Document:

EXHIBIT 10.2.7

                              EMPLOYMENT AGREEMENT

This EMPLOYMENT AGREEMENT ("Agreement") is entered into as of April 6, 2000,
(the "Effective Date") by and between CONDOR SYSTEMS, INC., a California
corporation (the "Company"), and JOHN TAFT, an individual resident of the State
of California (the "Employee").

WHEREAS, the Company wishes to assure that it will have the benefit of the
knowledge and experience of Employee, who has been Chief Financial Officer and
Secretary; and

WHEREAS, Employee is willing to enter into an agreement to such end upon the
terms and conditions set forth in this Agreement;

NOW, THEREFORE, in consideration of the foregoing and the mutual agreements
herein contained, the parties hereto agree as follows:

1. Employment.  The Company hereby employs the Employee, and the Employee hereby
accepts such employment with the Company, upon the terms and conditions
hereinafter set forth.

2. Term of Employment. Unless earlier terminated as provided in Section 5, the
Company shall employ the Employee under this Agreement commencing on the
Effective Date and ending on the second anniversary of the Effective Date (the
"Employment Period"). On the second and each succeeding anniversary of the
Effective Date, the Employment Period shall automatically be extended for one
additional year unless, not later than 30 days prior to such anniversary, the
Employee or the Company shall have given notice of his or its intention not to
extend the Employment Period. This Agreement will have no force and effect until
or unless the stockholders of the Company shall have approved this Agreement
pursuant to Section 8 of this Agreement.

3. Title and Duties.

(a) The Employee shall have the title and position of Chief Financial Officer
and Secretary of the Company. In addition to the foregoing, the Company's Board
of Directors (the "Board") may, in the exercise of its business judgment, elect
the Employee to such other office or offices as it may determine during the
Employment Period.

(b) In such capacities, Employee shall report to the Chief Executive Officer of
the Company. Employee's duties and responsibilities shall be as specified by the
Board or the Chief Executive Officer, but, in general, the Employee shall have

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such authority and such responsibilities as are consistent with the foregoing
positions.

(c) Throughout the Employment Period, the Employee shall devote substantially
all of his time, energy, skill and best efforts to the performance of his duties
hereunder in a manner that will faithfully and diligently further the business
and interests of the Company. Subject to the preceding sentence, the Employee
may serve, or continue to serve, on the boards of directors of other entities
and may engage in appropriate civic or charitable activities as long as such
activities do not interfere or conflict with the performance of the Employee's
duties pursuant to this Agreement and his responsibilities to the Company under
this Agreement, and provided that any board of directors position is disclosed
to the Board in writing at least 10 days in advance of Employee's election to
such board of directors position.

4. Compensation.

(a) Base Salary. The Company shall pay the Employee as compensation a salary at
the beginning rate of $195,000 per year (the "Base Salary"), payable in
accordance with the ordinary compensation practices of the Company. The
Compensation Committee of the Board shall annually review the Base Salary for
possible increase, in its sole discretion.

(b) Bonus. Employee shall be eligible to receive an annual bonus (the "Bonus")
of up to 100% of Base Salary for each calendar year in accordance with the
following:

         (A) If EBITDA, as hereunder defined, for any calendar year is less than
         the Floor EBITDA for such year, the Company will pay the Employee no
         bonus.

         (B) If EBITDA for any calendar year is equal to the Target EBITDA for
         such year, the Company shall pay the Employee a bonus of 50% of the
         actual Base Salary paid to the Employee during such calendar year;

         (C) If EBITDA for any calendar year is equal to or greater than the
         Ceiling EBITDA for such year; the Company shall pay the Employee a
         bonus of 100% of the actual Base Salary paid to the Employee during
         such calendar year;

         (D) If EBITDA for any calendar year is greater than the Floor EBITDA
         for such year but is less than the Target EBITDA for such year, the
         Company will pay the Employee a bonus calculated by linear
         interpolation, as

         described in Attachment I. If EBITDA for any calendar year is greater
         than the Target EBITDA for such year but is less than the Ceiling
         EBITDA for such year, the Company will pay the Employee a bonus
         calculated by linear interpolation, as described in Attachment I;

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(c) Definitions.  For purposes of this Section 4:

         (A) "EBITDA" means, for each calendar year, the EBITDA number achieved
         by the Company, as determined annually for purposes of this Agreement
         by the Compensation Committee of the Board.

         (B) "Floor EBITDA" means, for any applicable calendar year, a projected
         EBITDA established annually for purposes of this Agreement by the
         Compensation Committee of the Board, together with the Employee;
         provided that the 2000 Floor EBITDA shall be $16,100,000.

         (C) "Target EBITDA" means, for any applicable calendar year, a
         projected EBITDA established annually for purposes of this Agreement by
         the Compensation Committee of the Board, together with the Employee;
         provided that the 2000 Target EBITDA shall be $17,600,000.

         (D) "Ceiling EBITDA" means, for any applicable calendar year, a
         projected EBITDA established annually for purposes of this Agreement by
         the Compensation Committee of the Board, together with the Employee;
         provided that the 2000 Ceiling EBITDA shall be $18,700,000.

(d) Reimbursement of Expenses. The Company shall pay or reimburse the Employee
for all reasonable travel and other expenses incurred by the Employee in the
performance of his obligations under this Agreement, provided that the Employee
properly accounts for such expenses in accordance with the policies and
procedures of the Company.

(e) Vacation. The Employee shall be entitled to a number of paid vacation days
in each calendar year as determined by the Company from time to time for its
employees in accordance with Company policy (prorated for any calendar year in
which the Employee is employed under this Agreement for less than the entire
year).

(f) Fringe Benefits and Perquisites. During the Employment Period, Employee
shall be eligible, on the same basis as he is currently eligible, for employee
benefits (including fringe benefits, vacation, automobile allowance, pension and
life, health, accident and disability insurance) no less favorable than those
benefits

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for which he is eligible immediately prior to the Effective Time, except for the
Company's ESOP and other stock-based plans.

(g) Withholding.  All payments under this Agreement shall be subject to
withholding for applicable taxes.

5. Termination.  The Employee's employment by the Company shall be terminated
upon the occurrence of any of the following:

(a) By Employee Without Cause. The Employee may terminate his employment under
this Agreement upon at least 120 days' prior notice to the Board of the Company.
Upon termination of his employment and upon experiencing a "qualifying event",
as defined in Section 4980B(f)(3) of the Internal Revenue Code of 1986, as
amended, COBRA coverage shall be made available to the Employee in compliance
with federal law.

(b) By Employee for Good Reason. The Employee may terminate his employment under
this Agreement after the Effective Date, upon at least 30 days' prior notice to
the Board of the Company, for Good Reason. For purposes of this Agreement, "Good
Reason" shall mean the occurrence of the following:

         (i) the occurrence of a "Change in Control." For purposes of this
         Agreement, a "Change in Control" shall mean the occurrence of (x) the
         consolidation, reorganization or merger of the Company with or into
         another corporation or corporations or other legal entitie(s) not
         controlled by any entity that is an affiliate of the Company
         immediately following the Effective Date, or (y) the conveyance of all
         or substantially all of the stock or assets of the Company to another
         person or entity not controlled by any entity that is an affiliate of
         the Company immediately following the Effective Date; provided that a
         Change in Control shall not be deemed to occur upon the occurrence of
         an initial public offering of the Company's capital stock ("IPO"); or

         (B) the Employee's duties, authority or responsibilities as Chief
         Financial Officer and Secretary of the Company, whether managerial or
         supervisory, are materially diminished without the prior consent of the
         Employee.

(c) By the Company for Cause. The Company may terminate the Employee's
employment for Cause. "Cause" for purposes of this Agreement shall mean
Employee's (i) personal dishonesty; (ii) willful misconduct; (iii) breach of
fiduciary duty involving personal profit; (iv) intentional failure to perform
designated duties or willful refusal to implement decisions of the Board made in
good faith; (v) willful violation, for personal financial gain, of any law, rule
or

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regulation; or (vi) material breach of any provision of this Agreement;
provided, however, that prior to any proposed Board action pursuant to
subparagraph (iv) the Board shall give the Employee reasonable opportunity to
respond and, if appropriate, to otherwise perform as directed.

The Employee's right to compensation and other benefits from the Company under
this Agreement shall cease upon the Company's terminating the Employee's
employment under this Agreement for Cause. The provisions of this Section 5(c)
shall take precedence over the provisions of Section 5(a) notwithstanding any
prior notice by the Employee to the Company under Section 5(a).

(d) By the Company Without Cause.  The Company may terminate the Employee's
employment under this Agreement without Cause therefore at any time.

6. Severance Pay

a) In the event that the Employee's employment under this Agreement is
terminated pursuant to the provisions of Section 5(b) or 5(d), or if the Company
pursuant to Section 2 does not renew the employee's Employment Period, as
severance pay the Employee shall be paid a total of $500,000. Such severance pay
shall be paid in the form of a standby letter of credit issued by a bank or a
lump sum deposit to an escrow account at a bank designated by the Company, and
thereafter shall be drawn upon or paid to the Employee in eight equal
installments on the last business day of each of the eight fiscal quarters
following the quarter during which Employee's employment is terminated,
beginning with such fiscal quarter; provided that the escrow agreement will
provide that all payments of Employee's severance pay will cease if Employee
breaches any of the provisions of Section 7 of this Agreement. Employee shall
also be entitled to continued eligibility to participate in all health, medical
and dental benefit plans of the Company for which Employee was eligible
immediately prior to the effective time of the termination of Employee's
employment, or comparable coverage, for two years, or, if sooner, until
comparable health insurance coverage is available to Employee in connection with
subsequent employment or self-employment. In addition, the termination of the
Employee's employment shall not accelerate the vesting of unvested Options or
Stock Appreciation Rights (as such terms are defined in the 1999 Management
Incentive Plan) held by the Employee (if any).

(b) In the event that the Employee's employment under this Agreement is
terminated upon the death or disability of the Employee, then the Employee will
not be entitled to the severance benefits set forth in Section 6(a); however,
the Company will pay to the Employee or the Employee's spouse (if she is then
living) the Employee's then-current Base Salary in accordance with the Company's
normal pay practices until the earlier of (i) the end of the sixth calendar

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month following Employee's termination of active service, or (ii) such time as
the Employee's spouse (or a trust for her benefit) has received proceeds from
the insurance policy described in Section 4(e). Any Base Salary paid after the
death or disability of the Employee pursuant to clause (i) above shall be repaid
to the Company upon the receipt of the insurance proceeds described in clause
(ii) by the Employee's spouse (or by a trust for her benefit). The Company shall
also pay to Employee or Employee's spouse the pro rata portion of Employee's
bonus for the year during which the death or disability of the employee occurs
which payment shall not be subject to repayment. As of the date of the death or
disability of Employee, all benefits for the Employee pursuant to section 4(c),
(d) and (e) of this Agreement shall cease. Options and Stock Appreciation Rights
held by the Employee (if any) shall expire on the dates upon which such Option
and Stock Appreciation Rights would have expired had it not been for the
termination of Employee's employment or service. The Employee shall have the
right to exercise such Options and Stock Appreciation Rights prior to such
expiration to the extent such were exercisable at the date of such termination
of employment or service and shall not have been exercised. In addition, the
termination of the Employee's employment shall not accelerate the vesting of any
unvested Options or Stock Appreciation Rights held by the Employee (if any).

(c) If the Employee terminates his employment pursuant to Section 5(a) and
continues to provide services to the Company, or if the Employee's employment
under this Agreement is terminated pursuant to Section 5(c), the Company shall
continue to pay the Employee his then-current Base Salary in equal monthly
installments until the termination of his active service with the Company if the
Employee resigns pursuant to Section 5(a), or until the date of his termination
if the Employee's employment is terminated pursuant to Section 5(c). As of the
effective date of Employee's termination pursuant to Section 5(a) or Section
5(c), Employee shall be entitled to no bonus or benefits pursuant to this
Agreement, and the Employee's right to exercise an Option or a Stock
Appreciation Right (if any) shall terminate, and such Option or Stock
Appreciation Right shall expire, on the day of such termination of employment or
service. In addition, the Company or its designee shall have the right to
purchase all or a portion of the vested Options and/or Shares (as defined in the
1999 Management Incentive Plan) acquired upon the exercise of Options (if any)
by the Employee at a per share price equal to the lower of (i) the price paid by
Employee for such Shares which have been issued or which are issuable under
vested but unexercised Options and (ii) the fair market value (as determined in
accordance with Section 2.07 of the Investors Agreement dated as of April 1999
by and between the Company and the several Shareholders (as defined therein)
from time to time parties thereto) of such Shares which have been issued or
which are issuable under vested but unexercised Options on the date of purchase,
less the exercise price in the case of vested Options. The Company or its
designee shall also have the right to purchase all or a portion of any other
Shares, including Rollover Shares a (as defined in the 1999 Management Incentive

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Plan), previously purchased by the Employee (if any), at a per share price equal
to the fair market value (as determined in accordance with Section 2.07 of the
Investors Agreement dated as of April 1999 by and between the Company and the
several Shareholders (as defined therein) from time to time parties thereto) of
the Shares on the date of purchase by the Company. If the Company elects to
exercise its right under this Section 6(c), the Company shall deliver written
notice (a "Purchase Notice") to the Employee to such effect within 30 days of a
termination of Employee's employment. For purposes of this Section 6(c), the
"date of purchase" shall mean the third business day following the receipt of
notice by the Employee that the purchase right is to be exercised. Payment of
the purchase price may be made in cash or by certified check; provided that if
the terms of any agreement to which the Company is a party, or any of the
indentures governing any debt securities issued by the Company or any of its
subsidiaries would prohibit the Company from effecting such payment, payment may
be effected through a promissory note having such commercially reasonable terms
and interest rate as may be determined by the Company it is reasonable
discretion, provided that in any event such note shall become due at such time
as the prohibitions described above shall lapse.

(d) The provisions of this Section 6 and Section 7 of this Agreement shall
survive any termination of this Agreement.

7.  Non-Competition and Non-Solicitation

(a) Subject to Section 7(b) below, in consideration of his employment hereunder
and in view of the confidential position to be held by the Employee hereunder,
during the Employment Period and through the two-year period commencing on the
effective date of the termination of Employee's employment hereunder, the
Employee shall not, directly or indirectly, be employed by, or act as a
consultant or lender to or in association with, or as a director, officer,
employee, partner, owner, joint venturer, member or otherwise of any person,
firm, corporation, partnership, limited liability company, association or other
entity that engages in the same business as, or competes with, any business
actually conducted by the Company or any or its subsidiaries (other than
beneficial ownership of up to 2% of the outstanding voting stock of a publicly
traded company that is or owns such a competitor);

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(b) In the event that the employee is terminated by the Company for Cause or
resigns without Good Reason, during the Employment Period and through the
one-year period commencing on the effective date of the termination of
Employee's employment hereunder, the Employee shall not, directly or indirectly,
be employed by, or act as a consultant or lender to or in association with, or
as a director, officer, employee, partner, owner, joint venturer, member or
otherwise of any person, firm, corporation, partnership, limited liability
company, association or other entity that engages in the same business as, or
competes with, any business actually conducted by the Company or any of its
subsidiaries (other than beneficial ownership of up to 2% of the outstanding
voting stock of a publicly traded company that is or owns such a competitor);

(c) In consideration of his employment hereunder and in view of the confidential
position to be held by the Employee hereunder, during the Employment Period and
through the one-year period commencing on the effective date of the termination
of Employee's employment hereunder, the Employee will not (i) induce or attempt
to induce any employee of the Company or any of its subsidiaries to leave the
employ of the Company or such subsidiary, or in any way interfere with the
relationship between the Company or any of it subsidiaries and any employee
thereof, (ii) hire directly or indirectly any person who is then an employee of
the Company or any of its subsidiaries, or (iii) induce or attempt to induce any
customer, supplier, licensee or other business relation of the Company or any of
its subsidiaries to cease doing business with the Company or such subsidiary, or
in any way interfere with the relationship between any such customer, supplier,
licensee or business relation and the Company or such subsidiary; provided,
however, that the Employee will cease to be bound by this Section 7(c) on the
six-month anniversary of the effective date of the termination of Employee's
employment hereunder if his employment is terminated without Cause;

(d) The Employee expressly agrees that the character, duration and geographic
scope of the provisions of this Section 7 are reasonable in light of the
circumstances, as they exist on the date hereof. If any competent court shall
determine that the character, duration or geographic scope of such provisions is
unreasonable, then it is the intention and the agreement of the Employee and the
Company that this Agreement shall be construed by the court in such a manner as
to impose only those restrictions on the Employee's conduct that are reasonable
in the light of the circumstances and that are necessary to assure to the
Company the benefits of this Section 7.

8. Stockholder Approval. This Agreement shall be effective upon submission to
and approval by stockholders of the Company holding more than 75% of the voting
power of all outstanding common stock of the Company. In connection with such
submission and approval, the Company represents that it has provided

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each stockholder with the disclosure required by Treasury Regulation Section
1.280G-1-Q&A 7(d).

9. Entire Agreement; Amendments. This Agreement (upon its effectiveness),
together with option and other agreements relating to stock of the Company
entered into substantially contemporaneously herewith (if any), contain the
entire understanding of the parties with respect to the matters set out herein,
merging and superseding all prior and contemporaneous agreements and
understandings between the parties with respect to such matters. Only a written
instrument duly executed by all parties or their respective heirs, successors,
assigns or legal personal representatives may amend this Agreement.

10. No Conflicts; No Assignments.

(a) Employee represents and warrants to the Company that he is not as of the
date of this Agreement, and will not become during the Employment Period, a
party to any oral or written contract that prohibits, or materially restricts or
limits, or will prohibit or materially restrict or limit the performance of his
duties or the fulfillment of his obligations as an employee and an officer of
the Company or under this Agreement.

(b) The Employee acknowledges that the services to be rendered by him are unique
and personal and, accordingly, that he shall not assign any of his rights or
delegate any of his duties or obligations under this Agreement.

11. Waiver of Breach. Either party may, by written notice to the other: (i)
extend the time for the performance of any of the obligations or other actions
of the other, (ii) waive compliance with any of the covenants of the other
contained in this Agreement, and (iii) waive or modify performance of any of the
obligations of the other. However, mere forbearance or indulgence by either
party in any regard whatsoever shall not constitute a waiver of the covenant or
condition to be performed by the other party to which the same may apply and,
until complete performance of said covenant or condition, said party shall be
entitled to invoke any remedy available under this Agreement or by law or in
equity despite said forbearance or indulgence.

12. Gender Number. Whenever the context of this Agreement so required the
masculine gender shall include the feminine or neuter, the single number shall
include plural, and reference to one or more parties hereto shall include all
assignees of the party.

13. Headings. The section and paragraph headings contained in this Agreement are
for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.

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14. Arbitration; Governing Law. To the fullest extent permitted by law, any
dispute, claim or controversy of any kind including but not limited to, tort,
contract and statute arising under, in connection with or related to this
Agreement shall be resolved exclusively by binding arbitration in the State of
California, in accordance with the rules of the American Arbitration
Association. The Company and the Employee hereby waive any objection to personal
jurisdiction or venue in any forum located in the State of California. Either
party to this Agreement may file no claim, lawsuit or action of any kind;
arbitration is the exclusive dispute resolution mechanism between the parties.
Judgment may be entered on the arbitrator's award in any court of relevant
jurisdiction. This agreement shall be governed by and construed in accordance
with the laws of the State of California as such laws are applied to agreements
entered into and to be performed entirely within California by California
residents.

15. Severability. In the event that any provision of this Agreement, or the
application thereof to any person or circumstance, is held by a court of
competent jurisdiction to be invalid, illegal or unenforceable in any respect in
any jurisdiction, such invalidity, illegality or unenforceability shall not
affect any other provision of this Agreement in that jurisdiction or the
application of that provision to any other person or circumstance or in any
other jurisdiction, and this agreement shall then be construed in that
jurisdiction as if such invalid, illegal or unenforceable provision had not been
contained in this Agreement, but only to the extent of such invalidity,
illegality or unenforceability.

16. Further Assurances. Each party shall perform such further acts and execute
and deliver such further documents as may be reasonably necessary to carry out
the provisions of this Agreement.

17. Enforcement. In the event either party hereto fails to perform any of its
obligations under this Agreement or in the event a dispute arises concerning the
meaning or interpretation of any provision of this Agreement, the defaulting
party or the party not prevailing in such dispute as the case may be, shall pay
the reasonable costs and expenses incurred by the other party in enforcing or
establishing its rights hereunder, including without limitation, court costs and
reasonable attorney's fees.

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IN WITNESS WHEREOF, the Company and the Employee have duly executed and
delivered this Employment Agreement as of the day and year first above written.

                                                     CONDOR SYSTEMS, INC.

                                                     By:_______________________
                                                        Title:

                                                     EMPLOYEE:

                                                     --------------------------
                                                     John TaftEXHIBIT 10.2.8

                              EMPLOYMENT AGREEMENT

This EMPLOYMENT AGREEMENT ("Agreement") is entered into as of April 6, 2000,
(the "Effective Date") by and between CONDOR SYSTEMS, INC., a California
corporation (the "Company"), and TERRY SCHMIDT, an individual resident of the
State of California (the "Employee").

WHEREAS, the Company wishes to assure that it will have the benefit of the
knowledge and experience of Employee, who has been the Vice President of
Operations; and

WHEREAS, Employee is willing to enter into an agreement to such end upon the
terms and conditions set forth in this Agreement;

NOW, THEREFORE, in consideration of the foregoing and the mutual agreements
herein contained, the parties hereto agree as follows:

1. Employment. The Company hereby employs the Employee, and the Employee hereby
accepts such employment with the Company, upon the terms and conditions
hereinafter set forth.

2. Term of Employment. Unless earlier terminated as provided in Section 5, the
Company shall employ the Employee under this Agreement commencing on the
Effective Date and ending on the second anniversary of the Effective Date (the
"Employment Period"). On the second and each succeeding anniversary of the
Effective Date, the Employment Period shall automatically be extended for one
additional year unless, not later than 30 days prior to such anniversary, the
Employee or the Company shall have given notice of his or its intention not to
extend the Employment Period. This Agreement will have no force and effect until
or unless the stockholders of the Company shall have approved this Agreement
pursuant to Section 8 of this Agreement.

3. Title and Duties.

(a) The Employee shall have the title and position of Vice President of
Operations of the Company. In addition to the foregoing, the Company's Board of
Directors (the "Board") may, in the exercise of its business judgment, elect the
Employee to such other office or offices as it may determine during the
Employment Period.

(b) In such capacities, Employee shall report to the Chief Executive Officer of
the Company. Employee's duties and responsibilities shall be as specified by the
Board or the Chief Executive Officer, but, in general, the Employee shall have

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such authority and such responsibilities as are consistent with the foregoing
positions.

(c) Throughout the Employment Period, the Employee shall devote substantially
all of his time, energy, skill and best efforts to the performance of his duties
hereunder in a manner that will faithfully and diligently further the business
and interests of the Company. Subject to the preceding sentence, the Employee
may serve, or continue to serve, on the boards of directors of other entities
and may engage in appropriate civic or charitable activities as long as such
activities do not interfere or conflict with the performance of the Employee's
duties pursuant to this Agreement and his responsibilities to the Company under
this Agreement, and provided that any board of directors position is disclosed
to the Board in writing at least 10 days in advance of Employee's election to
such board of directors position.

4. Compensation.

(a) Base Salary. The Company shall pay the Employee as compensation a salary at
the beginning rate of $165,000 per year (the "Base Salary"), payable in
accordance with the ordinary compensation practices of the Company. The
Compensation Committee of the Board shall annually review the Base Salary for
possible increase, in its sole discretion.

(b) Bonus. Employee shall be eligible to receive an annual bonus (the "Bonus")
of up to 100% of Base Salary for each calendar year in accordance with the
following:

         (A) If EBITDA, as hereunder defined, for any calendar year is less than
         the Floor EBITDA for such year, the Company will pay the Employee no
         bonus.

         (B) If EBITDA for any calendar year is equal to the Target EBITDA for
         such year, the Company shall pay the Employee a bonus of 50% of the
         actual Base Salary paid to the Employee during such calendar year;

         (C) If EBITDA for any calendar year is equal to or greater than the
         Ceiling EBITDA for such year; the Company shall pay the Employee a
         bonus of 100% of the actual Base Salary paid to the Employee during
         such calendar year;

         (D) If EBITDA for any calendar year is greater than the Floor EBITDA
         for such year but is less than the Target EBITDA for such year, the
         Company will pay the Employee a bonus calculated by linear
         interpolation, as

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         described in Attachment I. If EBITDA for any calendar year is greater
         than the Target EBITDA for such year but is less than the Ceiling
         EBITDA for such year, the Company will pay the Employee a bonus
         calculated by linear interpolation, as described in Attachment I;

(c) Definitions.  For purposes of this Section 4:

         (A) "EBITDA" means, for each calendar year, the EBITDA number achieved
         by the Company, as determined annually for purposes of this Agreement
         by the Compensation Committee of the Board.

         (B) "Floor EBITDA" means, for any applicable calendar year, a projected
         EBITDA established annually for purposes of this Agreement by the
         Compensation Committee of the Board, together with the Employee;
         provided that the 2000 Floor EBITDA shall be $16,100,000.

         (C) "Target EBITDA" means, for any applicable calendar year, a
         projected EBITDA established annually for purposes of this Agreement by
         the Compensation Committee of the Board, together with the Employee;
         provided that the 2000 Target EBITDA shall be $17,600,000.

         (D) "Ceiling EBITDA" means, for any applicable calendar year, a
         projected EBITDA established annually for purposes of this Agreement by
         the Compensation Committee of the Board, together with the Employee;
         provided that the 2000 Ceiling EBITDA shall be $18,700,000.

(d) Reimbursement of Expenses. The Company shall pay or reimburse the Employee
for all reasonable travel and other expenses incurred by the Employee in the
performance of his obligations under this Agreement, provided that the Employee
properly accounts for such expenses in accordance with the policies and
procedures of the Company.

(e) Vacation. The Employee shall be entitled to a number of paid vacation days
in each calendar year as determined by the Company from time to time for its
employees in accordance with Company policy (prorated for any calendar year in
which the Employee is employed under this Agreement for less than the entire
year).

(f) Fringe Benefits and Perquisites. During the Employment Period, Employee
shall be eligible, on the same basis as he is currently eligible, for employee
benefits (including fringe benefits, vacation, automobile allowance, pension and
life, health, accident and disability insurance) no less favorable than those
benefits

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for which he is eligible immediately prior to the Effective Time, except for the
Company's ESOP and other stock-based plans.

(g) Withholding. All payments under this Agreement shall be subject to
withholding for applicable taxes.

5. Termination. The Employee's employment by the Company shall be terminated
upon the occurrence of any of the following:

(a) By Employee Without Cause. The Employee may terminate his employment under
this Agreement upon at least 120 days' prior notice to the Board of the Company.
Upon termination of his employment and upon experiencing a "qualifying event",
as defined in Section 4980B(f)(3) of the Internal Revenue Code of 1986, as
amended, COBRA coverage shall be made available to the Employee in compliance
with federal law.

(b) By Employee for Good Reason. The Employee may terminate his employment under
this Agreement after the Effective Date, upon at least 30 days' prior notice to
the Board of the Company, for Good Reason. For purposes of this Agreement, "Good
Reason" shall mean the occurrence of the following:

         (i) the occurrence of a "Change in Control." For purposes of this
         Agreement, a "Change in Control" shall mean the occurrence of (x) the
         consolidation, reorganization or merger of the Company with or into
         another corporation or corporations or other legal entitie(s) not
         controlled by any entity that is an affiliate of the Company
         immediately following the Effective Date, or (y) the conveyance of all
         or substantially all of the stock or assets of the Company to another
         person or entity not controlled by any entity that is an affiliate of
         the Company immediately following the Effective Date; provided that a
         Change in Control shall not be deemed to occur upon the occurrence of
         an initial public offering of the Company's capital stock ("IPO"); or

         (B) the Employee's duties, authority or responsibilities as Vice
         President of Operations of the Company, whether managerial or
         supervisory, are materially diminished without the prior consent of the
         Employee.

(c) By the Company for Cause. The Company may terminate the Employee's
employment for Cause. "Cause" for purposes of this Agreement shall mean
Employee's (i) personal dishonesty; (ii) willful misconduct; (iii) breach of
fiduciary duty involving personal profit; (iv) intentional failure to perform
designated duties or willful refusal to implement decisions of the Board made in
good faith; (v) willful violation, for personal financial gain, of any law, rule
or

                                       4
<PAGE>

regulation; or (vi) material breach of any provision of this Agreement;
provided, however, that prior to any proposed Board action pursuant to
subparagraph (iv) the Board shall give the Employee reasonable opportunity to
respond and, if appropriate, to otherwise perform as directed.

The Employee's right to compensation and other benefits from the Company under
this Agreement shall cease upon the Company's terminating the Employee's
employment under this Agreement for Cause. The provisions of this Section 5(c)
shall take precedence over the provisions of Section 5(a) notwithstanding any
prior notice by the Employee to the Company under Section 5(a).

(d) By the Company Without Cause. The Company may terminate the Employee's
employment under this Agreement without Cause therefore at any time.

6. Severance Pay

a) In the event that the Employee's employment under this Agreement is
terminated pursuant to the provisions of Section 5(b) or 5(d), or if the Company
pursuant to Section 2 does not renew the employee's Employment Period, as
severance pay the Employee shall be paid a total of $500,000. Such severance pay
shall be paid in the form of a standby letter of credit issued by a bank or a
lump sum deposit to an escrow account at a bank designated by the Company, and
thereafter shall be drawn upon or paid to the Employee in eight equal
installments on the last business day of each of the eight fiscal quarters
following the quarter during which Employee's employment is terminated,
beginning with such fiscal quarter; provided that the escrow agreement will
provide that all payments of Employee's severance pay will cease if Employee
breaches any of the provisions of Section 7 of this Agreement. Employee shall
also be entitled to continued eligibility to participate in all health, medical
and dental benefit plans of the Company for which Employee was eligible
immediately prior to the effective time of the termination of Employee's
employment, or comparable coverage, for two years, or, if sooner, until
comparable health insurance coverage is available to Employee in connection with
subsequent employment or self-employment. In addition, the termination of the
Employee's employment shall not accelerate the vesting of unvested Options or
Stock Appreciation Rights (as such terms are defined in the 1999 Management
Incentive Plan) held by the Employee (if any).

(b) In the event that the Employee's employment under this Agreement is
terminated upon the death or disability of the Employee, then the Employee will
not be entitled to the severance benefits set forth in Section 6(a); however,
the Company will pay to the Employee or the Employee's spouse (if she is then
living) the Employee's then-current Base Salary in accordance with the Company's
normal pay practices until the earlier of (i) the end of the sixth calendar

                                       5
<PAGE>

month following Employee's termination of active service, or (ii) such time as
the Employee's spouse (or a trust for her benefit) has received proceeds from
the insurance policy described in Section 4(e). Any Base Salary paid after the
death or disability of the Employee pursuant to clause (i) above shall be repaid
to the Company upon the receipt of the insurance proceeds described in clause
(ii) by the Employee's spouse (or by a trust for her benefit). The Company shall
also pay to Employee or Employee's spouse the pro rata portion of Employee's
bonus for the year during which the death or disability of the employee occurs
which payment shall not be subject to repayment. As of the date of the death or
disability of Employee, all benefits for the Employee pursuant to section 4(c),
(d) and (e) of this Agreement shall cease. Options and Stock Appreciation Rights
held by the Employee (if any) shall expire on the dates upon which such Option
and Stock Appreciation Rights would have expired had it not been for the
termination of Employee's employment or service. The Employee shall have the
right to exercise such Options and Stock Appreciation Rights prior to such
expiration to the extent such were exercisable at the date of such termination
of employment or service and shall not have been exercised. In addition, the
termination of the Employee's employment shall not accelerate the vesting of any
unvested Options or Stock Appreciation Rights held by the Employee (if any).

(c) If the Employee terminates his employment pursuant to Section 5(a) and
continues to provide services to the Company, or if the Employee's employment
under this Agreement is terminated pursuant to Section 5(c), the Company shall
continue to pay the Employee his then-current Base Salary in equal monthly
installments until the termination of his active service with the Company if the
Employee resigns pursuant to Section 5(a), or until the date of his termination
if the Employee's employment is terminated pursuant to Section 5(c). As of the
effective date of Employee's termination pursuant to Section 5(a) or Section
5(c), Employee shall be entitled to no bonus or benefits pursuant to this
Agreement, and the Employee's right to exercise an Option or a Stock
Appreciation Right (if any) shall terminate, and such Option or Stock
Appreciation Right shall expire, on the day of such termination of employment or
service. In addition, the Company or its designee shall have the right to
purchase all or a portion of the vested Options and/or Shares (as defined in the
1999 Management Incentive Plan) acquired upon the exercise of Options (if any)
by the Employee at a per share price equal to the lower of (i) the price paid by
Employee for such Shares which have been issued or which are issuable under
vested but unexercised Options and (ii) the fair market value (as determined in
accordance with Section 2.07 of the Investors Agreement dated as of April 1999
by and between the Company and the several Shareholders (as defined therein)
from time to time parties thereto) of such Shares which have been issued or
which are issuable under vested but unexercised Options on the date of purchase,
less the exercise price in the case of vested Options. The Company or its
designee shall also have the right to purchase all or a portion of any other
Shares, including Rollover Shares a (as defined in the 1999 Management Incentive

                                       6
<PAGE>

Plan), previously purchased by the Employee (if any), at a per share price equal
to the fair market value (as determined in accordance with Section 2.07 of the
Investors Agreement dated as of April 1999 by and between the Company and the
several Shareholders (as defined therein) from time to time parties thereto) of
the Shares on the date of purchase by the Company. If the Company elects to
exercise its right under this Section 6(c), the Company shall deliver written
notice (a "Purchase Notice") to the Employee to such effect within 30 days of a
termination of Employee's employment. For purposes of this Section 6(c), the
"date of purchase" shall mean the third business day following the receipt of
notice by the Employee that the purchase right is to be exercised. Payment of
the purchase price may be made in cash or by certified check; provided that if
the terms of any agreement to which the Company is a party, or any of the
indentures governing any debt securities issued by the Company or any of its
subsidiaries would prohibit the Company from effecting such payment, payment may
be effected through a promissory note having such commercially reasonable terms
and interest rate as may be determined by the Company it is reasonable
discretion, provided that in any event such note shall become due at such time
as the prohibitions described above shall lapse.

(d) The provisions of this Section 6 and Section 7 of this Agreement shall
survive any termination of this Agreement.

7.  Non-Competition and Non-Solicitation

(a) Subject to Section 7(b) below, in consideration of his employment hereunder
and in view of the confidential position to be held by the Employee hereunder,
during the Employment Period and through the two-year period commencing on the
effective date of the termination of Employee's employment hereunder, the
Employee shall not, directly or indirectly, be employed by, or act as a
consultant or lender to or in association with, or as a director, officer,
employee, partner, owner, joint venturer, member or otherwise of any person,
firm, corporation, partnership, limited liability company, association or other
entity that engages in the same business as, or competes with, any business
actually conducted by the Company or any or its subsidiaries (other than
beneficial ownership of up to 2% of the outstanding voting stock of a publicly
traded company that is or owns such a competitor);

                                       7
<PAGE>

(b) In the event that the employee is terminated by the Company for Cause or
resigns without Good Reason, during the Employment Period and through the
one-year period commencing on the effective date of the termination of
Employee's employment hereunder, the Employee shall not, directly or indirectly,
be employed by, or act as a consultant or lender to or in association with, or
as a director, officer, employee, partner, owner, joint venturer, member or
otherwise of any person, firm, corporation, partnership, limited liability
company, association or other entity that engages in the same business as, or
competes with, any business actually conducted by the Company or any of its
subsidiaries (other than beneficial ownership of up to 2% of the outstanding
voting stock of a publicly traded company that is or owns such a competitor);

(c) In consideration of his employment hereunder and in view of the confidential
position to be held by the Employee hereunder, during the Employment Period and
through the one-year period commencing on the effective date of the termination
of Employee's employment hereunder, the Employee will not (i) induce or attempt
to induce any employee of the Company or any of its subsidiaries to leave the
employ of the Company or such subsidiary, or in any way interfere with the
relationship between the Company or any of it subsidiaries and any employee
thereof, (ii) hire directly or indirectly any person who is then an employee of
the Company or any of its subsidiaries, or (iii) induce or attempt to induce any
customer, supplier, licensee or other business relation of the Company or any of
its subsidiaries to cease doing business with the Company or such subsidiary, or
in any way interfere with the relationship between any such customer, supplier,
licensee or business relation and the Company or such subsidiary; provided,
however, that the Employee will cease to be bound by this Section 7(c) on the
six-month anniversary of the effective date of the termination of Employee's
employment hereunder if his employment is terminated without Cause;

(d) The Employee expressly agrees that the character, duration and geographic
scope of the provisions of this Section 7 are reasonable in light of the
circumstances, as they exist on the date hereof. If any competent court shall
determine that the character, duration or geographic scope of such provisions is
unreasonable, then it is the intention and the agreement of the Employee and the
Company that this Agreement shall be construed by the court in such a manner as
to impose only those restrictions on the Employee's conduct that are reasonable
in the light of the circumstances and that are necessary to assure to the
Company the benefits of this Section 7.

8. Stockholder Approval. This Agreement shall be effective upon submission to
and approval by stockholders of the Company holding more than 75% of the voting
power of all outstanding common stock of the Company. In connection with such
submission and approval, the Company represents that it has provided each

                                       8
<PAGE>

stockholder with the disclosure required by Treasury Regulation Section
1.280G-1-Q&A 7(d).

9. Entire Agreement; Amendments. This Agreement (upon its effectiveness),
together with option and other agreements relating to stock of the Company
entered into substantially contemporaneously herewith (if any), contain the
entire understanding of the parties with respect to the matters set out herein,
merging and superseding all prior and contemporaneous agreements and
understandings between the parties with respect to such matters. Only a written
instrument duly executed by all parties or their respective heirs, successors,
assigns or legal personal representatives may amend this Agreement.

10. No Conflicts; No Assignments.

(a) Employee represents and warrants to the Company that he is not as of the
date of this Agreement, and will not become during the Employment Period, a
party to any oral or written contract that prohibits, or materially restricts or
limits, or will prohibit or materially restrict or limit the performance of his
duties or the fulfillment of his obligations as an employee and an officer of
the Company or under this Agreement.

(b) The Employee acknowledges that the services to be rendered by him are unique
and personal and, accordingly, that he shall not assign any of his rights or
delegate any of his duties or obligations under this Agreement.

11. Waiver of Breach. Either party may, by written notice to the other: (i)
extend the time for the performance of any of the obligations or other actions
of the other, (ii) waive compliance with any of the covenants of the other
contained in this Agreement, and (iii) waive or modify performance of any of the
obligations of the other. However, mere forbearance or indulgence by either
party in any regard whatsoever shall not constitute a waiver of the covenant or
condition to be performed by the other party to which the same may apply and,
until complete performance of said covenant or condition, said party shall be
entitled to invoke any remedy available under this Agreement or by law or in
equity despite said forbearance or indulgence.

12. Gender Number. Whenever the context of this Agreement so required the
masculine gender shall include the feminine or neuter, the single number shall
include plural, and reference to one or more parties hereto shall include all
assignees of the party.

13. Headings. The section and paragraph headings contained in this Agreement are
for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.

                                       9
<PAGE>

14. Arbitration; Governing Law. To the fullest extent permitted by law, any
dispute, claim or controversy of any kind including but not limited to, tort,
contract and statute arising under, in connection with or related to this
Agreement shall be resolved exclusively by binding arbitration in the State of
California, in accordance with the rules of the American Arbitration
Association. The Company and the Employee hereby waive any objection to personal
jurisdiction or venue in any forum located in the State of California. Either
party to this Agreement may file no claim, lawsuit or action of any kind;
arbitration is the exclusive dispute resolution mechanism between the parties.
Judgment may be entered on the arbitrator's award in any court of relevant
jurisdiction. This agreement shall be governed by and construed in accordance
with the laws of the State of California as such laws are applied to agreements
entered into and to be performed entirely within California by California
residents.

15. Severability. In the event that any provision of this Agreement, or the
application thereof to any person or circumstance, is held by a court of
competent jurisdiction to be invalid, illegal or unenforceable in any respect in
any jurisdiction, such invalidity, illegality or unenforceability shall not
affect any other provision of this Agreement in that jurisdiction or the
application of that provision to any other person or circumstance or in any
other jurisdiction, and this agreement shall then be construed in that
jurisdiction as if such invalid, illegal or unenforceable provision had not been
contained in this Agreement, but only to the extent of such invalidity,
illegality or unenforceability.

16. Further Assurances. Each party shall perform such further acts and execute
and deliver such further documents as may be reasonably necessary to carry out
the provisions of this Agreement.

17. Enforcement. In the event either party hereto fails to perform any of its
obligations under this Agreement or in the event a dispute arises concerning the
meaning or interpretation of any provision of this Agreement, the defaulting
party or the party not prevailing in such dispute as the case may be, shall pay
the reasonable costs and expenses incurred by the other party in enforcing or
establishing its rights hereunder, including without limitation, court costs and
reasonable attorney's fees.

                                      10

IN WITNESS WHEREOF, the Company and the Employee have duly executed and
delivered this Employment Agreement as of the day and year first above written.

                                                     CONDOR SYSTEMS, INC.

                                                     By:_______________________
                                                        Title:

                                                     EMPLOYEE:

                                                     --------------------------
                                                     Terry Schmidt

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