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MEADS INTERNATIONAL SIGNS $216 MILLION RISK REDUCTION EFFORT CONTRACT

ORLANDO, FL, July 10th, 2001 -- The NATO Medium Extended Air Defense System Management Agency (NAMEADSMA) today awarded a Risk Reduction Effort (RRE) contract to MEADS International, a multinational joint venture of Alenia Marconi Systems (AMS) from Italy, European Aeronautic Defence and Space (EADS) and LFK ? Lenkflugkörpersysteme GmbH from Germany, and Lockheed Martin from the United States. The MEADS program is expected to be a case model for future transatlantic cooperation.

Under the $216.35 million (equivalent U.S. dollars ? EUSD), 32-1/2 month RRE program, MEADS International will focus on risk reduction, application of key technologies that have been developed over the past years, and demonstration of the validity of the system design incorporating the PAC-3 missile. Critical technology areas will be assessed taking into account evolving national air defense concepts. In addition, the RRE program will generate detailed specifications, statements of work, schedules, and cost to prepare for the decision by the nations for a follow-on Design and Development Phase.

General Franco Parisi, General Manager of the MEADS program for NAMEADSMA, noted that U.S., German, and Italian co-development of MEADS ensures system design commonality that contributes to interoperability between U.S. and allied forces as well as providing homeland defense for the participating European nations.

MEADS International President Joel Strickland stated, "We are very pleased to have the opportunity to move ahead, bringing to fruition the advanced technologies developed by our parent companies." Executive Vice President Klaus Riedel added, "The MEADS system, as we designed it today, will be the Air Defense Standard for the future, having unprecedented firepower and flexibility of operations to meet current and future threats. Its netted distributed architecture enables scalable systems, allowing the military commander to tailor the fielded configuration exactly to his mission needs."

The MEADS program was developed in response to the International Common Operational Requirements that called for a system capability not met by current systems. MEADS incorporates the proven hit-to-kill PAC-3 missile in a system that includes surveillance and fire control sensors, battle management/communication centers, and high firepower launchers. The system will combine superior battlefield protection with unprecedented flexibility, allowing it to protect maneuver forces and to provide homeland defense against tactical ballistic missiles, cruise missiles, unmanned aerial vehicles, and aircraft.

MEADS is planned to provide capabilities unlike any other fielded or planned air and missile defense system. The system is easily deployed to a theater and, once there, can keep pace with fast-moving maneuver forces. When completed, MEADS will be the only air defense system able to roll off transports with the troops and immediately begin operations. Its open architecture will establish the pattern for 21st century air defense systems and enable the air defense asset allocation to be tailored for the task at hand, including homeland defense or defense of maneuver forces. This tailored allocation minimizes the investment costs for air defense; MEADS also provides greater firepower with less manpower than current systems, dramatically decreasing operations and support costs.

In 1999, MEADS International, Inc., was selected by NAMEADSMO, a chartered organization of NATO, to develop MEADS. A multinational joint venture headquartered in Orlando, Florida, MEADS International's participating companies are Alenia Marconi Systems, Spa in Italy, European Aeronautic Defence and Space (EADS Deutschland GmbH ? formerly DASA) and LFK (a subsidiary) in Germany, and Lockheed Martin in the United States. Together, these companies have focused an international engineering team to develop systems and technologies for the MEADS program, which continues to be a model for collaborative transatlantic efforts. The RRE program is being financed by the U.S., Germany, and Italy in shares of 55, 28, and 17 percent. The companies in the individual countries participate in the program with workshares that correspond to the funding shares.

Nettie Johnson, 407-356-5351
e-mail nettie.r.johnson@lmco.com