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Northrop Grumman and Kockum/ HDW Partner Up

Maritime Activity Reports, Inc.

October 22, 2002

Northrop Grumman Corporation has signed a cooperative agreement with Kockums AB and its parent company, Howaldtswerke Deutsche Werft AG (HDW), under which Kockums will join a team assembled by Northrop Grumman's Ship Systems sector to compete for the U.S. Navy's Focused Mission Vessel Study. This study is expected to result in the development and construction of a Littoral Combat Ship (LCS), one element of the DD(X) family of surface combatants planned for construction by the Navy during the next quarter century. The cooperative agreement between Northrop Grumman, Kockums and HDW covers business opportunities for the design, development, construction and sale of Visby-class ships and/or derivative technology to the U.S. government for the LCS and other U.S. programs, and for sales to friendly international governments through the Foreign Military Sales program. This is an exclusive agreement between the parties that, subject to Swedish government approval, allows Northrop Grumman and the U.S. government to take full advantage of more than seven years of Swedish investment in developing an all-composite, corvette-sized, monohull ship. The vessel technology combines stealth, speed, modularity and survivability characteristics in a way that is expected to revolutionize the effectiveness of small ships in littoral warfare and on other missions. Kockums has designed and built the first Visby-class corvette, which is presently undergoing combat systems installation and sea trials. Early indications are that the ship will meet or exceed expectations in every area. Northrop Grumman plans to use the Visby as the baseline for development of Ship Systems' proposal for the Navy's LCS program. Combining the proven hull and composite technology developed by Kockums with Northrop Grumman's composite and overall ship integration experience will allow the Navy to rely upon a proven, full-service shipbuilder, with access to state-of-the-art fielded technology, for the LCS program.

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