L-3 Electron Technologies, Inc

Highlights

of the Contract Between

L-3 Electron Technologies, Inc.

and

Electronic and Space Technicians

Local #1553

Contract Term

10/22/06 – 10/23/10

CONTRACT HIGHLIGHTS SUMMARY

Contract Term

Employees will enjoy the security of a four (4) year contract. Contract expires October 23, 2010.

Wages

Every employee will receive a General Wage Increase every year of the contract.

General Increases (See Wage Schedule Page 10)
1st Year – 3.0% (Effective October 2006, upon ratification)
2nd Year – 3.0% (Effective October 2007)
3rd Year – 3.0% (Effective October 2008)
4th Year – 3.0% (Effective October 2009)

Continue the current automatic wage progression of $.30/hour in June of each year up to the maximum.

Upgrades to the following classifications:

Plumber Maintenance A – from Labor Grade 21 to Labor Grade 24
Air Conditioning/Refrigeration Mechanic A – from Labor Grade 23 to Labor Grade 24
Shop Clerk Senior – from Labor Grade 9 to Labor Grade 14
Blueprint Control Clerk A – from Labor Grade 8 to Labor Grade 14

All upgraded employees receive the Promotional Wage Increase of .40/hr.

New Classifications Added to the Contract:

Electric Propulsion Thruster Generalist, Labor Grade 14
Electric Propulsion Thruster Technician A, Labor Grade 18
Electric Propulsion Thruster Technician SR, Labor Grade 24
Maintenance Generalist, Labor Grade 21

Seniority

Employees now have six (6) working days to respond to recall notice (as opposed to three (3) working days currently)

Temporary layoffs will continue to be made by Work Cell/Work Center

Medical, Dental and Vision coverage will be 100%Company Paid during a Temporary Layoff. No Employee Contribution will be required.

Employees on loan outside of an affected Work Cell will be included in all Temporary Layoff processes

Recall rights maintained for 60 calendar months (5 years) for employees with 5 or more years of bargaining unit seniority.

For employees with less than 5 years of seniority, the length of recall rights will be equal to the employee’s bargaining unit seniority.

Seniority accrual time (drag time) increased:
Labor Grades 9 – 15: 90 calendar days
Labor Grades 18 – 24: 180 calendar days

Holidays

Maintained 12 Company-paid holidays per year (See Page 12).

Continuation of Holiday year-end shutdown.

Medical and Dental Coverage

All coverage will be 100%identical to the salaried plans. This will result in lower medical premiums for all hourly employees (see cost and plan design comparisons on pages 14 – 16).

Employee premium contribution remains at 20% of the Company premium cost.

Contribution caps established for the duration of the contract (See Attachment Page 11).

Vision Care, provided through VSP, is now offered as part of all medical plans with no additional employee contribution.

Aetna point-of-service (POS) medical plan will be discontinued and replaced with the salaried Aetna plan.

The Kaiser and HealthNetHMOs will be continued

PacifiCare HMO will no longer be offered.

Pacificare has charged the highest monthly premium for an HMO in the past and continued to quote the highest rates for 2007. The HealthNet network contains 98% of the same Primary Care Providers and 100% of the hospitals.

Two (2) dental plans will be offered (DeltaDental and DeltaCare PMI)

Employee premium co-pay at 15%

Adult Orthodontia (braces) coverage now included in DeltaCare PMI

Retirement

Contributory Retirement Plan (‘Magic 75)

Will continue the current contributory retirement plan with Company subsidized medical.

Employees who terminate on or before November 30, 2006 and retire on or before December 1, 2006 will continue to receive retiree medical insurance at no cost (see table below):

If Terminate by . . . / Must Commence Retirement by . . .
October 31, 2006 / November 1, 2006
November 30, 2006 / December 1, 2006

Employees who terminate on or after December 1, 2006 and retire on or after January 1, 2007 will contribute 5% for Kaiser coverage, 15% for any other retiree medical coverage (see page 17 for retiree contributions).

Employees may now ‘waive’ retiree medical coverage at the time of retirement and remain eligible for ETI retiree medical coverage at a later time.

Employees must have ‘creditable’ medical coverage from another source, such as a spouse’s employer or own employment and show proof of the loss of that other coverage when they apply for ETI retiree medical at the later date.

Rule of “Magic 75” will continue.

Minimum Benefit Formula increased from $13 to $20 per month for each year of benefit service.

Effective January 1, 2007, Vision Coverage through VSPwill be included with retiree medical coverage.

Employees will not be required to make the 3% pensioncontribution during the first six (6) months of an approved leave of absence to remain eligible for retiree medical.
Beginning the 7th month of an approved leave of absence, employees can choose to make their 3% pension contribution even if they are not on Long Term Disability.

Employees are not required to maintain medical coverage, either as an active employee or while on an approved leave of absence, to maintain eligibility for retiree medical.

Registered Same-Sex Domestic Partner added to retiree coverage.

Special Layoff retirements will include employees who are laid off for medical disqualification.

Non-Contributory Retirement Plan

Medicare Supplement Plan will now be offered to employees retiring under the Contributory and Non-Contributory Retirement Plans.

New employees hired after January 1, 2007 will not be eligible to participate in L-3 ETI Retirement plans
Will participate in the Southern California Lumber Industry Retirement Fund.
L-3 ETI will fund the plan.
Rehired or Recalled employees will go back into their previous L-3 ETI Retirement Plan upon hire (within 5 years of layoff).

Other Benefits

The Company will continue to offer $50,000 Company-Paid Life Insurance and access to Short-Term and Long-Termdisability plans.

IncreasedCompany-Paid Accidental Death and DismembermentPlan for employees to$50,000 (was $25,000)

IncreasedCompany-paidBusiness Travel Accident Plan equal to 3 times annual salary (was 2 ¼; also applies to employees who drive in the course of their duties).

Effective January 1, 2007, the Supplemental Life Insurance Plan will be replaced with a Group Universal Life Insurance Plan
Coverage in effect as of 12/31/06 will be converted without Evidence of Insurability.
Employee coverage available up to 6 times basic salary.
Spouse coverage available up to $100,000 or 2 times employee’s basic salary.
Child Life Insurance coverage is increased to $10,000 and $20,000 (currently $5,000).
Portable benefit – When you retire or terminate from ETI, the employee will have the opportunity to continue coverage by paying the premium.

Other coverage (for example, auto, homeowners and long term care) are available at group rates.

Effective January 1, 2007, the Supplemental Accidental Death &Dismemberment Plan will be replaced with aVoluntary Accidental Death &Dismemberment Plan.
Employee coverage available up to 10 times basic salary.
Spouse and Family coverage also available.
No conversion from previous coverage, but all employees will have the opportunity to enroll at any level without Evidence of Insurability.

New Improvements to the Flexible Spending Accounts
Health care Spending Account deferral amount increased from $3,000 to $5,000 annually.

Master Savings Plan (401k)

Existing company match for 401(k) Plan of 4% is maintained.

Company match (4%) now provided on Catch-Up contributions. Employees must meet IRS requirements (i.e. turn age 50 in the calendar year, contributing at the maximum level) to be eligible for Catch-Up contributions.

Immediate 100% vesting to continue for all employees in 401(k) Plan.

Maximum employee contributions in 401(k) Plan will continue at 20% on a pre-tax or after-tax basis.

Leaves of Absence

Non-occupational medical leaves of absences may be approved for up to a maximum of 24 months
Employees on leave prior to January 1, 2007 will be eligible for medical leaves of absence up to 30 months

Continue to accumulate Company service and bargaining unit seniority for the first 90 consecutive calendar daysof non-occupational leaves.

Employees on occupational leaves will continue to accumulate Companyservice and bargaining unit seniority indefinitely while on leave.

Registered Same-Sex Domestic Partner included in Family Leave coverage

Sick Leave

Will continue to receive 80 hours of sick leave each full year of service, accrued in increments of 2.134 hours per week, until the 80 hours is achieved.

BereavementLeave will continue to be charged to the sick leave account.

Minimum sick leave pay increased to 2 hours.

Employee existing Extended Sick Leave (formerly known as EPTO) balances remain in tact.

Sick leave must be used prior to taking Leave Without Pay (LWOP).

Vacation

New hires, rehired or recalled employees immediately receive 40 hours of vacation to use. Weekly accruals begin at 6 months.

Vacation accrual amounts remain unchanged (see page 13).

Increased maximum vacation accrual schedule incorporated into the contract.

Work Cell Leader Program

Now included in the Contract.

Minimum starting point for new Work Cell Leader pay is $19.75 (plus 15% premium).

Work Cell leaders that lead higher labor grades than their own will receive an annual $2,000 bonus each year that they lead the higher labor grades.

Miscellaneous

Payroll Week officially changed to Saturday through Friday.

Jury Duty changed from 15 days to 10days per calendar year.

Non-Standard Work Week language removed from Contract.

Employee will now have the ability to verify time clock accuracy on a daily basis.

Employee Stock Purchase Program incorporated into the contract.

General Wage Increase Schedule

Schedule A-1 (Effective October, 2006)

Labor Grade / General
Increase / Rate Range Adjustment / New Minimum / New Maximum
24 / 3.0% / 3.0% / 16.63 / 27.73
22 / 3.0% / 3.0% / 14.58 / 24.32
21 / 3.0% / 3.0% / 14.27 / 23.78
18 / 3.0% / 3.0% / 12.89 / 21.49
15 / 3.0% / 3.0% / 12.07 / 20.11
14 / 3.0% / 3.0% / 11.85 / 19.75
9 / 3.0% / 3.0% / 10.29 / 17.20

Schedule A-2 (Effective October, 2007)

Labor Grade / General
Increase / Rate Range Adjustment / New Minimum / New Maximum
24 / 3.0% / 3.0% / 17.13 / 28.56
22 / 3.0% / 3.0% / 15.02 / 25.05
21 / 3.0% / 3.0% / 14.69 / 24.50
18 / 3.0% / 3.0% / 13.27 / 22.13
15 / 3.0% / 3.0% / 12.43 / 20.71
14 / 3.0% / 3.0% / 12.20 / 20.34
9 / 3.0% / 3.0% / 10.60 / 17.72

Schedule A-3 (Effective October, 2008)

Labor Grade / General
Increase / Rate Range Adjustment / New Minimum / New Maximum
24 / 3.0% / 3.0% / 17.65 / 29.42
22 / 3.0% / 3.0% / 15.47 / 25.80
21 / 3.0% / 3.0% / 15.13 / 25.23
18 / 3.0% / 3.0% / 13.67 / 22.79
15 / 3.0% / 3.0% / 12.81 / 21.33
14 / 3.0% / 3.0% / 12.57 / 20.95
9 / 3.0% / 3.0% / 10.92 / 18.25

Schedule A-4 (Effective October, 2009)

Labor Grade / General
Increase / Rate Range Adjustment / New Minimum / New Maximum
24 / 3.0% / 3.0% / 18.18 / 30.30
22 / 3.0% / 3.0% / 15.94 / 26.57
21 / 3.0% / 3.0% / 15.59 / 25.99
18 / 3.0% / 3.0% / 14.08 / 23.48
15 / 3.0% / 3.0% / 13.19 / 21.97
14 / 3.0% / 3.0% / 12.94 / 21.58
9 / 3.0% / 3.0% / 11.25 / 18.80
Medical Plan / 2008 / 2009 / 2010
Aetna
Employee Only / $45.22 / $52.00 / $59.81
Employee + Spouse / $92.57 / $106.45 / $122.42
Employee + Child(ren) / $90.76 / $104.38 / $120.03
Family / $134.60 / $154.79 / $178.01
HealthNet
Employee Only / $31.32 / $36.02 / $41.42
Employee + Spouse / $62.64 / $72.04 / $82.84
Employee + Child(ren) / $62.64 / $72.04 / $82.84
Family / $93.75 / $107.81 / $123.98
Kaiser
Employee Only / $28.70 / $33.01 / $37.96
Employee + Spouse / $63.02 / $72.47 / $83.34
Employee + Child(ren) / $57.40 / $66.02 / $75.92
Family / $85.89 / $98.78 / $113.60

Medical and Dental Contribution Caps by Year*

Dental Plan / 2008 / 2009 / 2010
DeltaDental
Employee Only / $3.18 / $3.66 / $4.21
Employee + Spouse / $6.37 / $7.32 / $8.42
Employee + Child(ren) / $6.37 / $7.32 / $8.42
Family / $9.87 / $11.35 / $13.06
Prepaid Dental Plan
Employee Only / $1.36 / $1.57 / $1.80
Employee + Spouse / $2.73 / $3.14 / $3.61
Employee + Child(ren) / $2.73 / $3.14 / $3.61
Family / $4.09 / $4.71 / $5.42

* Employee bi-weekly contribution caps represent the maximum contributions.

Holiday Schedule

2006

Thursday, November 23

Friday, November 24

Friday, December 22

Monday, December 25

Tuesday, December 26

Wednesday, December 27

Thursday, December 28

Friday, December 29

2007

Monday, January 1

Monday, May 28

Wednesday, July 4

Monday, September 3

Thursday, November 22

Friday, November 23

Monday, December 24

Tuesday, December 25

Wednesday, December 26

Thursday, December 27

Friday, December 28

Monday, December 31

2008

Tuesday, January 1

Monday, May 26

Friday, July 4

Monday, September 1

Thursday, November 27

Friday, November 28

Wednesday, December 24

Thursday, December 25

Friday, December 26

Monday, December 29

Tuesday, December 30

Wednesday, December 31

2009

Thursday, January 1

Monday, May 25

Friday, July 3

Monday, September 7

Thursday, November 26

Friday, November 27

Thursday, December 24

Friday, December 25

Monday, December 28

Tuesday, December 29

Wednesday, December 30

Thursday, December 31

2010

Friday, January 1

Monday, May 31

Monday, July 5

Monday, September 6

Vacation Accrual Schedule

Years* / Hours Per
Week / Hours Per
Year / Days
Per Year / Maximum Accrual
Days / Hours
Less than 1 / 1.538 / 80 / 10 / N/A
1 to 4 / 1.538 / 80 / 10 / 30 / 240
5 to 9 / 1.846 / 96 / 12 / 36 / 288
10 to 11 / 2.307 / 120 / 15 / 45 / 360
12 to 13 / 2.461 / 128 / 16 / 48 / 384
14 to 15 / 2.615 / 136 / 17 / 51 / 408
16 to 17 / 2.769 / 144 / 18 / 54 / 432
18 or more / 3.077 / 160 / 20 / 60 / 480

*Completed Company Service

Comparison of Employee Contributions

Current Union Employee Contribution / 2007 Employee Contribution if Remain in Union Plan Design / 2007 Employee Contribution in Salaried Plan Design
Aetna Choice POS II / Per Pay Period / Per Pay Period / Per Pay Period
Ee only / $42.74 / $45.05 / $39.32
Ee +Spouse / $85.48 / $90.09 / $80.49
Ee + Child(ren) / $85.48 / $90.09 / $78.92
Family / $128.22 / $135.14 / $117.05
HealthNet
Ee only / $25.80 / $30.62 / $27.24
Ee +Sp / Child / $51.60 / $61.24 / $54.47
Family / $77.40 / $91.85 / $81.52
Kaiser
Ee only / $25.21 / $27.17 / $24.96
Ee + Sp / $55.46 / $59.78 / $54.80
Ee + Child / $50.42 / $54.35 / $49.92
Family / $75.62 / $81.52 / $74.69
DeltaDental PPO
Ee only / $0.00 / $2.35 / $2.77
Ee +Sp / Child / $0.00 / $4.71 / $5.54
Family / $0.00 / $7.06 / $8.58
DentalCare PMI
Ee only / $0.00 / $1.35 / $1.19
Ee +Sp / Child / $0.00 / $2.71 / $2.37
Family / $0.00 / $4.07 / $3.56
Plan Feature / Aetna Choice POS II / HealthNet HMO / Kaiser Permanente HMO
In Network / Out of Network / In Network Only / In Network Only
Primary Care Provider Required? / No / No / Yes / No
Annual Deductible
Individual / N/A / $500 / N/A / N/A
Family / N/A / $1,500 / N/A / N/A
Annual Out of Pocket Maximum
Individual / $1,000 / $3,000 / $1,500 / $1,500
Family / $3,000 / $9,000 / $4,500 / $3,000
Preventive Care
Annual physical / $20 (generalist); $30 (specialist) / 30% after deductible / $20 co-pay / $20 co-pay
Routine pediatric care / $20 co-pay / 30% after deductible / no co-pay / $5
Routine GYN exam / $30 co-pay / 30% after deductible / $20 co-pay / $20 co-pay
Routine mammograms / 10% / 30% after deductible / no co-pay / no co-pay
Outpatient Care
Physician office visit / $20 co-pay / 30% after deductible / $20 co-pay / $20 co-pay
Specialist office visit / $30 co-pay / 30% after deductible / $30 co-pay / $20 co-pay
Outpatient surgery / 10% / 30% after deductible / $100 / $20 co-pay
X-ray and lab tests / 10% / 30% after deductible / no co-pay / no co-pay
Inpatient Hospital Care
Physician and surgical services / 10% / 30% after deductible / no co-pay / no co-pay
Semi-private room and board / 10% after $100/day copay for first 5 days / 30% after deductible / $250 per admission / $500 co-pay
Emergency Care
Emergency room visit / 10% after $50 copay (waived if admitted; no coverage for non-emergency use of emergency room) / 10% after $50 copay (waived if admitted; no coverage for non-emergency use of emergency room) / $35 (waived if admitted) / $50 (waived if admitted)
Ambulance service / 10% / 10% emergency; 30% non-emergency / no co-pay / $50
Rx - Retail
Generic / $10 co-pay / 30% / $10 co-pay / $10 co-pay
Brand / Formulary / $25 co-pay / 30% / $25 co-pay / $20 co-pay
Non-Formulary / $40 co-pay / 30% / $50 co-pay / Must be approved
Over-the-Counter (Prilosec, Claritin, Nicoderm and Nicorette only; Rx required) / $2 co-pay / No coverage / No coverage / No coverage
Rx - Mail Order
Generic / $20 co-pay / No coverage / $20 co-pay / $10 co-pay
Brand / Formulary / $50 co-pay / No coverage / $50 co-pay / $20 co-pay
Non-Formulary / $80 co-pay / No coverage / $100 co-pay / Must be approved

Health Plan Comparisons

Dental Plan Comparisons

Plan Feature / DeltaDental Preferred POS / DeltaCare PMI
In Network / Out of Network / In Network Only
Primary Care Provider Required? / No / No / Yes
Annual Deductible
Individual / $50 / $75 / None
Family / $150 / $225 / None
Annual Maximum
Individual / $2,000 / $2,000 / None
Preventive Care
Exam & X-rays / 0% / 20% / no co-pay
Fluoride / Up to Age 14 / Up to Age 14 / Up to Age 19
Sealants / Up to Age 14 / Up to Age 14 / Up to Age 14
Other Services
Basic Fillings / 20% / 50% / no co-pay
Extractions / 20% / 50% / no co-pay
Root Canal / 20% / 50% / no co-pay
Crowns / 40% / 50% / $165 - $180 depending on procedure
Orthodontics
Maximum allowance / $2,000 lifetime / $2,000 lifetime / Services must be performed by a Contract Orthodontist
Covered Persons / Children up to age 19 / Children up to age 19 / Children and Adults
Orthodontic Services / 50% / 50% / $700 for children up to age 19; $1,800 for adults
2007 Retiree Medical Contribution for Employees Whose Retirement Commences on or after 1-1-07 / Percentage of Premium
Per month
Aetna Choice POS II
Ee only / $112.95 / 15%
Ee +Spouse / $225.90 / 15%
Ee + Child(ren) / $153.60 / 15%
Family / $271.80 / 15%
HealthNet
Ee only / $70.42 / 15%
Ee +Sp / Child(ren) / $140.84 / 15%
Family / $210.96 / 15%
Kaiser
Ee only / $13.52 / 5%
Ee + Sp / $29.68 / 5%
Ee + Child(ren) / $27.04 / 5%
Family / $40.46 / 5%

2007 Retiree Medical Contribution Amounts