Document:

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                                                                  EXHIBIT 10.5.3

THE SECURITY REPRESENTED BY THIS CERTIFICATE HAS BEEN ACQUIRED FOR INVESTMENT
AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF.
NO SUCH SALE OR DISPOSITION MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION
STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY
THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED.

                             STOCK OPTION AGREEMENT

               This Stock Option Agreement (this "Agreement") is made and
entered into as of the date of grant set forth below (the "Date of Grant"), by
and between Condor Systems, Inc., a California corporation (the "Company"), and
the optionee named below ("Optionee").

Optionee:                           Noel Longuemare

Address:                            c/o Global Technology Partners, LLC
                                    1300 Eye Street, N.W., Suite 220 East
                                    Washington, D.C. 20005

Total Options Granted:              50,000

Exercise Price Per Share:           $1.00

Total Options Vested
  on Date of Grant:                 15,278

Total Options Vesting
  over three years:                 50,000

Vesting Commencement Date:          September 1, 1999

Date of Grant:                      August 4, 2000

Expiration Date for Exercise
  of All Options:                   September 1, 2009

Type of Stock Option:               [X]  Nonstatutory Stock Option

        Definitions: As used in this Agreement, the following definitions shall
apply:

               1. Grant of Option. The Company hereby grants to Optionee an
option (the "Option") to purchase the total number of shares of Class A common
stock of the Company ("Common Stock") set forth above opposite Total Options
Granted (the "Shares") at the Exercise Price Per Share set forth above (the
"Exercise Price"), subject to all of the terms and conditions of this Agreement.

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               2. Exercise of Option. This Option shall be exercisable for only
vested Shares during its term as follows:

                      (a) Vesting

                             (i) Time vesting. The number of Shares that is
11/36th of the total number of Shares listed opposite of "Total Options Grant"
are vested and exercisable on the date hereof, and 1/36th of the unvested Shares
shall vest and be exercisable on the last day of each month hereafter.
Notwithstanding the foregoing, all unvested Shares shall automatically become
fully vested and shall be immediately exercisable on and as of the date that any
share of Class C common stock of the Company is sold by any DLJMB Entity (as
defined in the Investors' Agreement, dated as of April 15, 1999, among the
Company and the several shareholders thereof).

                             (ii) This Option may not be exercised for a
fraction of a Share.

                             (iii) In no event may this Option be exercised
after the date of expiration of the term of this Option as set forth in Section
7 below.

                      (b) Method of Exercise. This Option shall be exercisable
by written notice which shall state the election to exercise the Option, the
number of Shares in respect of which the Option is being exercised, and such
other representations and agreements as to the holder's investment intent with
respect to such shares of Common Stock as may be required by the Company. Such
written notice shall be signed by Optionee and shall be delivered in person or
by certified mail to the Secretary or Chief Financial Officer of the Company.
The written notice shall be accompanied by payment of the exercise price.

                      (c) Adjustments, Merger, etc. The number and class of the
Shares and/or the exercise price specified above are subject to appropriate
adjustment in the event of changes in the capital stock of the Company by reason
of stock dividends, split-ups or combinations of shares, reclassifications,
mergers, consolidations, reorganizations or liquidations. Subject to any
required action of the shareholders of the Company, if the Company shall be the
surviving corporation in any merger or consolidation, this Option (to the extent
that it is still outstanding) shall pertain to and apply to the securities to
which a holder of the same number of shares of Common Stock that are then
subject to this Option would have been entitled.

                      No Shares will be issued pursuant to the exercise of an
Option unless such issuance and such exercise shall comply with all relevant
provisions of law and the requirements of any stock exchange upon which the
Shares may then be listed. Assuming such compliance, for income tax purposes the
Shares shall be considered transferred to the Optionee on the date on which the
Option is exercised with respect to such Shares.

               3. Optionee's Representations. By receipt of this Option, by its
execution, and by its exercise in whole or in part, Optionee represents to the
Company that Optionee understands that:

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                      (a) both this Option and any Shares purchased upon its
exercise are securities, the issuance by the Company of which requires
compliance with federal and state securities laws;

                      (b) these securities are made available to Optionee only
on the condition that Optionee makes the representations contained in this
Section 3 to the Company;

                      (c) Optionee has made a reasonable investigation of the
affairs of the Company sufficient to be well informed as to the rights and the
value of these securities;

                      (d) Optionee understands that the securities have not been
registered under the Securities Act of 1933, as amended (the "Act") in reliance
upon one or more specific exemptions contained in the Act, which may depend upon
(a) Optionee's bona fide investment intention in acquiring these securities; (b)
Optionee's intention to hold these securities in compliance with federal and
state securities laws; (c) Optionee having no present intention of selling or
transferring any part thereof (recognizing that the Option is not transferable)
in violation of applicable federal and state securities laws; and (d) there
being certain restrictions on transfer of the Shares subject to the Option;

                      (e) Optionee understands that the Shares subject to this
Option, in addition to other restrictions on transfer, must be held indefinitely
unless subsequently registered under the Act, or unless an exemption from
registration is available; that Rule 144, the usual exemption from registration,
is only available after the satisfaction of certain holding periods and in the
presence of a public market for the Shares; that there is no certainty that a
public market for the Shares will exist, and that otherwise it will be necessary
that the Shares be sold pursuant to another exemption from registration which
may be difficult to satisfy;

                      (f) Optionee understands that the certificate representing
the Shares will bear a legend prohibiting their transfer in the absence of their
registration or the opinion of counsel for the Company that registration is not
required, and a legend prohibiting their transfer in compliance with applicable
state securities laws unless otherwise exempted; and

                      (g) Optionee understands that the Shares will be subject
to right of first refusal of the Company and upon exercise of the Option,
Optionee will be required to sign the Company's stockholder agreement.

               4. Method of Payment. Payment of the purchase price shall be made
by cash, check or, in the sole discretion of the Board of Directors of the
Company at the time of exercise, promissory notes or other Shares of Common
Stock having a fair market value on the date of surrender equal to the aggregate
purchase price of the Shares being purchased.

               5. Restrictions on Exercise. This Option may not be exercised if
the issuance of such Shares upon such exercise or the method of payment of
consideration for such Shares would constitute a violation of any applicable
federal or state securities or other law or regulation. As a condition to the
exercise of this Option, the Company may require Optionee to make any
representation and warranty to the Company as may be required by any applicable
law or regulation.

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               6. Non-Transferability of Option. This Option may not be sold,
pledged, assigned, hypothecated, transferred, or disposed of in any manner other
than by will or by the laws of descent or distribution and may be exercised,
during the lifetime of the Optionee only by the Optionee; provided, however that
such Option may be transferred to any accredited investor as defined under the
rules promulgated under the Act, so long as (i) such transfer is in compliance
with all federal and state securities laws, (ii) such transferee agrees to be
bound by all terms and provisions hereof and agrees to execute all customary
documents necessary to confirm compliance thereof, (iii) only vested Shares may
be transferred, and (iv) there is not more than two transferees of the Option in
total. The terms of this Agreement shall be binding upon the executors,
administrators, heirs, successors and assigns of Optionee.

               7. Term of Option. This Option may not be exercised more than 10
years from the Vesting Commencement Date, and may be exercised during such term
only in accordance with the terms of this Option.

               8. Early Disposition of Stock; Taxation Upon Exercise of Option.
The Optionee understands that, upon exercise of this Option, Optionee will
recognize income for tax purposes in an amount equal to the excess of the then
fair market value of the Shares over the exercise price. Upon a resale of such
shares by the Optionee, any difference between the sale price and the fair
market value of the Shares on the date of exercise of the Option will be treated
as capital gain or loss. Optionee understands that the Company may be required
to withhold tax from Optionee's current compensation in certain circumstances.
To the extent that Optionee's current compensation is insufficient to satisfy
the withholding tax liability, the Company may require the Optionee to make a
cash payment to cover such liability as a condition to exercise of this Option.

               9. Tax Consequences. The Optionee understands that any of the
foregoing references to taxation are based on federal income tax laws and
regulations now in effect, and may not be applicable to the Optionee under
certain circumstances. The Optionee may also have adverse tax consequences under
state or local law. THE OPTIONEE HAS REVIEWED WITH THE OPTIONEE'S OWN TAX
ADVISORS THE FEDERAL, STATE, LOCAL AND FOREIGN TAX CONSEQUENCES OF THE
TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. THE OPTIONEE IS RELYING SOLELY ON
SUCH ADVISORS AND NOT ON ANY STATEMENTS OR REPRESENTATIONS OF THE COMPANY OR ANY
OF ITS AGENTS. THE OPTIONEE UNDERSTANDS THAT THE OPTIONEE (AND NOT THE COMPANY)
SHALL BE RESPONSIBLE FOR THE OPTIONEE'S OWN TAX LIABILITY THAT MAY ARISE AS A
RESULT OF THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT.

               10. Severability; Construction. In the event that any provision
in this Option shall be invalid or unenforceable, such provision shall be
severable from, and such invalidity or unenforceability shall not be construed
to have any effect on, the remaining provisions of this Option. This Option
shall be construed as to its fair meaning and not for or against either party.

               11. Damages. The parties agree that any violation of this
Agreement (other than a default in the payment of money) cannot be compensated
for by damages, and any aggrieved

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party shall have the right, and is hereby granted the privilege, of obtaining
specific performance of this Agreement in any court of competent jurisdiction in
the event of any breach hereunder.

               12. Governing Law. This Agreement shall be deemed to be made
under and governed by and construed in accordance with the laws of the State of
California. Jurisdiction for any disputes hereunder shall be solely in San Jose,
California.

               13. Delay. No delay or failure on the part of the Company or the
Optionee in the exercise of any right, power or remedy shall operate as a waiver
thereof, nor shall any single or partial exercise by either of them of any
right, power or remedy preclude other or further exercise thereof, or the
exercise of any other right, power or remedy.

               14. Investors' Agreement. The Optionee, by execution of this
Agreement, agrees to execute and be bound by the Investors' Agreement, dated as
of April 15, 1999, among the Company and the several shareholders from time to
time parties thereto.

               15. Market Standoff. Unless the Board of Directors otherwise
consents, Optionee agrees hereby not to sell or otherwise transfer any Shares or
other securities of the Company during the 180-day period following the
effective date of a registration statement of the Company filed under the Act;
provided, however, that such restriction shall apply only to the first
registration statement of the Company to become effective under the Act which
includes securities to be sold on behalf of the Company to the public in an
underwritten public offering under the Act. The Company may impose stop-transfer
instructions with respect to securities subject to the foregoing restrictions
until the end of such 180-day period.

               16. Complete Agreement. This Agreement constitutes the entire
agreement between the parties with respect to its subject matter, and supersedes
all other prior or contemporaneous agreements and understandings both oral or
written. This Agreement may only be amended in a writing signed by the Company
and the Optionee.

               17. Privileges of Stock Ownership. Participant shall not have any
of the rights of a shareholder with respect to any Shares until Optionee
exercises the Option and pays the Exercise Price.

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               18. Notices. Any notice required to be given or delivered to the
Company under the terms of this Agreement shall be in writing and addressed to
the Corporate Secretary of the Company at its principal corporate offices. Any
notice required to be given or delivered to Optionee shall be in writing and
addressed to Optionee at the address indicated above or to such other address as
such party may designate in writing from time to time to the Company. All
notices shall be deemed to have been given or delivered upon: personal delivery;
three (3) days after deposit in the United States mail by certified or
registered mail (return receipt requested); one (1) business day after deposit
with any return receipt express courier (prepaid); or one (1) business day after
transmission by rapifax or telecopier.

DATE OF GRANT:  August 4, 2000

                                   CONDOR SYSTEMS, INC.

                                   By:_____________________________________
                                      Name:
                                      Title:

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               Optionee hereby accepts this Agreement subject to all of the
terms and provisions hereof. Optionee has reviewed this Agreement in its
entirety, has had an opportunity to obtain the advice of counsel prior to
executing this Option and fully understands all provisions of this Agreement.
Optionee hereby agrees to accept as binding, conclusive and final all decisions
or interpretations of the Board of Directors of the Company upon any questions
arising under this Agreement.

Dated:___________

                                        ______________________________________
                                                     (Signature)
                                        Name (Print):

                                       7<PAGE>   1
                                                                  Exhibit 10.6.1

                              CONDOR SYSTEMS, INC.

                           DEFERRED COMPENSATION PLAN
                                 FOR MANAGEMENT

<PAGE>   2

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>

                                                                            PAGE
                                                                            ----
<S>     <C>                                                                 <C>
ARTICLE I         PURPOSE AND EFFECTIVE DATE.................................1

        1.01   Title.........................................................1

        1.02   Purpose.......................................................1

        1.03   Effective Date................................................1

ARTICLE II        DEFINITIONS AND CONSTRUCTION OF THE PLAN DOCUMENT..........1

        2.01   Annual Deferral Amount........................................1

        2.02   Beneficiary...................................................1

        2.03   Board.........................................................1

        2.04   Code..........................................................1

        2.05   Committee.....................................................1

        2.06   Company.......................................................1

        2.07   Compensation..................................................1

        2.08   Crediting Rate................................................1

        2.09   Deferral Account Balance......................................1

        2.10   Deferred Compensation.........................................2

        2.11   Disabled......................................................2

        2.12   Election Date.................................................2

        2.13   Election Form.................................................2

        2.14   Employee......................................................2

        2.15   Participant...................................................2

        2.16   Plan..........................................................2

        2.17   Plan Year.....................................................2

        2.18   Salary........................................................2

        2.19   Termination of Employment.....................................2

        2.20   Unforeseeable Financial Emergency.............................2

        2.21   Valuation Date................................................3

        2.22   Gender and Number.............................................3

        2.23   Titles........................................................3

ARTICLE III       ELIGIBILITY AND PARTICIPATION..............................3

        3.01   Eligibility...................................................3
</TABLE>
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                                TABLE OF CONTENTS
                                   (CONTINUED)

<TABLE>
<CAPTION>

                                                                            PAGE
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<S>     <C>                                                                 <C>
        3.02   Participation.................................................3

ARTICLE IV        PARTICIPANT DEFERRALS OF COMPENSATION......................3

        4.01   Deferred Compensation.........................................3

        4.02   Duration of Election Form.....................................3

        4.03   Election to Modify or Terminate Future Contributions..........3

        4.04   Vesting.......................................................4

ARTICLE V         DEFERRAL ACCOUNT AND CREDITING RATE........................4

        5.01   Deferral Account..............................................4

        5.02   Interest......................................................4

        5.03   Interest Credits..............................................4

ARTICLE VI        DISTRIBUTION...............................................4

        6.01   Distribution of Deferral Account Balance......................4

        6.02   Form of Distribution..........................................4

        6.03   Timing of Distribution........................................4

        6.04   Death Prior to Commencement of Benefit Payments...............4

        6.05   Death of a Participant Subsequent to Commencement of Benefit
                   Payments..................................................5

ARTICLE VII       UNFORESEEABLE FINANCIAL EMERGENCY..........................5

        7.01   Unforeseeable Financial Emergency.............................5

ARTICLE VIII      BENEFICIARY................................................5

        8.01   Beneficiary Designation.......................................5

        8.02   Proper Beneficiary............................................5

        8.03   Minor or Incompetent Beneficiary..............................5

        8.04   No Beneficiary Designation....................................5

ARTICLE IX        ADMINISTRATION OF THE PLAN.................................6

        9.01   Majority Vote.................................................6

        9.02   Finality of Determination.....................................6

        9.03   Certificates and Reports......................................6

        9.04   Indemnification and Exculpation...............................6

        9.05   Expenses......................................................6

        9.06   FICA and Other Taxes..........................................6

ARTICLE X         CLAIMS PROCEDURE...........................................7
</TABLE>
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<TABLE>
<CAPTION>

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<S>     <C>                                                                 <C>
        10.01  Written Claim.................................................7

        10.02  Denied Claim..................................................7

        10.03  Review Procedure..............................................7

        10.04  Committee Review..............................................7

ARTICLE XI        NATURE OF COMPANY'S OBLIGATION.............................7

        11.01  Company's Obligation..........................................7

        11.02  Creditor Status...............................................7

ARTICLE XII       MISCELLANEOUS..............................................8

        12.01  Written Notice................................................8

        12.02  Change of Address.............................................8

        12.03  Merger, Consolidation or Acquisition..........................8

        12.04  Amendment and Termination.....................................8

        12.05  Employment....................................................8

        12.06  Non-transferability...........................................8

        12.07  Legal Fees....................................................8

        12.08  Tax Withholding...............................................8

        12.09  Acceleration of Payment.......................................8

        12.10  Applicable Law................................................9
</TABLE>

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                                    ARTICLE I

                           PURPOSE AND EFFECTIVE DATE

        1.01 TITLE. This Plan shall be known as Condor Systems, Inc. Deferred
Compensation Plan for Management (hereinafter referred to as the "Plan").

        1.02 PURPOSE. The purpose of the Plan is to permit certain members of
management or highly compensated Employees to defer pre-tax Compensation. The
Plan constitutes an unfunded "top hat" arrangement under Title I of ERISA as
well as for income tax purposes.

        1.03 EFFECTIVE DATE. The effective date of this Plan shall be November
13, 2000.

                                   ARTICLE II

                DEFINITIONS AND CONSTRUCTION OF THE PLAN DOCUMENT

        2.01 ANNUAL DEFERRAL AMOUNT. "Annual Deferral Amount" shall mean that
portion of a Participant's Compensation to be paid during a Plan Year that a
Participant elects to have and is deferred for any one Plan Year. In the event
of a Participant's Termination of Employment prior to the end of a Plan Year,
such year's Annual Deferral Amount shall be the actual amount deferred and
withheld prior to such event.

        2.02 BENEFICIARY. "Beneficiary" shall mean the person or persons
designated, pursuant to Section 8.01, by the Participant to receive such
payments as may become payable hereunder after the death of said Participant.

        2.03 BOARD.  "Board" shall mean the Board of Directors of the Company.

        2.04 CODE. "Code" shall mean the Internal Revenue Code of 1986, as may
be amended from time to time.

        2.05 COMMITTEE. "Committee" shall mean the Committee designated by the
Board of Directors to administer the Plan.

        2.06 COMPANY. "Company" shall mean Condor Systems, Inc. and any
subsidiary or affiliated companies that adopt the Plan, with the Company's
approval, for its Employees.

        2.07 COMPENSATION. "Compensation" shall mean a Participant's Salary and
bonuses without regard to any deferrals or Salary reductions.

        2.08 CREDITING RATE. "Crediting Rate" shall mean an interest rate
determined and announced by the Committee the first day of each calendar
quarter.

        2.09 DEFERRAL ACCOUNT BALANCE. "Deferral Account Balance" shall mean
with respect to a Participant the sum of (i) his or her Deferred Compensation,
plus (ii) interest credited in accordance with Article V of this Plan, less
(iii) all distributions. This account shall be a

<PAGE>   6

bookkeeping entry only and shall be utilized solely as a device for the
measurement and determination of the amounts to be paid to a Participant
pursuant to this Plan.

        2.10 DEFERRED COMPENSATION. "Deferred Compensation" shall mean the sum
of all of a Participant's Annual Deferral Amounts.

        2.11 DISABLED. "Disabled" shall mean Total and Permanent Disability of a
Participant under the terms of the long-term disability plan of the Company, or,
in the absence of a long-term disability plan, as determined by the Board, in
its sole discretion.

        2.12 ELECTION DATE. "Election Date" shall mean the date established by
the Committee as the date before which an Employee must submit a valid Election
Form to the Committee. The applicable Election Dates can be no later than the
following: (a) 30 days after adoption of the Plan for Employees who are eligible
to participate at the time the Plan is adopted, (b) 30 days after a newly
eligible Employee is notified of the right to participate in the Plan, or (c)
December 15 prior to any following Plan Year if (a) or (b) above do not apply.

        2.13 ELECTION FORM. "Election Form" shall mean the form established from
time to time by the Committee that a Participant completes, signs and returns to
the Committee to make an election under the Plan.

        2.14 EMPLOYEE. "Employee" shall mean a person employed by the Company
who is a member of a select group of management or highly compensated Employees
as determined by the Committee.

        2.15 PARTICIPANT. "Participant" shall mean an Employee who has Deferred
Compensation pursuant to the terms of this Plan, and whose Deferral Account
Balance has not yet been fully distributed.

        2.16 PLAN. "Plan" shall mean the Condor Systems, Inc. Deferred
Compensation Plan for Management as described in this instrument and as amended
from time to time.

        2.17 PLAN YEAR. "Plan Year" shall the period commencing November 13,
2000 and ending December 31, 2000, and each calendar year thereafter.

        2.18 SALARY. "Salary" shall mean a Participant's base compensation for
the Plan Year excluding bonuses and other extraordinary forms of compensation
but including amounts deferred from base compensation pursuant to this Plan and
otherwise.

        2.19 TERMINATION OF EMPLOYMENT. "Termination of Employment" or similar
expression shall mean the termination of the Participant's employment as a
Employee of the Company and any division, subsidiary or affiliate thereof. A
Disabled Participant shall be deemed to have terminated employment for purposes
of this Plan.

        2.20 UNFORESEEABLE FINANCIAL EMERGENCY. "Unforeseeable Financial
Emergency" shall mean an unanticipated emergency that is caused by an event
beyond the control of the Participant that would result in severe financial
hardship to the Participant resulting from (i) a sudden and unexpected illness
or accident of the Participant or a dependent of the Participant, (ii)

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<PAGE>   7

a loss of the Participant's property due to casualty, or (iii) such other
extraordinary and unforeseeable circumstances arising as a result of events
beyond the control of the Participant, all as determined in the sole discretion
of the Committee.

        2.21 VALUATION DATE. "Valuation Date" shall mean the last day of each
calendar quarter.

        2.22 GENDER AND NUMBER. Wherever the context so requires, masculine
pronouns include the feminine and singular words shall include the plural.

        2.23 TITLES. Titles of the Articles of this Plan are included for ease
of reference only and are not to be used for the purpose of construing any
portion or provision of this Plan document.

                                   ARTICLE III

                          ELIGIBILITY AND PARTICIPATION

        3.01 ELIGIBILITY. Eligibility for participation in this Plan shall be
determined by the Committee, in its sole discretion, but all Participants must
be a member of a select group of management or highly compensated Employees of
the Company.

        3.02 PARTICIPATION. An Employee, after having been selected for
participation by the Committee, shall, as a condition to participation, complete
and return to the Committee a duly executed Election Form no later than the
applicable Election Date. A Deferral Account will be established for each
Participant at the time an Election Form is received by the Committee.

                                   ARTICLE IV

                      PARTICIPANT DEFERRALS OF COMPENSATION

        4.01 DEFERRED COMPENSATION. Each Participant in the Plan may have up to
100% of his or her Salary and up to 100% of his or her annual bonus, less any
amount due for taxes and subject to such offsets as the Committee may deem
necessary, deferred in accordance with the terms and conditions of this Plan.
Each Participant shall elect such Annual Deferral Amount by completing, signing
and returning to the Committee an Election Form by the applicable Election Date.
The amounts deferred, which are the Participant's Deferred Compensation, shall
be added to the Participant's Deferral Account.

        4.02 DURATION OF ELECTION FORM. A Participant's Election Form shall
remain in effect until modified or terminated as provided in Section 4.03.
Future deferrals will be terminated automatically for any Participant who is
deemed (by the Committee) to no longer be eligible for participation in the
Plan.

        4.03 ELECTION TO MODIFY OR TERMINATE FUTURE CONTRIBUTIONS. A Participant
who desires to modify or terminate the amount of future Compensation being
deferred under the Plan must notify the Committee in writing on an Election Form
provided by the Committee. Elections to decrease or terminate deferrals of
future Compensation shall become effective as

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<PAGE>   8

soon as administratively possible. Elections to increase deferrals of future
Compensation shall become effective on January 1 of the next Plan Year.

        4.04 VESTING. A Participant shall be fully vested at all times in his or
her Deferral Account Balance.

                                    ARTICLE V

                       DEFERRAL ACCOUNT AND CREDITING RATE

        5.01 DEFERRAL ACCOUNT. A Participant's Deferred Compensation under
Section 4.01 herein shall be credited on each valuation date to a Deferral
Account maintained for each Participant. Distributions pursuant to Articles VI
and VII shall be debited against the Participant's Deferral Account.

        5.02 INTEREST. Prior to any distribution of a Participant's Deferral
Account Balance under Article VI herein, the Company shall credit the Deferral
Account with interest on each Valuation Date at the Crediting Rate.

        5.03 INTEREST CREDITS. Interest credits to the Deferral Account Balance
in accordance with this Article V shall continue until the Deferral Account
Balance is paid in full to the Participant or the Participant's Beneficiary.

                                   ARTICLE VI

                                  DISTRIBUTION

        6.01 DISTRIBUTION OF DEFERRAL ACCOUNT BALANCE. Distribution of the value
of a Participant's Deferral Account Balance shall be in a lump sum or in annual
installments as specified on the Participant's Election Form. If the timing of
distribution or a payment form is not specified on an Election Form, a
Participant's Deferral Account Balance shall be distributed as a lump sum on the
earlier of (i) the Participant's termination of employment with Condor Systems,
Inc., or (ii) the incurrence and continuation for at least two (2) consecutive
days of an event of default under that certain Credit Agreement dated April 15,
1999 among Condor Systems, Inc. and the Banks named therein, with Bank of
America NTSA as administrative agent. The selection of a lump sum or installment
payments must be made on a Participant's, initial Election Form and cannot be
changed for future contributions and earnings thereon.

        6.02 FORM OF DISTRIBUTION. All distributions of a Participant's Deferral
Account shall be made in cash only.

        6.03 TIMING OF DISTRIBUTION. Distributions shall commence, or be paid in
a lump sum if so elected, as soon as administratively feasible after the date
shown on the Participant's Election Form. The timing of distributions elected by
the Participant on the Election Form shall be irrevocable as to all Deferred
Compensation under the Plan.

        6.04 DEATH PRIOR TO COMMENCEMENT OF BENEFIT PAYMENTS. In the event of a
Participant's death prior to the commencement of benefit payments hereunder, an
amount equal

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to the Participant's Deferral Account Balance shall be paid to the Participant's
Beneficiary in a lump sum within 90 days after the Participant's death.

        6.05 DEATH OF A PARTICIPANT SUBSEQUENT TO COMMENCEMENT OF BENEFIT
PAYMENTS. In the event of the death of a Participant subsequent to commencement
of benefit payments hereunder but prior to completion of such payments, the
installments shall continue and shall be paid to the designated Beneficiary as
if the Participant had survived. The Company shall reserve the right to commute
and pay the benefits in a lump sum.

                                   ARTICLE VII

                        UNFORESEEABLE FINANCIAL EMERGENCY

        7.01 UNFORESEEABLE FINANCIAL EMERGENCY. At the request of a Participant
in the event of an Unforeseeable Financial Emergency or at the request of any of
the Participant's Beneficiaries after the Participant's death, the Committee
may, in its sole discretion, accelerate and pay all or part of the value of a
Participant's Deferral Account Balance. An accelerated distribution hereunder
for an Unforeseeable Financial Emergency must be limited to only that amount
necessary to relieve the Unforeseeable Financial Emergency.

                                  ARTICLE VIII

                                   BENEFICIARY

        8.01 BENEFICIARY DESIGNATION. A Participant shall designate a
Beneficiary to receive benefits under the Plan on the Election Form provided by
the Committee. If more than one Beneficiary is named, the share and/or
precedence of each Beneficiary shall be indicated. A Participant shall have the
right to change the Beneficiary by submitting to the Committee a new Election
Form.

        8.02 PROPER BENEFICIARY. If the Committee has any doubt as to the proper
Beneficiary to receive payments hereunder, the Committee shall have the right to
withhold such payments until the matter is finally adjudicated. However, any
payment made by the Committee, in good faith and in accordance with this Plan,
shall fully discharge the Company from all further obligations with respect to
that payment.

        8.03 MINOR OR INCOMPETENT BENEFICIARY. In making any payments to or for
the benefit of any minor or an incompetent Beneficiary, the Committee, in its
sole and absolute discretion, may make a distribution to a legal or natural
guardian or other relative of a minor or court appointed committee of such
incompetent. Alternatively, it may make a payment to any adult with whom the
minor or incompetent temporarily or permanently resides. The receipt by a
guardian, committee, relative or other person shall be a complete discharge to
the Company. Neither the Company nor the Committee shall have any responsibility
to see to the proper application of any payments so made.

        8.04 NO BENEFICIARY DESIGNATION. If a Participant fails to designate a
Beneficiary as provided in Section 8.01 above, or if all designated
Beneficiaries predecease the Participant or die prior to complete distribution
of the Participant's benefits, then the Participant's designated

                                       5
<PAGE>   10

Beneficiary shall be deemed to be his or her surviving spouse. If the
Participant has no surviving spouse, the benefits remaining under the Plan to be
paid to a Beneficiary shall be payable to the executor or personal
representative of the Participant's estate.

                                   ARTICLE IX

                           ADMINISTRATION OF THE PLAN

        9.01 MAJORITY VOTE. All resolutions or other actions taken by the
Committee shall be by vote of a majority of those present at a meeting at which
a majority of the members are present, or in writing by all the members at the
time in office if they act without a meeting.

        9.02 FINALITY OF DETERMINATION. Subject to the Plan, the Committee
shall, from time to time, establish rules, forms and procedures for the
administration of the Plan. Except as herein otherwise expressly provided, the
Committee shall have the exclusive right to interpret the Plan and to decide any
and all matters arising thereunder or in connection with the administration of
the Plan, and it shall endeavor to act, whether by general rules or by
particular decisions, so as not to discriminate in favor of or against any
person. The decisions, actions and records of the Committee shall be conclusive
and binding upon the Company and all persons having or claiming to have any
right or interest in or under the Plan, and cannot be overruled by a court of
law unless arbitrary or capricious.

        9.03 CERTIFICATES AND REPORTS. The members of the Committee and the
officers and directors of the Company shall be entitled to rely on all
certificates and reports made by any duly appointed accountants, and on all
opinions given by any duly appointed legal counsel, which legal counsel may be
counsel for the Company.

        9.04 INDEMNIFICATION AND EXCULPATION. The Company shall indemnify and
hold harmless each current and former member of the Committee and each current
and former member of the Board against any and all expenses and liabilities (to
the extent not indemnified under any liability insurance contract or other
indemnification agreement) which the person incurs on account of any act or
failure to act in connection with the good faith administration of the Plan.
Expenses against which a member of the Committee shall be indemnified hereunder
shall include, without limitation, the amount of any settlement or judgment,
costs, counsel fees, and related charges reasonably incurred in connection with
a claim asserted, or a proceeding brought or settlement thereof. The foregoing
right of indemnification shall be in addition to any other rights to which any
such member of the Committee may be entitled as a matter of law, but shall be
conditioned upon the person's notifying the Company of the claim of liability
within 60 days of the notice of that claim and offering the Company the right to
participate in and control the settlement and defense of the claim.

        9.05 EXPENSES. The expenses of administering the Plan shall be borne by
the Company.

        9.06 FICA AND OTHER TAXES. For each Plan Year in which an Annual
Deferral Amount is being withheld, the Company shall ratably withhold from that
portion of the

                                       6
<PAGE>   11

Participant's Compensation that is not being deferred, the Participant's share
of FICA and other employment taxes.

                                    ARTICLE X

                                CLAIMS PROCEDURE

        10.01 WRITTEN CLAIM. Benefits shall be paid in accordance with the
provisions of this Plan. The Participant, or a designated recipient or any other
person claiming through the Participant shall make a written request for
benefits under this Plan. This written claim shall be mailed or delivered to the
Committee. Such claim shall be reviewed by the Committee or a delegate.

        10.02 DENIED CLAIM. If the claim is denied, in full or in part, the
Committee shall provide a written notice within ninety (90) days setting forth
the specific reasons for denial, and any additional material or information
necessary to perfect the claim, and an explanation of why such material or
information is necessary, and appropriate information and explanation of the
steps to be taken if a review of the denial is desired.

        10.03 REVIEW PROCEDURE. If the claim is denied and a review is desired,
the Participant (or Beneficiary) shall notify the Committee in writing within
sixty (60) days after receipt of the written notice of denial. In requesting a
review, the Participant or Beneficiary may request a review of pertinent
documents with regard to the benefits created under this agreement, may submit
any written issues and comments, may request an extension of time for such
written submission of issues and comments, and may request that a hearing be
held, but the decision to hold a hearing shall be within the sole discretion of
the Committee.

        10.04 COMMITTEE REVIEW. The decision on the review of the denied claim
shall be rendered by a Committee within sixty (60) days after the receipt of the
request for review (if no hearing is held) or within sixty (60) days after the
hearing if one is held. The decision shall be written and shall state the
specific reasons for the decision including reference to specific provisions of
this Plan on which the decision is based.

                                   ARTICLE XI

                         NATURE OF COMPANY'S OBLIGATION

        11.01 COMPANY'S OBLIGATION. The Company's obligations under this Plan
shall be an unfunded and unsecured promise to pay. The Company shall not be
obligated under any circumstances to fund its financial obligations under this
Plan.

        11.02 CREDITOR STATUS. Any assets which the Company may acquire or set
aside to help cover its financial liabilities are and must remain general assets
of the Company subject to the claims of its creditors. Neither the Company nor
this Plan gives a Participant or Beneficiary any beneficial ownership interest
in any asset of the Company. All rights of ownership in any such assets are and
remain in the Company. All Plan Participants and Beneficiaries shall be
unsecured general creditors of the Company.

                                       7
<PAGE>   12

                                   ARTICLE XII

                                  MISCELLANEOUS

        12.01 WRITTEN NOTICE. Any notice which shall be or may be given under
the Plan shall be in writing and shall be mailed by United States mail, postage
prepaid. If notice is to be given to the Company, such notice shall be addressed
to the Committee at Condor Systems, Inc. If notice is to be given to the
Participant, such notice shall be sent to the Participant's last known address.

        12.02 CHANGE OF ADDRESS. Any party may, from time to time, change the
address to which notices shall be mailed by giving written notice of such new
address.

        12.03 MERGER, CONSOLIDATION OR ACQUISITION. The Plan shall be binding
upon the Company, its assigns, and any successor to the Company which shall
succeed to substantially all of its assets and business through merger,
acquisition or consolidation, and upon a Participant, a Beneficiary, assigns,
heirs, executors and administrators.

        12.04 AMENDMENT AND TERMINATION. The Company, by action of the Board,
retains the sole and unilateral right to terminate, amend, modify, or supplement
this Plan, in whole or part, at any time. However, no Company action under this
right shall reduce the Deferral Account of any Participant or Beneficiary not
yet in payment status or reduce benefits that are in payment status.

        12.05 EMPLOYMENT. This Plan does not provide a contract of employment
between the Company and the Participant, and the Company reserves the right to
terminate the Participant's employment for any reason, at any time,
notwithstanding the existence of this Plan.

        12.06 NON-TRANSFERABILITY. Except insofar as prohibited by applicable
law, no sale, transfer, alienation, assignment, pledge, collateralization or
attachment of any benefits under this Plan shall be valid or recognized by the
Company. Neither the Participant, spouse, or designated Beneficiary shall have
any power to hypothecate, mortgage, commute, modify, or otherwise encumber in
advance of any of the benefits payable hereunder, nor shall any of said benefits
be subject to seizure for the payment of any debts, judgments, alimony
maintenance, owed by the Participant or Beneficiary, or be transferable by
operation of law in the event of bankruptcy, insolvency, or otherwise.

        12.07 LEGAL FEES. All reasonable legal fees incurred by any Participant
(or former Participant) to successfully enforce valid rights under this Plan
shall be paid by the Company in addition to sums due under this Plan.

        12.08 TAX WITHHOLDING. The Company may withhold from a payment any
federal, state, or local taxes required by law to be withheld with respect to
such payment and such sum as the Company may reasonably estimate as necessary to
cover any taxes for which the Company may be liable and which may be assessed
with regard to such payment.

        12.09 ACCELERATION OF PAYMENT. The Company reserves the right to
accelerate the payment of any benefits payable under this Plan at any time
without the consent of the

                                       8
<PAGE>   13

Participant, the Participant's estate, a Beneficiary or any other person
claiming through the Participant.

        12.10 APPLICABLE LAW. This Plan shall be governed by the laws of the
State of California.

        IN WITNESS WHEREOF, the Company has caused this instrument to be
executed by its duly authorized officer on this _______ day of
_________________, 20__, effective as of the 13th day of November, 2000.

CONDOR SYSTEMS, INC.

BY
   -----------------------------------------------
   Chief Financial Officer and Secretary

                                        9

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