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DRS Technologies

In the Boardroom With...
Mr. Fred L. Marion
President Surveillance & Reconnaissance Group
DRS Technologies (NYSE: DRS) Thank you for joining us today, Fred. Please give us an overview of your background and your role at DRS Technologies.

Fred L. Marion: I've been in the aerospace and defense industry over 35 years and have served as Chairman of the Board of Lockheed Martin MEADS, Inc., and as Chairman of the Board of SIKA, a joint venture formed by Lockheed Martin and British Aerospace. I was Vice President, Special Projects, of Lockheed Martin Electronics Sector. Prior to this I served as the Vice President, Fire Control Systems for Lockheed Martin Electronics Missiles; Vice President, Business Development and Advanced Systems, Vice President, Missile Systems and Vice President, Air Defense Systems, all for the Lockheed Martin Electronics and Missiles Company. I joined DRS Technologies, Inc. in December 1999 as President of DRS's Surveillance Reconnaissance Group and I am responsible for three DRS Strategic Business Units (SBU): Reconnaissance, Surveillance and Target Acquisition (RSTA); Training and Control Systems (TCS); and Test and Energy Management (TEM). My group has nine integrated companies across the United States and Canada. We account for about 1/3 of the total DRS business. DRS provides services to all branches of the U.S. Military. Without divulging any sensitive or confidential information, of course, can you tell us about a recent project for the Air Force, Army, Coast Guard, Marines, and Navy?

Fred L. Marion: Fiber Optic Data Multiplex System (FODMS) DDG51 Production of twenty three FODMS Ship Sets For installation on US Navy DDG51 Aegis Destroyer. Improved Thermal Sight System (ITSS) Production of 486 ITSS modification kits consisting of improved interface brackets and system cables for the USMC Light Armored Vehicle (LAV-25). USAFE Rangeless Instrumentation Training System (URITS) Customer Support and Services contract to maintain the USAF ranges in the U.K., Germany, Italy and other deployed sites. The rangeless system allows air forces to train fighter pilots autonomously anywhere, anytime. Embedded Health Management Systems DRS has provided the US Army, USMC and the Army National Guard in excess of 1200 vehicle sets including over 18,000 Sidecars(tm) for embedded diagnostics on the Abrams Main Battle Tank. What about success stories in the US Government domestic sector. Is there a project or two for the Department of Homeland Security which you can tell us about?

Fred L. Marion:
With respect to Homeland Security, we have teamed with the Boeing Company and proposed a solution to the Customs and Border Protection for the SBInet Program. The SBInet program designed to protect more than 6,000 miles of US southern and northern land borders including the Great Lakes. This comprehensive system provides an architecture to Predict, Deter, Detect, Identify, Classify, Respond, Detain and Remove border violators. At the same time we are developing some advanced technology to create a very robust capability to meet the border security mission with much better performance than anything available today.

We are also working various surveillance systems with intelligent video providing security systems for ports and harbors. Finally we also have a commercial arm supplying law enforcement agencies at federal, state and local levels with sophisticated night vision systems and IP based cameras with intelligent video. How about in International markets....can you tell us about DRS "wins" in Iraq?

Fred L. Marion: DRS is proud of the contributions we have made in the nation's Long War on terrorism. We have been working hard to ensure our soldier's have the very most modern equipment available. Specifically, we have maintained the Mast Mounted Sight (MMS) on the Kiowa Warrior at an very high operational readiness rate while surging our deliveries of the Bradley Fighting Vehicle's gunners sight known as Improved Bradley Acquisition System (IBAS) and the Long Range Advanced Scout Surveillance System (LRAS3) . We have also improved soldier effectiveness by providing Driver Vision Enhancer systems for tactical vehicles. These and many more combat weapon upgrades have significantly improved our soldier's survivability and effectiveness. Regarding the U.S. budget for defense, what is your perspective on the upcoming 2007 budget? Do you think the level of spending will be about the same as in 2006, less than 2006, or perhaps greater than 2006 spending?

Fred L. Marion: Our Nation is at war. My sense is that the Nation will continue to support the armed forces with everything they need to prosecute the GWOT. Are there other market drivers for DRS, in addition to Government spending, that you'd like to talk about?

Fred L. Marion: Since our two most important assets are our people and our customers, I want to add that we spend a lot of time trying to obtain the best people for all of our positions and we try to treat them right so that they feel good about working for DRS. With respect to our customers, we spend a great amount of time ensuring they are satisfied with our work and our products. We want them to want to do business with DRS and feel that DRS will never let them down. Thank you very much for joining us today, Fred.