings (loss) from          (23,507)   52,399     1,816 (32,186)(56,280)
continuing operations
 Earnings (loss) per share from
continuing
operations:
      Basic                      (1.03)     2.78      0.11   (1.98)  (3.49)
      Diluted                    (1.03)     2.66      0.11   (1.98)  (3.49)
 Other Data:
 EBITDA                        (20,254)   66,316    54,314   5,931  (9,830)
 Capital expenditures           30,142    36,029    15,014   5,680   5,383
 Cash provided by (used for)    23,268   (85,231)  (93,321)(48,951)(25,040)
operating activities
 Cash provided by (used for)   (99,157)   43,614    73,238  57,540 (19,156)
investing activities
 Cash provided by (used for)    81,218    74,088    (1,455)(39,637) 12,345
financing activities
 Balance Sheet Data:
 Total assets                1,328,786 1,157,259 1,052,666 993,398 828,680

 Long-term debt, less current  495,283   295,402   416,922 368,589 508,225
maturities
 Redeemable preferred stock of      --        --        --      --  16,342
subsidiary
 Stockholders' equity          407,500   473,559   232,424 230,861  39,278
 per outstanding common
  share                          16.38     20.54     13.98   14.10    2.50
</TABLE>

      The  results  of Banner Aerospace, Inc. are included in the periods  since
February  25,  1996,  when Banner Aerospace became a majority-owned  subsidiary.
Prior to February 25, 1996, our investment in Banner Aerospace was accounted for
using  the equity method. Fiscal 1998 includes the gain from the disposition  of
Banner  Aerospace's  hardware  group. The results  of  the  hardware  group  are
included   in  the  periods  from  March  1996  through  December  1997,   until
disposition.  Fiscal  1999  includes  the loss  on  the  disposition  of  Banner
Aerospace's Solair subsidiary and the loss recognized on the potential  sale  of
Dallas  Aerospace. The results of Solair are included in the periods from  March
1996  through  December  1998, until disposition. These transactions  materially
affect  the comparability of the information reflected in the selected financial
data.

      EBITDA  represents  the  sum of operating income before  depreciation  and
amortization. Included in EBITDA are restructuring and unusual charges of $6,374
and  $2,319 in fiscal 1999 and 1996, respectively. We consider EBITDA to  be  an
indicative measure of our operating performance due to the significance  of  our
long-lived  assets and because such data is considered useful by the  investment
community  to  better  understand our results, and can be used  to  measure  our
ability  to  service  debt, fund capital expenditures and expand  our  business.
EBITDA  is  not  a  measure of financial performance  under  GAAP,  may  not  be
comparable to other similarly titled measures of other companies and should  not
be  considered  as  an alternative either to net income as an indicator  of  our
operating  performance,  or to cash flows as a measure of  our  liquidity.  Cash
expenditures  for various long-term assets, interest expense, and  income  taxes
have  been,  and  will  be  incurred  which are  not  reflected  in  the  EBITDA
presentation.

ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND
                FINANCIAL CONDITION

      The Fairchild Corporation was incorporated in October 1969, under the laws
of the State of Delaware, under the name of Banner Industries, Inc.  On November
15,  1990,  we  changed our name from Banner Industries, Inc. to  The  Fairchild
Corporation.   We  are  the  owner  of 100% of RHI  Holdings,  Inc.  and  Banner
Aerospace,  Inc.  RHI  is  the  owner of 100% of Fairchild  Holding  Corp.   Our
principal operations are conducted through FHC and Banner Aerospace. During  the
periods presented, we held significant equity interests in Nacanco Paketleme and
Shared Technologies Fairchild Inc.

      The following discussion and analysis provide information which management
believes is relevant to assessment and understanding of our consolidated results
of  operations  and  financial  condition. The  discussion  should  be  read  in
conjunction with the consolidated financial statements and notes thereto.

GENERAL

      We  are a leading worldwide aerospace and industrial fastener manufacturer
and   distribution   logistics  manager  and,  through  Banner   Aerospace,   an
international supplier to airlines and general aviation businesses, distributing
a  wide  range of aircraft parts and related support services. Through  internal
growth  and strategic acquisitions, we have become one of the leading  suppliers
of  fasteners  to  aircraft  OEMs,  such as Boeing,  Lockheed  Martin,  Northrop
Grumman,  and  the  Airbus consortium, including, Aerospatiale,  DaimlerChrysler
Aerospace, British Aerospace and CASA.

      Our  aerospace business consists of two segments: aerospace fasteners  and
aerospace distribution. The aerospace fasteners segment manufactures and markets
high  performance fastening systems used in the manufacture and  maintenance  of
commercial and military aircraft. The aerospace distribution segment stocks  and
distributes  a  wide variety of aircraft parts to commercial  airlines  and  air
cargo  carriers,  fixed-base operators, corporate aircraft operators  and  other
aerospace companies.

CAUTIONARY STATEMENT

      Certain statements in this financial discussion and analysis by management
contain  certain "forward-looking statements" within the meaning of the  Private
Securities  Litigation  Reform  Act  of  1995  with  respect  to  our  financial
condition,  results  of  operation  and business.  These  statements  relate  to
analyses  and  other information which are based on forecasts of future  results
and  estimates of amounts not yet determinable. These statements also relate  to
our  future  prospects,  developments and business  strategies.  These  forward-
looking  statements  are identified by their use of terms and  phrases  such  as
"anticipate,"  "believe," "could," "estimate,"  "expect,"  "intend,"
"may,"  "plan,"  "predict," "project," "will" and  similar  terms  and
phrases,  including references to assumptions. These forward-looking  statements
involve   risks   and   uncertainties,  including  current  trend   information,
projections for deliveries, backlog and other trend projections, that may  cause
our  actual  future  activities  and results  of  operations  to  be  materially
different from those suggested or described in this Annual Report on Form  10-K.
These  risks include: product demand; our dependence on the aerospace  industry;
reliance on Boeing and the Airbus consortium of companies; customer satisfaction
and  quality issues; labor disputes; competition, including recent intense price
competition; our ability to integrate and realize anticipated synergies relating
to  the  acquisition  of Kaynar Technologies Inc.; our ability  to  achieve  and
execute  internal business plans; worldwide political instability  and  economic
growth;  and  the impact of any economic downturns and inflation, including  the
recent  weaknesses in the currency, banking and equity markets of  countries  in
South America and in the Asia/Pacific region.

      If  one  or  more  of  these risks or uncertainties  materializes,  or  if
underlying  assumptions prove incorrect, our actual results may vary  materially
from those expected, estimated or projected. Given these uncertainties, users of
the   information  included  in  this  financial  discussion  and  analysis   by
management, including investors and prospective investors are cautioned  not  to
place  undue  reliance on such forward-looking statements. We do not  intend  to
update  these  forward-looking statements in this Annual  Report,  even  if  new
information,  future events or other circumstances have made them  incorrect  or
misleading.

RESULTS OF OPERATIONS

   Business Transactions

      The following summarizes certain business combinations and transactions we
completed  which significantly affect the comparability of the period to  period
results  presented in this Management's Discussion and Analysis  of  Results  of
Operations and Financial Condition.

   Fiscal 1999 Transactions

      On  December  31, 1998, Banner consummated the sale of Solair,  Inc.,  its
largest  subsidiary in the rotables group of the aerospace distribution segment,
to  Kellstrom Industries, Inc., in exchange for approximately $60.4  million  in
cash  and a warrant to purchase 300,000 shares of common stock of Kellstrom.  In
December  1998, Banner recorded a $19.3 million pre-tax loss from  the  sale  of
Solair.  This  loss  was  included in cost of goods sold  as  it  was  primarily
attributable  to the bulk sale of inventory at prices below the carrying  amount
of inventory.

      On February 22, 1999, we used available cash to acquire 77.3% of SNEP S.A.
By  June 30, 1999, we had purchased significantly all of the remaining shares of
SNEP.  The  total  amount  paid was approximately $8.0 million,  including  $1.1
million  of debt assumed, in a business combination accounted for as a purchase.
The  total cost of the acquisition exceeded the fair value of the net assets  of
SNEP  by  approximately $4.3 million, which is preliminarily being allocated  as
goodwill, and amortized using the straight-line method over 40 years.  SNEP is a
French manufacturer of precision machined self-locking nuts and special threaded
fasteners serving the European industrial, aerospace and automotive markets.

      On  April 8, 1999, we acquired the remaining 15% of the outstanding common
and  preferred stock of Banner Aerospace, Inc. not already owned by us,  through
the merger of Banner with one of our subsidiaries. Under the terms of the merger
with  Banner, we issued 2,981,412 shares of our Class A common stock to  acquire
all  of  Banner's common and preferred stock (other than those already owned  by
us). Banner is now our wholly-owned subsidiary.

     On April 20, 1999, we completed the acquisition of all the capital stock of
Kaynar   Technologies   Inc.  for  approximately  $222   million   and   assumed
approximately $103 million of Kaynar Technologies's existing debt, the  majority
of  which  was  refinanced at closing. In addition, we paid $28  million  for  a
covenant   not   to   compete  from  Kaynar  Technologies's  largest   preferred
shareholder.  The total cost of the acquisition exceeded the fair value  of  the
net  assets  of  Kaynar Technologies by approximately $269.7 million,  which  is
preliminarily being allocated as goodwill, and amortized using the straight-line
method over 40 years. The acquisition was financed with existing cash, the  sale
of  $225 million of 10 3/4% senior subordinated notes due 2009 and proceeds from
a new bank credit facility.

      On  June  18,  1999,  we completed the acquisition of  Technico  S.A.  for
approximately $4.1 million and assumed approximately $2.2 million of  Technico's
existing debt. The total cost of the acquisition exceeded the fair value of  the
net  assets  of  Technico by approximately $2.9 million, which is  preliminarily
being  allocated as goodwill, and amortized using the straight-line method  over
40  years.  The  acquisition was financed with additional  borrowings  from  our
credit facility.

   Fiscal 1998 Transactions

      On  March  11,  1998,  Shared  Technologies  Fairchild  Inc.  merged  into
Intermedia Communications Inc. Under the terms of the merger, holders of  Shared
Technologies  Fairchild  common stock received $15.00  per  share  in  cash.  We
received  approximately $178.0 million in cash (before tax and selling expenses)
in  exchange for the common and preferred stock of Shared Technologies Fairchild
we  owned.   In fiscal 1998, we recorded a $96.0 million gain, net  of  tax,  on
disposal of discontinued operations, from the proceeds received from the  merger
of  Shared  Technologies  Fairchild  with  Intermedia.  The  results  of  Shared
Technologies Fairchild have been accounted for as discontinued operations.

      On  November 28, 1997, we acquired AS+C GmbH, Aviation Supply + Consulting
in  a  business combination accounted for as a purchase. The total cost  of  the
acquisition was $14.0 million, which exceeded the fair value of the  net  assets
of  AS+C  by  approximately  $8.1 million, which is allocated  as  goodwill  and
amortized  using the straight-line method over 40 years. We purchased AS+C  with
cash borrowings. AS+C is an aerospace parts, logistics, and distribution company
primarily servicing the European OEM market.

      On  December  19,  1997,  we  completed a  secondary  offering  of  public
securities.   The offering consisted of an issuance of 3,000,000 shares  of  our
Class  A  common stock at $20.00 per share, which generated $57 million  of  net
proceeds.  On  December  19,  1997,  immediately  following  the  Offering,   we
restructured our FHC and RHI credit agreements by entering into a new six-and-a-
half-year  credit  facility  to provide us with a $300  million  senior  secured
credit facility consisting of (i) a $75 million revolving loan with a letter  of
credit  sub-facility of $30 million and a $10 million swing  loan  sub-facility,
and (ii) a $225 million term loan.

      On  January  13,  1998,  Banner  Aerospace completed  the  disposition  of
substantially  all  of  the assets and certain liabilities  of  certain  of  its
subsidiaries to two wholly-owned subsidiaries of AlliedSignal Inc., in  exchange
for shares of AlliedSignal common stock with an aggregate value of $369 million.
The assets transferred to AlliedSignal consisted primarily of Banner Aerospace's
hardware  group,  which  included the distribution  of  bearings,  nuts,  bolts,
screws, rivets and other types of fasteners, and its PacAero unit. Approximately
$196  million of the common stock received from AlliedSignal Inc.  was  used  to
repay  outstanding  term loans of Banner Aerospace's subsidiaries,  and  related
fees.

      On  February 3, 1998, with the proceeds of the equity offering, term  loan
borrowings under the credit facility, and a portion of the after tax proceeds we
received from the Shared Technologies Fairchild, we refinanced substantially all
of   our  then  existing  indebtedness  (other  than  indebtedness  of  Banner),
consisting  of (i) $63.0 million to redeem 11 7/8% Senior Debentures  due  1999;
(ii)  $117.6 million to redeem 12% Intermediate Debentures due 2001; (iii) $35.9
million  to redeem 13 1/8% Subordinated Debentures due 2006; (iv) $25.1  million
to redeem 13% Junior Subordinated Debentures due 2007; and (vi) accrued interest
of $10.6 million.

      On  March  2,  1998, we acquired Edwards and Lock Management  Corporation,
doing  business as Special-T Fasteners, in a business combination accounted  for
as  a purchase. The cost of the acquisition was approximately $50.0 million,  of
which 50.1% of the contractual purchase price was paid in shares of our Class  A
common  stock  and  49.9% was paid in cash. The total cost  of  the  acquisition
exceeded  the  fair value of the net assets of Special-T by approximately  $23.3
million, which is being allocated as goodwill, and amortized using the straight-
line  method  over  40  years.   Special-T manages the  logistics  of  worldwide
distribution  of  Company-manufactured precision fasteners to customers  in  the
aerospace industry, government agencies, OEMs, and other distributors.

      On  May  11,  1998, we commenced an offer to exchange, for  each  properly
tendered  share  of common stock of Banner, a number of shares of  our  Class  A
common stock, par value $0.10 per share, equal to the quotient of $12.50 divided
by  $20.675  up  to  a maximum of 4,000,000 shares of Banner Aerospace's  common
stock. The exchange offer expired on June 9, 1998 and 3,659,364 shares of Banner
Aerospace's  common  stock  were validly tendered for  exchange  and  we  issued
2,212,361 shares Class A common stock to the tendering shareholders.

Fiscal 1997 Transactions

      In February 1997, we completed a transaction pursuant to which we acquired
common  shares and convertible debt representing an 84.2% interest, on  a  fully
diluted basis, of Simmonds S.A. We then initiated a tender offer to purchase the
remaining shares and convertible debt held by the public.  By June 30, 1997,  we
had  purchased,  or  placed  sufficient cash in  escrow  to  purchase,  all  the
remaining shares and convertible debt of Simmonds. The total purchase  price  of
Simmonds,  including  the assumption of debt, was approximately  $62.0  million,
which  we  funded with available cash and borrowings. We recorded  approximately
$20.5  million  in  goodwill  as a result of this acquisition,  which  is  being
amortized  using  the straight-line method over 40 years.  Simmonds  is  one  of
Europe's  leading  manufacturers and distributors of  aerospace  and  automotive
fasteners.

      On  June  30,  1997,  we  sold all the patents of  Fairchild  Scandinavian
Bellyloading Company to Teleflex Incorporated for $5.0 million, and  immediately
thereafter sold all the stock of Fairchild Scandinavian Bellyloading Company  to
a wholly-owned subsidiary of Teleflex for $2.0 million.

  Consolidated Results

     We currently report in two principal business segments: aerospace fasteners
and  aerospace  distribution.   The results of  the  Gas  Springs  division  are
included  in  the  Corporate  and  Other  classification.  The  following  table
illustrates the historical sales and operating income of our operations for  the
past three years.
<TABLE>
<CAPTION>

(In thousands)                 For the years ended June 30,
                                1999     1998       1997
<S>                           <C>       <C>       <C>
 Sales by Segment:
   Aerospace Fasteners        $442,722  $387,236  $269,026
   Aerospace Distribution      168,336   358,431   411,765
   Corporate and Other           6,264     5,760    15,185
   Eliminations (a)                  -   (10,251)  (15,213)
 Total Sales                  $617,322  $741,176  $680,763

 Operating Income (Loss) by
Segment:
   Aerospace Fasteners          38,956    32,722    17,390
   Aerospace Distribution      (40,003)   20,330    30,891
   Corporate and Other         (44,864)   (7,609)  (14,782)
 Total Operating Income
(Loss) (b)                    $(45,911)  $45,443   $33,499

(a)  Represents intersegment sales from our aerospace fasteners segment  to  our
     aerospace distribution segment.
(b)  Fiscal  1999 results include an inventory impairment charges of $41,465  in
     the aerospace distribution segment, costs relating to acquisitions of
     $23,604 and restructuring charges of $5,526 in the aerospace fasteners
     segment, $348 in the aerospace distribution segment, and $500 at corporate.
</TABLE>

      The  following unaudited pro forma table illustrates sales  and  operating
income of our operations by segment, on a pro forma basis, as if we had operated
in a consistent manner for the past three years. The pro forma results represent
the impact of our merger with Kaynar Technologies (completed in April 1999), our
merger  with  Banner  Aerospace (completed in April 1999),  our  acquisition  of
Special-T  (effective  January 1998), our disposition of  Solair  (completed  in
December  1998),  our disposition of the hardware group (completed  January  13,
1998),  the  disposition of Shared Technologies Fairchild  (completed  in  March
1998),  and  our  disposition  of  Fairchild Scandinavian  Bellyloading  Company
(completed  June  30,  1997),  as  if these transactions  had  occurred  at  the
beginning  of each period presented. The pro forma information is based  on  the
historical  financial  statements  of these  companies,  giving  effect  to  the
aforementioned  transactions.  The  pro forma  information  is  not  necessarily
indicative of the results of operations that would actually have occurred if the
transactions had been in effect since the beginning of each period, nor are they
necessarily indicative of our future results.
<TABLE>
<CAPTION>

                               For the years ended June 30,
                                1999     1998       1997
<S>                           <C>       <C>       <C>
 Sales by Segment:
   Aerospace Fasteners        $610,200  $630,538  $468,082
   Aerospace Distribution      140,017   148,339   117,781
   Corporate and Other           6,264     5,760     5,118
 Total Sales                  $756,481  $784,637  $590,981

 Operating Income (Loss) by
Segment:
   Aerospace Fasteners          54,426    68,037    32,992
   Aerospace Distribution      (20,836)    9,382     8,235
   Corporate and Other         (24,396)  (12,439)  (16,385)
 Total Operating Income
(Loss) (a)                    $  9,194  $ 64,980  $ 24,842

(a)  Fiscal  1999 results include an inventory impairment charge of  $22,145  in
     the aerospace distribution segment, costs relating to acquisitions of
     $23,604 and restructuring charges of $5,526 in the aerospace fasteners
     segment, $348 in the aerospace distribution segment, and $500 at corporate.
</TABLE>

      Net sales of $617.3 million in 1999 decreased by $123.9 million, or 16.7%,
compared  to  sales  of  $741.2 million in 1998. The  decrease  is  attributable
primarily  to  the  loss  of revenues resulting from the disposition  of  Banner
Aerospace's hardware group and Solair. Approximately 7.3% of the current  year's
sales  growth  came  from  acquisitions  in  the  aerospace  fasteners  segment.
Divestitures decreased our growth by approximately 21.0% and our internal growth
was  down  6.2%. Net sales of $741.2 million in 1998 increased by $60.4 million,
or  8.9%,  compared  to  sales  of $680.8 million  in  1997.  Sales  growth  was
stimulated   by  the  resurgent  commercial  aerospace  industry  and   business
acquisitions,  partially  offset by the loss of revenues  as  a  result  of  the
disposition  of Banner Aerospace's hardware group. Approximately  15.8%  of  the
1998 sales growth was stimulated by the resurgent commercial aerospace industry.
On  a pro forma basis, net sales decreased 3.6% and increased 32.8% in 1999  and
1998, respectively, as compared to the previous fiscal periods.

      Gross margin as a percentage of sales was 18.2%, 25.2% and 26.6% in  1999,
1998,  and  1997, respectively. Included in cost of goods sold for  1999  was  a
charge  of  $41.5 million recognized in our aerospace distribution segment  from
the disposition of Solair and the potential disposition of Dallas Aerospace.  Of
this  charge, $19.3 million was attributable to Solair's bulk sale of  inventory
at  prices below this carrying amount.  Excluding these charges, gross margin as
a  percentage of sales was 24.9% in fiscal 1999. The lower margins in the fiscal
1999  period  are  attributable  to a change in product  mix  in  our  aerospace
distribution  segment as a result of the dispositions. Partially offsetting  the
overall  lower  margins  was  an  improvement in margins  within  our  aerospace
fasteners  segment  resulting  from acquisitions, efficiencies  associated  with
increased  production, improved skills of the work force, and reduction  in  the
payment  of  overtime.  Decreased  margins  in  the  fiscal  1998  period   were
attributable to a change in product mix in the aerospace distribution segment as
a result of the disposition of Banner' Aerospace's hardware group.

      Selling,  general & administrative expense as a percentage  of  sales  was
24.2%,  19.1%, and 21.0% in fiscal 1999, 1998, and 1997, respectively.  Included
in  selling, general & administrative expense in fiscal 1999 were $23.6  million
of   one-time  costs  associated  primarily  with  the  acquisition  of   Kaynar
Technologies.  Excluding these costs, selling, general & administrative  expense
as a percentage of sales would have been 20.4% in 1999. This increase in 1999 is
attributable to increased environmental expenses. The improvement in fiscal 1998
was  attributable primarily to administrative efficiencies allowed by  increased
sales.

      Other  income  decreased $2.6 million in 1999 as  compared  to  1998,  and
increased  $6.5  million  in 1998 as compared to 1997.  These  changes  are  due
primarily  to the fiscal 1998 sale of air rights over a portion of the  property
we own and are developing in Farmingdale, New York.

      In fiscal 1999, we recorded $6.4 million of restructuring charges. Of this
amount, $0.5 million was recorded at our corporate office for severance benefits
and  $0.3  million was recorded at our aerospace distribution  segment  for  the
write-off  of  building improvements from premises vacated. The  remaining  $5.5
million  was  recorded as a result of the Kaynar Technologies merger integration
process  at  our  aerospace  fasteners segment for severance  benefits,  product
integration  expenses  incurred as of June 30,  1999,  and  the  write  down  of
redundant  fixed  assets. As of June 30, 1999, approximately  one-third  of  the
integration   process  has  been  executed.  We  expect  to   incur   additional
restructuring  charges  for product integration costs  during  the  next  twelve
months  at  our aerospace fasteners segment. We anticipate that our  integration
process will be substantially completed by the second quarter of fiscal 2000.

     We  reported an operating loss of $45.9 million in fiscal 1999 which was  a
decrease  from  operating income of $45.4 million reported in fiscal  1998.  The
current  year was affected by $71.4 million of expenses recognized for inventory
impairment, restructuring and costs related to acquisitions. Operating income of
$45.4  million  in  fiscal 1998 increased $11.9 million, or 35.7%,  compared  to
operating  income  of  $33.5 million in fiscal 1997. The increase  in  operating
income  was  due  primarily to the improved results in our  aerospace  fasteners
segment.

     Net interest expense decreased 29.0% in fiscal 1999 compared to fiscal 1998
and  decreased 10.4% in fiscal 1998 compared to fiscal 1997. The decreases  were
due  to  a  series  of transactions occurring in fiscal 1998 that  significantly
reduced our total debt. We expect interest expense to increase significantly  in
the  next  year  as  a  result of additional debt we  incurred  to  finance  the
acquisition of Kaynar Technologies.

      Investment income (loss), net, was $39.8 million, $(3.4) million, and $6.7
million  in  1999, 1998, and 1997, respectively. We recognized a large  gain  in
1999  from  the  liquidation of our position in AlliedSignal to raise  funds  to
acquire  Kaynar Technologies.  The $10.1 decrease in 1998 was due to recognition
of  unrealized  losses on the fair market adjustments of investments  previously
classified  as  trading securities in the fiscal 1998 periods,  while  recording
unrealized  gains from trading securities in the fiscal 1997 periods. Unrealized
holding  gains (losses) on available-for-sale investments are marked  to  market
value   through  stockholders'  equity  and  reported  separately  as  part   of
comprehensive income.

     Nonrecurring income of $124.0 million in 1998 resulted from the disposition
of  Banner Aerospace's hardware group. Nonrecurring income in 1997 included  the
$2.5 million gain from the sale of Scandinavian Bellyloading Company.

      We  recorded  an  income  tax  benefit of $13.2  million  in  fiscal  1999
representing  a  36.3%  effective  tax rate on pre-tax  losses  from  continuing
operations.  The  tax benefit approximates the statutory rate.  The  income  tax
provision  of $47.3 million reported in fiscal 1998 represents a 38.3% effective
tax  rate  on pre-tax earnings from continuing operations (excluding  equity  in
earnings  of  affiliates  and  minority interest) of  $123.4  million.  The  tax
provision  was  slightly  higher than the statutory  rate  because  of  goodwill
associated with the disposition of Banner Aerospace's hardware group,  which  is
not  deductible  for  tax purposes. Income taxes included  a  $7.3  million  tax
benefit  in  Fiscal  1997  on  a pre-tax loss of $5.0  million  from  continuing
operations.

      Equity  in earnings of affiliates decreased $0.8 million in 1999, compared
to 1998, and $0.4 million in 1998, compared to 1997. The decreases are primarily
attributable  to losses recorded by small start-up ventures. In  July  1999,  we
divested  our  31.9%  interest in Nacanco. This will likely  reduce  our  future
equity earnings.

     Minority interest decreased by $24.2 million in 1999 and increased by $22.8
million  in  1998  as a result of the $124.0 million nonrecurring  pre-tax  gain
recognized in 1998 from the disposition of Banner Aerospace's hardware group. On
April  8,  1999,  we  completed  a  merger with  Banner  Aerospace,  which  will
effectively reduce our future minority interest effects to immaterial amounts.

     Included in earnings (loss) from discontinued operations are the results of
Fairchild  Technologies  through January 1998, and our  equity  in  earnings  of
Shared  Technologies  Fairchild  prior to  the  merger  of  Shared  Technologies
Fairchild.  Losses  increased in fiscal 1998 as a  result  of  increased  losses
recorded  at  Fairchild  Technologies and lower equity earnings  contributed  by
Shared  Technologies  Fairchild.  (See Note  4  to  our  Consolidated  Financial
Statements).

      In  1998,  we  recorded a $96.0 million gain, net of tax, on  disposal  of
discontinued  operations, from the proceeds received from the merger  of  Shared
Technologies  Fairchild. This gain was partially offset in connection  with  the
adoption  of  a  formal  plan to enhance the opportunities  for  disposition  of
Fairchild Technologies. Under this plan we recorded an after-tax charge of $31.3
million and $36.2 million on disposal of discontinued operations in fiscal  1999
and  1998,  respectively. Included in the fiscal 1998 charge, was $28.2  million
(net  of an income tax benefit of $11.8 million) for the net losses of Fairchild
Technologies  through  June 30, 1998 and $8.0 million  (net  of  an  income  tax
benefit  of  $4.8  million)  for  the estimated operating  losses  of  Fairchild
Technologies.   The  fiscal  1999  after-tax  operating  loss   from   Fairchild
Technologies  exceeded the June 1998 estimate recorded for  expected  losses  by
$28.6  million (net of an income tax benefit of $8.1 million) through June 1999.
An  additional after-tax charge of $2.8 million (net of an income tax benefit of
$2.4  million) was recorded in fiscal 1999, based on a current estimate  of  the
remaining  losses in connection with the disposition of Fairchild  Technologies.
While  we  believe  that $2.8 million is a reasonable charge for  the  remaining
losses  to  be  incurred from Fairchild Technologies, there can be no  assurance
that this estimate is adequate.

     In fiscal 1999, we recognized an extraordinary loss of $4.2 million, net of
tax,  to  write-off the remaining deferred loan fees associated with  the  early
extinguishment  of  our  indebtedness pursuant  to  our  acquisition  of  Kaynar
Technologies (See Note 8). In fiscal 1998 we recognized an extraordinary loss of
$6.7  million,  net of tax, to write-off the remaining deferred  loan  fees  and
original   issue   discounts  associated  with  early  extinguishment   of   our
indebtedness  pursuant the repayment of all our public debt and  refinancing  of
credit facilities.

       Comprehensive   income  (loss)  includes  foreign  currency   translation
adjustments and unrealized holding changes in the fair market value of
available-for-sale  investment  securities. The fair market value  of
unrealized  holding securities  declined  by  $16.5 million in fiscal 1999 and
increased  by  $20.6 million  in  1998.  The 1999 changes reflect primarily
gains realized  from  the liquidation  of  investments,  primarily AlliedSignal
common  stock.  The  1998 increase  was  primarily the result of an increase in
the value of  AlliedSignal common  stock  which  we  received from the
disposition  of  Banner  Aerospace's hardware  group.  Foreign  currency
translation adjustments  decreased  by  $2.5 million and $5.1 million in fiscal
1999 and 1998, respectively.

Segment Results

Aerospace Fasteners Segment

      Sales  in  the aerospace fasteners segment increased by $55.5  million  to
$442.7  million,  up 14.3% in fiscal 1999, compared to fiscal  1998,  reflecting
growth  due  primarily  to  the acquisition of Kaynar Technologies.  New  orders
stabilized  in  1999 reflecting a plateau  during fiscal 1999 and  ultimately  a
slight  downturn in the commercial aerospace industry in the fourth  quarter  of
fiscal 1999. Backlog increased by $38 million in fiscal 1999 to $215 million  at
June 30, 1999, reflecting the acquisition of Kaynar Technologies. Excluding  $90
million of backlog contributed by Kaynar Technologies, our backlog decreased $52
million. Sales in the aerospace fasteners segment increased by $118.2 million to
$387.2  million,  up 43.9% in fiscal 1998, compared to fiscal  1997,  reflecting
growth  in  the  commercial  aerospace industry  combined  with  the  effect  of
acquisitions.  On  a  pro  forma  basis reflecting  acquisitions  in  comparable
periods,  sales  decreased 3.2% in fiscal 1999, compared  to  fiscal  1998,  and
increased 34.7% in fiscal 1998 compared to fiscal 1997

      Operating  income  increased by $6.2 million, or 19.1%,  in  fiscal  1999,
compared to fiscal 1998.  Included in our 1999 results are restructuring charges
of  $5.5 million for integration costs and severance from the integration of our
business with the Kaynar Technologies business. Excluding restructuring charges,
operating income increased $11.7 million in fiscal 1999 compared to fiscal 1998.
Excluding  restructuring charges, internal growth was 7.9%  in  fiscal  1999  at
operations  we  owned entirely during the period, compared to  the  fiscal  1998
results of these same operations on a pro forma basis. Operating income improved
by   $15.3  million,  or  88.2%,  in  fiscal  1998,  compared  to  fiscal  1997.
Acquisitions and marketing changes were contributing factors to the fiscal  1998
improvement.  We  anticipate that cost savings resulting from the  manufacturing
integration  of  the  Kaynar Technologies business with our  own  business  will
further  improve  operating  results in fiscal  2000.  On  a  pro  forma  basis,
operating  income decreased $13.6 million in fiscal 1999, as compared to  fiscal
1998 and increased $35.0 million in fiscal 1998, as compared to fiscal 1997.

      We  believe the demand for aerospace fasteners in fiscal 2000 will  remain
relatively  high in Europe, and expect sluggish demand in the United States.  We
anticipate that order rates may start increasing again during the ladder part of
fiscal 2000. In the meantime, we believe production volume on a worldwide  basis
will  remain at reasonable levels. We expect that our merger integration savings
and production efficiency improvements will allow us to generate an increase  in
margin.

Aerospace Distribution Segment

     Sales in our aerospace distribution segment decreased by $190.1 million, or
53.0%, in fiscal 1999, compared to the fiscal 1998 period, due primarily to  the
loss  of  revenues  as  a result of the disposition of the  hardware  group  and
Solair.  Sales decreased by $53.3 million, or 13.0% in fiscal 1998, compared  to
fiscal  1997. The exclusion of six months' revenues as a result of the  hardware
group  disposition was responsible primarily for the decrease in 1998, in  which
sales  otherwise  reflected a robust aerospace industry. On a  twelve-month  pro
forma  basis, sales decreased $8.3 million, or 5.6%, in 1999 compared  to  1998,
and increased $30.6 million, or 25.9%, in 1998 compared to 1997.

     Operating income decreased by $60.3 million, in fiscal 1999, as compared to
fiscal  1998. A charge of $41.4 million is included in the current year results,
in  connection  with  the  sale  of Solair and  the  potential  sale  of  Dallas
Aerospace. Excluding these charges, operating income would have decreased  $18.9
million  in  fiscal  1999, compared to the same period of the  prior  year,  due
primarily to the disposition of Solair and the hardware group. Operating  income
decreased  $10.6  million in fiscal 1998, compared to fiscal 1997,  due  to  the
hardware group disposition. On a twelve-month pro forma basis, operating  income
decreased $30.2 million in fiscal 1999, compared to fiscal 1998, and was  stable
in fiscal 1998 compared to fiscal 1997.

Corporate and Other

      The  Corporate and Other classification includes the Gas Springs  division
and  corporate activities. The group reported an 8.8% improvement  in  sales  in
fiscal  1999,  compared to fiscal 1998. An operating loss of  $44.9  million  in
fiscal  1999  was $37.3 million higher than the operating loss of  $7.6  million
reported  in  fiscal 1998. The current year includes $23.6 million  of  one-time
costs   associated  primarily  with  the  acquisition  of  Kaynar  Technologies,
restructuring  charges, and increased environmental, legal and travel  expenses.
Also,  the  prior  year  included other income of $8.6 million,  including  $4.4
million realized as a result of the condemnation of air rights over a portion of
the property we own and are developing in Farmingdale, New York.

      The  group  reported  a decrease in sales of $9.4  million,  in  1998,  as
compared  to  1997, due to the exclusion of Fairchild Scandinavian  Bellyloading
results  in fiscal 1998. The operating loss decreased by $7.2 million  in  1998,
compared  to  fiscal  1997, as a result of an increase in  other  income  and  a
decrease in legal expenses.
FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES

      Total  capitalization  as of June 30, 1999 and  1998  amounted  to  $931.6
million and $789.6 million, respectively. The changes in capitalization included
an increase of $208.1 million in debt and a decrease of $66.1 million in equity.
The increase in debt was a result of the acquisition of Kaynar Technologies. The
decrease  in  equity was due primarily to a $22.1 million purchase  of  treasury
stock, the $59.0 million reported loss, and a $19.0 million change in cumulative
other comprehensive income, offset partially by the issuance of $22.2 million of
our Class A common stock resulting from the merger with Banner Aerospace.

      We  maintain a portfolio of investments classified primarily as available-
for-sale securities, which had a fair market value of $28.9 million at June  30,
1999. The market value of these investments decreased $16.5 million in 1999  due
primarily to the liquidation of investments in which investment income of  $39.8
million  was  realized. While there is risk associated with market  fluctuations
inherent  in  stock investments, and because our portfolio it  not  diversified,
large   swings  in  its  value  should  be  expected.  In  1999,  we  liquidated
substantially all of our AlliedSignal common stock, using the proceeds therefrom
in  connection with the acquisition of Kaynar Technologies. In fiscal  1999,  we
sold approximately 4.9 million shares of AlliedSignal common stock for aggregate
proceeds of approximately $219.9 million.

      We  have  an  88-acre  site in Farmingdale, New  York,  of  which  we  are
developing  as  a  shopping  center. We have invested  (cash  and  interest)  of
approximately $40.4 million, $17.3 million and $6.7 million into this project in
1999,  1998  and 1997, respectively. We estimate funding of approximately  $20.0
million is needed to complete this project.

      Net  cash  provided  by  operating activities for fiscal  1999  was  $23.3
million. The primary use of cash for operating activities in fiscal 1999 was  an
increase   in   accounts  payable,  accrued  liabilities  and  other   long-term
liabilities  of  $45.9 million, partially offset by our net  loss  and  non-cash
adjustments of $16.8 million. Net cash used for operating activities for  fiscal
1998  was  $85.2  million. The primary use of cash for operating  activities  in
fiscal 1998 was a $54.9 million increase in inventories.

      Net  cash used for investing activities for fiscal 1999 was $99.2  million
and  included $274.4 million used for acquisitions, partially offset  by  $189.4
million  received  from the liquidation of investments. Net cash  provided  from
investing  activities  for fiscal 1998 was $43.6 million and  included  proceeds
received  from  the  disposition of discontinued  operations,  including  Shared
Technologies Fairchild, of $168.0 million. This was slightly offset by cash used
for  the acquisition of subsidiaries and minority interests of $32.8 million and
$26.4 million, respectively.

     Net cash provided by financing activities in fiscal 1999 and 1998 was $81.2
million  and $74.1 million, respectively. Cash provided by financing  activities
in fiscal 1999 included the issuance of additional debt of $483.2 million offset
partially  by  $380.0 million of debt repayments and $22.1 million  of  treasury
stock  purchased.  We increased our debt in fiscal 1999,  as  a  result  of  the
acquistion  of  Kaynar  Technologies. Cash provided by financing  activities  in
fiscal  1998  included the issuance $53.8 million of stock from our 1998  equity
offering  and  $275.5  million from the issuance of  additional  debt  partially
offset  by  the  repayment of debt and the repurchase of  debentures  of  $258.0
million.

        Our   principal   cash  requirements  include  debt   service,   capital
expenditures, acquisitions, and payment of other liabilities. Other  liabilities
that  require  the  use  of cash include postretirement benefits,  environmental
investigation   and  remediation  obligations,  real  estate  development,   and
litigation  settlements and related costs.  We expect that cash  on  hand,  cash
generated  from  operations, and cash from borrowings and asset  sales  will  be
adequate to satisfy our cash requirements in fiscal 2000.

Discontinued Operations

      In  fiscal  1999,  1998,  and  1997, Fairchild  Technologies  had  pre-tax
operating  losses  of  approximately $49.5  million,  $48.7  million,  and  $3.6
million,  respectively. In addition, as a result of the downturn  in  the  Asian
markets, Fairchild Technologies experienced delivery deferrals, reduction in new
orders,  lower margins and increased price competition. In response, in February
1998,  we  adopted a formal plan for the disposition of Fairchild  Technologies.
The  plan  called  for  a  reduction in production  capacity  and  headcount  at
Fairchild  Technologies  and the pursuit of potential  vertical  and  horizontal
integration  with  peers  and competitors of the two divisions  that  constitute
Fairchild Technologies.

       During  the  fourth quarter of fiscal 1999, we liquidated  a  significant
portion  of  Fairchild  Technologies  mostly  consisting  of  our  semiconductor
equipment group through several transactions.  On April 14, 1999, we disposed of
our  photoresist  deep  ultraviolet track equipment machines,  spare  parts  and
testing  equipment to Apex Co., Ltd. in exchange for 1,250,000  shares  of  Apex
stock  valued at approximately $5.1 million. On June 15, 1999, we received  $7.9
million from Suess Microtec AG and the right to receive 350,000 shares of  Suess
Microtec stock (or approximately $3.5 million) by June 2000 in exchange for  all
of the fixed assets and inventory of Fairchild Technologies SEG GmbH and certain
intellectual  property.  On May 1, 1999, we sold Fairchild  CDI  for  a  nominal
amount. Subsequent to June 30, 1999, we received approximately $7.1 million from
Novellus  in  exchange  for  our  Low-K  dielectric  product  line  and  certain
intellectual  property.  We are also exploring several alternative  transactions
regarding the Fairchild Technologies optical disc equipment group business,  but
we have not made any definitive arrangement for its ultimate disposition.

Uncertainty of the Spin-Off

      In  order to focus our operations on the aerospace industry, we have  been
considering for some time distributing to our stockholders certain of our assets
via  distribution of all of the stock of a new entity, which may own  all  or  a
substantial part of our non-aerospace operations. We are still in the process of
deciding  the exact composition of the assets and liabilities to be included  in
the  spin-off,  but such assets would be likely to include certain  real  estate
interests. Our ability to consummate the spin-off, if we should choose to do so,
would  be contingent, among other things, on attaining certain milestones  under
our  credit  facility,  or waivers thereof, and all necessary  governmental  and
third party approvals. There is no assurance that we will be able to reach  such
milestones or obtain the necessary waivers from our lenders. In addition, we may
encounter  unexpected  delays in effecting the spin-off,  and  we  can  make  no
assurance  as  to  the timing thereof, or as to whether the spin-off  will  ever
occur.

     Depending on the ultimate structure and timing of the spin-off, it may be a
taxable  transaction  to our stockholders and could result  in  a  material  tax
liability  to  us as well as our stockholders. The amount of the tax  to  us  is
uncertain, and if the tax is material to us, we may elect not to consummate  the
spin-off.  Because  circumstances may change  and  provisions  of  the  Internal
Revenue  Code of 1986, as amended, may be further amended from time to time,  we
may,  depending on various factors, restructure or delay the timing of the spin-
off to minimize the tax consequences to us and our stockholders, or elect not to
consummate the spin-off.  Under the spin-off, it is expected that that the newly
created  entity  may  assume  certain of our liabilities,  including  contingent
liabilities, and may indemnify us for such liabilities. In the event this entity
is  unable  to satisfy the liabilities, which it will assume in connection  with
the spin-off, we may have to satisfy such liabilities.

Year 2000

      As  the end of the century nears, there is a widespread concern that  many
existing data processing devices that use only the last two digits to refer to a
year  will  not  properly recognize a year that begins with  the  digits  ''20''
instead of ''19.'' If not properly modified, these data processing devices could
fail,  create erroneous results, or cause unanticipated systems failures,  among
other  problems. In response, we have developed a worldwide Year 2000  readiness
plan that is divided into a number of interrelated and overlapping phases. These
phases   include   corporate  awareness  and  planning,  readiness   assessment,
evaluation  and  prioritization  of solutions,  implementation  of  remediation,
validation testing, and contingency planning. Each is discussed below.

     Awareness.  In the corporate awareness and planning phase, we formed a Year
2000  project group under the direction of our Chief Financial Officer and Chief
Information Officer, identified and designated key personnel within the  company
to  coordinate  our  Year  2000 efforts, and retained the  services  of  outside
technical  review  and modification consultants. The project group  prepared  an
overall  schedule and working budget for our Year 2000 plan. We  have  completed
this  phase  of  our  Year  2000 plan. We evaluate  our  information  technology
applications  regularly, and based on such evaluation revise  the  schedule  and
budget  to  reflect the progress of our Year 2000 readiness efforts.  The  Chief
Financial  Officer  and  Chief  Information  Officer  regularly  report  to  our
management and to our audit committee on the status of the Year 2000 project.

      Assessment.   In the readiness assessment phase, we, in coordination  with
our   technical  review  consultants,  have  been  evaluating  our   Year   2000
preparedness  in  a  number  of  areas,  including  our  information  technology
infrastructure,  external resources, physical plant and  production  facilities,
equipment and machinery, products and inventory. We have completed this phase of
our  Year  2000  Plan.  Pending the completion of  all  validation  testing,  we
continue to review on a regular basis all aspects of our Year 2000 preparedness.
In this respect, we have designated officers at each of our business segments to
provide  regular assessment updates to our Chief Information Officer and outside
consultants,  who  have assimilated a range of alternative methods  to  complete
each phase of our Year 2000 plan and are reporting regularly their findings  and
conclusions to our management.

      Evaluation.  In the evaluation and prioritization of solutions  phase,  we
seek  to develop potential solutions to the Year 2000 issues identified  in  our
readiness  assessment  phase, consider those solutions in  light  of  our  other
information   technology  and  business  priorities,  prioritize   the   various
remediation tasks, and develop an implementation schedule. This phase is largely
complete.  However, we will continue to evaluate our Year 2000 readiness  status
through  November  15, 1999, when all validation testing is  anticipated  to  be
complete.  However, identified problems will be corrected as soon as practicable
after  identification.  To date, we have not identified  any  major  information
technology system or non-information technology system that must be replaced  in
its  entirety for Year 2000 reasons. We have also determined that  most  of  the
Year   2000   issues  identified  in  the  assessment  phase  can  be  addressed
satisfactorily  through system modifications, component  upgrades  and  software
patches.  Thus,  we do not presently anticipate incurring any  material  systems
replacement costs relating to the Year 2000 issues.

      Implementation.  In the implementation of remediation phase, we, with  the
assistance  of  our  technical  review and modification  consultants,  began  to
implement  the  proposed  solutions  to any identified  Year  2000  issues.  The
solutions  include  equipment  and  component  upgrades,  systems  and  software
patches,   reprogramming  and  resetting  machines,  and  other   modifications.
Substantially  all  of the material systems within the aerospace  fasteners  and
aerospace  distribution segments of our business are currently Year 2000  ready.
However, we are continuing to evaluate and implement Year 2000 modifications  to
embedded data processing technology in certain manufacturing equipment  used  in
our aerospace fasteners segment.

      Testing.  In the validation testing phase, we seek to evaluate and confirm
the  results of our Year 2000 remediation efforts. In conducting our  validation
testing,  we  are  using,  among  other things,  proprietary  testing  protocols
developed  internally and by our technical review and modification  consultants,
as well as testing tools such as Greenwich Mean Time's Check 2000 and SEMATECH's
Year  2000 Readiness Testing Scenarios Version 2.0. The Greenwich tools identify
potential  Year  2000-related  software and  data  problems,  and  the  SEMATECH
protocols validate the ability of data processing systems to rollover  and  hold
transition  dates.  Testing  for both the aerospace fasteners  segment  and  the
aerospace distribution segment is approximately 90 percent complete.   To  date,
the  results of our validation testing have not revealed any new and significant
Year  2000  issues or any ineffective remediation. We have completed testing  of
our most critical information technology and related systems.

     Contingency Planning.  In the contingency planning phase, we, together with
our  technical review consultants, are assessing the Year 2000 readiness of  our
key  suppliers,  distributors,  customers and  service  providers.  Toward  that
objective,  we  have sent letters, questionnaires and surveys  to  our  business
partners,  inquiring about their Year 2000 readiness arrangements.  The  average
response  rate has been approximately 55 percent, including our most significant
business  partners  have  responded to our inquiries. In  this  phase,  we  have
evaluated  the risks that our failure or the failure of others to be  Year  2000
ready  would cause a material disruption to, or have a material effect  on,  our
financial condition, business or operations. So far, we have identified only our
aerospace fasteners MRP system as being both mission critical and potentially at
risk.  In  mitigation  of this concern, we have engaged a  consultant  to  test,
evaluate  and  implement the manufacturer-designed Year  2000  patches  for  the
system.   We are also developing and evaluating contingency plans to  deal  with
events  arising from significant Year 2000 issues outside of our infrastructure.
In   this  regard,  we  are  considering  the  advisability  of  augmenting  our
inventories of certain raw materials and finished products, securing  additional
sources for certain supplies and services, arranging for back-up utilities,  and
exploring alternate distribution and sales channels, among other things.

     The following chart summarizes our progress, by phase and business segment,
in completing the Year 2000 plan:


<TABLE>
<CAPTION>

                     Percentage of Year 2000 Plan Completed
                         (By Phase and Business Segment)

                                    Quarter Ended
                 Sept.Dec.  Mar. June  Sept. Dec. Mar.   June  Work
                  28,  28,   29,  30,   27,   27,  28,   30,  Remaining
                 1997 1997  1998 1998   1998 1998 1999   1999
<S>              <C>   <C>   <C>   <C>   <C>    <C>   <C>   <C>    <C>
Awareness:
     Aerospace    50% 100%  100% 100%   100% 100% 100%   100%   0%
Fasteners
     Aerospace    100  100   100  100   100   100  100   100    0
Distribution
Assessment:
     Aerospace         25    50   75    100   100  100   100    0
Fasteners
     Aerospace          0     0    0     50   100  100   100    0
Distribution
Evaluation:
     Aerospace                           0    70   100   100    0
Fasteners
     Aerospace                           20   100  100   100    0
Distribution
Implementation:
     Aerospace                                50   60     90    10
Fasteners
     Aerospace                                40   75     95    5
Distribution
Testing:
     Aerospace                                20   35     90    10
Fasteners
     Aerospace                               30-40 70     90    10
Distribution
Contingency
Planning:
     Aerospace                           0    20   35     90    10
Fasteners
     Aerospace                           25   50   65     90    10
Distribution
</TABLE>

      The  chart  below summarizes costs we incurred through June 30,  1999,  by
segment,  to  address  Year  2000  issues, and the  total  costs  we  reasonably
anticipate  incurring during the remainder of 1999 relating  to  the  Year  2000
issue.
<TABLE>
<CAPTION>

(In thousands)                Year 2000 Costs Anticipated Year 2000
                                   as of              Costs
                               June 30, 1999   During the Next Six
                                                      Months
<S>                          <C>               <C>
Aerospace Fasteners                $685                $400
Aerospace Distribution             $600                $50
</TABLE>

      We  have  funded  the costs of our Year 2000 plan from  general  operating
funds,  and  all such costs have been deducted from income. To date,  the  costs
associated  with our Year 2000 efforts have not had a material  effect  on,  and
have caused no delays with respect to, our other information technology programs
or projects.

      We anticipate that we will complete our Year 2000 preparations by November
15, 1999. Although our Year2000 implementation, testing and contingency planning
phases  are not yet complete, we do not currently believe that Year 2000  issues
will  materially  affect  our  business,  results  of  operations  or  financial
condition. However, in some international markets in which we conduct  business,
the  level of awareness and remediation efforts by third parties, utilities  and
infrastructure  managers relating to the Year 2000 issue may  be  less  advanced
than  in  the United States, which could, despite our efforts, have  an  adverse
effect on us. If our mission critical systems are not Year 2000 ready, we  could
be  subject  to  significant business interruptions,  and  could  be  liable  to
customers  and other third parties for breach of contract, breach  of  warranty,
misrepresentation, unlawful trade practices and other claims.

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

      In  June 1998, the FASB issued Statement of Financial Accounting Standards
No. 133 "Accounting for Derivative Instruments and Hedging Activities." SFAS 133
establishes  a  new model for accounting for derivatives and hedging  activities
and  supersedes  and  amends  a  number of existing  accounting  standards.   It
requires  that  all derivatives be recognized as assets and liabilities  on  the
balance sheet and measured at fair value.  The corresponding derivative gains or
losses  are  reported  based  on the hedge relationship  that  exists,  if  any.
Changes  in the fair value of derivative instruments that are not designated  as
hedges  or  that  do not meet the hedge accounting criteria  in  SFAS  133,  are
required  to  be reported in earnings.  Most of the general qualifying  criteria
for  hedge accounting under SFAS 133 were derived from, and are similar to,  the
existing  qualifying  criteria in SFAS 80 "Accounting  for  Futures  Contracts."
SFAS 133 describes three primary types of hedge relationships: fair value hedge,
cash  flow  hedge,  and foreign currency hedge. In June 1999,  the  FASB  issued
Statement  of  Financial  Accounting Standards No. 137  to  defer  the  required
effective  date of implementing SFAS 133 from fiscal years beginning after  June
15,  1999 to fiscal years beginning after June 15, 2000. We will adopt SFAS  133
in fiscal 2001 and we are currently evaluating the financial statement impact.

ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

      The  table  below  provides  information about  our  derivative  financial
instruments  and other financial instruments that are sensitive  to  changes  in
interest rates, which include interest rate swaps. For interest rate swaps,  the
table  presents notional amounts and weighted average interest rates by expected
(contractual)  maturity  dates.  Notional amounts  are  used  to  calculate  the
contractual  payments  to  be  exchanged under the  contract.  Weighted  average
variable  rates  are based on implied forward rates in the yield  curve  at  the
reporting date.
<TABLE>
<CAPTION>


                                 Expected Maturity Date
                         2000   2001    2002   2003     2004  Thereafter
<S>                     <C>     <C>     <C>     <C>     <C>      <C>
Interest Rate Swaps:
   Variable to fixed    20,000 60,000     -      -       -    100,000
      Average cap rate   7.25%  6.81%     -      -       -     6.49%
      Average floor      5.84%  5.99%     -      -       -     6.24%
rate
      Weighted average   5.71%  5.74%     -      -       -     6.12%
rate
      Fair market value  (44)   (99)      -      -       -    (3,709)
</TABLE>



ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

      The  following  consolidated financial statements of the Company  and  the
report of our independent public accountants with respect thereto, are set forth
below.


                                                                      Page

Report of Independent Public Accountants                               29

Consolidated Balance Sheets as of June 30, 1999 and 1998               30

Consolidated Statements of Earnings for each of the Three
  Years Ended June 30, 1999, 1998, and 1997                            32

Consolidated Statements of Stockholders' Equity for each
  of the Three Years Ended June 30, 1999, 1998, and 1997               34

Consolidated  Statements of Cash Flows for each of the Three
  Years Ended June 30, 1999, 1998, and 1997                            35

Notes to Consolidated Financial Statements                             36

Supplementary  information regarding "Quarterly Financial Data  (Unaudited)"  is
set forth under Item 8 in Note 21 to Consolidated Financial Statements.

                    Report of Independent Public Accountants

To The Fairchild Corporation and Consolidated Subsidiaries:

      We  have  audited  the  accompanying consolidated balance  sheets  of  The
Fairchild Corporation (a Delaware corporation) and consolidated subsidiaries  as
of  June 30, 1999 and 1998, and the related consolidated statements of earnings,
stockholders'  equity and cash flows for each of the three years in  the  period
ended  June  30,  1999,  1998  and 1997.  These  financial  statements  are  the
responsibility of the Company's management.  Our responsibility is to express an
opinion on these financial statements based on our audits. We did not audit  the
financial statements of Nacanco Paketleme (see Note 7), the investment in  which
is reflected in the accompanying financial statements using the equity method of
accounting.  The  investment in Nacanco Paketleme represents  1  percent  and  2
percent  of  total  assets as of June 30, 1999 and 1998, respectively,  and  the
equity  in its net income represents 11 percent, 9 percent, and  257 percent  of
earnings  from  continuing  operations as of June  30,  1999,  1998,  and  1997,
respectively. The statements of Nacanco Paketleme were audited by other auditors
whose report has been furnished to us and our opinion, insofar as it relates  to
the  amounts  included for Nacanco Paketleme, is based on the  report  of  other
auditors.

      We  conducted  our  audits in accordance with generally accepted  auditing
standards.  Those standards require that we plan and perform an audit to  obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the  amounts and disclosures in the financial statements. An audit also includes
assessing  the  accounting  principles used and significant  estimates  made  by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

      In  our opinion, based on our audits and the report of other auditors, the
financial statements referred to above present fairly, in all material respects,
the   financial   position  of  The  Fairchild  Corporation   and   consolidated
subsidiaries  as of June 30, 1999 and 1998, and the results of their  operations
and  their cash flows for each of the three years ended June 30, 1999, 1998  and
1997, in conformity with generally accepted accounting principles.


                    Arthur Andersen LLP


Vienna, VA
September 15, 1999

<TABLE>
<CAPTION>
             THE FAIRCHILD CORPORATION AND CONSOLIDATED SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                                 (In thousands)


                                             June 30, June 30,
                   ASSETS                      1999     1998

<S>                                          <C>       <C>
CURRENT ASSETS:
Cash and cash equivalents, $15,752 and $746
restricted                                   $ 54,860  $ 49,601
Short-term investments                         13,094     3,962
Accounts receivable-trade, less allowances    130,121   120,284
of $6,442 and $5,655
Inventories:
   Finished goods                             137,807   187,205
   Work-in-process                             38,316    20,642
   Raw materials                               14,116     9,635
                                              190,239   217,482
Net current assets of discontinued
operations                                          -    11,613
Prepaid expenses and other current assets      73,926    53,081
TOTAL CURRENT ASSETS                          462,240   456,023

Property, plant and equipment, net of
accumulated
  depreciation of $103,556 and $82,968        184,065   118,963
Net assets held for sale                       21,245    23,789
Net noncurrent assets of discontinued                     8,541
operations                                          -
Cost in excess of net assets acquired
(Goodwill), less
  accumulated amortization of $40,307 and     447,722   168,307
$42,079
Investments and advances, affiliated           31,791    27,568
companies
Prepaid pension assets                         63,958    61,643
Deferred loan costs                            13,077     6,362
Real estate investment                         83,791    43,440
Long-term investments                          15,844   235,435
Other assets                                    5,053     7,188
TOTAL ASSETS                               $1,328,786 $1,157,259








The accompanying Notes to Consolidated Financial Statements are an integral part
of these statements.
</TABLE>

<TABLE>
<CAPTION>

             THE FAIRCHILD CORPORATION AND CONSOLIDATED SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                                 (In thousands)

                                             June 30, June 30,
    LIABILITIES AND STOCKHOLDERS' EQUITY       1999     1998

<S>                                          <C>       <C>
CURRENT LIABILITIES:
Bank notes payable and current maturities of
long-term debt                               $ 28,860 $  20,665
Accounts payable                               72,271    53,859
Accrued liabilities:
    Salaries, wages and commissions            43,095    23,613
    Employee benefit plan costs                 5,204     1,463
    Insurance                                  14,216    12,575
    Interest                                    7,637     2,303
    Other accrued liabilities                  50,984    52,789
                                              121,136    92,743
Net current liabilities of discontinued
operations                                     10,999         -
Income taxes                                             28,311
                                                    -
TOTAL CURRENT LIABILITIES                     233,266   195,578

LONG-TERM LIABILITES:
Long-term debt, less current maturities       495,283   295,402
Other long-term liabilities                    25,904    23,767
Retiree health care liabilities                44,813    42,103
Noncurrent income taxes                       121,961    95,176
Minority interest in subsidiaries                  59    31,674
TOTAL LIABILITIES                             921,286   683,700

STOCKHOLDERS' EQUITY:
Class A common stock, 10 cents par value;
authorized 40,000,000
  shares, 29,754,448 (26,678,561 in 1998)
shares issued and
  22,258,580 (20,428,591 in 1998) shares        2,975     2,667
outstanding
Class B common stock, 10 cents par value;
authorized 20,000,000
  shares, 2,621,652 (2,624,716 in 1998)           262       263
shares issued and outstanding
Paid-in capital                               229,038   195,112
Retained earnings                             252,030   311,039
Cumulative other comprehensive income         (2,703)    16,386
Treasury Stock, at cost, 7,495,868
(6,249,970 in 1998) shares
  of Class A common stock                    (74,102)  (51,908)
TOTAL STOCKHOLDERS' EQUITY                    407,500   473,559
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
                                           $1,328,786 $1,157,259






The accompanying Notes to Consolidated Financial Statements are an integral part
of these statements.
</TABLE>

<TABLE>
<CAPTION>
             THE FAIRCHILD CORPORATION AND CONSOLIDATED SUBSIDIARIES
                       CONSOLIDATED STATEMENTS OF EARNINGS
                      (In thousands, except per share data)

                                        For the Years Ended June 30,
                                              1999    1998    1997
<S>                                          <C>     <C>      <C>
REVENUE:
   Net sales                                $617,322 $741,176 $680,763
   Other income, net                           3,899    6,508       28

                                             621,221  747,684  680,791
 COSTS AND EXPENSES:
Cost of goods sold, including inventory
impairment adjustments of $41,465 in 1999    504,893  554,670  499,419
relating to the disposition of Solair and
the potential disposition of Dallas
Aerospace
   Selling, general & administrative         149,348  142,102  143,059
   Amortization of goodwill                    6,517    5,469    4,814
   Restructuring                               6,374        -        -
                                             667,132  702,241  647,292
 OPERATING INCOME (LOSS)                     (45,911)  45,443   33,499
 Interest expense                             33,162   46,007   52,376
 Interest income                              (2,816)  (3,292)  (4,695)
 Net interest expense                         30,346   42,715   47,681
 Investment income (loss), net                39,800   (3,362)   6,651
 Non-recurring income                              -  124,028    2,528
 Earnings (loss) from continuing operations
before taxes                                 (36,457) 123,394   (5,003)
 Income tax (provision) benefit               13,245  (47,274)   7,344
 Equity in earnings of affiliates, net         1,795    2,571    2,989
 Minority interest, net                       (2,090) (26,292)  (3,514)
 Earnings (loss) from continuing operations  (23,507)  52,399    1,816
 Loss from discontinued operations, net            -   (4,296)    (485)
 Gain (loss) on disposal of discontinued
operations, net                              (31,349)  59,717       -
 Earnings (loss) before extraordinary items  (54,856) 107,820   1,331
 Extraordinary items, net                     (4,153) (6,730)       -
NET EARNINGS (LOSS)                         $(59,009) $101,090 $ 1,331
 Other comprehensive income, net of tax:
 Foreign currency translation adjustments     (2,545) (5,140)  (1,514)
 Unrealized holding gains (losses) on
secruities arising during the period         (16,544) 20,633       74
 Other comprehensive income (loss)           (19,089) 15,493   (1,440)
 COMPREHENSIVE INCOME (LOSS)                $(78,098)$116,583  $ (109)





The accompanying Notes to Consolidated Financial Statements are an integral part
of these statements.
</TABLE>

<TABLE>
<CAPTION>

             THE FAIRCHILD CORPORATION AND CONSOLIDATED SUBSIDIARIES
                       CONSOLIDATED STATEMENTS OF EARNINGS
                      (In thousands, except per share data)


                                          For the Years Ended June 30,
                                              1999    1998   1997
<S>                                          <C>     <C>     <C>
BASIC EARNINGS PER SHARE:
Earnings (loss) from continuing operations         $      $       $
                                            $ (1.03) $ 2.78  $ 0.11
Loss from discontinued operations, net
                                                   -  (0.23)  (0.03)
Gain (loss) on disposal of discontinued
operations, net                               (1.38)   3.17       -
Extraordinary items, net
                                              (0.18)  (0.36)      -
NET EARNINGS (LOSS)
                                            $ (2.59) $ 5.36  $ 0.08
 Other comprehensive income, net of tax:
 Foreign currency translation adjustments
                                            $ (0.11) $(0.27) $ (0.09)
 Unrealized holding gains (losses) on
securities arising during the period          (0.73)   1.10       -
 Other comprehensive income
                                              (0.84)   0.83   (0.09)
 COMPREHENSIVE INCOME (LOSS)
                                             $(3.43) $ 6.19   $(0.01)

DILUTED EARNINGS PER SHARE:
Earnings (loss) from continuing operations
                                            $ (1.03) $ 2.66   $ 0.11
Loss from discontinued operations, net
                                                   -  (0.22)   (0.03)
Gain (loss) on disposal of discontinued
operations, net                               (1.38)   3.04       -
Extraordinary items, net
                                              (0.18)  (0.34)      -
NET EARNINGS (LOSS)
                                            $ (2.59) $ 5.14   $  0.08
 Other comprehensive income, net of tax:
 Foreign currency translation adjustments
                                            $ (0.11) $(0.26)  $ (0.09)
 Unrealized holding gains (losses) on
securities arising during the period          (0.73)   1.05       -
 Other comprehensive income
                                              (0.84)   0.79     (0.09)
 COMPREHENSIVE INCOME (LOSS)                 $(3.43) $ 5.93    $(0.01)
Weighted average shares outstanding:
  Basic                                       22,766 18,834    16,539
  Diluted                                     22,766 19,669    17,321









The accompanying Notes to Consolidated Financial Statements are an integral part
of these statements.
</TABLE>

<TABLE>
<CAPTION>

             THE FAIRCHILD CORPORATION AND CONSOLIDATED SUBSIDIARIES
                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                                 (In thousands)

                        Class Class
                          A     B                              Cumulative
                        Common Common Paid                     Other
                                        in   Retained Treasury Comprehensive
                        Stock  Stock Capital Earnings Stock    Income  Total
<S>                        <C>   <C>    <C>    <C>    <C>    <C>       <C>
Balance, July 1, 1996   $2,000  $263 $69,366 $208,618 $(51,719) $2,333 $230,861
 Net earnings                -     -       -    1,331        -       -    1,331
 Foreign currency
translation adjustments      -     -       -        -        -  (1,514)  (1,514)
 Fair market value of
stock warrants issued        -     -     546        -        -       -      546
 Proceeds received from
options exercised (234,935
shares)                     23    -    1,103        -        -       -    1,126
 Net unrealized holding
gain on available-for-sale
securities                   -    -        -        -        -      74       74
 Balance, June 30, 1997  2,023  263   71,015  209,949  (51,719)    893  232,424
 Net earnings                -    -        -  101,090        -       -  101,090
 Foreign currency
translation adjustments      -    -        -        -        -  (5,140)  (5,140)
 Compensation expense from
 adjusted terms to warrants and
options                      -    -    5,655        -        -       -    5,655
 Stock issued for Special-
T acquisition              108    -   21,939        -        -       -   22,047
 Stock issued for Exchange
Offer                      221    -   42,588        -        -       -   42,809
 Equity Offering
                           300    -   53,268        -        -       -   53,568
 Proceeds received from
stock options
    exercised (141,259
shares)                     10    -      652        -     (189)      -      473
 Cashless exercise of
warrants (47,283 shares)     5    -       (5)       -        -       -        -
 Net unrealized holding
gain on available-for-sale
securities                   -    -        -        -        -  20,633   20,633
 Balance, June 30, 1998  2,667  263  195,112  311,039  (51,908) 16,386  473,559
Net Loss                     -    -        -  (59,009)       -       -  (59,009)
 Foreign currency
translation adjustments      -    -        -        -        -  (2,545)  (2,545)
 Stock issued for Special-
T acquistion                   1  -      132        -        -       -      133
 Stock issued for Banner
Aerospace merger             298  -   33,093        -        -       -   33,391
 Proceeds received from
stock options
   exercised (75,383
shares)                        7  -      266        -      (92)      -      181
 Restricted stock plan
issuance (14,969 shares)       1  -       (1)       -      -                 -
 Purchase of treasury
shares (1,239,750 shares)      -  -        -        -   (22,102)     - (22,102)
 Exchange of Class B for
Class A
   common stock (3,064         1 (1)       -        -         -      -       -
shares)
 Compensation expense from
stock options                  -   -     436        -         -      -     436
 Net unrealized holding
loss on
   available-for-sale
securities                     -   -       -        -         -(16,544)(16,544)
 Balance, June 30, 1999    2,975 262 229,038  252,030   (74,102)(2,703)407,500

The accompanying Notes to Consolidated Financial Statements are an integral part
of these statements.
</TABLE>
<TABLE>
<CAPTION>
             THE FAIRCHILD CORPORATION AND CONSOLIDATED SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (In thousands)
                                              For the Years Ended June 30,
                                                   1999    1998    1997
<S>                                              <C>      <C>      <C>
Cash flows from operating activities:
       Net earnings (loss)                     $ (59,009)101,090   1,331
       Depreciation and amortization              25,657  20,873  20,815
       Deferred loan fee amortization              1,100   2,406   2,847
       Accretion of discount on long-term
liabilities                                        5,270   3,766   4,963
        Net gain on the disposition of
subsidiaries                                           - (124,041)     -
        Net gain on the sale of discontinued
operations                                             - (132,787)     -
        Extraordinary items, net of cash
payments                                           6,389  10,347       -
        Provision for restructuring (excluding
cash payments of $2,600 in 1999)                   3,774       -       -
        (Gain) loss on sale of property, plant,
and equipment                                        400     246    (72)
        (Undistributed) distributed earnings of
affiliates, net                                    3,433   1,725 (1,055)
        Minority interest                          2,090  26,292   3,514
        Change in trading securities              (1,254)  9,275  (5,733)
        Change in receivables                      8,632 (12,846)(48,693)
        Change in inventories                     14,727 (54,857)(36,868)
        Change in other current assets           (22,365)(26,643)(14,088)
        Change in other non-current assets       (26,741)    700  (9,828)
        Change in accounts payable, accrued
liabilities and other long-term liabilities       45,906  77,434   6,747
        Non-cash charges and working capital
changes of discontinued operations                15,259  11,789 (17,201)
        Net cash provided by (used for)
operating activities                              23,268 (85,231)(93,321)
 Cash flows from investing activities:
        Proceeds received from (used for)
investment securities, net                       189,379  (7,287)(12,951)
        Purchase of property, plant and
equipment                                        (30,142)(36,029)(15,014)
        Proceeds from sale of plant, property
and equipment                                        844     336     213
        Equity investment in affiliates           (7,678) (4,343) (1,749)
        Minority interest in subsidiaries              - (26,383) (1,610)
        Acquisition of subsidiaries, net of cash
acquired                                        (274,427)(32,795)(55,916)
        Net proceeds received from sale of
subsidiary                                        60,396       -       -
        Net proceeds received from the sale of
discontinued operations                                - 167,987 173,719
        Changes in real estate investment        (40,351)(17,262) (6,737)
        Changes in net assets held for sale        3,134   2,140     385
        Investing activities of discontinued
operations                                          (312) (2,750) (7,102)
        Net cash provided by (used for)
investing activities                             (99,157) 43,614  73,238
 Cash flows from financing activities:
        Proceeds from issuance of debt           483,222 275,523 154,294
        Debt repayments and repurchase of
debentures, net                                (380,083)(258,014)(155,600)
        Issuance of Class A common stock             181  54,041   1,126
       Purchase of treasury stock                (22,102)      -       -
        Financing activities of discontinued
operations                                             -   2,538  (1,275)
        Net cash provided by (used for)
financing activities                              81,218  74,088  (1,455)
    Effect of exchange rate changes on cash          (70) (2,290)  1,309
    Net change in cash and cash equivalents        5,259  30,181 (20,229)
    Cash and cash equivalents, beginning of the
year                                              49,601  19,420  39,649
    Cash and cash equivalents, end of the year   $54,860 $49,601 $19,420

The accompanying Notes to Consolidated Financial Statements are an integral part
of these statements.
</TABLE>

             THE FAIRCHILD CORPORATION AND CONSOLIDATED SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                      (In thousands, except per share data)

 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

      General:  All  references  in  the notes  to  the  consolidated  financial
statements   to   the  terms  "we,"  "our,"  "us,"  the  "Company"   and
"Fairchild" refer to The Fairchild Corporation and its subsidiaries.

     Corporate Structure:  The Fairchild Corporation was incorporated in October
1969,  under  the laws of the State of Delaware.  Effective April  8,  1999,  we
became  the sole owner of Banner Aerospace, Inc.  RHI Holdings, Inc. is a direct
subsidiary  of  us.   RHI is the owner of 100% of Fairchild Holding  Corp.   Our
principal  operations are conducted through Fairchild Holding Corp.  and  Banner
Aerospace.   During  the periods covered by these financial statements  we  held
significant  equity  interests  in  Nacanco Paketleme  and  Shared  Technologies
Fairchild  Inc.   In February 1998, we adopted a formal plan to dispose  of  our
interest  in  our  technologies products segment operating  under  the  name  of
Fairchild  Technologies.  Accordingly,  our  financial  statements  present  the
results  of  our  former  communications services segment,  Shared  Technologies
Fairchild and Fairchild Technologies as discontinued operations.

     Fiscal  Year:   Our  fiscal year  ends June 30. All  references  herein  to
"1999",  "1998", and "1997" mean the fiscal years ended June 30, 1999, 1998  and
1997, respectively.

      Consolidation  Policy: The accompanying consolidated financial  statements
are  prepared  in accordance with generally accepted accounting  principles  and
include  our accounts and all of the accounts of our wholly-owned and  majority-
owned subsidiaries.  All significant intercompany accounts and transactions have
been  eliminated in consolidation.  Investments in companies in which  ownership
interest  range from 20 to 50 percent are accounted for using the equity  method
(see Note 7).

      Revenue  Recognition: Sales and related costs are recognized upon shipment
of product and performance of services. Sales and related cost of sales on long-
term  contracts are recognized as products are delivered and services performed,
determined by the percentage of completion method. Lease and rental revenue  are
recognized as earned.

      Cash Equivalents/Statements of Cash Flows:  For purposes of the Statements
of  Cash Flows, we consider all highly liquid investments with original maturity
dates  of three months or less as cash equivalents. Total net cash disbursements
(receipts) made by us for income taxes and interest were as follows:
<TABLE>
<CAPTION>

                              1999     1998     1997
<S>                         <C>      <C>      <C>
 Interest                    $29,200  $52,737 $48,567
 Income Taxes                (21,304)    (987) (1,926)
</TABLE>

      Restricted  Cash:  On June 30, 1999 and 1998, we had  restricted  cash  of
$15,752  and  $746, respectively, all of which is maintained as  collateral  for
certain debt facilities.  Cash investments are in short-term treasury bills  and
certificates of deposit.

      Investments: Management determines the appropriate classification  of  our
investments  at  the time of acquisition and reevaluates such  determination  at
each  balance  sheet date.  Trading securities are carried at fair  value,  with
unrealized  holding  gains and losses included in earnings.   Available-for-sale
securities are carried at fair value, with unrealized holding gains and  losses,
net   of  tax,  reported  as  a  separate  component  of  stockholders'  equity.
Investments  in  equity securities and limited partnerships  that  do  not  have
readily determinable fair values are stated at cost and are categorized as other
investments.  Realized  gains  and  losses are  determined  using  the  specific
identification  method  based on the trade date of a transaction.   Interest  on
corporate  obligations, as well as dividends on preferred stock, are accrued  at
the balance sheet date.

     Inventories: Inventories are stated at the lower of cost or market. Cost is
determined  using  the  last-in, first-out ("LIFO") method  at  several  of  our
domestic  aerospace  fastener manufacturing operations and using  the  first-in,
first-out ("FIFO") method elsewhere.  If the FIFO inventory valuation method had
been  used  exclusively,  inventories would have been approximately  $3,018  and
$8,706  higher  at  June  30,  1999  and 1998, respectively.   Inventories  from
continuing operations are valued as follows
<TABLE>
<CAPTION>

                                    June 30,   June 30,
                                      1999     1998
<S>                                <C>        <C>
 First-in, first-out (FIFO)         $162,797 $177,426
 Last-in, First-out (LIFO)            27,442   40,056
 Total inventories                  $190,239 $217,482
</TABLE>

      Properties and Depreciation: The cost of property, plant and equipment  is
depreciated  over  estimated useful lives of the related  assets.  The  cost  of
leasehold  improvements is depreciated over the lesser  of  the  length  of  the
related leases or the estimated useful lives of the assets.  In fiscal 1999,  we
changed  the estimated useful life for depreciating our machinery and  equipment
from 8 to 10 years. Depreciation is computed using the straight-line method  for
financial  reporting purposes and accelerated depreciation methods  for  Federal
income  tax  purposes.  No interest costs were capitalized in any of  the  years
presented.  Property, plant and equipment consisted of the following:
<TABLE>
<CAPTION>

                                    June 30, June 30,
                                      1999     1998
<S>                                 <C>       <C>
Land                                $ 13,325 $ 11,694
Building and improvements             56,790   47,579
Machinery and equipment              173,791  113,669
Transportation vehicles                1,062      676
Furniture and fixtures                22,439   16,362
Construction in progress              20,214   11,951
Property, plant and equipment at     287,621  201,931
cost
Less: Accumulated depreciation       103,556   82,968
Net property, plant and equipment   $184,065 $118,963
</TABLE>

     Amortization of Goodwill: Goodwill, which represents the excess of the cost
of  purchased  businesses over the fair value of their net assets  at  dates  of
acquisition, is being amortized on a straight-line basis over 40 years.

      Deferred  Loan  Costs: Deferred loan costs associated  with  various  debt
issues  are  being amortized over the terms of the related debt,  based  on  the
amount  of  outstanding debt, using the effective interest method.  Amortization
expense  for  these  loan costs for 1999, 1998 and 1997 was $1,100,  $2,406  and
$2,847, respectively.

     Impairment of Long-Lived Assets: We review our long-lived assets, including
property,  plant  and  equipment, identifiable  intangibles  and  goodwill,  for
impairment  whenever  events  or  changes in  circumstances  indicate  that  the
carrying  amount  of  the  assets may not be fully  recoverable.   To  determine
recoverability of our long-lived assets we evaluate the probability that  future
undiscounted net cash flows will be less than the carrying amount of our assets.
Impairment  is measured based on the difference between the carrying  amount  of
our assets and their fair value.

       Foreign  Currency Translation: For foreign subsidiaries whose  functional
currency is the local foreign currency, balance sheet accounts are translated at
exchange rates in effect at the end of the period, and income statement accounts
are  translated  at  average  exchange rates  for  the  period.   The  resulting
translation   gains  and  losses  are  included  as  a  separate  component   of
stockholders'  equity.   Foreign  currency  transaction  gains  and  losses  are
included in other income and were insignificant in fiscal 1999, 1998 and 1997.

      Research  and  Development:  Company-sponsored  research  and  development
expenditures are expensed as incurred.

      Capitalization of interest and taxes: We capitalize interest  expense  and
property  taxes  relating  to certain real estate property  being  developed  in
Farmingdale, New York. Interest of $4,671, $3,078 and $2,356 was capitalized  in
1999, 1998 and 1997, respectively.

      Nonrecurring Income: Nonrecurring income of $124,028 in 1998 resulted from
the disposition of our aerospace distribution segment's hardware group (See Note
2).  Nonrecurring income of $2,528 in 1997 resulted from the gain recorded  from
the sale of Fairchild Scandinavian Bellyloading Company, (See Note 2).

      Stock-Based  Compensation:  In fiscal 1997, we  implemented  Statement  of
Financial   Accounting   Standards   No.  123,   "Accounting   for   Stock-Based
Compensation".  SFAS 123 establishes financial accounting standards  for  stock-
based employee compensation plans and for transactions in which an entity issues
equity  instruments  to  acquire  goods  or  services  from  non-employees.   As
permitted by SFAS 123, we will continue to use the intrinsic value based  method
of  accounting  prescribed by APB Opinion No. 25, for our  stock-based  employee
compensation  plans.  Fair market disclosures required by SFAS 123 are  included
in Note 12.

      Fair  Value of Financial Instruments: The carrying amount reported in  the
balance  sheet  approximates the fair value for our cash and  cash  equivalents,
investments,  short-term borrowings, current maturities of long-term  debt,  and
all other variable rate debt (including borrowings under our credit agreements).
The  fair  value  for  our other fixed rate long-term debt  is  estimated  using
discounted cash flow analyses, based on our current incremental borrowing  rates
for  similar  types of borrowing arrangements.  Fair values of our  off-balance-
sheet  instruments (hedging agreements, letters of credit, commitments to extend
credit, and lease guarantees) are based on fees currently charged to enter  into
similar  agreements, taking into account the remaining terms of  the  agreements
and  the  counter parties' credit standing. These instruments are  described  in
Note 8.

      Use  of  Estimates:  The preparation of financial statements in conformity
with  generally accepted accounting principles requires our management  to  make
estimates  and  assumptions  that  affect the reported  amounts  of  assets  and
liabilities, concerning the disclosure of contingent assets and liabilities, and
the  reported  amounts  of revenues and expenses during  the  reporting  period.
Actual results could differ from those estimates.

     Reclassifications: Certain amounts in our prior years' financial statements
have been reclassified to conform to the 1999 presentation.

      Recently  Issued Accounting Pronouncements: In June 1998, the FASB  issued
Statement  of Financial Accounting Standards No. 133, "Accounting for Derivative
Instruments  and  Hedging  Activities." SFAS 133 establishes  a  new  model  for
accounting  for derivatives and hedging activities and supersedes and  amends  a
number  of  existing accounting standards.  It requires that all derivatives  be
recognized as assets and liabilities on the balance sheet and measured  at  fair
value.   The corresponding derivative gains or losses are reported based on  the
hedge relationship that exists, if any.  Changes in the fair value of derivative
instruments  that  are not designated as hedges or that do not  meet  the  hedge
accounting criteria in SFAS 133, are required to be reported in earnings.   Most
of  the  general qualifying criteria for hedge accounting under  SFAS  133  were
derived  from, and are similar to, the existing qualifying criteria in SFAS  80,
"Accounting for Futures Contracts."  SFAS 133 describes three primary  types  of
hedge  relationships:  fair value hedge, cash flow hedge, and  foreign  currency
hedge. In June 1999, the FASB issued Statement of Financial Accounting Standards
No.  137  to  defer the required effective date of implementing  SFAS  133  from
fiscal years beginning after June 15, 1999 to fiscal years beginning after  June
15,  2000. We will adopt SFAS 133 in fiscal 2001 and we are currently evaluating
the financial statement impact.

BUSINESS COMBINATIONS

 Aquisitions

      We  have  accounted for the following acquisitions by using  the  purchase
method.   The respective purchase price is assigned to the net assets  acquired,
based  on  the  fair  value  of such assets and liabilities  at  the  respective
acquisition dates.

      On  June  18,  1999,  we completed the acquisition of  Technico  S.A.  for
approximately $4.1 million and assummed approximately $2.2 million of Technico's
existing debt. The total cost of the acquisition exceeded the fair value of  the
net  assets  of  Technico by approximately $2.9 million, which is  preliminarily
being  allocated as goodwill, and amortized using the straight-line method  over
40  years.  The  acquisition was financed with additional  borrowings  from  our
credit facility.

     On April 20, 1999, we completed the acquisition of all the capital stock of
Kaynar   Technologies,  Inc.  for  approximately  $222   million   and   assumed
approximately $103 million of Kaynar Technologies's existing debt, the  majority
of  which  was  refinanced at closing. In addition, we paid $28  million  for  a
covenant   not   to   compete  from  Kaynar  Technologies's  largest   preferred
shareholder.  The total cost of the acquisition exceeded the fair value  of  the
net  assets  of  Kaynar Technologies by approximately $269.7 million,  which  is
preliminarily being allocated as goodwill, and amortized using the straight-line
method over 40 years. The acquisition was financed with existing cash, the  sale
of  $225 million of 10 3/4% senior subordinated notes due 2009 and proceeds from
a new bank credit facility.

      On February 22, 1999, we used available cash to acquire 77.3% of SNEP S.A.
By  June  30,  1997, we had purchased significantly all of the remaining  shares
SNEP.  The  total  amount  paid was approximately $8.0 million,  including  $1.1
million  of debt assumed, in a business combination accounted for as a purchase.
The  total cost of the acquisition exceeded the fair value of the net assets  of
SNEP  by  approximately $4.3 million, which is preliminarily being allocated  as
goodwill, and amortized using the straight-line method over 40 years.  SNEP is a
French manufacturer of precision machined self-locking nuts and special threaded
fasteners serving the European industrial, aerospace and automotive markets.

      On  March  2,  1998, we acquired Edwards and Lock Management  Corporation,
doing  business as Special-T Fasteners, in a business combination accounted  for
as  a purchase. The cost of the acquisition was approximately $50.0 million,  of
which 50.1% of the contractual purchase price was paid in shares of our Class  A
common  stock  and  49.9% was paid in cash. The total cost  of  the  acquisition
exceeded  the  fair value of the net assets of Special-T by approximately  $23.3
million, which is being allocated as goodwill, and amortized using the straight-
line  method  over  40  years.   Special-T manages the  logistics  of  worldwide
distribution  of  our manufactured precision fasteners to our customers  in  the
aerospace industry, government agencies, OEMs, and other distributors.

      On  November 28, 1997, we acquired AS+C GmbH, Aviation Supply + Consulting
in  a  business combination accounted for as a purchase. The total cost  of  the
acquisition was $14.0 million, which exceeded the fair value of the  net  assets
of  AS+C by approximately $8.1 million, which is being allocated as goodwill and
amortized  using the straight-line method over 40 years. We purchased AS+C  with
cash borrowings. AS+C is an aerospace parts, logistics, and distribution company
primarily servicing European customers.

      In February 1997, we completed a transaction pursuant to which we acquired
common  shares and convertible debt representing an 84.2% interest, on  a  fully
diluted basis, of Simmonds S.A. We then initiated a tender offer to purchase the
remaining shares and convertible debt held by the public.  By June 30, 1997,  we
had  purchased,  or  placed  sufficient cash in  escrow  to  purchase,  all  the
remaining shares and convertible debt of Simmonds. The total purchase  price  of
Simmonds,  including  the assumption of debt, was approximately  $62.0  million,
which  we  funded with available cash and borrowings. We recorded  approximately
$20.5  million  in  goodwill  as a result of this acquisition,  which  is  being
amortized  using  the straight-line method over 40 years.  Simmonds  is  one  of
Europe's leading manufacturers of aerospace and automotive fasteners.
    Divestitures

      On  December  31, 1998, Banner Aerospace consummated the sale  of  Solair,
Inc.,  its  largest  subsidiary in the rotables group, to Kellstrom  Industries,
Inc.,  in  exchange for approximately $60.4 million in cash  and  a  warrant  to
purchase  300,000 shares of common stock of Kellstrom. In December 1998,  Banner
Aerospace  recorded a $19.3 million pre-tax loss from the sale of  Solair.  This
loss was included in cost of goods sold as it was attributable primarily to  the
bulk sale of inventory at prices below the carrying amount of that inventory.

      On  January  13,  1998,  Banner  Aeropsace completed  the  disposition  of
substantially all of the assets and certain liabilities of certain  subsidiaries
to  AlliedSignal Inc., in exchange for shares of AlliedSignal Inc. common  stock
with  an aggregate value of $369 million. The assets transferred to AlliedSignal
consisted  primarily of Banner Aerospace's hardware group,  which  included  the
distribution  of  bearings,  nuts, bolts, screws,  rivets  and  other  types  of
fasteners, and its PacAero unit. Approximately $196 million of the common  stock
received  from AlliedSignal was used to repay outstanding term loans  of  Banner
Aerospace's subsidiaries, and related fees.

      On  June  30,  1997,  we  sold all the patents of  Fairchild  Scandinavian
Bellyloading Company to Teleflex Incorporated for $5.0 million, and  immediately
thereafter  sold  for  $2.0  million, all the stock  of  Fairchild  Scandinavian
Bellyloading  Company  to  a wholly-owned subsidiary of  Teleflex.  Nonrecurring
income  in  1997  included the $2.5 million gain from the sale  of  Scandinavian
Bellyloading Company.

3.   MINORITY INTEREST IN CONSOLIDATED SUBSIDIARIES

     Outstanding minority interest in our subsidiaries at June 30, 1999 and June
30, 1998 were $59 and $31,674 respectively.

      On  April 8, 1999, we acquired the remaining 15% of the outstanding common
and  preferred stock of Banner Aerospace, Inc. not already owned by us,  through
the merger of Banner Aerospace with one of our subsidiaries. Under the terms  of
the  merger with Banner, we issued 2,981,412 shares of our Class A common  stock
to  acquire  all  of Banner Aerospace's common and preferred stock  (other  than
those already owned by us). Banner Aerospace is now our wholly-owned subsidiary.

      On June 9, 1998 we exchanged 3,659,364 shares of Banner Aerospace's common
stock for 2,212,361 newly issued shares of our Class A common stock. As a result
of  the exchange offer, our ownership of Banner common stock increased to 83.3%.
In  May 1997, Banner Aerospace granted all of its stockholders certain rights to
purchase  Series  A  convertible paid-in-kind preferred stock.   In  June  1997,
Banner Aerospace received net proceeds of $33,876 and issued 3,710,955 shares of
preferred  stock. We purchased $28,390 of the preferred stock issued  by  Banner
Aerospace, increasing our voting percentage to 64.0%..

4.  DISCONTINUED OPERATIONS AND NET ASSETS HELD FOR SALE

      On  March  11,  1998,  Shared  Technologies  Fairchild  Inc.  merged  into
Intermedia Communications Inc.  Under the terms of the merger, holders of Shared
Technologies  Fairchild  common stock received $15.00  per  share  in  cash.  We
received  approximately $178.0 million in cash (before tax and selling expenses)
in  exchange for the common and preferred stock of Shared Technologies Fairchild
we  owned.   In fiscal 1998, we recorded a $96.0 million gain, net  of  tax,  on
disposal of discontinued operations, from the proceeds received from the  merger
of  Shared  Technologies  Fairchild  with  Intermedia.  The  results  of  Shared
Technologies  Fairchild have been accounted for as discontinued operations.  Net
earnings from discontinued operations for Shared Technologies Fairchild was $648
and $3,149 in 1998 and 1997, respectively.

      In  fiscal  1999,  1998,  and  1997, Fairchild  Technologies  had  pre-tax
operating  losses  of  approximately $49.5  million,  $48.7  million,  and  $3.6
million,  respectively. In addition, as a result of the downturn  in  the  Asian
markets, Fairchild Technologies experienced delivery deferrals, reduction in new
orders,  lower margins and increased price competition. In response, in February
1998,  we  adopted a formal plan for disposition of Fairchild Technologies.  The
plan  called  for a reduction in production capacity and headcount at  Fairchild
Technologies  and  the pursuit of potential vertical and horizontal  integration
with  peers  and  competitors  of the two divisions  that  constitute  Fairchild
Technologies.

      During  the  fourth  quarter of fiscal 1999, we liquidated  a  significant
portion  of  Fairchild  Technologies, mostly  consisting  of  our  semiconductor
equipment group through several transactions.  On April 14, 1999, we disposed of
our  photoresist  deep  ultraviolet track equipment machines,  spare  parts  and
testing  equipment to Apex Co., Ltd. in exchange for 1,250,000  shares  of  Apex
stock  valued at approximately $5.1 million. On June 15, 1999, we received  $7.9
million from Suess Microtec AG and the right to receive 350,000 shares of  Suess
Microtec stock (or approximately $3.5 million) by September 2000 in exchange for
all  of  the  shares of Fairchild Technologies SEG GmbH and certain intellectual
property. On May 1, 1999, we sold Fairchild CDI for a nominal amount. Subsequent
to  June  30,  1999,  we received approximately $7.1 million  from  Novellus  in
exchange  for  our  Low-K  dielectric  product  line  and  certain  intellectual
property.  We are also exploring several alternative transactions regarding  the
Fairchild  Technologies optical disc equipment group business, but we  have  not
made any definitive arrangements for its ultimate disposition.

      In  connection  with the adoption of such plan, we recorded  an  after-tax
charge  of $31.3 million and $36.2 million in discontinued operations in  fiscal
1999  and  1998,  respectively. Included in the fiscal 1998  charge,  was  $28.2
million,  net of an income tax benefit of $11.8 million, for the net  losses  of
Fairchild Technologies through June 30, 1998 and $8.0 million, net of an  income
tax  benefit  of $4.8 million, for the estimated remaining operating  losses  of
Fairchild  Technologies. The fiscal 1999 after-tax operating loss from Fairchild
Technologies  exceeded the June 1998 estimate recorded for  expected  losses  by
$28.6  million, net of an income tax benefit of $8.1 million, through June 1999.
An  additional after-tax charge of $2.8 million, net of an income tax benefit of
$2.4  million, was recorded in fiscal 1999, based on a current estimate  of  the
remaining  losses in connection with the disposition of Fairchild  Technologies.
While  we  believe  that $2.8 million is a reasonable charge for  the  remaining
losses  to  be  incurred from Fairchild Technologies, there can be no  assurance
that this estimate is adequate.

      Earnings from discontinued operations for the twelve months ended June 30,
1998  and  1997  includes  net losses of $4,944 and $3,634,  respectively,  from
Fairchild  Technologies  until  the adoption date  of  a  formal  plan  for  its
discontinuance.

      Net  assets held for sale at June 30, 1999, includes two parcels  of  real
estate in California, and several other parcels of real estate located primarily
throughout  the  continental United States, which we  plan  to  sell,  lease  or
develop,  subject to the resolution of certain environmental matters and  market
conditions.   Also included in net assets held for sale are limited  partnership
interests  in a real estate development joint venture and a landfill development
partnership.

      Net  assets held for sale are stated at the lower of cost or at  estimated
net realizable value, which consider anticipated sales proceeds. Interest is not
allocated to net assets held for sale.

5.   PRO FORMA FINANCIAL STATEMENTS (UNAUDITED)

      The  following table set forth the derivation of the unaudited  pro  forma
results,  representing  the  impact of our acquisition  of  Kaynar  Technologies
(completed in April 1999), our merger with Banner Aerospace (completed in  April
1999), our acquisition of Special-T (effective January 1998), our disposition of
Solair  (completed in December 1998), our disposition of the hardware  group  of
Banner  Aerospace  (completed  January 13,  1998),  the  disposition  of  Shared
Technologies  Fairchild  (completed  in March  1998),  and  our  divestiture  of
Fairchild  Scandianvian Bellyloading Company (completed June 30,  1997),  as  if
these  transactions had occurred at the beginning of each period presented.  The
pro  forma information is based on the historical financial statements of  these
companies,  giving effect to the aforementioned transactions.  In preparing  the
pro  forma data, certain assumptions and adjustments have been made which reduce
interest  expense  and investment income from our revised  debt  structures  and
reduce  minority interest from our merger with Banner Aerospace. The  pro  forma
financial  information does not reflect nonrecurring income and gains  from  the
disposal  of discontinued operations that have occurred from these transactions.
The  unaudited pro forma information is not intended to be indicative of  either
future  results  of our operations or results that might have been  achieved  if
these transactions had been in effect since the beginning of each period
<TABLE>
<CAPTION>

                                             1999     1998     1997
<S>                                        <C>      <C>      <C>
Sales                                     $ 756,481 $784,637 $ 590,981
Operating income (a)                          9,194   64,980    24,842
Earnings (loss) from continuing operations
(a, b)                                     (13,268)   10,110   (5,400)
Basic earnings (loss) from continuing
operations per share                         (0.58)     0.45    (0.28)
Diluted earnings (loss) from continuing
operations per share                         (0.58)     0.42    (0.28)
Net earnings (loss)                        (48,770)   58,801   (5,885)
Basic earnings (loss) per share              (2.14)     2.61    (0.30)
Diluted earnings (loss) per share            (2.14)     2.43    (0.30)

(a)   -  Fiscal 1999 pro forma results includes pre-tax charges recorded for the
  write-down of inventory and allowances for the doubtful collection of  certain
  accounts receivable of $25,045, costs relating to acquisitions of $23,604  and
  restructuring charges of $6,374.
(b)   -  Excludes  pre-tax investment income of $35,407 from the liquidation  of
  certain investments.
</TABLE>

6.   INVESTMENTS

Investments  at  June 30, 1999 consist primarily of common stock investments  in
public corporations, which are classified as trading securities or
available-for-sale securities.  Other short-term investments and long-term
investments do  not have  readily  determinable fair values and consist
primarily of investments  in preferred  and  common shares of private companies
and limited  partnerships.  A summary of investments held by us follows:
<TABLE>
<CAPTION>

                                          June 30, 1999  June 30, 1998
                                          Aggregate      Aggregate
                                          Fair     Cost   Fair   Cost
                                          Value   Basis   Value  Basis
<S>                                      <C>     <C>      <C>     <C>
Short-term investments:
     Trading securities - equity         $ 1,254 $ 1,221 $    -  $    -
     Available-for-sale equity            11,618   9,573  3,907   5,410
securities
     Other investments                       222     222     55      55
                                         $13,094 $11,016 $3,962  $5,465
Long-term investments:
     Available-for-sale equity
securities                               $14,616 $ 7,342 $234,307 $195,993
     Other investments                     1,228   1,228    1,128    1,128
                                         $15,844 $ 8,570 $235,435 $197,121
</TABLE>

     On June 30, 1999, we had gross unrealized holding gains from available-for-
sale  securities of $13,649 and gross unrealized holding losses from  available-
for-sale securities of $4,330.

     Investment income is summarized as follows:
<TABLE>
<CAPTION>

                                          1999     1998   1997
<S>                                      <C>     <C>      <C>
 Gross realized gain from sales          $36,677 $  364   $1,673
 Change in unrealized holding gain
(loss) from trading securities                33 (5,791)   4,289
 Gross realized loss from impairments          -   (182)       -
 Dividend income                           3,090   2,247     689
                                         $39,800 $(3,362) $6,651
</TABLE>

7.   INVESTMENTS AND ADVANCES, AFFILIATED COMPANIES

The  following table summarizes historical financial information on  a  combined
100%  basis  of  our principal investments, which are accounted  for  using  the
equity method.
<TABLE>
<CAPTION>

                                      1999     1998     1997
<S>                                 <C>       <C>       <C>
 Statement of Earnings:
     Net sales                      $ 75,495 $ 90,235 $102,962

     Gross profit                     25,297   32,449   39,041

     Earnings from continuing
operations                            13,119   14,780   14,812

     Net earnings                     13,119   14,780   14,812

 Balance Sheet at June 30:

     Current assets                 $ 26,942 $ 33,867

     Non-current assets               38,661   39,898

     Total assets                     65,603   73,765

     Current liabilities              12,249   14,558

     Non-current liabilities           1,828    1,471
</TABLE>

     On  June 30, 1999 we owned approximately 31.9% of Nacanco Paketleme  common
stock.   We  recorded equity earnings of $4,153, $4,683, and  $4,673  from  this
investment for 1999, 1998 and 1997, respectively.

     Our  share  of  equity  in  earnings, net of  tax,  of  all  unconsolidated
affiliates for 1999, 1998 and 1997 was $1,795, $2,571, and $2,989, respectively.
The carrying value of investments and advances, affiliated companies consists of
the following:
<TABLE>
<CAPTION>

                                       June     June
                                       30,      30,
                                      1999     1998
<S>                                 <C>       <C>
 Nacanco                             $17,356  $19,329
 Others                               14,435    8,239
                                     $31,791  $27,568
</TABLE>

      On  June  30,  1999,  approximately $2,698 of  our  $252,030  consolidated
retained  earnings  were  from undistributed earnings  of  50  percent  or  less
currently owned affiliates accounted for using the equity method.

8.  NOTES PAYABLE AND LONG-TERM DEBT

At  June  30, 1999 and 1998, notes payable and long-term debt consisted  of  the
following:
<TABLE>
<CAPTION>

                                            June 30,  June 30,
                                              1999      1998
<S>                                        <C>        <C>
 Short-term notes payable (weighted
average interest rates of 3.6%              $ 22,924  $ 17,811
   and 5.2% in 1999 and 1998,
respectively)
 Bank credit agreements                     $258,100  $290,800
 10 3/4 % Senior subordinated notes due 2009
                                             225,000         -
 10.65% Industrial revenue bonds               1,500     1,500
 Capital lease obligations, interest from
6.9% to 10.1%                                  2,873       923
 Other notes payable, collateralized by
property, plant and
   equipment, interest from 3.5% to 10.5%     13,746     5,033

                                             501,219   298,256
 Less: Current maturities                     (5,936)   (2,854)
 Net long-term debt                         $495,283  $295,402
</TABLE>

     Credit Agreements

     We maintain credit facilities with a consortium of banks, providing us with
a  term  loan  and revolving credit facilities. On April 20, 1999,  simultaneous
with  our  acquisition of Kaynar Technologies, we restructured our then existing
credit  facilities by entering into a new credit agreement to provide us with  a
$325,000 senior secured credit facility. The new credit facilities consist of  a
$225,000 term loan and a $100,000 revolving loan with a $40,000 letter of credit
sub-facility  and a $15,000 swing loan sub-facility. Borrowings under  the  term
loan will generally bear interest at a rate of, at our option, either 2% over
the  Citibank N.A. base rate, or 3% over the Eurodollar rate until March  31,
2000,  and is subject to change based upon our financial performance thereafter.
Advances made under the revolving credit facilities will generally bear interest
at  a rate of, at our option, either (i) 2% over the Citibank N.A. base rate, or
(ii)  3% over the Eurodollar rate until March 31, 2000, and is subject to change
based  upon our financial performance thereafter. The new credit facilities  are
subject to a non-use commitment fee on the aggregate unused availability, of
1/2% if greater than half of the revolving loan is being utilized or 3/4%
if less than
half of the revolving loan is being utilized.  Outstanding letters of credit are
subject  to  fees  equivalent  to the Eurodollar margin  rate.  The  new  credit
facilities will mature on April 30, 2006. The term loan is subject to  mandatory
prepayment requirements and optional prepayments. The revolving loan is  subject
to mandatory prepayment requirements and optional commitment reductions.

      We  are  required  under the new credit agreement to comply  with  certain
financial  and  non-financial  loan  covenants,  including  maintaining  certain
interest  and  fixed charge coverage ratios and maintaining certain indebtedness
to  EBITDA  ratios  at  the end of each fiscal quarter.  Additionally,  the  new
credit  agreement  restricts annual capital expenditures to $40,000  during  the
life of the facility. Except for non-guarantor assets, substantially all of  our
assets  are pledged as collateral under the new credit agreement. The new credit
agreement restricts the payment of dividends to our shareholders to an aggregate
of the lesser of $0.01 per share or $400 over the life of the agreement. At June
30,  1999,  we  were  in  compliance with all the  covenants  under  the  credit
agreement.

      At  June  30,  1999, we had borrowings outstanding of  $33,100  under  the
revolving credit facilities and we had letters of credit outstanding of $17,677,
which  were  supported by a sub-facility under the revolving credit  facilities.
At  June  30,  1999, we had unused bank lines of credit aggregating $49,223,  at
interest  rates  slightly higher than the prime rate.  We  also  had  short-term
lines  of  credit  relating to foreign operations, aggregating $25,857,  against
which we owed $12,295 at June 30, 1999.

     Senior Subordinated Notes

      On  April  20,  1999,  in  conjunction  with  the  acquisition  of  Kaynar
Technologies,  we  issued, at par value, $225,000 of 10 3/4% senior subordinated
notes  that mature on April 15, 2009. We will pay interest on these notes  semi-
annually on April 15 and October 15 of each year, beginning on October 15, 1999.
Except in the case of certain equity offerings by us, we cannot choose to redeem
these  notes until five years have passed from the issue date of the  notes.  At
any  one or more times after that date, we may choose to redeem some or  all  of
the  notes  at certain specified prices, plus accrued and unpaid interest.  Upon
the  occurrence of certain change of control events, each holder may require  us
to  repurchase all or a portion of the notes at 101% of their principal  amount,
plus accrued and unpaid interest.

      The  notes  are our senior subordinated unsecured obligations.  They  rank
senior  to  or  equal  in right of payment with any of our  future  subordinated
indebtedness,  and subordinated in right of payment to any of our  existing  and
future   senior   indebtedness.  The  notes  are  effectively  subordinated   to
indebtedness and other liabilities of our subsidiaries which are not guarantors.
Substantially  all  of  our  domestic  subsidiaries  guarantee  the  notes  with
unconditional  guarantees  of  payment that will effectively  rank  below  their
senior  debt, but will rank equal to their other subordinated debt, in right  of
payment.

      The  indenture  under which the notes were issued contains covenants  that
limit  what  we  (and  most or all of our subsidiaries) may  do.  The  indenture
contains covenants that limit our ability to: incur additional indebtedness; pay
dividends  on,  redeem or repurchase our capital stock; make  investments;  sell
assets;  create  certain liens; engage in certain transactions with  affiliates;
and  consolidate or merge or sell all or substantially all of our assets or  the
assets  of  certain of our subsidiaries. In addition, we will  be  obligated  to
offer  to  repurchase the notes at 100% of their principal amount, plus  accrued
and  unpaid interest, if any, to the date of repurchase, in the event of certain
asset  sales.  These restrictions and prohibitions are subject to  a  number  of
important qualifications and exceptions.

     Debt Maturity Information

      The  annual  maturity  of  our  bank  notes  payable  and  long-term  debt
obligations (exclusive of capital lease obligations) for each of the five  years
following  June  30, 1999, are as follows:  $27,690 for 2000, $5,189  for  2001,
$4,113 for 2002, $3,632 for 2003 and $2,988 for 2004.

    Hedge Agreements

      In  September 1995, we entered into several interest rate hedge agreements
to manage our exposure to increases in interest rates on our variable rate debt.
The hedge agreements provide interest rate protection on $60,000 of debt through
September 2000, by providing an interest rate cap of 7% if the 90-day LIBOR rate
exceeds 7%. If the 90-day LIBOR rate drops below 5%, we will be required to  pay
interest at a floor rate of approximately 6%.

      In November 1996, we entered into an additional hedge agreement to provide
interest  rate protection on $20,000 of debt through November 1999.   The  hedge
agreement  provides for a cap of 7 1/4% if the 90-day LIBOR exceeds 7  1/4%.  If
the  90-day LIBOR drops below 5%, we will be required to pay interest at a floor
rate  of  approximately 6%.  No cash outlay was required to  obtain  this  hedge
agreement, as the cost of the cap was offset by the sale of the floor.

      In  fiscal 1998 we entered into a series of interest rate hedge agreements
to reduce our exposure to increases in interest rates on variable rate debt. The
ten-year  hedge agreements provides us with interest rate protection on $100,000
of  variable  rate debt, with interest being calculated based on a  fixed  LIBOR
rate  of 6.24% to February 17, 2003. On February 17, 2003, the bank will have  a
one-time  option to elect to cancel the agreement or to do nothing  and  proceed
with the transaction, using a fixed LIBOR rate of 6.715% for the period February
17,  2003  to  February 19, 2008. No costs were incurred as a  result  of  these
transactions.

      We recognize interest expense under the provisions of the hedge agreements
based  on  the  fixed rate. We are exposed to credit loss in the event  of  non-
performance by the lenders; however, such non-performance is not anticipated.

      The  table  below  provides  information about  our  derivative  financial
instruments  and other financial instruments that are sensitive  to  changes  in
interest  rates,  including interest rate swaps. For interest  rate  swaps,  the
table  presents notional amounts and weighted average interest rates by expected
(contractual)  maturity  dates.  Notional amounts  are  used  to  calculate  the
contractual  payments  to  be  exchanged under the  contract.  Weighted  average
variable  rates  are based on implied forward rates in the yield  curve  at  the
reporting date.
<TABLE>
<CAPTION>
                                Expected Maturity Date
                         2000   2001    2002   2003     2004 Thereafter
<S>                     <C>     <C>     <C>     <C>     <C>      <C>
Interest Rate Swaps:
   Variable to fixed    20,000 60,000     -      -       -    100,000
      Average cap rate   7.25%  6.81%     -      -       -     6.49%
      Average floor      5.84%  5.99%     -      -       -     6.24%
rate
      Weighted average   5.71%  5.74%     -      -       -     6.12%
rate
      Fair market value  (44)   (99)      -      -       -    (3,709)
</TABLE>

      The fair value of our other off-balance-sheet financial instruments is not
material  at  June 30, 1999. The fair value of our fixed rate debt  approximates
our carrying balance at June 30, 1999.

9. PENSIONS AND POSTRETIREMENT BENEFITS

     Pensions

      In  February  1998,  the  FASB issued Statement  of  Financial  Accounting
Standards   No.   132,   "Employers'  Disclosures  about  Pensions   and   Other
Postretirement   Benefits."   This  statement  amends  and  eliminates   certain
disclosures  previously required as well as adds certain new disclosures.   This
statement does not change the way pension costs and liabilities are measured  or
recognized in the financial statements. To conform to Statement No. 132, we have
presented  and,  where necessary, restated our disclosure in these  consolidated
financial statements.

     We  have  defined  benefit pension plans covering most  of  our  employees.
Employees  in  our foreign subsidiaries may participate in local pension  plans,
for which our liability is in the aggregate insignificant. Our funding policy is
to  make  the  minimum  annual contribution required by the Employee  Retirement
Income     Security     Act     of    1974    or    local     statutory     law.
     The changes in the pension plans' benefit obligations were as follows:
<TABLE>
<CAPTION>

                                     1999   1998
<S>                                 <C>     <C>
Projected benefit obligation at
July 1,                            $222,607 $206,444
Service cost                          3,454    2,685
Interest cost                        14,328   14,518
Actuarial (gains) / losses           (5,003)  15,364
Benefit payments                    (14,236) (16,366)
Plan amendment                          837        -
Foreign currency translation             (2)     (38)
Projected benefit obligation at
 June 30,                          $221,985 $222,607
</TABLE>

    The changes in the fair values of the pension plans' assets were as follows:
<TABLE>
<CAPTION>

                                     1999   1998
<S>                                 <C>     <C>
Plan assets at July 1,            $261,097$237,480
Actual return on plan assets        11,995  41,102
Administrative expenses             (1,190) (1,024)
Benefit payments                   (14,236)(16,366)
Foreign currency translation            (4)    (95)
Plan assets at June 30,           $257,662$261,097
</TABLE>

      The following table sets forth the funded status and amounts recognized in
our consolidated balance sheets at June 30, 1999 and 1998, for the plans:
<TABLE>
<CAPTION>

                                           June 30,June 30,
                                             1999    1998
<S>                                        <C>      <C>
Plan assets in excess of projected benefit
obligations                               $ 35,677 $ 38,490
Unrecognized net loss                       27,867   23,797
Unrecognized prior service cost/(credit)       634     (387)
Unrecognized transition (asset)              (220)     (257)
Prepaid pension expense recognized in the
balance sheet                             $ 63,958 $ 61,643
</TABLE>

      The  net  prepaid  pension expense recognized in the consolidated  balance
sheets consisted entirely of a prepaid pension asset.
     A summary of the components of total pension expense is as follows:
<TABLE>
<CAPTION>

                                     1999   1998    1997
<S>                               <C>      <C>     <C>
Service cost - benefits earned
during the period                 $  3,454 $ 2,685 $ 2,521
Interest cost on projected benefit
obligation                          14,328  14,518  15,833
Expected return on plan assets     (21,694)(20,455)(21,294)
Amortization of net loss             1,813   1,522     928
Amortization of prior service
credit                                (184)   (184)   (180)
Amortization of transition (asset)     (36)    (38)    (39)
Loss recognized due to curtailment       -       -     142
Net periodic pension (income)      $(2,319)$(1,952)$(2,089)
</TABLE>

     Weighted  average  assumptions used in accounting for the  defined  benefit
pension plans as of June 30, 1999 and 1998 were as follows:
<TABLE>
<CAPTION>

                                     1999   1998
<S>                                 <C>     <C>
Discount rate                        7.25%  7.0%
Expected rate of increase in         4.5%   4.5%
salaries
Expected long-term rate of return    9.0%   9.0%
on plan assets
</TABLE>

      Plan assets include an investment in our Class A common stock, valued at a
fair market value of $8,178 and $16,167 at June 30, 1999 and 1998, respectively.
Substantially  all  of the other plan assets are invested in listed  stocks  and
bonds.

     Postretirement Health Care Benefits

      We  provide  health  care  benefits for most  of  our  retired  employees.
Postretirement  health care benefit expense from continuing  operations  totaled
$951,  $804,  and $642 for 1999, 1998 and 1997, respectively.  Our  accrual  was
approximately  $33,155 and $33,062 as of June 30, 1999 and  1998,  respectively,
for  postretirement  health  care benefits related to  discontinued  operations.
This represents the cumulative discounted value of the long-term obligation  and
includes interest expense of $3,902, $3,714, and $3,349 for the years ended June
30, 1999, 1998 and 1997, respectively.

     The  changes  in the accumulated postretirement benefit obligation  of  the
plans were as follows:
<TABLE>
<CAPTION>

                                         1999     1998
<S>                                    <C>       <C>
Accumulated postretirement benefit
obligation at July 1,                  $ 58,197$ 50,870
Service cost                                227     166
Interest cost                             3,860   3,979
Actuarial (gains) / losses              (2,718)  10,696
Benefit payments                        (4,539) (6,511)
Plan amendment                                - (1,003)
Accumulated postretirement benefit
obligation at June 30,                 $ 55,027$ 58,197
</TABLE>

      In  fiscal 1998, we amended a former subsidiary's medical plan to increase
the  retirees' contribution rate to approximately 20% of the negotiated premium.
Such   plan   amendment  resulted  in  a  $1,003  decrease  to  the  accumulated
postretirement  benefit  obligation and is being amortized  as  an  unrecognized
prior  service  credit  over  the  average future  lifetime  of  the  respective
retirees.

      The following table sets forth the funded status and amounts recognized in
the  Company's  consolidated balance sheets at June 30, 1999 and 1998,  for  the
plans:
<TABLE>
<CAPTION>

                                           1999     1998
<S>                                      <C>       <C>
Accumulated postretirement benefit
obligation                               $ 55,027$ 58,197
Unrecognized prior service credit            (866)   (935)
Unrecognized net loss                      12,833  16,387
Accrued postretirement benefit liability $ 43,060$ 42,745
</TABLE>

      The  accumulated postretirement benefit obligation was determined using  a
discount  rate of 7.25% at June 30, 1999 and 7.0% at June 30, 1998.  The  effect
of  such change resulted in a decrease to the accumulated postretirement benefit
obligation  in  fiscal 1999.  For measurement purposes, a 6.0%  annual  rate  of
increase  in  the  per capita claims cost of covered health  care  benefits  was
assumed for fiscal 1999.  The rate was assumed to decrease gradually to 4.0% for
fiscal 2003 and remain at that level thereafter.

     A summary of the components of total postretirement expense is as follows:
<TABLE>
<CAPTION>

                                        1999   1998    1997
<S>                                    <C>     <C>     <C>
Service cost - benefits earned during
the period                            $   227  $  166 $  140
Interest cost on accumulated
postretirement benefit obligation       3,860   3,979  3,940
Amortization of prior service credit      (69)    (69)     -
Amortization of net (gain) / loss         835     442    (89)
Net periodic postretirement benefit
cost                                  $ 4,853 $ 4,518 $3,991
</TABLE>


      Assumed  health  care cost trend rates have a significant  effect  on  the
amounts  reported  for  health  care plans.  A one  percentage-point  change  in
assumed health care cost trend rates would have the following effects as of  and
for the fiscal year ended June 30, 1999:
<TABLE>
<CAPTION>

                                         One Percentage-Point
                                         Increase Decrease
<S>                                      <C>       <C>
Effect on service and interest
components of net periodic cost          $    126 $ (122)
Effect on accumulated postretirement        1,604 (1,513)
benefit obligation
</TABLE>

10.  INCOME TAXES

      The  provision  (benefit) for income taxes from continuing  operations  is
summarized as follows:
<TABLE>
<CAPTION>

                               1999    1998     1997
<S>                          <C>      <C>      <C>
 Current:
     Federal                $  3,416 $ (6,245) $ 4,003

     State                       140      500    1,197

     Foreign                   3,994    3,893      (49)

                               7,550   (1,852)   5,151
 Deferred:
     Federal                 (10,731)  46,092  (15,939)

     State                   (10,064)   3,034    3,444

                             (20,795)  49,126 (12,495)

 Net tax provision (benefit)$(13,245) $47,274 $(7,344)
</TABLE>

      The  income tax provision (benefit) for continuing operations differs from
that  computed  using the statutory Federal income tax rate of  35%,  in  fiscal
1999, 1998 and 1997, for the following reasons:
<TABLE>
<CAPTION>

                                          1999     1998    1997
<S>                                     <C>       <C>      <C>
 Computed statutory amount              $(12,760) $43,188  $(1,751)
 State income taxes, net of applicable
federal tax benefit                        2,488    4,362      778
 Nondeductible acquisition valuation
items                                      1,903    1,204    1,064
 Tax on foreign earnings, net of tax
credits                                   (2,392)  (1,143)  (1,938)
 Difference between book and tax basis
of assets acquired and                       (53)   4,932   (1,102)
    liabilities assumed
 Revision of estimate for tax accruals    (1,790)  (3,905)  (5,335)
 Other                                      (641)  (1,364)     940
 Net tax provision (benefit)            $(13,245) $47,274  $(7,344)
</TABLE>


      The  following  table is a summary of the significant  components  of  our
deferred tax assets and liabilities, and deferred provision or benefit, for  the
following periods:
<TABLE>
<CAPTION>

                                    1999             1998     1997
                                  Deferred          Deferred  Deferred
                         June 30,(Provision)June 30,(Provision)(Provision)
                           1999  Benefit    1998    Benefit   Benefit
<S>                      <C>      <C>       <C>      <C>      <C>
 Deferred tax assets:
 Accrued expenses        $ 14,159 $ 11,572 $ 2,587 $(3,853)  $  504
 Asset basis differences    8,822      710   8,112   7,540   (1,492)
 Inventory                 11,117   11,117       -  (2,198)   2,198
 Employee compensation
and benefits               13,587    8,501   5,086     (55)   (267)
 Environmental reserves     3,975      509   3,466     207  (1,253)
 Loss and credit
carryforward                    -        -       -        - (8,796)
 Postretirement benefits   16,428   (1,706) 18,134   (1,338)   138
 Other                      4,639   (7,465) 12,104    4,506  2,079

                           72,727   23,238  49,489    4,809 (6,889)
 Deferred tax
liabilities:
 Asset basis differences  (84,386)  (3,954)(80,432) (54,012)(3,855)
 Inventory                      -    1,546  (1,546)  (1,546) 2,010
 Pensions                 (19,614)    (428)(19,186)      95 (1,038)
 Other                     (5,319)     393  (5,712)   1,528 22,267

                         (109,319)  (2,443)(106,876)(53,935)19,384
 Net deferred tax
 liability               $(36,592) $20,795 $(57,387)$(49,126)$12,495
</TABLE>

     The amounts included in the balance sheet are as follows:
<TABLE>
<CAPTION>

                                      June    June
                                      30,     30,
                                      1999    1998
<S>                                 <C>      <C>
 Prepaid expenses and other current
assets:
 Current deferred                   $5,999   $     -
 Income taxes payable:
 Current deferred                   $    -   $34,553
 Other current                           -    (6,242)
                                    $    -   $28,311
 Noncurrent income tax liabilities:
 Noncurrent deferred                $42,591  $22,834
 Other noncurrent                    79,370   72,342
                                   $121,961  $95,176
</TABLE>

      The  1999, 1998 and 1997 net tax benefits include the results of reversing
$1,790,  $3,905,  and  $5,335 respectively, of federal income  taxes  previously
provided for, due to a change in the estimate of required tax accruals.

      Domestic  income  taxes,  less  available credits,  are  provided  on  the
unremitted  income  of  foreign subsidiaries and affiliated  companies,  to  the
extent  we  intend  to repatriate such earnings.  No domestic  income  taxes  or
foreign  withholding taxes are provided on the undistributed earnings of foreign
subsidiaries and affiliates, which are considered permanently invested, or which
would  be offset by allowable foreign tax credits.  At June 30, 1999, the amount
of   domestic  taxes  payable  upon  distribution  of  such  earnings  was   not
significant.

      In the opinion of our management, adequate provision has been made for all
income  taxes  and interest; and any liability that may arise for prior  periods
will  not  have a material effect on our financial condition or our  results  of
operations.

11.  EQUITY SECURITIES

      We  had 22,258,580 shares of Class A common stock and 2,621,652 shares  of
Class  B  common  stock outstanding at June 30, 1999.  Class A common  stock  is
traded  on  both the New York and Pacific Stock Exchanges.  There is  no  public
market  for  the  Class  B common stock.  Shares of Class  A  common  stock  are
entitled  to one vote per share and cannot be exchanged for shares  of  Class  B
common  stock.   Shares of Class B common stock are entitled to  ten  votes  per
share and can be exchanged, at any time, for shares of Class A common stock on a
share-for-share  basis.  In fiscal 1999, 75,383 and 14,969  shares  of  Class  A
common  stock were issued as a result of the exercise of stock options  and  the
Special-T restricted stock plan, respectively, and shareholders converted  3,064
shares  of  Class  B common stock into Class A common stock. In accordance  with
terms  of  our acquisition of Special-T, as amended, we issued 9,911  restricted
shares  of  our  Class  A  common  stock in fiscal  1999  as  additional  merger
consideration. Additionally, our Class A common stock outstanding was reduced as
a result of 1,239,750 shares purchased by Banner Aerospace, which are considered
as treasury stock for accounting purposes.

      On  April 8, 1999, we acquired the remaining 15% of the outstanding common
and  preferred  stock of Banner Aerospace not already owned by us,  through  the
merger of Banner Aerospace with one of our subsidiaries. Under the terms of  the
merger  with Banner Aerospace, we issued 2,981,412 shares of our Class A  common
stock  to  acquire all of Banner Aerospace's common and preferred  stock,  other
than those shares already owned by us.

     During fiscal 1999, we issued 8,852 deferred compensation units pursuant to
our  stock  option  deferral plan as a result of a cashless exercise  of  15,000
stock  options.  Each deferred compensation unit is represented by one share  of
our treasury stock and is convertible into one share of our Class A common stock
after a specified period of time.

12.    STOCK OPTIONS AND WARRANTS

     Stock Options

      We  are authorized to issue 5,141,000 shares of our Class A common  stock,
upon  the  exercise  of  stock options issued under our 1986  non-qualified  and
incentive  stock option plan.  The purpose of the 1986 stock option plan  is  to
encourage  continued  employment and ownership of Class A common  stock  by  our
officers  and  key  employees, and to provide additional  incentive  to  promote
success.  The 1986 stock option plan authorizes the granting of options  at  not
less  than  the market value of the common stock at the time of the  grant.  The
option  price  is payable in cash or, with the approval of our compensation  and
stock  option  committee of the Board of Directors, in shares of  common  stock,
valued  at  fair  market value at the time of exercise.   The  options  normally
terminate five years from the date of grant, subject to extension of  up  to  10
years  or  for  a  stipulated  period  of time  after  an  employee's  death  or
termination of employment.  The 1986 plan expires on April 9, 2006; however, all
stock  options outstanding as of April 9, 2006 shall continue to be  exercisable
pursuant to their terms.

      We are authorized to issue 250,000 shares of our Class A common stock upon
the  exercise  of  stock  options issued under  the ten year  1996  non-employee
directors stock option plan.  The 1996 non-employee directors stock option  plan
authorizes  the granting of options at the market value of the common  stock  on
the  date of grant.  An initial stock option grant for 30,000 shares of Class  A
common  stock  is  made to each person who becomes a new non-employee  Director,
with  the options vesting 25% each year from the date of grant.  On the date  of
each  annual  meeting, each person elected as a non-employee  Director  will  be
granted  an  option  for  1,000  shares  of  Class  A  common  stock  that  vest
immediately.  The exercise price is payable in cash or, with the approval of our
compensation and stock option committee, in shares of Class A or Class B  common
stock,  valued at fair market value at the date of exercise.  All options issued
under  the  1996  non-employee directors stock option plan will  terminate  five
years from the date of grant or a stipulated period of time after a non-employee
Director  ceases  to be a member of the Board.  The 1996 non-employee  directors
stock  option  plan  is designed to maintain our ability to attract  and  retain
highly qualified and competent persons to serve as our outside directors.

      Upon  our  April  8,  1999  merger with Banner Aerospace,  all  of  Banner
Aerospace's  stock options then issued and outstanding were converted  into  the
right to receive 870,315 shares of our common stock.

      On November 17, 1994, our stockholders approved the grant of stock options
of  190,000  shares to our outside Directors to replace expired  stock  options.
These stock options expire five years from the date of the grant.

      A  summary  of stock option transactions under our stock option  plans  is
presented in the following tables:
<TABLE>
<CAPTION>

                                           Weighted
                                           Average
                                           Exercise
                                Shares      Price
<S>                           <C>        <C>
Outstanding at July 1, 1996    1,273,487  $     4.27
    Granted                      457,350       14.88
    Exercised                   (234,935)       4.79
    Expired                       (1,050)       4.59
    Forfeited                     (9,412)       3.59
Outstanding at June 30, 1997   1,485,440        7.46
    Granted                      357,250       24.25
    Exercised                   (141,259)       4.70
    Forfeited                    (46,650)       7.56
Outstanding at June 30, 1998   1,654,781        7.46
    Granted                      338,000       14.36
    Plans assumption from        870,315        4.25
Banner merger
    Exercised                    (75,383)       5.21
    Expired                         (500)       3.50
    Forfeited                       (650)      12.16
Outstanding at June 30, 1999   2,786,563     $ 11.05
Exercisable at June 30, 1997     486,855     $  4.95
Exercisable at June 30, 1998     667,291     $  6.58
Exercisable at June 30, 1999   1,867,081     $  8.75
</TABLE>

     A summary of options outstanding at June 30, 1999 is presented as follows:
<TABLE>
<CAPTION>



                     Options Outstanding          Opertions Exercisable
                               Weighted Average            Weighted
                               Average  Remaining          Average
Range of          Number       Exercise Contracted Number  Exercise
Exercise Prices   Outstanding  Price    Life   Exercisable Price
<S>                 <C>        <C>      <C>       <C>       <C>
  $3.50 - $8.625                         1.4
                    1,149,787  $ 4.76    years1,017,490  $ 4.84
  $8.72 - $13.48                         4.6
                      396,741  $ 9.56   years   386,741  $ 9.47
 $13.625 - $16.25                        3.5
                      906,285  $14.77   years   379,412  $15.07
$18.5625 - $25.0625                      3.2
                      333,750  $24.02   years    83,438  $24.14
 $3.50 - $25.0625                        4.1
                    2,786,563  $11.05   years 1,867,081  $ 8.75
</TABLE>

      The weighted average grant date fair value of options granted during 1999,
1998,  and 1997 was $6.48, $11.18, and $6.90, respectively.  The fair  value  of
each  option  granted  is  estimated on the grant date using  the  Black-Scholes
option  pricing  model.   The following significant  assumptions  were  made  in
estimating fair value:
<TABLE>
<CAPTION>

                                 1999       1998        1997
<S>                           <C>        <C>         <C>
Risk-free interest rate      4.3% - 5.4% 5.4% - 6.3% 6.0% - 6.7%
Expected life in years           4.66       4.66        4.65
Expected volatility            45% - 46%  44% - 45%  43% - 45%
Expected dividends               none        none       none
</TABLE>

      We  recognized compensation expense of $23 from stock options issued to  a
consultant  and $414 from an employee stock plan that was established  with  our
acquisition  of Special-T Fasteners in 1998. We recognized compensation  expense
of $104 as a result of stock options that were modified in 1998. We are applying
APB  Opinion  No. 25 in accounting for its stock option plans.  Accordingly,  no
compensation cost has been recognized for the granting of stock options  to  our
employees in 1999, 1998 or 1997. If stock options granted in 1999, 1998 and 1997
were  accounted for based on their fair value as determined under SFAS 123,  pro
forma earnings would be as follows:
<TABLE>
<CAPTION>

                                  1999     1998     1997
<S>                             <C>      <C>       <C>
Net earnings (loss):
    As reported                $(59,009) $101,090 $ 1,331
    Pro forma                   (60,682)   99,817     283
Basic earnings (loss) per
share:
    As reported                $  (2.59) $   5.36  $ 0.08
    Pro forma                     (2.66)     5.30    0.02
Diluted earnings (loss) per
share:
    As reported                $  (2.59) $   5.14  $ 0.08
    Pro forma                     (2.66)     5.07    0.02
</TABLE>

      The  pro forma effects of applying SFAS 123 are not representative of  the
effects on reported net earnings for future years. The effect of SFAS 123 is not
applicable  to  awards  made prior to 1996. Additional awards  are  expected  in
future years.

     Stock Option Deferral Plan

      On  November  17, 1998, our shareholders approved a stock option  deferral
plan.   Pursuant to the stock option deferral plan, certain officers  (at  their
election)  may defer payment of the "compensation" they receive in a  particular
year  or  years  from  the exercise of stock options. "Compensation"  means  the
excess  value of a stock option, determined by the difference between  the  fair
market value of shares issueable upon exercise of a stock option, and the option
price  payable  upon  exercise  of  the stock  option.   An  officer's  deferred
compensation   is  payable  in  the  form  of  "deferred  compensation   units,"
representing the number of shares of common stock that the officer  is  entitled
to  receive  upon  expiration of the deferral period.  The  number  of  deferred
compensation units issueable to an officer is determined by dividing the  amount
of  the  deferred compensation by the fair market value of our stock as  of  the
date of deferral.

     Stock Warrants

      Effective  as  of  February 21, 1997, we approved the continuation  of  an
existing  warrant  to  Stinbes  Limited (an affiliate  of  Jeffrey  Steiner)  to
purchase  375,000  shares of our Class A or Class B common stock  at  $7.80  per
share.  The  warrant has been modified to permit exercise within certain  window
periods  including,  within two years after the merger  of  Shared  Technologies
Fairchild  Inc. with certain companies. The warrant's exercise price  per  share
increases by $.002 for each day subsequent to March 13, 1999. The payment of the
warrant price may be made in cash or in shares of our Class A or Class B  common
stock,  valued  at  fair  market value at the time of exercise,  or  combination
thereof.  In no event may the warrant be exercised after March 13, 2002, but  as
a  result of certain events is now exercisable only through March 9, 2000. As  a
result of certain modifications to the warrant, we recognized a charge of $5,606
in 1998.

     On February 21, 1996, we issued warrants to purchase 25,000 shares of Class
A  common stock, at $9.00 per share, to a non-employee for services provided  in
connection with our various dealings with Peregrine Direct Investments  Limited.
The  warrants issued are immediately exercisable and will expire on November  8,
2000.

     On November 9, 1995, we issued warrants to purchase 500,000 shares of Class
A  Common Stock, at $9.00 per share, to Peregrine Direct Investments Limited, in
exchange  for  a  standby  commitment it received  on  November  8,  1995,  from
Peregrine. We elected not to exercise our rights under the Peregrine commitment.
The warrants are immediately exercisable and will expire on November 8, 2000.

13.  EARNINGS PER SHARE

The  following  table illustrates the computation of basic and diluted  earnings
(loss) per share:
<TABLE>
<CAPTION>

                                         1999    1998     1997
<S>                                    <C>      <C>      <C>
Basic earnings per share:
Earnings (loss) from continuing
operations                            $(23,507) $52,399 $  1,816
Weighted average common shares
outstanding                             22,766   18,834   16,539
Basic earnings per share:
Basic earnings (loss) from continuing
operations per share                  $ (1.03)  $  2.78  $  0.11

Diluted earnings per share:
Earnings (loss) from continuing
operations                            $(23,507) $ 52,399 $  1,816
Weighted average common shares
outstanding                             22,766    18,834   16,539
Diluted effect of options          Antidilutive      546      449
Diluted effect of warrants         Antidilutive      289      333
Total shares outstanding                22,766    19,669   17,321
Diluted earnings (loss) from
continuing operations per share      $   (1.03) $   2.66 $   0.11
</TABLE>

      The  computation of diluted loss from continuing operations per share  for
1999  excluded  the  effect  of incremental common shares  attributable  to  the
potential exercise of common stock options outstanding and warrants outstanding,
because  their  effect  was  antidilutive. No adjustments  were  made  to  share
information in the calculation of earnings per share for discontinued operations
and extraordinary items.

14.  RESTRUCTURING CHARGES

      In  fiscal  1999,  we recorded $6,374 of restructuring  charges.  Of  this
amount,  $500  was recorded at our corporate office for severance  benefits  and
$348  was  recorded at our aerospace distribution segment for the  write-off  of
building  improvements from premises vacated. The remainder, $5,526 was recorded
as  a  result  of the Kaynar Technologies initial integration in  our  aerospace
fasteners segment, i.e. for severance benefits ($3,932), for product integration
costs  incurred as of June 30, 1999 ($1,334), and for the write  down  of  fixed
assets  ($260). All costs classified as restructuring were the direct result  of
formal  plans to close plants and to terminate employees. The costs included  in
restructuring were predominately nonrecurring in nature.  Other than a reduction
in  our  existing  cost  structure  and  manufacturing  capacity,  none  of  the
restructuring charges resulted in future increases in earnings or represented an
accrual  of  future costs. As of June 30, 1999, approximately one-third  of  the
integration plans has been executed. We expect to incur additional restructuring
charges  for  product  integration costs during the next twelve  months  at  our
aerospace fasteners segment. We anticipate that our integration process will  be
substantially completed in the second quarter of fiscal 2000.

15.   EXTRAORDINARY ITEMS

      In fiscal 1999, we recognized an extraordinary loss of $4,153, net of tax,
to  write-off  the  remaining  deferred loan  fees  associated  with  the  early
extinguishment of our indebtedness in connection with our acquisition of  Kaynar
Technologies (See Note 8).

      In fiscal 1998, we recognized an extraordinary loss of $6,730, net of tax,
to  write-off  the  remaining deferred loan fees and  original  issue  discounts
associated with early extinguishment of our indebtedness when we repaid all  our
public debt and refinanced our credit facilities.

16.   RELATED PARTY TRANSACTIONS

      We  paid  for  a  chartered aircraft used from time to time  for  business
related  travel.  The owner of the chartered aircraft is a company 51% owned  by
an  immediate  family member of Mr. Jeffrey Steiner. Cost for such flights  that
are  charged  to us are comparable to those charged in arm's length transactions
between unaffiliated third parties'.

      We  pay  for  a chartered helicopter used from time to time  for  business
related  travel.  The owner of the chartered helicopter is a company  controlled
by  Mr.  Jeffrey  Steiner. Cost for such flights that  are  charged  to  us  are
comparable  to  those charged in arm's length transactions between  unaffiliated
third parties'.

      In 1999, we entered into a $300 loan agreement with one of our senior vice
president's  who  was  relocated.  At June 30,  1999,  a  balance  of  $200  was
outstanding.

17.  LEASES

     Operating Leases

      We  hold  certain of our facilities and equipment under long-term  leases.
The  minimum rental commitments under non-cancelable operating leases with lease
terms in excess of one year, for each of the five years following June 30, 1999,
are  as  follows: $5,200 for 2000, $3,549 for 2001, $2,784 for 2002, $2,043  for
2003,  and  $1,164 for 2004.  Rental expense on operating leases from continuing
operations  for  fiscal  1999,  1998 and 1997 was $9,485,  $8,610,  and  $4,928,
respectively.

     Capital Leases

      Minimum  commitments  under capital leases for  each  of  the  five  years
following June 30, 1999, are $1,324 for 2000, $808 for 2001, $498 for 2002, $380
for  2003, and $254 for 2004, respectively. At June 30, 1999, the present  value
of capital lease obligations was $2,874. At June 30, 1999, capital assets leased
and included in property, plant, and equipment consisted of:
<TABLE>
<CAPTION>

<S>                                 <C>
Land                              $     86
Buildings and improvements           2,180
Machinery and equipment              6,282
Furniture and fixtures                  33
Less: Accumulated depreciation      (2,250)
                                    $6,331
</TABLE>

     Leasing Operations

      In  fiscal 1999, we began leasing retail space to tenants under  operating
leases  at  completed  sections  of  a shopping  center  we  are  developing  in
Farmingdale,  New York. Rental revenue is recognized as lease payments  are  due
from  tenants  and  the related costs are amortized over their estimated  useful
life.  Accumulated depreciation on finished sections of the shopping center  and
leased to others is $100 at June 30, 1999. The future minimum lease payments  to
be received from noncancellable operating leases on June 30, 1999 were $3,246 in
2000, $4,678 in 2001, $4,678 in 2002, $4,684 in 2003, $4,706 in 2004 and $47,350
thereafter.  Subsequent  to  June 30, 1999, we have  entered  into  several  new
agreements to lease additional retail space at our shopping center.

18.  CONTINGENCIES

     Government Claims

      The  Corporate Administrative Contracting Officer (the "ACO"), based  upon
the  advice  of  the  United States Defense Contract Audit Agency,  has  made  a
determination  that  a  former subsidiary of ours did not  comply  with  Federal
Acquisition Regulations and Cost Accounting Standards in accounting for (i)  the
1985  reversion  of certain assets of terminated defined benefit pension  plans,
and  (ii)  pension costs upon the closing of segments of our former subsidiaries
business.  The ACO has directed us to prepare cost impact proposals relating  to
such  plan terminations and segment closings and, following receipt of such cost
impact proposals, may seek adjustments to contract prices.  The ACO alleges that
substantial  amounts  will  be due if such adjustments  are  made,  however,  an
estimate  of the possible loss or range of loss from the ACO's assertion  cannot
be made.  We believe that management of our former subsidiary properly accounted
for the asset reversions in accordance with applicable accounting standards.  We
intend  to enter into mediation with the government to attempt to resolve  these
pension accounting issues.

     Environmental Matters

      Our  operations are subject to stringent government imposed  environmental
laws  and regulations concerning, among other things, the discharge of materials
into  the environment and the generation, handling, storage, transportation  and
disposal  of  waste and hazardous materials.  To date, such laws and regulations
have  not  had  a  material  effect  on  our  financial  condition,  results  of
operations,  or  net  cash flows of us, although we have expended,  and  can  be
expected  to  expend  in the future, significant amounts  for  investigation  of
environmental  conditions and installation of environmental control  facilities,
remediation  of environmental conditions and other similar matters, particularly
in our aerospace fasteners segment.

      In  connection with our plans to dispose of certain real estate,  we  must
investigate  environmental conditions and we may be  required  to  take  certain
corrective  action prior or pursuant to any such disposition.  In  addition,  we
have  identified  several  areas of potential contamination  at  or  from  other
facilities owned, or previously owned, by us, that may require us to  either  to
take  corrective action or to contribute to a clean-up.  We are also a defendant
in   certain  lawsuits  and  proceedings  seeking  to  require  us  to  pay  for
investigation or remediation of environmental matters and we have  been  alleged
to  be a potentially responsible party at various "superfund" sites.  We believe
that  we have recorded adequate reserves in our financial statements to complete
such  investigation  and  take  any necessary corrective  actions  or  make  any
necessary  contributions.  No  amounts have been  recorded  as  due  from  third
parties,  including  insurers, or set off against, any environmental  liability,
unless  such  parties  are contractually obligated to  contribute  and  are  not
disputing such liability.

     As of June 30, 1999, the consolidated total of our recorded liabilities for
environmental  matters  was approximately $10.3 million, which  represented  the
estimated  probable exposure for these matters.  It is reasonably possible  that
our total exposure for these matters could be approximately $17.5 million.

     Other Matters

      On  January 12, 1999, AlliedSignal made indemnification claims against  us
for  $18.9  million,  arising from the disposition  to  AlliedSignal  of  Banner
Aerospace's hardware business. We believe that the amount of the claim is far in
excess of any amount that AlliedSignal is entitled to recover from us.

      We  are  involved in various other claims and lawsuits incidental  to  our
business, some of which involve substantial amounts.  We, either on our  own  or
through our insurance carriers, are contesting these matters.  In the opinion of
management,  the  ultimate resolution of the legal proceedings, including  those
mentioned  above,  will  not have a material adverse  effect  on  our  financial
condition, future results of operations or net cash flows.

19.  BUSINESS SEGMENT INFORMATION

      In June 1997, the Financial Accounting Standards Board issued Statement of
Financial  Accounting  Standards  No. 131, "Disclosures  about  Segments  of  an
Enterprise and Related Information." SFAS 131 supersedes Statement of  Financial
Accounting  Standards  No. 14 "Financial Reporting for Segments  of  a  Business
Enterprise" and requires that a public company report certain information  about
its  reportable  operating  segments in annual and  interim  financial  reports.
Generally, financial information is required to be reported on the basis that is
used  internally for evaluating segment performance and deciding how to allocate
resources to segments.  We adopted SFAS 131 in fiscal 1999.

      We  reports  in  two principal business segments. The aerospace  fasteners
segment  includes  the manufacture of high performance specialty  fasteners  and
fastening systems.  The aerospace distribution segment distributes a wide  range
of  aircraft  parts and related support services to the aerospace industry.  The
results  of Fairchild Technologies, which is primarily engaged in the  designing
and  manufacturing of capital equipment and systems for recordable compact  disc
and   advance  semiconductor  manufacturing,  were  previously  reported   under
Corporate  and  Other,  along  with  the  results  of  two  smaller  operations.
Fairchild  Technologies  is  now  recorded in  discontinued  operations.     Our
financial data by business segment is as follows:
<TABLE>
<CAPTION>

                                      1999     1998     1997
<S>                                 <C>       <C>       <C>
 Sales:
     Aerospace Fasteners            $442,722 $387,236 $269,026
     Aerospace Distribution          168,336  358,431  411,765
     Corporate and Other               6,264    5,760   15,185
     Eliminations (a)                      -  (10,251) (15,213)
 Total Sales                        $617,322 $741,176 $680,763
 Operating Income (Loss):
     Aerospace Fasteners            $ 38,956 $ 32,722 $ 17,390
     Aerospace Distribution          (40,003)  20,330   30,891
     Corporate and Other             (44,864)  (7,609) (14,782)
 Operating Income (Loss) (b)        $(45,911)$ 45,443 $ 33,499
 Capital Expenditures:
     Aerospace Fasteners            $ 27,414 $ 31,221 $  8,964
     Aerospace Distribution            1,951    3,812    4,787
     Corporate and Other                 777      996    1,263
 Total Capital Expenditures         $ 30,142 $ 36,029 $ 15,014
 Depreciation and Amortization:
     Aerospace Fasteners            $ 22,459 $ 16,260 $ 15,506
     Aerospace Distribution            1,871    3,412    4,139
     Corporate and Other               1,327    1,201    1,170
 Total Depreciation and
Amortization                        $ 25,657 $ 20,873 $ 20,815
 Identifiable Assets at June 30:
     Aerospace Fasteners            $655,714 $427,927 $346,533
     Aerospace Distribution          291,281  452,397  428,436
     Corporate and Other             381,791  276,935  277,697

 Total Identifiable Assets       $1,328,786 $1,157,259 $1,052,666

(a)  - Represents intersegment sales from our aerospace fasteners segment to our
  aerospace distribution segment.
(b)  - Fiscal 1999 results include an inventory impairment charges of $41,465 in
  the  aerospace distribution segment, costs relating to acquisitions of $23,604
  and restructuring charges of $5,526 in the aerospace fasteners segment, $348
  in the aerospace distribution segment, and $500 at corporate.
</TABLE>

20.  FOREIGN OPERATIONS AND EXPORT SALES

Our  operations  are located primarily in the United States and Europe.   Inter-
area  sales are not significant to the total sales of any geographic area.   Our
financial data by geographic area is as follows:
<TABLE>
<CAPTION>

                                       1999     1998     1997
<S>                                  <C>      <C>      <C>
Sales by Geographic Area:
    United States                    $440,447 $613,325 $580,453
    Europe                            176,315  127,851  100,310
    Australia                             417        -        -
    Other                                 143        -        -
Total Sales                          $617,322 $741,176 $680,763
Operating Income (Loss) by
Geographic Area:
    United States                    $(66,245)$ 28,575 $ 27,489
    Europe                             19,989   16,868    6,010
    Australia                             331        -        -
    Other                                  14        -        -
Total Operating Income (Loss)        $(45,911)$ 45,443 $ 33,499
Identifiable Assets by Geographic
Area at June 30:
    United States                  $1,011,993 $903,054 $855,233
    Europe                            306,156  254,205  197,433
    Australia                          10,176        -        -
    Other                                 461        -        -
Total Identifiable Assets          $1,328,786 $1,157,259 $1,052,666
</TABLE>

      Export  sales are defined as sales by our domestic operations to customers
in foreign countries. Export sales were as follows:
<TABLE>
<CAPTION>

                                       1999     1998     1997
<S>                                  <C>      <C>      <C>
Export Sales
     Europe                          $ 42,891 $ 68,515 $ 48,187
     Japan                             14,147   12,056   19,819
     Canada                            12,460   16,426   17,797
     Asia (excluding Japan)             6,337   19,744   21,221
     South America                      3,556   11,038    4,414
     Other                             14,694   10,340   11,493
Total Export Sales                   $ 94,085 $138,119 $122,931
</TABLE>

21.  QUARTERLY FINANCIAL DATA (UNAUDITED)

The  following  table  of quarterly financial data has been  prepared  from  our
financial records, without audit, and reflects all adjustments which are, in the
opinion  of our management, necessary for a fair presentation of the results  of
operations for the interim periods presented.
<TABLE>
<CAPTION>

Fiscal 1999 quarters ended              Sept. 27  Dec. 27 March 28June 30
<S>                                     <C>      <C>       <C>      <C>
Net sales                               $148,539 $151,181$146,352 $171,250
Gross profit                              34,672   18,062  36,890   22,805
Earnings (loss) from continuing            1,190   (8,827) 20,383 (36,253)
    per basic share                         0.05    (0.40)   0.93   (1.46)
    per diluted share                       0.05    (0.40)   0.92   (1.46)
Loss from disposal of discontinued             -   (9,180)(19,694) (2,475)
operations, net
    per basic share                            -    (0.42)  (0.90)  (0.10)
    per diluted share                          -    (0.42)  (0.89)  (0.10)
Extraordinary items, net                       -        -       -  (4,153)
    Per basic share                            -        -       -   (0.17)
    Per diluted share                          -        -       -   (0.17)
Net earnings (loss)                        1,190  (18,007)    689 (42,881)
    per basic share                         0.05    (0.82)   0.03   (1.73)
    per diluted share                       0.05    (0.82)   0.03   (1.73)
Market price range of Class A Stock:
High                                      23 7/8   16 1/4 16 3/16       15
Low                                       12 3/8   10 3/8  10 1/2       10
Close                                     13 5/8   13 7/8 10 11/16   12 3/4
</TABLE>

<TABLE>
<CAPTION>

Fiscal 1998 quarters ended              Sept. 28  Dec. 28 March 29June 30
<S>                                     <C>      <C>       <C>      <C>
 Net sales                              $194,362 $208,616$164,164 $174,034
 Gross profit                             46,329   56,822  37,790   45,565
 Earnings (loss) from continuing
operations                                 1,229  (4,605)  50,418    5,357
    per basic share                         0.07   (0.27)    2.52     0.25
    per diluted share                       0.07   (0.27)    2.41     0.24
Loss from discontinued operations, net      (737)  (1,945) (1,578)     (36)
    Per basic share                        (0.04)   (0.11)  (0.08)    0.24
    Per diluted share                      (0.04)   (0.11)  (0.08)    0.44
Gain (loss) from disposal of
discontinued operations, net                   -   29,974  46,548  (16,805)
    Per basic share                            -     1.75    2.32    (0.78)
    Per diluted share                          -     1.75    2.23    (0.76)
Extraordinary items, net                       -   (3,024) (3,701)      (5)
    Per basic share                            -    (0.18)  (0.18)       -
    Per diluted share                          -    (0.18)  (0.18)       -
Net earnings (loss)                          492   20,400  91,687  (11,489)
    Per basic share                         0.03     1.19    4.58    (0.53)
    per diluted share                       0.03     1.19    4.38    (0.52)
Market price range of Class A Stock:
High                                     28  3/8 28 11/16      25       23
Low                                           17 19  5/16 19  7/16 18  3/16
Close                                    26  7/8  21  1/2 21  1/4 20  3/16
</TABLE>

      Gross  profit was reduced for inventory impairment adjustments of  $19,320
and  $22,145  in  the  second and fourth quarter of fiscal  1999,  respectively,
relating  to the disposition of Solair and the potential disposition  of  Dallas
Aerospace. Gain (loss) on disposal of discontinued operations includes losses of
$9,180,  $19,694, and $2,475 in the second, third and fourth quarters of  fiscal
1999,  respectively, and $22,352 and $13,891 in the third and fourth quarter  of
fiscal  1998,  respectively, resulting from the estimated loss  on  disposal  of
Fairchild  Technologies.  Gain  (loss) on disposal  of  discontinued  operations
includes  gains (losses) of $29,974, $68,900, and $(2,914) in the second,  third
and  fourth  quarter of fiscal 1998, respectively, from the Shared  Technologies
Fairchild divestiture. Earnings from discontinued operations, net, includes  the
results  of  Fairchild  Technologies and Shared  Technologies  Fairchild  (until
disposition)  in  each  quarter.  Extraordinary  items  relate  to   the   early
extinguishment of our debt.

22.  CONSOLIDATING FINANCIAL STATEMENTS (UNAUDITED)

      The following unaudited financial statements separately show The Fairchild
Corporation and the subsidiaries of The Fairchild Corporation.  These  financial
statements  are provided to fulfill public reporting requirements and separately
present  guarantors of the 10 3/4% senior subordinated notes due 2009 issued  by
The  Fairchild Corporation (the "Parent Company").  The guarantors are primarily
composed  of  our  domestic subsidiaries, excluding Fairchild Technologies,  the
equity  investment  in Nacanco, a real estate development venture,  and  certain
other subsidiaries.

<TABLE>
<CAPTION>

                      CONSOLIDATING STATEMENTS OF EARNINGS
                        FOR THE YEAR ENDED JUNE 30, 1999
                         Parent                        Elimi-  Fairchild
                         Company Guarantors Guarantors nations Historical
<S>                      <C>     <C>       <C>       <C>       <C>
Net Sales                $     -  $448,495 $169,720  $  (893)  $617,322
Costs and expenses
  Cost of sales                -   381,912  123,874     (893)   504,893
  Selling, general &
 administrative            8,114   113,167   24,168         -   145,449
  Restructuring                -     6,374        -         -     6,374
  Amortization of
 goodwill                    248     5,228    1,041         -     6,517
                           8,362   506,681  149,083      (893)  663,233
  Operating income
 (loss)                   (8,362)  (58,186)  20,637         -   (45,911)

Net interest expense      27,130    (4,283)   7,499         -    30,346
Investment (income)
 loss, net                     -   (39,800)       -         -   (39,800)
Earnings(loss) before
 taxes                   (35,492)  (14,103)  13,138         -   (36,457)
Income tax (provision)
 benefit                  21,481    (6,936)  (1,300)        -    13,245
Equity in earnings of
 affiliates and
 subsidiaries            (44,998)     (516)   1,344    45,965     1,795
Minority interest              -    (2,090)       -         -    (2,090)
Earnings (loss) from
 continuing operations   (59,009)  (23,645)  13,182    45,965   (23,507)
Earnings (loss) from
 disposal of discontinued
 operations                    -         -  (31,349)        -   (31,349)
Extraordinary items            -    (4,153)       -         -    (4,153)
Net earnings (loss)     $(59,009) $(27,798)$(18,167)  $45,965  $(59,009)


</TABLE>
<TABLE>
<CAPTION>

                           CONSOLIDATING BALANCE SHEET
                                  JUNE 30, 1999

                        Parent              Non                    Fairchild
                        Company  Guarantors Guarantors Eliminatins Historical
<S>                     <C>      <C>        <C>        <C>        <C>
Cash                    $     27  $ 41,793  $ 13,040   $     -    $  54,860
Short-term investments        71    13,023         -         -       13,094
Accounts Receivable (including
 intercompany), less
 allowances                  549    52,929    76,643         -      130,121
Inventory, net              (182)  145,080    45,341         -      190,239
Prepaid and other current
 assets                    1,297    69,000     3,629         -       72,926
Total current assets       1,762   321,825   138,653         -      462,240
Investment in
 Subsidiaries            841,744         -         -  (841,744)           -
Net fixed assets             611   137,852    45,602         -      184,065
Net assets held for sale       -    21,245         -         -       21,245
Investment if affiliates   1,300    13,135    17,356         -       31,791
Goodwill                   5,533   402,595    39,594         -      447,722
Deferred loan costs       13,029        26        22         -       13,077
Prepaid pension assets         -    63,958         -         -       63,958
Real estate investment         -         -    83,791         -       83,791
Long-term investments          -    15,844         -         -       15,844
Other assets              16,244   (11,865)      674         -        5,053
Total assets            $880,223  $964,615  $325,692 $(842,744)  $1,328,786

Bank notes payable &
current maturities of
debt                    $  2,250  $  2,548  $ 24,062 $       -   $   28,860
Accounts payable
(including inter-
company)                     972    12,824    58,475         -       72,271
Other accrued expenses     7,272    99,669    14,195         -      121,136
Net current liabilities
of discontinued operations     -         -    10,999         -       10,999
Total liabilities         10,494   115,041   107,731         -      233,266

Long-term debt, less
current maturities       480,850     9,908     4,525         -      495,283
Other long-term
liabilities                  405    18,138     7,361         -       25,904
Noncurrent income taxes  (19,026)  140,749       238         -      121,961
Retiree health care
liabilities                    -    40,189     4,624         -       44,813
Minority interest in
subsidiaries                   -         9        50         -           59
Total liabilities        472,723   324,034   124,529         -      921,286

Class A common
stock                      2,775       200     5,085    (5,085)       2,975
Class B common
stock                        262         -         -         -          262
Paid-in-capital            2,138   226,900   263,058  (263,058)     229,038
Retained earnings
(deficit)                477,191   413,483   (65,043) (573,601)     252,030
Cumulative other
comprehensive income       (764)        (2)   (1,937)        -       (2,703)
Treasury stock, at cost (74,102)         -         -         -      (74,102)
Total stockholders'
equity                  407,500    640,581   201,163  (841,744)     407,500
Total liabilities &
stockholders' equity   $880,223   $964,615  $325,692 $(841,744)  $1,328,786
</TABLE>
<TABLE>
<CAPTION>

                     CONSOLIDATING STATEMENTS OF CASH FLOWS
                        FOR THE YEAR ENDED JUNE 30, 1999

                         Parent               Non          Elimina- Fairchild
                         Company   Guarantors Guarantors    tions   Historical
<S>                      <C>       <C>        <C>         <C>       <C>
Cash Flows from Operating
Activities:
Net earnings (loss)      $(59,009)  $(27,798)  $(18,167)  $ 45,965 $(59,009)
Depreciation &
amortization                  127     17,610      7,920          -   25,657
Amortization of
deferred loan fees          1,100          -          -          -    1,100
Accretion of discount
on long-term
liabilities                 5,270          -          -          -    5,270
Extraordinary items net
of cash paid                    -      6,389          -          -    6,389
Provision for
restructuring                   -      3,774          -          -    3,774
Loss on sale of
PP&E                            -        307         93          -      400
Distributed earnings of
affiliates                      -      1,460      1,973          -    3,433
Minority interest               -      2,826       (736)         -    2,090
Change in assets and
liabilities                15,030     52,898     (3,058)   (45,965)  18,905
Non-cash charges and
working capital changes
of discontinued operations      -          -     15,259          -   15,259
Net cash (used for) provided
by operating activities   (37,482)    57,466      3,284          -   23,268
Cash Flows from Investing Activities:
Proceeds received from investment
securities                      -    189,379          -          -  189,379
Purchase of PP&E              (61)   (19,162)   (10,919)         -  (30,142)
Proceeds from sale of PP&E      -        656        188          -      844
Equity investment in
affiliates                    630     (8,308)         -          -   (7,678)
Gross proceeds from
divestiture of
subsidiary                      -     60,396          -          -   60,396
Acquisition of subsidiaries,
net of cash acquired     (221,467)   (45,287)    (7,673)         - (274,427)
Change in real estate
investment                      -          -    (40,351)         -  (40,351)
Change in net assets
held for sale                   -      3,134          -          -    3,134
Investing activities of
discontinued operations         -          -       (312)         -     (312)
Net cash (used for) provided
by investing activities  (220,898)   180,808    (59,067)         -  (99,157)
Cash Flows from Financing Activities:
Proceeds from issuance of
debt                      483,100     (3,241)     3,363         -   483,222
Debt repayment
(including intercompany),
net                      (225,000)   (213,187)   58,104         -  (380,083)
Issuance of Class A
common stock                  126       (126)         -         -         -
Proceeds from exercised
stock options                 181          -          -         -       181
Purchase of treasury
stock                           -    (22,102)         -         -   (22,102)
Net cash (used for)
provided by financing
activities                258,407   (238,656)    61,467         -    81,218
Exchange rate effect
on cash                         -          -        (70)        -       (70)
Net change in cash             27       (382)     5,614         -     5,259
Cash, beginning of
the year                        -     42,175      7,426         -    49,601
Cash, end of the
year                    $      27   $ 41,793   $ 13,040    $    -  $ 54,860
</TABLE>

<TABLE>
<CAPTION>

                      CONSOLIDATING STATEMENTS OF EARNINGS
                        FOR THE YEAR ENDED JUNE 30, 1998

                         Parent            Non     Elimina-   Fairchild
                        Company Guarantors Guarantors tion    Historical
<S>                             <C>       <C>       <C>       <C>
Net Sales               $     -  $613,324 $138,807 $(10,955)  $741,176
Cost and expenses
  Cost of sales               -   464,942  100,683  (10,955)   554,670
  Selling, general &
 administrative           3,516   112,447   19,631        -    135,594
  Amortization of
 goodwill                   147     4,247    1,075        -      5,469

                          3,663   581,636  121,389  (10,955)   695,733
  Operating income
 (loss)                  (3,663)   31,688   17,418        -     45,443

Net interest expense     24,048    14,094    4,573        -     42,715
Investment (income)
loss, net                  (208)    3,570        -        -      3,362
Nonrecurring income
on disposition of
subsidiary                    -  (124,028)       -        -   (124,028)
Earnings (loss) before
taxes                   (27,503)  138,052   12,845        -    123,394
Income tax (provision)
benefit                  10,580   (54,384)  (3,470)        -   (47,274)
Equity in earnings
of affiliates and
subsidiaries            118,013       140    3,044  (118,626)    2,571
Minority interest             -   (26,292)       -         -   (26,292)
Earnings (loss) from
continuing operations   101,090    57,516   12,419 (118,626)    52,399
Earnings (loss) from
discontinued
operations                    -     2,348  (6,644)         -    (4,296)
Earnings (loss) from
disposal of
discontinued operations       -    95,018 (35,301)         -    59,717
Extraordinary items           -    (6,730)      -          -    (6,730)
Net earnings
(loss)                 $101,090  $148,152$(29,526) $(118,626) $101,090
</TABLE>

<TABLE>
<CAPTION>
                           CONSOLIDATING BALANCE SHEET
                                  JUNE 30, 1998

                         Parent             Non        Elimina-  Fairchild
                         Company Guarantors Guarantors tions     Historical
<S>                     <C>      <C>       <C>        <C>       <C>
Cash                    $     -  $ 42,175  $ 7,426   $     -  $ 49,601
Short-term investments       71     3,891        -         -     3,962
Accounts Receivable
(including intercompany),
less allowances             400    74,158   45,726         -   120,284
Inventory, net                -   183,164   34,318         -   217,482
Prepaid and other
current assets           (1,230)   48,145    6,166         -    53,081
Net current assets of
discontinued operations       -         -   11,613         -    11,613
  Total current assets     (759)  351,533  105,249         -   456,023
Investment in
Subsidiaries            627,634         -        -  (627,634)        -
Net fixed assets            677    77,678   40,608         -   118,963
Net assets held
for sale                      -    23,789        -         -    23,789
Net noncurrent of
discontinued operations       -         -    8,541         -     8,541
Investment in affiliates    963     7,276   19,329         -    27,568
Goodwill                 14,333   120,253   33,721         -   168,307
Deferred loan cost        5,168     1,194        -         -     6,362
Prepaid pension assets        -    61,643        -         -    61,643
Real estate investment        -       214   43,226         -    43,440
Long-term investments         -   235,435        -         -   235,435
Other assets             15,863    (8,833)     158         -     7,188
  Total assets         $663,879  $870,182 $250,832 $(627,634)$1,157,259
Bank notes payable &
current maturities
of debt                $  2,250  $      - $ 18,415 $       - $  20,665
Accounts payable
(including intercompany)    124    11,197   42,538         -    53,859
Other accrued expenses   10,165    94,453   16,436         -   121,054
  Total current
 liabilities              12,539   105,650   77,389         -   195,578
Long-term debt, less
current maturities       222,750    67,300    5,352         -   295,402
Other long-term
liabilities                  470    16,428    6,869         -    23,767
Noncurrent income
tax                      (45,439)  140,262      353         -    95,176
Retiree health care
liabilities                    -    38,677    3,426         -    42,103
Minority interest in
subsidiaries                   -    31,674        -         -    31,674
  Total liabilities      190,320   399,991   93,389         -   683,700
Class A common stock       2,467       200    3,084   (3,084)     2,667
Class B common stock         263         -        -         -       263
Paid-in-capital          (29,476)  224,588  200,656 (200,656)   195,112
Retained earnings        513,204   265,436 (43,707) (423,894)   311,039

Cumulative other
comprehensive
income                      (761)   19,737  (2,590)        -    16,386
Treasury stock, at cost  (12,138)  (39,770)      -         -   (51,908)
  Total stockholders'
 equity                  473,559   470,191 157,443  (627,634)   473,559
Total liabilities
and stockholders'
equity                  $663,879  $870,182 $250,832 $(627,634) $1,157,259
</TABLE>
<TABLE>
<CAPTION>
                     CONSOLIDATING STATEMENTS OF CASH FLOWS
                        FOR THE YEAR ENDED JUNE 30, 1998
                         Parent             Non     Elimina-  Fairchild
                         Company Guarantors Guarantors tion   Historical
<S>                     <C>      <C>      <C>       <C>        <C>
Cash Flows from Operating Activities:
Net earnings (loss)     $101,090 $148,152 $(29,526) $(118,626) $101,090
Depreciation &
amortization                  72   14,939    5,862          -    20,873
Amortization of
deferred loan fees         2,406        -        -          -     2,406
Accretion of discount
on long-term
liabilities                3,766        -        -          -     3,766
Net gain on disposition
of subsidiaries                - (124,041)       -          -  (124,041)
Net gain on sale
of discontinued
operations                     - (132,787)       -          -  (132,787)
Extraordinary items net
of cash paid                   -   10,347        -          -    10,347
Loss on sale of PP&E           -      147       99          -       246
Distributed earnings
of affiliates                  -      547    1,178          -     1,725
Minority interest              -   26,890     (598)         -    26,292
Change in assets
and liabilities         (187,408)  64,276   (2,431)   118,626    (6,937)
Non-cash charges and
working capital changes
of discontinued
operations                     -        -   11,789          -    11,789
Net cash (used for)
provided by operating
activities               (80,074)   8,470  (13,627)         -   (85,231)
Cash Flows from Investing Activities:
Proceeds used for
investment securities          -   (7,287)       -          -    (7,287)
Purchase of PP&E               -  (30,220)  (5,809)         -   (36,029)
Proceeds from sale
of PP&E                        -      336        -          -       336
Equity investment in
affiliates                  (141)  (4,202)       -          -    (4,343)
Minority interest in
subsidiaries                   -  (26,383)       -          -   (26,383)
Acquisition of subsidiaries,
net of cash acquired           -  (25,445)  (7,350)         -   (32,795)
Net proceeds from sale
of discontinued
operations                     -  167,987        -          -   167,987
Change in real estate
investment                     -        -  (17,262)         -   (17,262)
Change in net assets
held for sale                  -    2,140        -          -     2,140
Investing activities of
discontinued operations        -        -   (2,750)         -    (2,750)
Net cash (used for)
provided by investing
activities                  (141)  76,926  (33,171)         -    43,614
Cash Flows from Financing Activities:
Proceeds from issuance
of debt                  225,000   50,523        -          -   275,523
Debt repayment (including
intercompany), net      (198,867)(106,899)  47,752          -  (258,014)
Issuance of Class A
common stock              53,848      193        -          -    54,041
Financing activities
of discontinued
operations                     -        -    2,538          -     2,538
Net cash provided by (used)
for financing
  Activities              79,981  (56,183)  50,290          -    74,088
Exchange rate effect
on cash                        -        -   (2,290)         -    (2,290)
Net change in cash          (234)  29,213    1,202          -    30,181
Cash, beginning of
the year                     234   12,962    6,224          -    19,420
Cash, end of year        $     -  $42,175   $7,426     $    -   $49,601
</TABLE>

<TABLE>
<CAPTION>


                      CONSOLIDATING STATEMENTS OF EARNINGS
                        FOR THE YEAR ENDED JUNE 30, 1997
                        Parent             Non      Elimina- Fairchild
                        Company Guarantors Guarantors tions  Historical
<S>                     <C>       <C>     <C>       <C>       <C>
Net Sales               $     -  $593,819  $90,243  $(3,299)  $680,763
Costs and Expense:
  Cost of sales               -   441,534   61,184   (3,299)   499,419
  Selling, general &
 administrative            3,925   117,739   21,367         -   143,031
  Amortization of
 goodwill                    130     4,215      469         -     4,814

                           4,055   563,488   83,020   (3,299)   647,264
  Operating income
 (loss)                   (4,055)   30,331    7,223         -    33,499

Net interest expense      25,252    21,556      873         -    47,681
Investment income, net       (16)   (6,635)       -         -    (6,651)
Nonrecurring income
on disposition of
subsidiary                     -    (2,528)       -         -    (2,528)
Earnings (loss) before
taxes                    (29,291)   17,938    6,350         -    (5,003)
Income tax (provision)
benefit                   15,076    (8,263)     531         -     7,344
Equity in earnings
of affiliates and
subsidiaries              15,546     (528)    3,037  (15,066)     2,989
Minority interest              -   (3,514)        -        -    (3,514)
Earnings (loss) from
continuting operations     1,331     5,633    9,918  (15,066)     1,816
Earnings (loss) from
discontinued
operations                     -     3,149   (3,634)       -       (485)
Net earnings (loss)     $  1,331  $  8,782  $ 6,284 $(15,066)    $1,331
</TABLE>

<TABLE>
<CAPTION>
                     CONSOLIDATING STATEMENTS OF CASH FLOWS
                        FOR THE YEAR ENDED JUNE 30, 1997

                         Parent             Non      Elimina- Fairchild
                         Company Guarantors Guarantors tions  Historical
<S>                      <C>      <C>       <C>    <C>         <C>
Cash Flows from Operating Activities:
Net earnings (loss)      $ 1,331  $ 8,782   $6,284 $(15,066)   $ 1,331
Depreciation &
amoritzation                 179   15,356    5,280         -    20,815
Amortization of deferred
loan fees                  2,847         -        -         -     2,847
Accretion of discount on
long-term liabilities      4,963         -        -         -     4,963
Gain on sale of PP&E           -      (72)        -         -      (72)
(Undistributed)
distributed earnings of
affiliates                     -   (1,434)      379         -   (1,055)
Minority interest              -     2,896      618         -     3,514
Change in assets
and liabilities          (23,591) (102,350)   2,412    15,066  (108,463)
Non-cash charges and
working capital changes
of discontinued
operations                     -         - (17,201)         -  (17,201)
Net cash used for
operating activities     (14,271)  (76,822) (2,228)         -  (93,321)
Cash Flows from Investing Activities:
Proceeds used for
investment securities          -   (12,951)       -         -  (12,951)
Purchase of PP&E               -   (12,371)  (2,643)         -  (15,014)
Proceeds from sale of
PP&E                           -       213        -         -       213
Equity investment
in affiliates              2,092    (3,841)        -         -   (1,749)
Minority interest in
subsidiaries                   -    (1,610)        -         -   (1,610)
Acquisitin of subsidiaries,
net of cash acquired           -         - (55,916)         -  (55,916)
Net proceeds from sale
of discontinued
operations                     -   173,719        -         -   173,719
Change in real estate
investment                     -         -  (6,737)         -   (6,737)
Change in net assets
held for sale                  -       385        -         -       385
Investing activities of
discontinued operations        -         -  (7,102)         -   (7,102)
Net cash (used for)
provided by investing
activities                 2,092   143,544 (72,398)         -    73,238
Cash Flows from Financing Activities:
Proceeds from issuance
of debt                    9,400   144,894        -         -   154,294
Debt repayment(including
intercompany), net             -  (229,874)  74,274         -  (155,600)
Issuance of Class A
common stock               1,126          -        -         -     1,126
Financing activities of
discontinued operations        -         -  (1,275)         -   (1,275)
Net cash (used for)
provided by financing
activities                10,526  (84,980)   72,999         -   (1,455)
Exchange rate effect
on cash                        -        -    1,309         -     1,309
Net change in cash        (1,653) (18,258)    (318)         -  (20,229)
Cash, beginning of
the year                   1,887   31,220    6,542         -    39,649
Cash, end of year       $    234  $12,962  $ 6,224   $     -  $ 19,420
</TABLE>


23.  SUBSEQUENT EVENTS

On  July  29, 1999, we sold our 31.9% interest in Nacanco Paketleme to  American
National  Can  Group, Inc. for approximately $48.2 million. We  also  agreed  to
provide  consulting  services over a three-year period,  at  an  annual  fee  of
approximately  $1.5  million. We used the net proceeds from the  disposition  to
reduce our indebtedness.

     In  September 1999, we have expressed our intent to sell Dallas  Aeropsace,
Inc. to a prospective acquirer. If the sale is consummated we intend to use  the
proceeds  to  reduce our indebtedness or to grow our business at  our  aerospace
fastener                                                                segment.
ITEM 9.  DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

PART III

ITEM 5.  OTHER INFORMATION

Articles  have  appeared in the French press reporting an inquiry  by  a  French
magistrate  into certain allegedly improper business transactions involving  Elf
Acquitaine,  a  French petroleum company, its former chairman and various  third
parties,  including  Maurice Bidermann. In connection  with  this  inquiry,  the
magistrate  has  made inquiry into allegedly improper transactions  between  Mr.
Steiner and that petroleum company. In response to the magistrate's request that
Mr.  Steiner  appear  in  France  as a witness, Mr.  Steiner  submitted  written
statements  concerning  the  transactions and  appeared  in  person  before  the
magistrate and others. Mr. Steiner, who has been put under examination  (mis  en
examen) by the magistrate, with respect to this matter, has not been charged.

     Mr.  Steiner appeared before the Tribunal de Grande Instance  de  Paris  to
answer  a  charge of knowingly benefiting in 1990 from a misuse by Mr. Bidermann
of  corporate  assets  of Societe Generale Mobiliere et  Immobiliere,  a  French
corporation  in  which  Mr.  Bidermann  is  believed  to  have  been  the   sole
shareholder.  Mr.  Steiner was assessed a fine of two million French  Francs  in
connection  therewith.  Both  Mr.  Steiner and  the  prosecutor  (parquet)  have
appealed the decision.

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY

The  information required by this Item is incorporated herein by reference  from
the 1999 Proxy Statement.

ITEM 11.  EXECUTIVE COMPENSATION

The  information required by this Item is incorporated herein by reference  from
the 1999 Proxy Statement.

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The  information required by this Item is incorporated herein by reference  from
the 1999 Proxy Statement.

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

The  information required by this Item is incorporated herein by reference  from
the                    1999                   Proxy                   Statement.
PART IV

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

The following documents are filed as part of this Report:

(a)(1)  Financial Statements.

      All  financial statements of the registrant as set forth under Item  8  of
this report on Form 10-K (see index on Page 15).

(a)(2)    Financial  Statement  Schedules  and  Report  of  Independent   Public
Accountants.


Schedule Number               Description                        Page

    I      Condensed Financial Information of Parent Company      77

    II          Valuation and Qualifying Accounts                 81


     All other schedules are omitted because they are not required.

Report of Independent Public Accountants

To The Fairchild Corporation:

We  have  audited in accordance with generally accepted auditing standards,  the
consolidated  financial statements of The Fairchild Corporation and subsidiaries
included  in  this Form 10-K and have issued our report thereon dated  September
15,  1999.   Our audits were made for the purpose of forming an opinion  on  the
basic  financial statements taken as a whole.  The schedules listed in the index
on the preceding page are the responsibility of the Company's management and are
presented  for  the  purpose  of  complying with  the  Securities  and  Exchange
Commission's  rules and are not part of the basic financial  statements.   These
schedules  have been subjected to the auditing procedures applied in the  audits
of  the  basic  financial statements and, in our opinion, fairly  state  in  all
material  respects  the  financial data required to  be  set  forth  therein  in
relation to the basic financial statements taken as a whole.


                    Arthur Andersen LLP


Vienna, VA
September 15, 1999
<TABLE>
<CAPTION>

 SCHEDULE I - CONDENSED FINANCIAL INFORMATION OF REGISTRANT

                            THE FAIRCHILD CORPORATION
              CONDENSED FINANCIAL STATEMENTS OF THE PARENT COMPANY
                        BALANCE SHEETS (NOT CONSOLIDATED)
                                 (In thousands)

                                            June 30,  June 30,
                  ASSETS                      1999      1998
<S>                                        <C>        <C>
Current assets:
Cash and cash equivalents                 $       27  $     --
Marketable Securities                             71        71
Accounts receivable                              549       400
Inventory                                       (182)       ---
Prepaid expenses and other current assets      1,297   (1,230)
Total current assets                           1,762     (759)

Property, plant and equipment, less
accumulated depreciation                         611       677
Investments in subsidiaries                  841,744   627,634
Investments and advances, affiliated
companies                                      1,300       963
Goodwill                                       5,533    14,333
Noncurrent tax assets                         19,026    45,439
Deferred loan fees                            13,029     5,168
Other assets                                  16,244    15,863
Total assets                                $899,249  $709,318

   LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Notes payable                               $  2,250  $  2,250
Accounts payable                                 972       124
Accrued Salaries                                 497     5,929
Accrued Insurance                                213       213
Accrued Interest                               7,049     1,082
Other Accrued                                  1,990       967
Accrued Income Taxes                          (2,477)    1,974
Total current liabilities                     10,494    12,539
Long-term debt                               480,850   222,750
Other long-term liabilities                      405       470
Total liabilities                            491,749   235,759
Stockholders' equity:
Class A common stock                           2,775     2,467
Class B common stock                             262       263
Treasury stock                               (74,102)  (12,138)
Cumulative comprehensive Income                 (764)     (761)
Additional paid in capital                     2,138   (29,476)
Retained earnings                            477,191   513,204
Total stockholders' equity                   407,500   473,559
Total liabilities and stockholders' equity  $899,249  $709,318

The accompanying notes are an integral part of these condensed financial
statements.
</TABLE>

<TABLE>
<CAPTION>

                                                                      Schedule I

             THE FAIRCHILD CORPORATION AND CONSOLIDATED SUBSIDIARIES
                  CONDENSED FINANCIAL STATEMENTS OF THE COMPANY
                    STATEMENT OF EARNINGS (NOT CONSOLIDATED)
                                 (In thousands)

                                   For the Years Ended June 30,
                                     1999     1998     1997
<S>                                <C>      <C>      <C>
Costs and Expenses:
Selling, general & administrative  $  8,114 $  3,516  $ 3,925
Amortization of goodwill                248      147      130
                                      8,362    3,663    4,055

Operating loss                       (8,362)  (3,663)  (4,055)

Net interest expense                 27,130   24,048   25,252
Investment income, net                   --      208       16
Equity in earnings of affiliates        967     (613)     480
Loss from continuing operations
before taxes                        (34,525) (28,116) (28,811)

Income tax provision (benefit)      (21,481) (10,580) (15,076)
Loss before equity in earnings
(loss) of subsidiaries              (13,044) (17,536) (13,735)

Equity in earnings (loss) of
subsidiaries                        (45,965) 118,626   15,066
Net earnings (loss)                $(59,009)$101,090  $ 1,331

The accompanying notes are an integral part of these condensed financial
statements.
</TABLE>

<TABLE>
<CAPTION>

                                                                      Schedule I
                            THE FAIRCHILD CORPORATION
              CONDENSED FINANCIAL STATEMENTS OF THE PARENT COMPANY
                   STATEMENT OF CASH FLOWS (NOT CONSOLIDATED)
                                 (IN THOUSANDS)


                                        For the Years Ended June 30,
                                          1999     1998     1997

<S>                                     <C>      <C>      <C>
Cash provided by (used for) operation  $(37,482)$(80,074)$(14,271)

Investing activities:
Acquisition of subsidiaries            (221,467)     --       --
Purchase of PP&E                            (61)     --       --
Equity investments in affiliates            630    (141)    2,092
Other                                        --       --       --

                                        (220,898)  (141)     2,092
Financing activities:
Proceeds from issuance of debt,
including intercompany                  483,100  225,000    9,400
Debt repayments                        (225,000)(198,867)    -
Issuance of common stock                    307   53,848    1,126
Other                                       --       --       --

                                        258,407   79,981   10,526
Net increase (decrease) in cash        $     27  $  (234) $(1,653)




The accompanying notes are an integral part of these condensed financial
statements.
</TABLE>

                                                                      Schedule I

             THE FAIRCHILD CORPORATION AND CONSOLIDATED SUBSIDIARIES
                  CONDENSED FINANCIAL STATEMENTS OF THE COMPANY
                NOTES TO FINANCIAL STATEMENTS (NOT CONSOLIDATED)
                                 (In thousands)

1.  BASIS OF PRESENTATION

In  accordance  with  the requirements of Regulation S-X of the  Securities  and
Exchange  Commission,  our  financial statements are  condensed  and  omit  many
disclosures  presented in the consolidated financial statements  and  the  notes
thereto.

2. LONG-TERM DEBT
<TABLE>
<CAPTION>

                                        June 30,  June 30,
                                          1999      1998
<S>                                    <C>        <C>
    Bank Credit Agreement              $258,100   $225,000
    10 3/4% Senior subordinated Notes
Due 2009                                225,000         --
    Total Debt                         $483,100   $225,000
    Less: Current Maturities             (2,250)    (2,250)
    Total Long-Term Debt               $480,850   $222,750
</TABLE>

     Maturities of long-term debt for the next five years are as follows: $2,250
in 2000, $2,250 in 2001, $2,250 in 2002,  $2,250 in 2003, and $2,250 in 2004.

3. DIVIDENDS FROM SUBSIDIARIES

Cash   dividends   paid  to  The  Fairchild  Corporation  by  its   consolidated
subsidiaries  were,  $47,742,  $42,100 and  $10,000  in  1999,  1998  and  1997,
respectively. In 1999, The Fairchild Corporation received dividends of its stock
with  a  fair market value of $22,102 and Banner Aerospace's stock with  a  fair
market  value of $187,424 from its subsidiaries.    We are involved  in  various
other  claims  and  lawsuits incidental to our business, some of  which  involve
substantial  amounts.  We, either on our own or through our insurance  carriers,
are  contesting these matters.  In our opinion, the ultimate resolution  of  the
legal  proceedings  will  not have a material adverse effect  on  our  financial
condition, future results of operations or net cash flows.

4.  CONTINGENCIES

We are involved in various other claims and lawsuits incidental to its business,
some of which involve substantial amounts.  We, either on our own or through our
insurance  carriers, is contesting these matters.  In the opinion of management,
the  ultimate  resolution  of the legal proceedings will  not  have  a  material
adverse  effect on our financial condition, or future results of  operations  or
net cash flows.

SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS

     Changes in the allowance for doubtful accounts are as follows:
<TABLE>
<CAPTION>

                                For the Years Ended June 30,
                                  1999     1998    1997
<S>                             <C>      <C>      <C>
 Beginning balance              $  5,655 $ 6,905 $ 5,449
 Charges to cost and expenses      3,426   2,240   1,978
 Charges to other accounts (a)    (2,940) (2,642)    445
 Acquired companies                  616       -       -
 Amounts written off                (315)   (848)   (967)
 Ending Balance                 $  6,442 $ 5,655 $ 6,905

(a)   Recoveries  of  amounts  written off in prior  periods,  foreign  currency
  translation and the change in related noncurrent taxes. Fiscal 1998 includes a
  reduction of $2,801 relating to the assets disposed as a result the disposition
  of Banner Aerospace's hardware group.
</TABLE>


(a)(3)  Exhibits.

Articles of Incorporation, Bylaws, and Instruments Defining Rights of Securities

3.1  Registrant's   Restated  Certificate  of  Incorporation  (incorporated   by
     reference to Exhibit "C" of Registrant's Proxy Statement dated October  27,
     1989).

*3.2 Registrant's By-Laws, amended and restated as of February 12, 1999.

4.1  Specimen of Class A Common Stock certificate (incorporated by reference  to
     Registration Statement No. 33-15359 on Form S-2).

4.2  Specimen of Class B Common Stock certificate (incorporated by reference  to
     Registrant's Annual Report on Form  10-K for the fiscal year ended June 30,
     1989).

4.3  Indenture  dated as of April 20, 1999, between the Company  and  Subsidiary
     Guarantors and The Bank of New York, as Trustee (relating to the  Company's
     10  3/4% Senior Subordinated Notes Due 2009) (incorporated by reference  to
     Registrant's  Registration Statement No. 333-80311 on  Form  S-4,  declared
     effective August 9, 1999).

4.4  Form  of Global Note (relating to the Company's 10 3/4% Senior Subordinated
     Notes  Due  2009)  (incorporated by reference to Registrant's  Registration
     Statement No. 333-80311 on Form S-4, declared effective August 9, 1999).

4.5  Registration  Rights Agreement, dated April 15, 1999, between  the  Company
     and  Credit  Suisse  First  Boston Corporation on  behalf  of  the  Initial
     Purchasers (relating to the Company's 10 3/4% Senior Subordinated Notes Due
     2009) (incorporated by reference to Registrant's Registration Statement No.
     333-80311 on Form S-4, declared effective August 9, 1999).

4.6  Purchase  Agreement, dated as of April 15, 1999, between the  Company,  the
     Subsidiary Guarantors and the Initial Purchasers (relating to the Company's
     10  3/4% Senior Subordinated Notes Due 2009) (incorporated by reference  to
     Registrant's  Registration Statement No. 333-80311 on  Form  S-4,  declared
     effective August 9, 1999).


(a)(3)    Exhibits (continued)

10.  Material Contracts

(Stock Option Plans)

10.1 1988  U.K.  Stock  Option Plan of Banner Industries, Inc. (incorporated  by
     reference  to Registrant's Annual Report on Form  10-K for the fiscal  year
     ended June 30, 1988).

10.2 Description  of  grants  of  stock options  to  non-employee  directors  of
     Registrant   (incorporated by reference to Registrant's  Annual  Report  on
     Form  10-K for the fiscal year ended June 30, 1988).

10.3 Amended  and  Restated 1986 Non-Qualified and Incentive Stock Option  Plan,
     dated  as  of February 9, 1998 (incorporated by reference to Exhibit  B  of
     Registrant's Proxy Statement dated October 9, 1998).

10.4 Amendment  Dated May 7, 1998 to the 1986 Non-Qualified and Incentive  Stock
     Option  Plan (incorporated by reference to Exhibit A of Registrant's  Proxy
     Statement dated October 9, 1998).

10.5 1996 Non-Employee Directors Stock Option Plan (incorporated by reference to
     Exhibit B of Registrant's Proxy Statement dated October 7, 1996).

10.6 Stock  Option  Deferral Plan dated February 9, 1998  (for  the  purpose  of
     allowing deferral of gain upon exercise of stock options) (incorporated  by
     reference  to  Registrant's Quarterly Report on From 10-Q for  the  quarter
     ended March 29, 1998).

*10.7     Amendment dated May 21, 1999, amending the 1996 Non-Employee Directors
     Stock  Option  Plan  (for the purpose of allowing  deferral  of  gain  upon
     exercise of stock options).

(Employee Agreements)

10.8 Amended and Restated Employment Agreement between Registrant and Jeffrey J.
     Steiner dated September 10, 1992 (incorporated by reference to Registrant's
     Annual Report on Form  10-K for the fiscal year ended June 30, 1993).

10.9 Employment  Agreement  between RHI Holdings, Inc.,  and  Jacques  Moskovic,
     dated  as  of  December 29, 1994 (incorporated by reference to Registrant's
     Annual Report on Form 10-K/A for the fiscal year ended June 30, 1996).

10.10      Employment  Agreement  between Fairchild France,  Inc.,  and  Jacques
     Moskovic,  dated  as  of December 29, 1994 (incorporated  by  reference  to
     Registrant's  Annual Report on Form 10-K/A for the fiscal year  ended  June
     30, 1996).

10.11      Employment  Agreement between Fairchild France, Inc., Fairchild  CDI,
     S.A.,  and  Jacques Moskovic, dated as of April 18, 1997  (incorporated  by
     reference  to  the Registrant's Annual Report on From 10-K for  the  fiscal
     year ended June 30, 1995).

10.12     Letter Agreement dated September 9, 1996, between Registrant and Colin
     M.  Cohen (incorporated by reference to Registrant's Annual Report on  Form
     10-K for the fiscal year ended June 30, 1997).

*10.13    Banner Aerospace, Inc. Deferred Bonus Plan, dated January 21, 1998 (as
     amended), to allow the deferral of bonuses in connection with 1998 or 1999
     Extraordinary Transactions.

10.14      Letter Agreement dated February 27, 1998, between Registrant and John
     L.  Flynn  (incorporated by reference to Registrant's Quarterly  Report  on
     From 10-Q for the quarter ended March 29, 1998).

10.15      Letter  Agreement  dated February 27, 1998,  between  Registrant  and
     Donald  E.  Miller  (incorporated by reference  to  Registrant's  Quarterly
     Report on From 10-Q for the quarter ended March 29, 1998).

10.16      Employment  Agreement  between Robert Edwards and  Fairchild  Holding
     Corp.,  dated  March  2,  1998 (incorporated by reference  to  Registrant's
     Quarterly Report on From 10-Q for the quarter ended March 29, 1998).

10.17      Promissory Note in the amount of $100,000, issued by Robert Sharpe to
     the   Registrant,  dated  July  1,  1998  (incorporated  by  reference   to
     Registrant's Annual Report on Form  10-K for the fiscal year ended June 30,
     1998).

10.18   Promissory Note in the amount of $200,000 issued by Robert Sharpe to the
     Registrant,  dated July 1, 1998 (incorporated by reference to  Registrant's
     Annual Report on Form  10-K for the fiscal year ended June 30, 1998).

*10.19    Officer Loan Program, dated as of February 5, 1999, lending up to
     $750,000 to officers for the purchase of Company Stock.


*10.20   Employment  Agreement between Jordan Law and Fairchild  Holding  Corp.,
     dated as of April 20, 1999.

*10.21   Employment Agreement between LeRoy A. Dack and Fairchild Holding Corp.,
     dated as of April 20, 1999.

*10.22    Director and Officer Loan Program, dated as of August 12, 1999,
     lending up to $2,000,000 to officers and directors for the purchase of
     Company Stock.

(Credit Agreements)

     Fairchild Holding Corp. Credit Agreement

10.23      Credit  Agreement dated as of March 13, 1996, among Fairchild Holding
     Corp.,  Citicorp USA, Inc. and certain financial institutions (incorporated
     by  reference  to Registrant's Annual Report on Form  10-K for  the  fiscal
     year ended June 30, 1996).

10.24     Restated and Amended Credit Agreement dated as of July 26, 1996, among
     Fairchild   Holding  Corp,  Citicorp  USA,  Inc.  and   certain   financial
     institutions  (the "FHC Credit Agreement") (incorporated  by  reference  to
     Registrant's Annual Report on Form  10-K for the fiscal year ended June 30,
     1996).

10.25      Amendment  No.  1, dated as of January 21, 1997, to  the  FHC  Credit
     Agreement  dated  as  of  March  13, 1996  (incorporated  by  reference  to
     Registrant's Quarterly Report on From 10-Q for the quarter ended March  30,
     1997).

10.26     Amendment No. 2 and Consent, dated as of February 21, 1997, to the FHC
     Credit  Agreement dated as of March 13, 1996 (incorporated by reference  to
     Registrant's Quarterly Report on From 10-Q for the quarter ended March  30,
     1997).

10.27      Amendment  No.  3,  dated  as of June 30, 1997,  to  the  FHC  Credit
     Agreement  dated  as  of  March  13, 1996  (incorporated  by  reference  to
     Registrant's Annual Report on Form  10-K for the fiscal year ended June 30,
     1997).

10.28      Second  Amended And Restated Credit Agreement dated as  of  July  18,
     1997,  to the FHC Credit Agreement dated as of March 13, 1996 (incorporated
     by  reference  to Registrant's Annual Report on Form  10-K for  the  fiscal
     year ended June 30, 1997).

     RHI Credit Agreement

10.29      Restated and Amended Credit Agreement dated as of May 27, 1996,  (the
     "RHI  Credit Agreement"), among RHI Holdings, Inc., Citicorp USA, Inc.  and
     certain  financial institutions. (incorporated by reference to Registrant's
     Annual Report on Form  10-K for the fiscal year ended June 30, 1996).

10.30     Amendment No. 1 dated as of July 29, 1996, to the RHI Credit Agreement
     dated  as of May 27, 1996 (incorporated by reference to Registrant's Annual
     Report on Form  10-K for the fiscal year ended June 30, 1996).

10.31     Amendment No. 2 dated as of April 7, 1997, to the RHI Credit Agreement
     dated  as of May 27, 1996 (incorporated by reference to Registrant's Annual
     Report on Form  10-K for the fiscal year ended June 30, 1997).

10.32      Amendment  No.  3 dated as of September 26, 1997, to the  RHI  Credit
     Agreement  dated  as  of  May  27,  1996  (incorporated  by  reference   to
     Registrant's Quarterly Report on Form 10-Q for the quarter ended  September
     28, 1997).

     Fairchild Corporation Credit Agreement

10.33     Third Amended and Restated Credit Agreement, dated as of December  19,
     1997,  among  RHI Holdings, Inc., Fairchild Holding Corp., the  Registrant,
     Citicorp  USA,  Inc.  and certain financial institutions  (incorporated  by
     reference  to  Registrant's Quarterly Report on Form 10-Q for  the  quarter
     ended December 28, 1997).

10.34      Amendment  No.  1 dated as of January 29, 1999 to Third  Amended  and
     Restated  Credit  Agreement dated as of December 19, 1997 (incorporated  by
     reference  to  Registrant's Quarterly Report on Form 10-Q for  the  quarter
     ended March 28, 1999).

*10.35     Credit  Agreement  dated as of April 20, 1999,  among  The  Fairchild
     Corporation  (as  Borrower),  Citicorp. USA,  Inc.  and  certain  financial
     institutions.

     Interest Rate Hedge Agreements

10.36      Interest  Rate Hedge Agreement between Registrant and Citibank,  N.A.
     dated  as  of  August 19, 1997 (incorporated by reference  to  Registrant's
     Quarterly Report on Form 10-Q for the quarter ended September 28, 1997).

10.37      Amendment  dated as of December  23, 1997, to the Interest Rate Hedge
     Agreement between Registrant and Registrant and Citibank, N.A.  dated as of
     August 19, 1997(incorporated by reference to (incorporated by reference  to
     Registrant's  Quarterly Report on Form 10-Q for the quarter ended  December
     28, 1997).

10.38      Amendment   dated  as of January  14,  1997,  to  the  Interest  Rate
     Hedge  Agreement between Registrant  and Citibank, N.A. dated as of  August
     19,  1997  (incorporated by reference to Registrant's Quarterly  Report  on
     From 10-Q for the quarter ended March 29, 1998).

(Warrants to Steiner Affiliate)

10.39      Form  Warrant  Agreement (including form of Warrant)  issued  by  the
     Company to Drexel Burnham Lambert on March 13, 1986, subsequently purchased
     by  Jeffrey  Steiner  and  subsequently assigned  to  Stinbes  Limited  (an
     affiliate  of  Jeffrey Steiner), for the purchase of Class  A  or  Class  B
     Common  Stock  (incorporated herein by reference to  Exhibit  4(c)  of  the
     Company's Registration Statement No. 33-3521 on Form S-2).

10.40     Form Warrant Agreement issued to Stinbes Limited dated as of September
     26, 1997, effective retroactively as of February 21, 1997 (incorporated  by
     reference  to  Registrant's Quarterly Report on Form 10-Q for  the  quarter
     ended September 28, 1997).

10.41      Extension  of  Warrant  Agreement  between  Registrant   and  Stinbes
     Limited  for 375,000 shares of Class A or Class B Common  Stock  dated   as
     of   September  26,  1997, effective retroactively as of February 21,  1997
     (incorporated by reference to Registrant's Quarterly Report  on  Form  10-Q
     for the quarter ended September 28, 1997).

10.42      Amendment  of Warrant Agreement dated February 9, 1998,  between  the
     Registrant  and Stinbes Limited (incorporated by reference to  Registrant's
     Quarterly Report on From 10-Q for the quarter ended March 29, 1998).

10.43      Amendment  of  Warrant Agreement dated December 12,  1998,  effective
     retroactively  as  of  September 7, 1998, between  Registrant  and  Stinbes
     Limited (incorporated by reference to Registrant's Quarterly Report on From
     10-Q for the quarter ended March 29, 1999).

(Other Material Contracts)

10.44      Asset  Purchase Agreement dated as of January 23, 1996,  between  The
     Fairchild  Corporation,  RHI Holdings, Inc. and Cincinnati  Milacron,  Inc.
     (incorporated  by reference to the Registrant's Report on  Form  8-K  dated
     January 26, 1996).

10.45     Agreement and Plan of Merger dated as of November 9, 1995 by and among
     The  Fairchild Corporation, RHI Holdings, Inc., Fairchild Industries,  Inc.
     and  Shared  Technologies, Inc. ("STI Merger Agreement")  (incorporated  by
     reference to Registrant's Report on Form 8-K dated November 9, 1995).

10.46      Amendment No. 1 to STI Merger Agreement dated as of February 2,  1996
     (incorporated by reference to Registrant's Report on Form 8-K  dated  March
     13, 1996).

10.47      Amendment No. 2 to STI Merger Agreement dated as of February 23, 1996
     (incorporated by reference to Registrant's Report on Form 8-K  dated  March
     13, 1996).

10.48      Amendment  No. 3 to STI Merger Agreement dated as of  March  1,  1996
     (incorporated  by reference to the Registrant's Report on  Form  8-K  dated
     March 13, 1996).

10.49      Voting  Agreement  dated as of July 16, 1997, between  RHI  Holdings,
     Inc.,  and Tel-Save Holdings, Inc. (regarding voting Registrant's stock  in
     Shared  Technologies  Fairchild Inc.) (incorporated  by  reference  to  the
     Registrant's Schedule 13D/A, Amendment No. 3, filed July 22, 1997).

10.50      Stock  Option Agreement dated November 20, 1997 between RHI Holdings,
     Inc.  and  Intermedia  Communications Inc. (incorporated  by  reference  to
     Schedule  13D/A, Amendment No. 4, dated as of November 25, 1997,  filed  by
     the Company on  December 1, 1997).

10.51       Stock  Purchase  Agreement  dated  November  25,  1997  between  RHI
     Holdings,   Inc.  and  Intermedia  Communications  Inc.  (incorporated   by
     reference  to   Schedule 13D/A, Amendment No. 4, dated as of  November  25,
     1997, filed by the Company on December 1, 1997).

10.52      Asset  Purchase Agreement dated as of December 8, 1997, among  Banner
     Aerospace,  Inc.  and  seven of its subsidiaries (Adams  Industries,  Inc.,
     Aerospace  Bearing  Support,  Inc., Aircraft  Bearing  Corporation,  Banner
     Distribution,  Inc.,  Burbank  Aircraft  Supply,  Inc.,  Harco,  Inc.   and
     PacAero),  AlliedSignal Inc. and AS BAR LLC (incorporated by  reference  to
     Banner Aerospace, Inc.'s Report on Form 8-K dated January 28, 1998).

10.53      Asset  Purchase Agreement dated as of December 8, 1997, among  Banner
     Aerospace, Inc. and two of its subsidiaries (PB Herndon Aerospace, Inc. and
     Banner  Aerospace Services, Inc.), AlliedSignal Inc. and  AS  BAR  PBH  LLC
     (incorporated by reference to Banner Aerospace, Inc.'s Report on  Form  8-K
     dated January 28, 1998).

10.54      Agreement  and Plan of Merger dated January 28, 1998, as  amended  on
     February  20,  1998,  and  March 2, 1998 (the "Special-T  Fasteners  Merger
     Agreement),  between  the  Company  and  the  shareholders'  of   Special-T
     Fasteners,  regarding the merger of Special-T into Fairchild  (incorporated
     by  reference to Registrant's Report on Form 8-K dated March 2, 1998, filed
     on March 12, 1998).

10.55      Third  Amendment dated September 25, 1998 to the Special-T  Fasteners
     Merger  Agreement  (incorporated by reference  to   Registrant's  Quarterly
     Report on From 10-Q for the quarter ended September 27, 1998).

10.56      Agreement  and  Plan  of Reorganization by and  among  The  Fairchild
     Corporation,  Dah  Dah,  Inc. and Kaynar Technologies  Inc.,  dated  as  of
     December   26,  1998,  regarding  the  merger  of  Kaynar  into   Fairchild
     (incorporated by reference to Registrant's Registration Statement on Form
     S-4 filed on January 15, 1999).

10.57      Voting  and  Option Agreement by and among The Fairchild Corporation,
     Dah Dah, Inc., CFE Inc., and general Electric Capital Corporation dated  as
     of  December  26,  1998, regarding voting of Kaynar stock for  the  Kaynar-
     Fairchild merger (incorporated by reference to Registrant's Report on  Form
     8-K dated December 30, 1998).

10.58     Voting Agreements by and between The Fairchild Corporation and each of
     the following individuals: Jordan Law, David A. Werner, Robert L. Beers and
     LeRoy  A.  Dack,  each agreement dated as of December 26,  1998,  regarding
     voting  of  Kaynar  stock  for the Kaynar-Fairchild merger(incorporated  by
     reference to Registrant's Report on Form 8-K dated December 30, 1998).

10.59     Agreement and Plan of Merger between The Fairchild Corporation, MTA,
     Inc. and Banner Aerospace, Inc., dated as of January 11, 1999, regarding
     the merger of Banner into Fairchild (incorporated by reference to "Appendix
     A" of Registrant's Proxy Statement/Prospectus included as part of
     Registrant's Registration Statement No. 333-70673 on Form S-4 declared
     effective March 25, 1999).

*10.60    Share Purchase Agreement dated as of July 27, 1999 between a Company
     subsidiary and Jeffrey Steiner (as Sellers) and American National Can
     Group, Inc. (as Buyer), for the sale of all stock of Nacanco Paketleme A.S.
     owned by the Sellers.

(a)(3)  Exhibits (continued)

Other Exhibits

11.  Computation  of  earnings  per  share (found  at  Note  13  in  Item  8  to
     Registrant's Consolidated Financial Statements for the fiscal  years  ended
     June 30, 1999, 1998 and 1997).

*22     List of subsidiaries of Registrant.

*23.1  Consent of Arthur Andersen LLP, independent public accountants.

*23.2  Consent of Price Waterhouse Coopers, independent public accountants.

*27     Financial Data Schedules.

99.1 Financial statements, related notes thereto and Auditors' Report of Nacanco
     Paketleme  for  the  fiscal year ended December 31, 1998  (incorporated  by
     reference to the Registrant's Report on Form 8-K filed on June 26, 1999).
-------------------------
*Filed herewith.

(b)  Reports on Form 8-K

      On  April  8,  1999, the Company filed a Form 8-K to report (Item  5)  the
completion  of  the merger with Banner Aerospace, Inc. and to report  additional
losses taken at Fairchild Technologies.

      On May 5, 1999, the Company filed a Form 8-K to report the acquisition  of
Kaynar  Technologies  Inc. to report (Item 7) audited  financial  statements  of
Kaynar   Technologies  Inc.,  and  unaudited  pro  forma  consolidate  financial
statements giving effect to the acquisition of Kaynar Technologies Inc.

      On  June 25, 1999, the Company filed a Form 8-K to report (Item 5) audited
financial  statements for the years ended December 31, 1998, 1997 and  1996  for
Nacanco Paketleme, formerly a 32% owned equity affiliate.

                                   SIGNATURES

      Pursuant  to  the  requirements of Section 13 or 15(d) of  the  Securities
Exchange Act of 1934, we have duly caused this report to be signed on our behalf
by the undersigned, thereunto duly authorized.

                            THE FAIRCHILD CORPORATION



                               By:    Colin M. Cohen
                                      Senior Vice President and
                                      Chief Financial Officer



Date:  September 28, 1999
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has  been signed below by the following persons on behalf of the Registrant,  in
their capacities and on the dates indicated.

By:       JEFFREY J. STEINER   Chairman, Chief Executive

           MICHAEL T. ALCOX   Vice President and Director   September 28,
By:            /s/                                             1999
           Michael T. Alcox

          MELVILLE R. BARLOW           Director
By:
          Melville R. Barlow

          MORTIMER M. CAPLIN           Director             September 28,
By:            /s/                                             1999
          Mortimer M. Caplin

            COLIN M. COHEN      Senior Vice President,      September 28,
By:            /s/              Chief                          1999
            Colin M. Cohen       Financial Officer and
                                       Director

             PHILIP DAVID              Director
By:
             Philip David

            ROBERT EDWARDS     Executive Vice President     September 28,
By:            /s/                                              1999
            Robert Edwards           And Director

           HAROLD J. HARRIS            Director             September 28,
By:           /s/                                                1999
           Harold J. Harris

            DANIEL LEBARD              Director             September 28,
By:             /s/                                              1999
            Daniel Lebard

         JACQUES S. MOSKOVIC     Senior Vice President      September 28,
By:             /s/                                              1999
         Jacques S. Moskovic         And Director

          HERBERT S. RICHEY            Director
By:
          Herbert S. Richey

             MOSHE SANBAR              Director             September 28,
By:              /s/                                            1999
             Moshe Sanbar

         ROBERT A. SHARPE II    Senior Vice President,
By:
         Robert A. Sharpe II    Operations and Director

           ERIC I. STEINER    President, Chief  Operating
By:
           Eric I. Steiner       Officer and Director