L-3 COMMUNICATIONS HOLDINGS, INC.

                              AMENDED AND RESTATED
                         1999 LONG TERM PERFORMANCE PLAN

                                TABLE OF CONTENTS

                                                                            PAGE
                                                                            ----
SECTION 1.    Purpose....................................................     1
SECTION 2.    Definitions; Rules of Construction.........................     1
SECTION 3.    Eligibility................................................     4
SECTION 4.    Awards.....................................................     4
SECTION 5.    Shares of Stock and Share Units Available Under Plan.......     8
SECTION 6.    Award Agreements...........................................    10
SECTION 7.    Adjustments; Change in Control; Acquisitions...............    12
SECTION 8.    Administration.............................................    15
SECTION 9.    Amendment and Termination of this Plan.....................    17
SECTION 10.   Miscellaneous..............................................    18



                        L-3 COMMUNICATIONS HOLDINGS, INC.
                              AMENDED AND RESTATED
                         1999 LONG TERM PERFORMANCE PLAN

SECTION 1. Purpose.

     The purpose of this Plan is to benefit the Corporation's stockholders by
encouraging high levels of performance by individuals who contribute to the
success of the Corporation and its Subsidiaries and to enable the Corporation
and its Subsidiaries to attract, motivate, retain and reward talented and
experienced individuals. This purpose is to be accomplished by providing
eligible individuals with an opportunity to obtain or increase a proprietary
interest in the Corporation and/or by providing eligible individuals with
additional incentives to join or remain with the Corporation and its
Subsidiaries.

SECTION 2. Definitions; Rules of Construction.

     (a) Defined Terms. The terms defined in this Section shall have the
following meanings for purposes of this Plan:

          "Award" means an award granted pursuant to Section 4.

          "Award Agreement" means an agreement described in Section 6 by the
     Corporation for the benefit of a Participant, setting forth (or
     incorporating by reference) the terms and conditions of an Award granted to
     a Participant.

          "Beneficiary" means a person or persons (including a trust or trusts)
     validly designated by a Participant or, in the absence of a valid
     designation, entitled by will or the laws of descent and distribution, to
     receive the benefits specified in the Award Agreement and under this Plan
     in the event of a Participant's death.

          "Board of Directors" or "Board" means the Board of Directors of the
     Corporation.

          "Cash Flow" means cash and cash equivalents derived from either (i)
     net cash flow from operations or (ii) net cash flow from operations,
     financings and investing activities, as determined by the Committee at the
     time an Award is granted.

          "Change in Control" means change in control as defined in Section
     7(c).



          "Code" means the Internal Revenue Code of 1986, as amended from time
     to time.

          "Committee" means the Committee described in Section 8(a).

          "Corporation" means L-3 Communications Holdings, Inc.

          "Employee" means any person, including an officer (whether or not also
     a director) in the regular full-time employment of the Corporation or any
     of its Subsidiaries who, in the opinion of the Committee is, or is expected
     to be, primarily responsible for the management, growth or protection of
     some part or all of the business of the Corporation or any of its
     Subsidiaries, but excludes, in the case of an Incentive Stock Option, an
     Employee of any Subsidiary that is not a "subsidiary corporation" of the
     Corporation as defined in Code Section 424(f).

          "EPS" means earnings per common share on a fully diluted basis
     determined by dividing (a) net earnings, less dividends on preferred stock
     of the Corporation by (b) the weighted average number of common shares and
     common share equivalents outstanding.

          "Exchange Act" means the Securities Exchange Act of 1934, as amended
     from time to time.

          "Executive Officer" means executive officer as defined in Rule 3b-7
     under the Exchange Act. If the Board has designated the executive officers
     of the Corporation for purposes of reporting under the Exchange Act, the
     designation shall be conclusive for purposes of this Plan.

          "Fair Market Value" means the closing price of the relevant security
     as reported on the composite tape of New York Stock Exchange issues (or if,
     at the date of determination, the security is not so listed or if the
     principal market on which it is traded is not the New York Stock Exchange,
     such other reporting system as shall be selected by the Committee) on the
     relevant date, or, if no sale of the security is reported for that date,
     the next preceding day for which there is a reported sale. The Committee
     shall determine the Fair Market Value of any security that is not publicly
     traded, using criteria as it shall determine, in its sole direction, to be
     appropriate for the valuation.

          "Insider" means any person who is subject to Section 16(b) of the
     Exchange Act.


                                        2



          "Option" means a Nonqualified Stock Option or an Incentive Stock
     Option as described in Section 4(a)(1) or (2).

          "Participant" means a person who is granted an Award, pursuant to this
     Plan, that remains outstanding.

          "Performance-Based Awards" is defined in Section 4(b).

          "Performance Goal" means EPS or ROE or Cash Flow or Total Stockholder
     Return or such other performance goal that the Committee in its sole
     discretion establishes in accordance with the requirements of Section
     162(m) of the Code for which applicable shareholder approval requirements
     are met, and "Performance Goals" means any combination thereof.

          "ROE" means consolidated net income of the Corporation (less preferred
     dividends), divided by the average consolidated common stockholders'
     equity.

          "Rule 16b-3" means Rule 16b-3 under Section 16 of the Exchange Act, as
     amended from time to time.

          "Share Units" means the number of units under an Award that is payable
     solely in cash or is actually paid in cash, determined by reference to the
     number of shares of Stock by which the Award is measured.

          "Stock" means shares of Common Stock of the Corporation, par value
     $0.01 per share, subject to adjustments made under Section 7 or by
     operation of law.

          "Subsidiary" means, as to any person, any corporation, association,
     partnership, joint venture or other business entity of which 50% or more of
     the voting stock or other equity interests (in the case of entities other
     than corporations), is owned or controlled (directly or indirectly) by that
     entity, or by one or more of the Subsidiaries of that entity, or by a
     combination thereof.

          "Total Stockholder Return" means with respect to the Corporation or
     other entities (if measured on a relative basis), the (1) change in the
     market price of its common stock (as quoted in the principal market on
     which it is traded as of the beginning and ending of the period) plus
     dividends and other distributions paid, divided by (ii) the beginning
     quoted market price, all of which is adjusted for any changes in equity
     structure, including, but not limited to, stock splits and stock dividends.


                                        3



     (b) Financial and Accounting Terms. Except as otherwise expressly provided
or the context otherwise requires, financial and accounting terms, including
terms defined herein as Performance Goals, are used as defined for purposes of,
and shall be determined in accordance with, generally accepted accounting
principles and as derived from the audited consolidated financial statements of
the Corporation, prepared in the ordinary course of business.

     (c) Rules of Construction. For purposes of this Plan and the Award
Agreements, unless otherwise expressly provided or the context otherwise
requires, the terms defined in this Plan include the plural and the singular,
and pronouns of either gender or neuter shall include, as appropriate, the other
pronoun forms.

SECTION 3. Eligibility.

     Any one or more Awards may be granted to any Employee, or any non-Employee
who provides services to or on behalf of the Corporation or any of its
Subsidiaries, who is designated by the Committee to receive an Award.

SECTION 4. Awards.

     (a) Type of Awards. The Committee may from time to time grant any of the
following types of Awards, either singly, in tandem or in combination with other
Awards:

          (1) Nonqualified Stock Options. A Nonqualified Stock Option is an
     Award in the form of an option to purchase Stock that is not intended to
     comply with the requirements of Code Section 422. The exercise price of
     each Nonqualified Stock Option granted under this Plan shall be not less
     than the Fair Market Value of the Stock on the date that the Option is
     granted. All Nonqualified Stock Options granted in accordance with this
     clause (1) shall be treated as Performance-Based Awards subject to the
     applicable restrictions of Section 4(b).

          (2) Incentive Stock Options. An Incentive Stock Option is an Award in
     the form of an option to purchase Stock that is intended to comply with the
     requirements of Code Section 422 or any successor section thereof. The
     exercise price of each Incentive Stock Option granted under this Plan shall
     be not less than the Fair Market Value of the Stock on the date the Option
     is granted. If a Participant on the date an Incentive Stock Option is
     granted owns, directly or indirectly within the meaning of Code Section
     424(d), stock possessing more than ten percent (10%) of the total combined
     voting power of all classes of stock of the Corporation, the exercise price
     per share of the


                                        4



     Incentive Stock Option shall not be less than one hundred and ten percent
     (110%) of the Fair Market Value per share of the Stock at the time of
     grant, and such Incentive Stock Option shall not be exercisable after the
     expiration of five (5) years from the date such Incentive Stock Option is
     granted. To the extent that the aggregate "fair market value" of Stock with
     respect to which one or more incentive stock options first become
     exercisable by a Participant in any calendar year exceeds $100,000, taking
     into account both Stock subject to Incentive Stock Options under this Plan
     and stock subject to incentive stock options under all other plans of the
     Corporation or of other entities referenced in Code Section 422(d)(1), the
     options shall be treated as Nonqualified Stock Options. For this purpose,
     the "fair market value" of the Stock subject to options shall be determined
     as of the date the Options were awarded. All Incentive Stock Options
     granted in accordance with this clause (2) shall be treated as
     Performance-Based Awards subject to the applicable restrictions of Section
     4(b).

          (3) Stock Appreciation Rights. A Stock Appreciation Right is an Award
     in the form of a right to receive, upon surrender of the right, but without
     other payment, an amount based on the appreciation in the value of the
     Stock or the Option over a base price established in the Award, payable in
     cash, Stock or such other form or combination of forms of payout, at times
     and upon conditions (which may include a Change in Control), as may be
     approved by the Committee. The minimum base price of a Stock Appreciation
     Right granted under this Plan shall be not less than the Fair Market Value
     of the underlying Stock on the date the Stock Appreciation Right is granted
     or, in the case of a Stock Appreciation Right related to an Option (whether
     already outstanding or concurrently granted), the exercise price of the
     related Option. All Stock Appreciation Rights granted in accordance with
     this clause (3) shall be treated as Performance-Based Awards subject to the
     applicable restrictions under Section 4(b).

          (4) Restricted Stock. Restricted Stock is an Award of shares of Stock
     of the Corporation that are issued, but subject to restrictions on transfer
     and/or such other restrictions on incidents of ownership as the Committee
     may determine. Restricted Stock Awards to Executive Officers that are
     either granted or vest upon attainment of one or more of the Performance
     Goals shall only be granted as Performance-Based Awards under Section 4(b).
     The minimum vesting period for Awards of Restricted Stock made after April
     27, 2004 shall be three years following date of grant, except that
     Restricted Stock Awards made after such date that are Performance-Based
     Awards


                                        5



     shall have a minimum vesting period of one year following date of grant,
     and provided that the vesting schedule of any Award of Restricted Stock
     (whether or not a Performance-Based Award) made after April 27, 2004 may
     not be accelerated.

          (5) Other Share-Based Awards. The Committee may from time to time
     grant Awards under this Plan that provide the Participants with Stock or
     the right to purchase Stock, or provide other incentive Awards (including,
     but not limited to, phantom stock or units, performance stock or units,
     bonus stock, dividend equivalent units, or similar securities or rights)
     that have a value derived from the value of, or an exercise or conversion
     privilege at a price related to, or that are otherwise payable in shares of
     Stock. The Awards shall be in a form determined by the Committee, provided
     that the Awards shall not be inconsistent with the other express terms of
     this Plan. Awards under this Section 4(a)(5) to Executive Officers that are
     either granted or become vested, exercisable or payable based on attainment
     of one or more of the Performance Goals shall only be granted as
     Performance-Based Awards under Section 4(b).

     (b) Special Performance-Based Awards. Without limiting the generality of
the foregoing, any of the type of Awards listed in Section 4(a) may be granted
as awards that satisfy the requirements for "performance-based compensation"
within the meaning of Code Section 162(m) ("Performance-Based Awards"), the
grant, vesting, exercisability or payment of which depends on the degree of
achievement of the Performance Goals relative to preestablished targeted levels
for the Corporation or any of its Subsidiaries, divisions or other business
units. Notwithstanding anything contained in this Section 4(b) to the contrary,
any Option or Stock Appreciation Right granted in accordance with paragraph (a)
shall be subject only to the requirements of clauses (1) and (3) below in order
for such Awards to satisfy the requirements for Performance-Based Awards under
this Section 4(b) (with such Awards hereinafter referred to as a "Qualifying
Option" or a "Qualifying Stock Appreciation Right", respectively). With the
exception of any Qualifying Option or Qualifying Stock Appreciation Right, an
Award that is intended to satisfy the requirements of this Section 4(b) shall be
designated as a Performance-Based Award at the time of grant.

          (1) Eligible Class. The eligible class of persons for Awards under
     this Section 4(b) shall be all Employees.

          (2) Performance Goals. The performance goals for any Awards under this
     Section 4(b) (other than Qualifying Options and Qualifying Stock
     Appreciation Rights) shall be, on an absolute or


                                        6



     relative basis, one or more of the Performance Goals. The specific
     performance target(s) with respect to Performance Goal(s) must be
     established by the Committee in advance of the deadlines applicable under
     Code Section 162(m) and while the performance relating to the Performance
     Goal(s) remains substantially uncertain.

          (3) Individual Limits. The maximum number of shares of Stock or Share
     Units that are issuable under Options, Stock Appreciation Rights,
     Restricted Stock or other Awards (described under Section 4(a)(5)) that are
     granted as Performance-Based Awards to any Participant shall not exceed
     five percent of the total shares outstanding of the Corporation during the
     life of the Plan, either individually or in the aggregate, subject to
     adjustment as provided in Section 7. Awards that are cancelled or repriced
     during the year shall be counted against this limit to the extent required
     by Code Section 162(m).

          (4) Committee Certification. Before any Performance-Based Award under
     this Section 4(b) (other than Qualifying Options and Qualifying Stock
     Appreciation Rights) is paid, the Committee must certify in writing (by
     resolution or otherwise) that the applicable Performance Goal(s) and any
     other material terms of the Performance-Based Award were satisfied;
     provided, however, that a Performance-Based Award may be paid without
     regard to the satisfaction of the applicable Performance Goal in the event
     of the Participant's death, permanent disability or retirement or in the
     event of a Change in Control as provided in Section 7(b).

          (5) Terms and Conditions of Awards; Committee Discretion to Reduce
     Performance Awards. The Committee shall have discretion to determine the
     conditions, restrictions or other limitations, in accordance with the terms
     of this Plan and Code Section 162(m), on the payment of individual
     Performance-Based Awards under this Section 4(b). To the extent set forth
     in an Award Agreement, the Committee may reserve the right to reduce the
     amount payable in accordance with any standards or on any other basis
     (including the Committee's discretion), as the Committee may impose.
     Notwithstanding anything to the contrary above, the minimum vesting period
     of any Performance-Based Award granted after April 27, 2004 shall be one
     year following date of grant, and, to the extent that any such
     Performance-Based Award is comprised of Restricted Stock, the vesting
     schedule of such Award, once outstanding, may not be accelerated.


                                        7



          (6) Adjustments for Material Changes. In the event of (i) a change in
     corporate capitalization, a corporate transaction or a complete or partial
     corporate liquidation, or (ii) any extraordinary gain or loss or other
     event that is treated for accounting purposes as an extraordinary item
     under generally accepted accounting principles, or (iii) any material
     change in accounting policies or practices affecting the Corporation and/or
     the Performance Goals or targets, then, to the extent any of the foregoing
     events (or a material effect thereof) was not anticipated at the time the
     targets were set, the Committee shall make adjustments to the Performance
     Goals and/or targets, applied as of the date of the event, and based solely
     on objective criteria, so as to neutralize, in the Committee's judgment,
     the effect of the event on the applicable Performance-Based Award.

          (7) Interpretation. Except as specifically provided in this Section
     4(b), the provisions of this Section 4(b) shall be interpreted and
     administered by the Committee in a manner consistent with the requirements
     for exemption of Performance-Based Awards granted to Executive Officers as
     "performance-based compensation" under Code Section 162(m) and regulations
     and other interpretations issued by the Internal Revenue Service
     thereunder.

          (8) Maximum Term of Awards. No Award that contemplates exercise or
     conversion may be exercised or converted to any extent, and no other Award
     that defers vesting, shall remain outstanding and unexercised, unconverted
     or unvested more than ten years after the date the Award was initially
     granted.

SECTION 5. Shares of Stock and Share Units Available Under Plan.

     (a) Aggregate Share Limit. (i) The maximum number of shares of Stock that
may be issued pursuant to all Awards under the Plan is 14,500,000 and (ii) the
maximum number of such shares of Stock that may be issued pursuant to all Awards
of Incentive Stock Options is 3,000,000, in each case subject to adjustment as
provided in this Section 5 or Section 7. The maximum number of shares of Stock
for which Options and Stock Appreciation Rights (or Awards other than
Performance Based Awards pursuant to Section 4(b)) may be granted during a
calendar year to any Employee shall be 500,000. Any Restricted Stock grant may
not exceed, in aggregate with all other Restricted Stock grants under this Plan,
two percent of the shares of Stock outstanding at the time of grant, subject to
adjustment as provided in this Section 5 or Section 7.

     (b) Aggregate Share Unit Limit. The maximum number of Share Units that may
be paid pursuant to all Awards shall not be more than


                                        8



1,500,000, subject to adjustment as provided in this Section 5 or Section 7.
Notwithstanding the foregoing, if an Award paid or payable in Share Units
satisfies the requirements for an exclusion from the definition of a derivative
security under Rule 16a-l(c) that does not require that the Award be made under
a Rule 16b-3 plan, the Share Units that may be paid under the Award shall not be
counted against the Share Unit limit of this Section 5(b).

     (c) Reissue of Shares and Share Units. Any unexercised, unconverted or
undistributed portion of any expired, cancelled, terminated or forfeited Award,
or any alternative form of consideration under an Award that is not paid in
connection with the settlement of an Award or any portion of an Award, shall
again be available for Award under Section 5(a) or 5(b), as applicable, whether
or not the Participant has received benefits of ownership (such as dividends or
dividend equivalents or voting rights) during the period in which the
Participant's ownership was restricted or otherwise not vested. Shares of Stock
that are issued pursuant to Awards and subsequently reacquired by the
Corporation pursuant to the terms and conditions of the Awards shall be
available for reissuance under the Plan.

     (d) Interpretive Issues. Additional rules for determining the number of
shares of Stock or Share Units authorized under this Plan may be adopted by the
Committee, as it deems necessary or appropriate.

     (e) Treasury Shares; No Fractional Shares. The Stock which may be issued
(which term includes Stock reissued or otherwise delivered) pursuant to an Award
under this Plan may be treasury or authorized but unissued Stock or Stock
acquired, subsequently or in anticipation of a transaction under this Plan, in
the open market or in privately negotiated transactions to satisfy the
requirements of this Plan. No fractional shares shall be issued but fractional
interests may be accumulated.

     (f) Consideration. The Stock issued under this Plan may be issued (subject
to Section 10(d)) for any lawful form of consideration, the value of which
equals the par value of the Stock or such greater or lesser value as the
Committee, consistent with Sections 10(d) and 4(a)(1), (2) and (3), may require.

     (g) Purchase or Exercise Price; Withholding. The exercise or purchase price
(if any) of the Stock issuable pursuant to any Award and any withholding
obligation under applicable tax laws shall be paid at or prior to the time of
the delivery of such Stock in cash or, subject to the Committee's express
authorization and the restrictions, conditions and procedures as the Committee
may impose, any one or combination of (i)


                                        9



cash, (ii) the delivery of shares of Stock, (iii) a reduction in the amount of
Stock or other amounts otherwise issuable or payable pursuant to such Award, or
(iv) to the extent permitted by law, the delivery of a promissory note or other
obligation for the future payment in money, the terms and conditions of which
shall be determined (subject to Section 10(d)) by the Committee. In the case of
a payment by the means described in clause (ii) or (iii) above, the Stock to be
so delivered or offset shall be determined by reference to the Fair Market Value
of the Stock on the date as of which the payment or offset is made.

     (h) Cashless Exercise. The Committee may also permit the exercise of the
Award and payment of any applicable withholding tax in respect of an Award by
delivery of written notice, subject to the Corporation's receipt of a third
party payment in full in cash (or in such other form as permitted under Section
5(g)) for the exercise price and the applicable withholding at or prior to the
time of issuance of Stock, in the manner and subject to the procedures as may be
established by the Committee.

SECTION 6. Award Agreements.

     Each Award under this Plan shall be evidenced by an Award Agreement in a
form approved by the Committee setting forth the number of shares of Stock or
Share Units, as applicable, subject to the Award, and the price (if any) and
term of the Award and, in the case of Performance-Based Awards, the applicable
Performance Goals. The Award Agreement shall also set forth (or incorporate by
reference) other material terms and conditions applicable to the Award as
determined by the Committee consistent with the limitations of this Plan.

     (a) Incorporated Provisions. Award Agreements shall be subject to the terms
of this Plan and shall be deemed to include the following terms, unless the
Committee in the Award Agreement otherwise (consistent with applicable legal
considerations) provides:

          (1) Transferability: An Award shall not be assignable nor
     transferable, except by will or by the laws of descent and distribution,
     and during the lifetime of a Participant the Award shall be exercised only
     by such Participant or by his or her guardian or legal representative,
     except that Awards, other than Incentive Stock Options, may be transferred
     to and exercised by a family member or family members of a Participant, or
     transferred to an irrevocable trust or trusts (or other similar estate
     planning entity or entities) established for the benefit of a Participant
     and/or one or more of the Participant's family members, during the
     Participant's lifetime. The


                                       10



     designation of a Beneficiary hereunder shall not constitute a transfer
     prohibited by the foregoing provisions.

          (2) Rights as Stockholder: A Participant shall have no rights as a
     holder of Stock with respect to any unissued securities covered by an Award
     until the date the Participant becomes the holder of record of these
     securities. Except as provided in Section 7, no adjustment or other
     provision shall be made for dividends or other stockholder rights, except
     to the extent that the Award Agreement provides for dividend equivalents or
     similar economic benefits.

          (3) Withholding: The Participant shall be responsible for payment of
     any taxes or similar charges required by law to be withheld from an Award
     or an amount paid in satisfaction of an Award and these obligations shall
     be paid by the Participant on or prior to the payment of the Award. In the
     case of an Award payable in cash, the withholding obligation shall be
     satisfied by withholding the applicable amount and paying the net amount in
     cash to the Participant. In the case of an Award paid in shares of Stock, a
     Participant shall satisfy the withholding obligation as provided in Section
     5(g) or Section 5(h).

          (4) Option Holding Period: Subject to the authority of the Committee
     under Section 7, a minimum six-month period shall elapse between the date
     of initial grant of any Option and the sale of the underlying shares of
     Stock, and the Corporation may impose legend and other restrictions on the
     Stock issued on exercise of the Options to enforce this requirement.

     (b) Other Provisions. Award Agreements may include other terms and
conditions as the Committee shall approve, including but not limited to the
following:

          (1) Termination of Employment: A provision describing the treatment of
     an Award in the event of the retirement, disability, death or other
     termination of a Participant's employment with or services to the Company,
     including any provisions relating to the vesting, exercisability,
     forfeiture or cancellation of the Award in these circumstances, subject, in
     the case of Performance-Based Awards, to the requirements for
     "performance-based compensation" under Code Section 162(m).

          (2) Vesting; Effect of Termination; Change in Control: Any other terms
     consistent with the terms of this Plan as are necessary and appropriate to
     effect the Award to the Participant, including but


                                       11



     not limited to the vesting provisions, any requirements for continued
     employment, any other restrictions or conditions (including performance
     requirements) of the Award, and the method by which (consistent with
     Section 7) the restrictions or conditions lapse, and the effect on the
     Award of a Change in Control. (A) The minimum vesting period for
     Performance-Based Awards made after April 27, 2004 shall be one year
     following date of grant and (B) the minimum vesting period for Awards of
     Restricted Stock made after April 27, 2004 shall be three years following
     date of grant, except that (i) Restricted Stock Awards that are
     Performance-Based Awards shall have a minimum vesting period of one year
     following date of grant and (ii) the vesting schedule of any Award of
     Restricted Stock (whether or not a Performance-Based Award) made after
     April 27, 2004 may not be accelerated.

          (3) Replacement and Substitution: Any provisions permitting or
     requiring the surrender of outstanding Awards or securities held by the
     Participant in whole or in part in order to exercise or realize rights
     under or as a condition precedent to other Awards, or in exchange for the
     grant of new or amended Awards under similar or different terms.

     (c) Contract Rights, Forms and Signatures. Any obligation of the
Corporation to any Participant with respect to an Award shall be based solely
upon contractual obligations created by this Plan and an Award Agreement. No
Award shall be enforceable until the Award Agreement has been signed on behalf
of the Corporation by an Executive Officer (other than the recipient) or his or
her delegate. By accepting receipt of the Award Agreement, a Participant shall
be deemed to have accepted and consented to the terms of this Plan and any
action taken in good faith under this Plan by and within the discretion of the
Committee, the Board of Directors or their delegates. Unless the Award Agreement
otherwise expressly provides, there shall be no third party beneficiaries of the
obligations of the Corporation to the Participant under the Award Agreement.

SECTION 7. Adjustments; Change in Control; Acquisitions.

     (a) Adjustments. If there shall occur any recapitalization, stock split
(including a stock split in the form of a stock dividend), reverse stock split,
merger, combination, consolidation, or other reorganization or any extraordinary
dividend or other extraordinary distribution in respect of the Stock (whether in
the form of cash, Stock or other property), or any split-up, spin-off,
extraordinary redemption, or exchange of outstanding Stock, or there shall occur
any other similar corporate transaction or event in respect of the Stock, or a
sale of substantially all the assets of the


                                       12



Corporation as an entirety, then the Committee shall, in the manner and to the
extent, if any, as it deems appropriate and equitable to the Participants and
consistent with the terms of this Plan, and taking into consideration the effect
of the event on the holders of the Stock:

          (1) proportionately adjust any or all of

               (A) the number and type of shares of Stock and Share Units which
          thereafter may be made the subject of Awards (including the specific
          maxima and numbers of shares of Stock or Share Units set forth
          elsewhere in this Plan),

               (B) the number and type of shares of Stock, other property, Share
          Units or cash subject to any or all outstanding Awards,

               (C) the grant, purchase or exercise price, or conversion ratio of
          any or all outstanding Awards, or of the Stock, other property or
          Share Units underlying the Awards,

               (D) the securities, cash or other property deliverable upon
          exercise or conversion of any or all outstanding Awards,

               (E) subject to Section 4(b), the performance targets or standards
          appropriate to any outstanding Performance-Based Awards, or

               (F) any other terms as are affected by the event; and

          (2) subject to any applicable limitations in the case of a transaction
     to be accounted for as a pooling of interests under generally accepted
     accounting principles, provide for

               (A) an appropriate and proportionate cash settlement or
          distribution, or

               (B) the substitution or exchange of any or all outstanding
          Awards, or the cash, securities or property deliverable on exercise,
          conversion or vesting of the Awards.

     Notwithstanding the foregoing, in the case of an Incentive Stock Option, no
adjustment shall be made which would cause this Plan to violate Section 424(a)
of the Code or any successor provisions thereto, without the written consent of
the Participant adversely affected thereby. The Committee shall act prior to an
event described in this paragraph (a) (including at the time of an Award by
means of more specific provisions in


                                       13



the Award Agreement) if deemed necessary or appropriate to permit the
Participant to realize the benefits intended to be conveyed by an Award in
respect of the Stock in the case of an event described in paragraph (a).

     (b) Change in Control. The Committee may, in the Award Agreement, provide
for the effect of a Change in Control on an Award. Such provisions may include,
but are not limited to any one or more of the following with respect to any or
all Awards: (i) the specific consequences of a Change in Control on the Awards;
(ii) a reservation of the Committee's right to determine in its discretion at
any time that there shall be full acceleration or no acceleration of benefits
under the Awards; (iii) that only certain or limited benefits under the Awards
shall be accelerated; (iv) that the Awards shall be accelerated for a limited
time only; or (v) that acceleration of the Awards shall be subject to additional
conditions precedent (such as a termination of employment following a Change in
Control).

     In addition to any action required or authorized by the terms of an Award,
the Committee may take any other action it deems appropriate to ensure the
equitable treatment of Participants in the event of or in anticipation of a
Change in Control, including but not limited to any one or more of the following
with respect to any or all Awards: (i) the acceleration or extension of time
periods for purposes of exercising, vesting in, or realizing gain from, the
Awards; (ii) the waiver of conditions on the Awards that were imposed for the
benefit of the Corporation, (iii) provision for the cash settlement of the
Awards for their equivalent cash value, as determined by the Committee, as of
the date of the Change in Control; or (iv) such other modification or adjustment
to the Awards as the Committee deems appropriate to maintain and protect the
rights and interests of Participants upon or following the Change in Control.
The Committee also may accord any Participant a right to refuse any acceleration
of exercisability, vesting or benefits, whether pursuant to the Award Agreement
or otherwise, in such circumstances as the Committee may approve.

     Notwithstanding the foregoing provisions of this Section 7(b) or any
provision in an Award Agreement to the contrary, (i) in no event shall the
Committee be deemed to have discretion to accelerate or not accelerate or make
other changes in or to any or all Awards, in respect of a transaction, if such
action or inaction would be inconsistent with or would otherwise frustrate the
intended accounting for a proposed transaction as a pooling of interests under
generally accepted accounting principles; and (ii) if any Award to any Insider
is accelerated to a date that is less than six months after the date of the
Award, the Committee may prohibit a sale of the underlying Stock (other than a
sale by operation or law in exchange for or


                                       14



through conversion into other securities), and the Corporation may impose legend
and other restrictions on the Stock to enforce this prohibition.

     (c) Change in Control Definition. For purposes of this Plan, with respect
to any Award other than an Award issued pursuant to an Award Agreement that
separately defines the term "change in control," a change in control shall
include and be deemed to occur upon the following events:

          (1) The acquisition by any person or group (including a group within
     the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act), other
     than the Corporation or any of its Subsidiaries, of beneficial ownership
     (within the meaning of Rule 13d-3 under the Exchange Act) of 51 percent or
     more of the combined voting power of the Corporation's then outstanding
     voting securities, other than by any employee benefit plan maintained by
     the Corporation;

          (2) The sale of all or substantially all of the assets of the
     Corporation or of L-3 Communications Corporation or any successor thereto;
     or

          (3) The election, including the filling of vacancies, during any
     period of 24 months or less, of 50 percent or more, of the members of the
     Board, without the approval of Continuing Directors, as constituted at the
     beginning of such period. "Continuing Directors" shall mean any director of
     the Company who either (i) is a member of the Board on the date of grant of
     the relevant Award, or (ii) is nominated for election to the Board by a
     majority of the Board which is comprised of Directors who were, at the time
     of such nomination, Continuing Directors.

     (d) Business Acquisitions. Awards may be granted under this Plan on the
terms and conditions as the Committee considers appropriate, which may differ
from those otherwise required by this Plan to the extent necessary to reflect a
substitution for or assumption of stock incentive awards held by employees of
other entities who become employees of the Corporation or a Subsidiary as the
result of a merger of the employing entity with, or the acquisition of the
property or stock of the employing entity by, the Corporation or a Subsidiary,
directly or indirectly.

SECTION 8. Administration.

     (a) Committee Authority and Structure. This Plan and all Awards granted
under this Plan shall be administered by the Compensation Committee of the Board
or such other committee of the Board or subcommittee of the Compensation
Committee as may be designated by the Board and constituted so as to permit this
Plan to comply with the


                                       15



disinterested administration requirements of Rule 16b-3 under the Exchange Act
and the "outside director" requirement of Code Section 162(m). The members of
the Committee shall be designated by the Board. A majority of the members of the
Committee (but not fewer than two) shall constitute a quorum. The vote of a
majority of a quorum or the unanimous written consent of the Committee shall
constitute action by the Committee.

     (b) Selection and Grant. The Committee shall have the authority to
determine the individuals (if any) to whom Awards will be granted under this
Plan, the type of Award or Awards to be made, and the nature, amount, pricing,
timing, and other terms of Awards to be made to any one or more of these
individuals, subject to the terms of this Plan.

     (c) Construction and Interpretation. The Committee shall have the power to
interpret and administer this Plan and Award Agreements, and to adopt, amend and
rescind related rules and procedures. All questions of interpretation and
determinations with respect to this Plan, the number of shares of Stock, Stock
Appreciation Rights, or units or other Awards granted, and the terms of any
Award Agreements, the adjustments required or permitted by Section 7, and other
determinations hereunder shall be made by the Committee and its determination
shall be final and conclusive upon all parties in interest. In the event of any
conflict between an Award Agreement and any non-discretionary provisions of this
Plan, the terms of this Plan shall govern.

     (d) Express Authority to Change Terms of Awards. The Committee may, at any
time, alter or amend any or all Award Agreements under this Plan in any manner
that would be authorized for a new Award under this Plan, including but not
limited to any manner set forth in Section 9 (subject to any applicable
limitations thereunder), except that no amendment may change the exercise price
or base price of an Award, except in connection with an adjustment pursuant to
Section 7(a). Without limiting the Committee's authority under this plan
(including Sections 7 and 9), but subject to any express limitations of this
plan (including under Sections 4(a)(4), 4(b)(5), 6(b)(2), 7 and 9), the
Committee shall have the authority to accelerate the exercisability or vesting
of an Award, to extend the term or waive early termination provisions of an
Award (subject to the maximum ten-year term under Section 4(b)), and to waive
the Corporation's rights with respect to an Award or restrictive conditions of
an Award (including forfeiture conditions), in any case in such circumstances as
the Committee deems appropriate.

     (e) Rule 16b-3 Conditions; Bifurcation of Plan. It is the intent of the
Corporation that this Plan and Awards hereunder satisfy and be interpreted in a
manner, that, in the case of Participants who are or may be


                                       16



Insiders, satisfies any applicable requirements of Rule 16b-3, so that these
persons will be entitled to the benefits of Rule 16b-3 or other exemptive rules
under Section 16 under the Exchange Act and will not be subjected to avoidable
liability thereunder as to Awards intended to be entitled to the benefits of
Rule 16b-3. If any provision of this Plan or of any Award would otherwise
frustrate or conflict with the intent expressed in this Section 8(e), that
provision to the extent possible shall be interpreted and deemed amended so as
to avoid such conflict. To the extent of any remaining irreconcilable conflict
with this intent, the provision shall be deemed disregarded as to Awards
intended as Rule 16b-3 exempt Awards. Notwithstanding anything to the contrary
in this Plan, the provisions of this Plan may at any time be bifurcated by the
Board or the Committee in any manner so that certain provisions of this Plan or
any Award Agreement intended (or required in order) to satisfy the applicable
requirements of Rule 16b-3 are only applicable to Insiders and to those Awards
to Insiders intended to satisfy the requirements of Rule 16b-3.

     (f) Delegation and Reliance. The Committee may delegate to the officers or
employees of the Corporation the authority to execute and deliver those
instruments and documents, to do all acts and things, and to take all other
steps deemed necessary, advisable or convenient for the effective administration
of this Plan in accordance with its terms and purpose, except that the Committee
may not delegate any discretionary authority to grant or amend an award or with
respect to substantive decisions or functions regarding this Plan or Awards as
these relate to the material terms of Performance-Based Awards to Executive
Officers or to the timing, eligibility, pricing, amount or other material terms
of Awards to Insiders. In making any determination or in taking or not taking
any action under this Plan, the Board and the Committee may obtain and may rely
upon the advice of experts, including professional advisors to the Corporation.
No director, officer, employee or agent of the Corporation shall be liable for
any such action or determination taken or made or omitted in good faith.

     (g) Exculpation and Indemnity. Neither the Corporation nor any member of
the Board of Directors or of the Committee, nor any other person participating
in any determination of any question under this Plan, or in the interpretation,
administration or application of this Plan, shall have any liability to any
party for any action taken or not taken in good faith under this Plan or for the
failure of an Award (or action in respect of an Award) to satisfy Code
requirements as to incentive stock options or to realize other intended tax
consequences, to qualify for exemption or relief under Rule 16b-3 or to comply
with any other law, compliance with which is not required on the part of the
Corporation.

SECTION 9. Amendment and Termination of this Plan.


                                       17



     The Board of Directors may at any time amend, suspend or discontinue this
Plan, subject to any stockholder approval that may be required under applicable
law. Notwithstanding the foregoing, no such action by the Board or the Committee
shall, in any manner adverse to a Participant other than as expressly permitted
by the terms of an Award Agreement, affect any Award then outstanding and
evidenced by an Award Agreement without the consent in writing of the
Participant or a Beneficiary, a Participant's family member or a trust (or
similar estate planning entity) established for the benefit of a Participant
and/or one or more of the Participant's family members entitled to an Award.
Notwithstanding the above, any amendment that would (i) materially increase the
benefits accruing to any Participant or Participants hereunder, (ii) materially
increase the aggregate number of shares of Stock, Share Units or other equity
interest(s) that may be issued hereunder, or (iii) materially modify the
requirements as to eligibility for participation in this Plan, shall be subject
to shareholder approval.

SECTION 10. Miscellaneous.

     (a) Unfunded Plans. This Plan shall be unfunded. Neither the Corporation
nor the Board of Directors nor the Committee shall be required to segregate any
assets that may at any time be represented by Awards made pursuant to this Plan.
Neither the Corporation, the Committee, nor the Board of Directors shall be
deemed to be a trustee of any amounts to be paid or securities to be issued
under this Plan.

     (b) Rights of Employees.

          (1) No Right to an Award. Status as an Employee shall not be construed
     as a commitment that any one or more Awards will be made under this Plan to
     an Employee or to Employees generally. Status as a Participant shall not
     entitle the Participant to any additional Award.

          (2) No Assurance of Employment. Nothing contained in this Plan (or in
     any other documents related to this Plan or to any Award) shall confer upon
     any Employee or Participant any right to continue in the employ or other
     service of the Corporation or any Subsidiary or constitute any contract (of
     employment or otherwise) or limit in any way the right of the Corporation
     or any Subsidiary to change a person's compensation or other benefits or to
     terminate the employment or services of a person with or without cause.

     (c) Effective Date; Duration. This Plan has been adopted by the Board of
Directors of the Corporation. This Plan shall become effective


                                       18



upon and shall be subject to the approval of the stockholders the Corporation.
This Plan shall remain in effect until any and all Awards under this Plan have
been exercised, converted or terminated under the terms of this Plan and
applicable Award Agreements. Notwithstanding the foregoing, no Award may be
granted under this Plan after April 27, 2009. Notwithstanding the foregoing, any
Award granted prior to such date may be amended after such date in any manner
that would have been permitted prior to such date, except that no such amendment
shall increase the number of shares subject to, comprising or referenced in such
Award.

     (d) Compliance with Laws. This Plan, Award Agreements, and the grant,
exercise, conversion, operation and vesting of Awards, and the issuance and
delivery of shares of Stock and/or other securities or property or the payment
of cash under this Plan, Awards or Award Agreements, are subject to compliance
with all applicable federal and state laws, rules and regulations (including but
not limited to state and federal insider trading, registration, reporting and
other securities laws and federal margin requirements) and to such approvals by
any listing, regulatory or governmental authority as may be necessary or, in the
opinion of counsel for the Corporation, advisable in connection therewith. Any
securities delivered under this Plan shall be subject to such restrictions (and
the person acquiring such securities shall, if requested by the Corporation,
provide such evidence, assurance and representations to the Corporation as to
compliance with any of such restrictions) as the Corporation may deem necessary
or desirable to assure compliance with all applicable legal requirements.

     (e) Applicable Law. This Plan, Award Agreements and any related documents
and matters shall be governed by, and construed in accordance with, the laws of
the State of New York, except as to matters of Federal law.

     (f) Non-Exclusivity of Plan. Nothing in this Plan shall limit or be deemed
to limit the authority of the Corporation, the Board or the Committee to grant
awards or authorize any other compensation, with or without reference to the
Stock, under any other plan or authority.







                                       19