News Release

Boeing Selects Palomar Products' Intercommunication System

March, 2000 - Palomar Products, Inc. has been selected by Boeing to provide a secure intercommunications system for the US Air Force's first Airborne Laser (ABL). A virtually stock 747-400F has been delivered to Boeing's facility in Wichita, Kansas for conversion into the first military laser aircraft.

The communications requirements of the ABL Platform will be satisfied by Palomars' AN/AIC-34 ICS equipment. The AIC-34 ICS has been delivered to multiple US Navy Special Mission applications, and we are pleased it has been selected for this important US Air Force Program. This $1.3 billion USAF program is planned to culminate in September 2003 with the test shootdown of a theater ballistic missile.

During the next two years the aircraft will undergo significant modifications. The cargo floor requires strengthening to handle the weight of the chemical laser and a 14,000 pound nose turret will be added to the aircraft. Airlock and chemical safety barriers will be installed and some of the aircraft skin will be replaced with titanium to withstand the laser exhaust.

Val Policky, Palomar Products' President, stated: "This is a very important program to our Company. There is considerable non-recurring engineering to be performed and the future production potential for this platform is significant. Our company has a strong working relationship with Boeing extending back to the early AWACS days. Boeing will be pleased with the equipment and can expect Palomar to deliver on time and to specification."

Contact:
Palomar Products
Bob Lawson
Marketing Director
Voice (949) 766-5434
FAX (949) 766-5353
email: rlawson@palpro.com