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Elbit Systems' Part of the WATCHKEEPER Program is Underway: GBP317 Million (Over $500 Million) Order to Elbit Systems and Thales UK's Joint Company, U

29 October 2005

Elbit Systems Ltd. ; reported today that its joint venture company with Thales UK, ;UAV Tactical Systems Limited (U-TacS) was awarded by Thales UK a GBP317 ;million order (over $500 million), to be performed over an eight-year period. ;U-TacS' financial statements will be consolidated within Elbit Systems' ;financial reports. This order is part of the WATCHKEEPER program for which ;the UK Ministry of Defence and Thales UK signed a GBP700 million contract in ;August. U-TacS will execute significant portions of the WATCHKEEPER Program for ;Thales UK, the WATCHKEEPER prime contractor. The majority of U-TacS' activity will be executed in the UK with a ;significant amount of its work sub-contracted to small and medium sized ;enterprises across the UK. Elbit Systems is U-TacS' largest subcontractor ;with approximately one third this contract's value. U-TacS is expected to employ, during the initial stages, dozens of ;workers, most of whom will be recruited locally. U-TacS is currently in the ;process of establishing its facilities in the UK city of Leicester. In addition to executing the WATCHKEEPER Program, Elbit Systems and ;Thales have agreed to jointly market tactical UAV projects in other countries ;worldwide. The President and CEO of Elbit Systems, Joseph Ackerman, said: "We are ;proud to be part of the WATCHKEEPER team, led by Thales UK, for one of the ;most prestigious and advanced UAV program in the world. We are looking ;forward to additional exciting and challenging opportunities resulting from ;our agreement to jointly market other tactical UAV projects." WATCHKEEPER will provide the UK Armed Forces with an essential ;Intelligence, Surveillance, Target Acquisition and Reconnaissance (ISTAR) ;capability based on the Hermes 450 unmanned air vehicle (UAV) system and will ;be a key component of the UK's Network Enabled Capability (NEC). This Program will deliver equipment, training and facilities, with the ;capability of coming into service starting in 2010. WATCHKEEPER will provide the UK Armed Forces with all weather day and ;night surveillance in times of war, tension or during peace-keeping ;operations without the need to deploy troops into sensitive areas or harmful ;situations. The WATCHKEEPER system can provide continuous 24/7 surveillance ;when needed, using unmanned air vehicles able to stay airborne for more than ;16 hours each. The WATCHKEEPER system consists of the WK450 unmanned air vehicle ;carrying day/night sensors and laser target designator connected by a data ;link to a network of containerised Ground Control Stations where operators ;will control the entire mission and interface within a network enabled ;environment. High resolution optical and radar imagery will be exploited and ;disseminated to provide valuable intelligence for operational commanders. The ;system is capable of rapid deployment and operations anywhere in the world. About Elbit Systems Elbit Systems Ltd. is an international defense electronics company ;engaged in a wide range of defense-related programs throughout the world, in ;the areas of aerospace, land and naval systems, command, control, ;communications, computers, intelligence, surveillance and reconnaissance ;("C4ISR"), advanced electro-optic and space technologies. The company focuses ;on the upgrading of existing military platforms and developing new ;technologies for defense and homeland security applications. ; Contacts ; Company contact: IR Contacts: Ilan Pacholder, Corporate Secretary Ehud Helft/Kenny Green and VP Finance & Capital Markets Elbit Systems Ltd: GK International: Tel: +972-4-831-6632 Tel: +1-866-704-6710 Fax: +972-4-831-6659 Fax: +972-3-607-4711 pacholder@elbit.co.il ehud@gk-biz.com kenny@gk-biz.com ; ; STATEMENTS IN THIS PRESS RELEASE WHICH ARE NOT HISTORICAL DATA ARE ;FORWARD-LOOKING STATEMENTS WHICH INVOLVE KNOWN AND UNKNOWN RISKS, ;UNCERTAINTIES OR OTHER FACTORS NOT UNDER THE COMPANY'S CONTROL, WHICH MAY ;CAUSE ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS OF THE COMPANY TO BE ;MATERIALLY DIFFERENT FROM THE RESULTS, PERFORMANCE OR OTHER EXPECTATIONS ;IMPLIED BY THESE FORWARD-LOOKING STATEMENTS. THESE FACTORS INCLUDE, BUT ARE ;NOT LIMITED TO, THOSE DETAILED IN THE COMPANY'S PERIODIC FILINGS WITH THE ;SECURITIES AND EXCHANGE COMMISSION ; ; ;

Source: PR Newswire