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Northrop Grumman Receives $248 Million Contract for ICBM Propulsion Replacement Program

CLEARFIELD, Utah - Dec. 22, 2004 - The Air Force today awarded Northrop Grumman Corporation (NYSE: NOC) a $248 million contract to continue the full-rate production phase of the intercontinental ballistic missile (ICBM) Propulsion Replacement Program (PRP). The program is designed to replace aging solid rocket motor sets - stages 1, 2, and 3 - in the Minuteman III force with remanufactured motors to maintain alert readiness status through 2020.

This is the fourth of seven full-rate production options exercised by the Air Force Materiel Wing, ICBM System Program Office, at Hill Air Force Base, Utah. The total program has a value of $1.75 billion over nine years.

PRP is one of nine modernization efforts currently managed by prime integration contractor Northrop Grumman, in addition to its responsibility to maintain and sustain the nation's ICBM force.

In June, Northrop Grumman announced that it had resumed delivery of the Minuteman III Stage 2 and Stage 3 rocket motors to the U.S. Air Force following a nine-month pause in production when work was transitioned from the Pratt & Whitney facility in San Jose, Calif., to Alliant Tech Systems' (ATK) Bacchus facility in Magna, Utah.

"The Northrop Grumman propulsion replacement program team has exceeded expectations in their efforts to qualify the ATK facility and resume deliveries," said John Clay, vice president and program manager, ICBM Prime Integration Contract, Northrop Grumman Mission Systems. "This latest award culminates a significant effort to restructure the program following two industrial accidents in the summer and fall 2003, and positions the program for successful execution in the future."

ATK is now producing all motors at full rate utilizing multiple facilities located in northern Utah. The remanufacturing of the motors includes replacing the aging propellant in the motors and replacing obsolete or environmentally unsafe materials and components.

Northrop Grumman is the Air Force's ICBM prime integration contractor charged with maintaining readiness of the United States' ICBM weapon system through 2020. This 15-year contract, which began in December 1997, is currently valued at $4.5 billion with a total projected value of more than $6 billion. Northrop Grumman manages a team consisting of four principal teammates and more than 20 subcontractors.

Northrop Grumman Mission Systems, based in Reston, Va., is a global integrator of complex, mission-enabling systems and services for defense, intelligence and civil government markets. The sector's technology leadership and expertise spans areas such as strategic systems, including ICBMs; missile defense; intelligence, surveillance and reconnaissance; command and control; and technical services and training.

Contacts:

Jay McCaffrey
Northrop Grumman Mission Systems
(703) 345-8910
jay.mccaffrey@ngc.com