<SUBMISSION>
<ACCESSION-NUMBER>0000950123-09-029417
<TYPE>PRER14A
<PUBLIC-DOCUMENT-COUNT>5
<FILING-DATE>20090804
<DATE-OF-FILING-DATE-CHANGE>20090804
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>AXSYS TECHNOLOGIES INC
<CIK>0000206030
<ASSIGNED-SIC>3827
<IRS-NUMBER>111962029
<STATE-OF-INCORPORATION>DE
<FISCAL-YEAR-END>1228
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>PRER14A
<ACT>34
<FILE-NUMBER>000-16182
<FILM-NUMBER>09982862
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>175 CAPITAL BLVD SUITE 103
<CITY>ROCKY HILL
<STATE>CT
<ZIP>06067
<PHONE>2018711500
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>175 CAPITAL BLVD SUITE 103
<CITY>ROCKY HILL
<STATE>CT
<ZIP>06067
</MAIL-ADDRESS>
<FORMER-COMPANY>
<FORMER-CONFORMED-NAME>VERNITRON CORP
<DATE-CHANGED>19920703
</FORMER-COMPANY>
</FILER>
<DOCUMENT>
<TYPE>PRER14A
<SEQUENCE>1
<FILENAME>l36705dprer14a.htm
<DESCRIPTION>FORM PRER14A
<TEXT>
<HTML>
<HEAD>
<TITLE>FORM PRER14A</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
</DIV><!-- END PAGE WIDTH -->
<DIV style="width: 89%; margin-left: 5%"><!-- BEGIN PAGE WIDTH -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>UNITED STATES<BR>
    SECURITIES AND EXCHANGE COMMISSION<BR>
    Washington,&#160;D.C. 20549<BR>
    </B>
</DIV>

<DIV style="margin-top: 5pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>SCHEDULE&#160;14A<BR>
    <FONT style="white-space: nowrap">(RULE&#160;14a-101)</FONT><BR>
    </B>
</DIV>

<DIV style="margin-top: 5pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>INFORMATION REQUIRED IN PROXY STATEMENT<BR>
    SCHEDULE&#160;14A INFORMATION<BR>
    </B>
</DIV>

<DIV style="margin-top: 5pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>PROXY STATEMENT PURSUANT TO SECTION&#160;14(a) OF THE
    SECURITIES<BR>
    EXCHANGE ACT OF 1934</B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Filed by the
    Registrant&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#254;
    </FONT>
</DIV>

<DIV style="margin-top: 2pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Filed by a Party other than the
    Registrant&#160;<FONT style="font-family: Wingdings; font-variant: normal">&#111;
    </FONT>
</DIV>

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Check the appropriate box:
</DIV>

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <FONT style="font-family: Wingdings; font-variant: normal">&#254;</FONT>&#160;&#160;Preliminary
    Proxy Statement
</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <FONT style="font-family: Wingdings; font-variant: normal">&#111;</FONT>&#160;&#160;Confidential,
    For Use of the Commission Only (as permitted by
    <FONT style="white-space: nowrap">Rule&#160;14a-6(e)(2))</FONT>
</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <FONT style="font-family: Wingdings; font-variant: normal">&#111;</FONT>&#160;&#160;Definitive
    Proxy Statement
</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <FONT style="font-family: Wingdings; font-variant: normal">&#111;</FONT>&#160;&#160;Definitive
    Additional Materials
</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <FONT style="font-family: Wingdings; font-variant: normal">&#111;</FONT>&#160;&#160;Soliciting
    Material Pursuant to &#167;
    <FONT style="white-space: nowrap">240.14a-12</FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    AXSYS TECHNOLOGIES, INC.
</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=480 length=0 -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <FONT style="font-size: 8pt">(Name of Registrant as Specified in
    Its Charter)
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <FONT style="font-size: 8pt">N/A
    </FONT>
</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=480 length=0 -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <FONT style="font-size: 8pt">(Name of Person(s) Filing Proxy
    Statement, if Other Than the Registrant)
    </FONT>
</DIV>

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Payment of Filing Fee (Check the appropriate box):
</DIV>

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>    <FONT style="font-family: Wingdings; font-variant: normal">&#111;</FONT>&#160;&#160;
</TD>
    <TD align="left">    No fee required.
</TD>
</TR>


<TR style="line-height: 2pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>    <FONT style="font-family: Wingdings; font-variant: normal">&#254;</FONT>&#160;&#160;
</TD>
    <TD align="left">    Fee computed on table below per Exchange Act
    <FONT style="white-space: nowrap">Rules&#160;14a-6(i)(1)</FONT>
    and 0-11.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="5%"></TD>
    <TD width="92%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    (1)&#160;&#160;
</TD>
    <TD align="left">
    Title of each class of securities to which transaction applies:
</TD>
</TR>

</TABLE>

<DIV align="left" style="margin-left: 8%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    common stock, par value $0.01 per share
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="5%"></TD>
    <TD width="92%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    (2)&#160;&#160;
</TD>
    <TD align="left">
    Aggregate number of securities to which transaction applies:
</TD>
</TR>

</TABLE>

<DIV align="left" style="margin-left: 8%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    11,622,629 outstanding shares of common stock (includes
    restricted shares) and options to purchase 294,322&#160;shares
    of common stock
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="5%"></TD>
    <TD width="92%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    (3)&#160;&#160;
</TD>
    <TD align="left">
    Per unit price or other underlying value of transaction computed
    pursuant to Exchange Act
    <FONT style="white-space: nowrap">Rule&#160;0-11</FONT>
    (set forth the amount on which the filing fee is calculated and
    state how it was determined):
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 8%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    $54.00 per outstanding share of common stock plus $11,018,976 in
    the aggregate to cash out options to purchase shares of common
    stock
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="5%"></TD>
    <TD width="92%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    (4)&#160;&#160;
</TD>
    <TD align="left">
    Proposed maximum aggregate value of transaction: $638,640,940
</TD>
</TR>

<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR style="line-height: 4pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    (5)&#160;&#160;
</TD>
    <TD align="left">
    Total fee paid: $35,636
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="97%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>    <FONT style="font-family: Wingdings; font-variant: normal">&#254;</FONT>&#160;&#160;
</TD>
    <TD align="left">    Fee paid previously with preliminary materials.
</TD>
</TR>


<TR style="line-height: 4pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>    <FONT style="font-family: Wingdings; font-variant: normal">&#111;</FONT>&#160;&#160;
</TD>
    <TD align="left">    Check box if any part of the fee is offset as provided by
    Exchange Act
    <FONT style="white-space: nowrap">Rule&#160;0-11(a)(2)</FONT>
    and identify the filing for which the offsetting fee was paid
    previously. Identify the previous filing by registration
    statement number, or the Form or Schedule and the date of its
    filing.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="5%"></TD>
    <TD width="92%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    (1)&#160;&#160;
</TD>
    <TD align="left">
    Amount previously paid:
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 8pt; margin-left: 8%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=480 length=0 -->

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="5%"></TD>
    <TD width="92%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    (2)&#160;&#160;
</TD>
    <TD align="left">
    Form, Schedule or Registration Statement No.:
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 8pt; margin-left: 8%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=480 length=0 -->

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="5%"></TD>
    <TD width="92%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    (3)&#160;&#160;
</TD>
    <TD align="left">
    Filing Party:
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 8pt; margin-left: 8%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=480 length=0 -->

<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="3%"></TD>
    <TD width="5%"></TD>
    <TD width="92%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    (4)&#160;&#160;
</TD>
    <TD align="left">
    Date Filed:
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 8pt; margin-left: 8%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=480 length=0 -->

<P align="left" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 89%; margin-left: 5%"><!-- BEGIN PAGE WIDTH -->
</DIV><!-- END PAGE WIDTH -->
<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="right" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <IMG src="l36705dl3670510.gif" alt="(AXSYS LOGO)"><B><FONT style="font-family: 'Times New Roman', Times">
    </FONT></B>
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Preliminary
    Copy</FONT></B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="right" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV align="right" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    August [&#160;&#160;], 2009
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Dear Fellow Stockholders:
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    You are cordially invited to attend a special meeting of
    stockholders of Axsys Technologies, Inc., which is referred to
    as Axsys, to be held on September [&#160;&#160;], 2009, at
    10:00&#160;a.m. (Eastern Time), at Hartford Marriott Rocky Hill
    at Corporate Ridge, 100 Capital Boulevard, Rocky Hill,
    Connecticut, unless postponed to a later date.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    At the special meeting, we will ask you to adopt a merger
    agreement among Axsys, General Dynamics Advanced Information
    Systems, Inc., which is referred to as GD AIS, and Vision Merger
    Sub, Inc., an indirect, wholly owned subsidiary of General
    Dynamics Corporation, which is referred to as General Dynamics
    and which is GD AIS&#146;s ultimate parent. As a result of the
    merger, Axsys will become an indirect, wholly owned subsidiary
    of General Dynamics and each of your shares of Axsys common
    stock will be converted into the right to receive $54.00 in
    cash, without interest.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>The proxy statement accompanying this letter is furnished in
    connection with the solicitation by the Board of Directors of
    Axsys of proxies to be used at the special meeting.</B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Board of Directors of Axsys, which is referred to as the
    Board, has carefully reviewed and considered the terms and
    conditions of the proposed merger. Based on its review, the
    Board has determined that the merger is advisable to and in the
    best interests of Axsys and its stockholders. <B>Accordingly,
    the Board has unanimously approved the merger agreement and
    unanimously recommends that you vote FOR the adoption of the
    merger agreement.</B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Your vote is very important. The merger cannot be completed
    unless holders of at least a majority of shares of Axsys common
    stock outstanding and entitled to vote at the special meeting
    vote to adopt the merger agreement.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Only holders of record of Axsys common stock at the close of
    business on July&#160;30, 2009, will be entitled to vote at the
    special meeting. Please complete, sign, date and return your
    proxy. If you hold your shares in &#147;street name,&#148; you
    should instruct your broker how to vote in accordance with your
    voting instruction form. Completing a proxy now will not prevent
    you from being able to vote at the special meeting by attending
    in person and casting a vote. Failure to submit a signed proxy
    or to vote in person at the special meeting will have the same
    effect as a vote against the adoption of the merger agreement.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The proxy statement accompanying this letter explains the
    proposed merger and the merger agreement and provides specific
    information concerning the special meeting. Please read the
    entire proxy statement carefully.
</DIV>

<DIV style="margin-top: 24pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Sincerely,
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <IMG src="l36705dl3670508.gif" alt="-s- Stephen W. Bershad">
</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Stephen W. Bershad
</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Chairman of the Board of Directors and</I>
</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Chief Executive Officer</I>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>This Proxy Statement is dated August&#160;[&#160;&#160;],
    2009, and is first being mailed to Axsys stockholders on or
    about August&#160;[&#160;&#160;], 2009</B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<P align="left" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B><FONT style="font-size: 12pt"> NOTICE OF SPECIAL MEETING OF
    STOCKHOLDERS<BR>
    TO BE HELD ON SEPTEMBER&#160;[&#160;&#160;], 2009</FONT></B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 2pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>To Stockholders of Axsys Technologies, Inc.</I>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 2pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    A special meeting of stockholders of Axsys Technologies, Inc.,
    which is referred to as Axsys, will be held at 10:00&#160;a.m.
    (Eastern Time), on September&#160;[&#160;&#160;], 2009, at
    Hartford Marriott Hill at Corporate Ridge, 100 Capital
    Boulevard, Rocky Hill, Connecticut, unless postponed to a later
    date. The special meeting is being held to consider and vote
    upon the following proposals:
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 2pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="8%"></TD>
    <TD width="3%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    1.&#160;
</TD>
    <TD align="left">
    To adopt the Agreement and Plan of Merger, dated as of
    June&#160;4, 2009, as such agreement may be amended from time to
    time in accordance with its terms, by and among Axsys, General
    Dynamics Advanced Information Systems, Inc. and Vision Merger
    Sub, Inc., an indirect, wholly owned subsidiary of General
    Dynamics Corporation, which is referred to as General Dynamics
    and which is General Dynamics Advanced Information Systems,
    Inc.&#146;s ultimate parent. As a result of the merger, Axsys
    will become an indirect, wholly owned subsidiary of General
    Dynamics and each outstanding share of Axsys common stock will
    be converted into the right to receive $54.00 in cash, without
    interest.
</TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 1pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="8%"></TD>
    <TD width="3%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    2.&#160;
</TD>
    <TD align="left">
    To approve adjournments of the special meeting, if necessary, to
    permit further solicitation of proxies if there are not
    sufficient votes at the time of the special meeting to adopt the
    merger agreement.
</TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 2pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Only holders of record of shares of Axsys common stock at the
    close of business on July&#160;30, 2009, the record date for the
    special meeting, are entitled to notice of, and to vote at, the
    special meeting and any adjournments or postponements thereof.
    Each share of common stock is entitled to vote on all matters
    that properly come before the special meeting and is entitled to
    one vote on each matter properly brought before the special
    meeting.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 2pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>The Board of Directors of Axsys unanimously recommends that
    Axsys stockholders vote FOR the adoption of the merger
    agreement.</B> Axsys cannot complete the merger unless the
    merger agreement is adopted by Axsys stockholders. Adoption of
    the merger agreement requires the affirmative vote of the
    holders of at least a majority of shares of Axsys common stock
    outstanding and entitled to vote at the special meeting. Stephen
    W. Bershad, who is our Chairman of the Board and Chief Executive
    Officer and who owns in the aggregate 1,666,753, or
    approximately 14.3%, of the shares of our common stock entitled
    to vote at the special meeting, has entered into a voting
    agreement under which he has agreed to vote or cause to be voted
    all of his shares of Axsys common stock <B>FOR </B>the adoption
    of the merger agreement.
</DIV>

<DIV style="margin-top: 2pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The attached proxy statement describes the proposed merger and
    the actions to be taken in connection with the merger and
    provides additional information about the parties involved.
</DIV>

<DIV style="margin-top: 2pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>Whether or not you plan to attend the special meeting, please
    complete, sign and date the enclosed proxy and return it
    promptly in the enclosed postage-paid return envelope, or give
    your proxy by telephone or over the Internet by following the
    instructions on the proxy card. You may revoke the proxy at any
    time prior to its exercise at the special meeting in the manner
    described in the attached proxy statement. Completing a proxy
    now will not prevent you from being able to vote at the special
    meeting by attending in person and casting a vote. Your vote at
    the special meeting will supersede any previously submitted
    proxy.</B>
</DIV>

<DIV style="margin-top: 2pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>If you fail to return your proxy or to attend the special
    meeting in person, your shares will not be counted for purposes
    of determining whether a quorum is present at the special
    meeting and will have the same effect as a vote AGAINST the
    adoption of the merger agreement.</B>
</DIV>

<DIV style="margin-top: 2pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Please do not send any stock certificates at this time.
</DIV>

<DIV style="margin-top: 24pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    By order of the Board of Directors,
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <IMG src="l36705dl3670509.gif" alt="-s- Cynthia McNickle">
</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Cynthia McNickle<BR>
    <I>Secretary</I>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    August&#160;[&#160;&#160;], 2009
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<P align="left" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<DIV align="left">
<!-- TOC -->
</DIV>

<DIV align="left">
<A name="tocpage"></A>
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><U><FONT style="font-family: 'Times New Roman', Times">TABLE
    OF CONTENTS</FONT></U></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="96%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadright -->
</TR>
<!-- Table Width Row END -->
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#101'>SUMMARY</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#102'>Information About the Merger Parties</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#103'>Axsys Technologies, Inc</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#104'>General Dynamics Advanced Information Systems,
    Inc</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#105'>Vision Merger Sub, Inc</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#202'>General Dynamics Corporation</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#203'>Relationship of Parties</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#106'>The Special Meeting (page&#160;12)</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#107'>Date, Time and Place</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#108'>Purpose</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#109'>Record Date; Stockholders Entitled to Vote</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#110'>Voting and Proxies</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#111'>Quorum</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#112'>Vote Required</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#113'>Effect of Abstentions and Broker Non-Votes on
    Voting</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#114'>Expenses of Proxy Solicitation</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#115'>Board Recommendation (page&#160;21)</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#116'>The Merger and the Merger Agreement
    (pages&#160;16 &#038; 38)</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#117'>Structure of the Merger</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#118'>Axsys Common Stock, Including Restricted Common
    Stock</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    4
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#119'>Axsys Stock Options</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#120'>Opinion of Jefferies&#160;&#038; Company,
    Inc.&#160;</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#121'>Conditions to the Merger</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#122'>Termination of the Merger Agreement and
    Termination Fees</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#123'>No Solicitation</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#124'>Governmental Review</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#125'>Voting Agreement (page&#160;54)</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#126'>Certain United States Federal Income Tax
    Consequences (page&#160;32)</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#127'>Interests of Axsys Directors and Executive
    Officers in the Merger (page&#160;28)</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#128'>Appraisal Rights of Axsys Stockholders
    (page&#160;33)</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#129'>QUESTIONS AND ANSWERS ABOUT THE SPECIAL MEETING
    AND THE MERGER</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#130'>The Merger</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#131'>Other Special Meeting Proposals</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#132'>Procedures</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#133'>FORWARD-LOOKING STATEMENTS MAY PROVE
    INACCURATE</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    11
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#134'>THE SPECIAL MEETING</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#135'>Date, Time and Place</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#136'>Record Date; Stockholders Entitled to Vote</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#137'>Quorum</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#138'>PROPOSALS&#160;TO BE CONSIDERED AT THE SPECIAL
    MEETING</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#139'>ITEM&#160;1&#160;&#151; THE MERGER</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#140'>ITEM&#160;2&#160;&#151; APPROVE AN ADJOURNMENT OF
    THE SPECIAL MEETING, IF NECESSARY, TO PERMIT FURTHER
    SOLICITATION OF PROXIES</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    12
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#141'>Stockholder Vote Required to Adopt the Proposals
    at the Special Meeting</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13
</TD>
<TD>&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    i
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left"><FONT size="1">

</FONT></DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="96%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadright -->
</TR>
<!-- Table Width Row END -->
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#142'>Voting</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#143'>Voting and Proxies</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#144'>Revocation of Proxies</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    14
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#145'>Solicitation Costs</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    15
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#146'>Exchange of Stock Certificates</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    15
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#147'>THE MERGER</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    16
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#148'>Background of the Merger</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    16
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#149'>Axsys&#146; Reasons for the Merger</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    19
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#150'>Recommendation of the Board</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    21
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#151'>Opinion of Jefferies&#160;&#038; Company, Inc</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    21
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#152'>Certain Financial Information</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    27
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#153'>Interests of Axsys Directors and Executive
    Officers in the Merger</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    28
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#154'>Treatment of Stock Options</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    28
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#155'>Treatment of Restricted Stock</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    29
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#156'>Employment Agreement and Severance Protection
    Agreements</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    29
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#157'>Indemnification; Directors&#146; and
    Officers&#146; Insurance</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    31
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#158'>Governmental and Regulatory Matters</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    31
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#159'>Certain United States Federal Income Tax
    Consequences</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    32
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#160'>Summary Only</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    32
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#161'>Merger</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    32
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#162'>Appraisal Rights of Axsys Stockholders</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    33
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#163'>Termination of Listing of Shares of Axsys Common
    Stock</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    37
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#201'>Certain Litigation Related to the Merger</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    37
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#164'>THE MERGER AGREEMENT</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    38
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#165'>The Merger</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    38
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#166'>Closing and Effective Time of the Merger</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    38
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#167'>Consideration to be Received in the Merger</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    38
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#168'>Cancellation of Shares</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    38
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#169'>Treatment of Stock Options and Restricted
    Stock</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    38
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#170'>Dissenters&#146; Shares</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    39
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#171'>Payment for Shares</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    39
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#172'>Representations and Warranties</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    40
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#173'>Covenants and Agreements</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    42
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#174'>Conduct of Business of Axsys</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    42
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#175'>Additional Reports</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    44
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#176'>Reasonable Best Efforts, Antitrust
    Filings&#160;&#038; Cooperation</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    44
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#177'>Stockholder Approvals</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    46
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#178'>Access to Information; Confidentiality</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    46
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#179'>No Solicitation</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    46
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#180'>Takeover Laws and Provisions</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    49
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#181'>Stockholder Litigation</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    49
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#182'>Indemnification and Insurance</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    49
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#183'>Employee Matters</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    49
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 30pt">
    <A HREF='#184'>Additional Covenants</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    50
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#185'>Conditions of the Merger</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    50
</TD>
<TD>&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    ii
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left"><FONT size="1">

</FONT></DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="96%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadright -->
</TR>
<!-- Table Width Row END -->
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#186'>Termination</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    51
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#187'>Termination Fees</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    52
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#188'>Effect of Termination</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    52
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#189'>Amendment</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    53
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#190'>Extension; Waiver</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    53
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#191'>THE VOTING AGREEMENT</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    54
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#192'>Voting Matters, Grant of Proxy and Waiver of
    Dissenters Rights</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    54
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#193'>Transfer and Other Restrictions</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    54
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#194'>Termination</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    55
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#195'>MARKET PRICE OF AXSYS COMMON STOCK</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    56
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#196'>AXSYS COMMON STOCK OWNERSHIP</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    57
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#197'>Security Ownership of Directors and Named
    Executive Officers</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    57
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    <A HREF='#198'>Security Ownership of Certain Owners</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    58
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#199'>ADDITIONAL INFORMATION</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    59
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#200'>STOCKHOLDER PROPOSALS&#160;FOR ANNUAL MEETING</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    60
</TD>
<TD>&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV align="left">
<!-- /TOC -->
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><U><FONT style="font-family: 'Times New Roman', Times">ANNEXES</FONT></U></B>
</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="95%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadright -->
</TR>
<!-- Table Width Row END -->
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#204'>Annex&#160;A&#160;&#151; Agreement and Plan of
    Merger</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#205'>Annex&#160;B&#160;&#151; Voting Agreement
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    </A>B-1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#206'>Annex&#160;C&#160;&#151; Opinion of
    Jefferies&#160;&#038; Company, Inc.</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    C-1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#207'>Annex&#160;D&#160;&#151; Section&#160;262 of the
    General Corporation Law of the State of Delaware</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    D-1
</TD>
<TD>&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    iii
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='101'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">PRELIMINARY
    COPY<BR>
    </FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">SUMMARY</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>This summary highlights selected information from this proxy
    statement and may not contain all of the information that is
    important to you. You should carefully read this entire proxy
    statement, including the attached annexes, and the other
    documents to which we have referred you. We have included page
    references parenthetically to direct you to a more complete
    description of the topics presented in this summary.</I>
</DIV>
<A name='102'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">&#149;&#160;&#160;Information
    About the Merger Parties</FONT></B>
</DIV>
</A>
<A name='103'>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Axsys
    Technologies, Inc.</FONT></I></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Axsys Technologies, Inc., which is referred to as Axsys, we, us
    or the Company, designs and manufactures precision optical
    solutions for defense, aerospace, homeland security, and
    commercial applications. Our principal executive offices are
    located at 175 Capital Boulevard, Suite&#160;103, Rocky Hill,
    Connecticut 06067, and our telephone number is
    <FONT style="white-space: nowrap">(860)&#160;257-0200.</FONT>
</DIV>
<A name='104'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">General
    Dynamics Advanced Information Systems, Inc.</FONT></I></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    General Dynamics Advanced Information Systems, Inc., which is
    referred to as GD AIS, is an indirect, wholly owned subsidiary
    of General Dynamics Corporation. GD AIS designs, develops,
    manufactures, integrates, operates and maintains mission systems
    for defense, space, intelligence, surveillance, reconnaissance,
    homeland security and homeland defense customers. Headquartered
    in Fairfax, Va., GD AIS specializes in ground systems; imagery
    processing; mission payloads; space vehicles; maritime
    subsurface, surface and airborne mission systems; and tasking,
    collection, processing, exploitation and dissemination programs
    for national intelligence. GD AIS&#146; principal executive
    offices are located
    <FONT style="white-space: nowrap">c/o&#160;General</FONT>
    Dynamics Corporation at 2941 Fairview Park Drive,
    Suite&#160;100, Falls Church, Virginia 22042, and its telephone
    number is
    <FONT style="white-space: nowrap">(703)&#160;876-3000.</FONT>
</DIV>
<A name='105'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Vision
    Merger Sub, Inc.</FONT></I></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Vision Merger Sub, Inc., a Delaware corporation, which is
    referred to as Merger Sub, is an indirect, wholly owned
    subsidiary of General Dynamics Corporation formed solely for the
    purpose of effecting the merger with Axsys. Merger Sub has not
    conducted any unrelated activities since its organization.
    Merger Sub&#146;s principal executive offices are located
    <FONT style="white-space: nowrap">c/o&#160;General</FONT>
    Dynamics Corporation at 2941 Fairview Park Drive,
    Suite&#160;100, Falls Church, Virginia 22042, and its telephone
    number is
    <FONT style="white-space: nowrap">(703)&#160;876-3000.</FONT>
</DIV>
<A name='202'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">General
    Dynamics Corporation</FONT></I></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    General Dynamics Corporation, which is referred to as General
    Dynamics, offers a broad portfolio of products and services in
    business aviation; combat vehicles, weapons systems, and
    munitions; shipbuilding design and construction; and information
    systems, technologies, and services. General Dynamics serves the
    U.S.&#160;government as well as international defense and
    commercial customers worldwide. General Dynamics&#146; principal
    executive offices are located at 2941 Fairview Park Drive,
    Suite&#160;100, Falls Church, Virginia 22042, and its telephone
    number is
    <FONT style="white-space: nowrap">(703)&#160;876-3000.</FONT>
</DIV>
<A name='203'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Relationship
    of Parties</FONT></I></B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    While Axsys negotiated the merger agreement with General
    Dynamics, General Dynamics and Axsys agreed to have GD AIS, an
    indirect, wholly owned subsidiary of General Dynamics, enter
    into the Merger Agreement for organizational reasons, with
    General Dynamics providing a guaranty of the obligations of GD
    AIS and Merger Sub. See &#147;The Merger&#160;&#151; Background
    of the Merger&#148; on page&#160;16. Upon completion of the
    merger, Axsys will become an indirect, wholly owned subsidiary
    of General Dynamics.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    1
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left"><FONT size="1">

</FONT></DIV>
<A name='106'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">&#149;&#160;&#160;The
    Special Meeting (page&#160;12)</FONT></B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are furnishing this proxy statement to our stockholders as
    part of the solicitation of proxies by our Board for use at the
    special meeting.
</DIV>
<A name='107'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Date,
    Time and Place</FONT></I></B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The special meeting of stockholders of Axsys will be held at
    10:00&#160;a.m. (Eastern Time), on
    September&#160;<B>[&#160;&#160;]</B>, 2009, at Hartford Marriott
    Rocky Hill at Corporate Ridge, 100 Capital Boulevard, Rocky
    Hill, Connecticut, unless postponed to a later date.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<A name='108'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Purpose</FONT></I></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    You will be asked to consider and vote upon a proposal to adopt
    the Agreement and Plan of Merger, which is referred to as the
    merger agreement. The merger agreement provides that Merger Sub
    will merge with and into Axsys, and Axsys will become an
    indirect, wholly owned subsidiary of General Dynamics. Each
    share of Axsys common stock that you own immediately prior to
    the effective time of the merger will be converted into the
    right to receive $54.00 in cash, without interest.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    You may also be asked to vote to approve adjournments of the
    special meeting, if necessary, to permit further solicitation of
    proxies if there are not sufficient votes at the time of the
    special meeting to adopt the merger agreement.
</DIV>
<A name='109'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Record
    Date; Stockholders Entitled to Vote</FONT></I></B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    You are entitled to vote at the special meeting if you owned
    shares of Axsys common stock as of the close of business on
    July&#160;30, 2009, the record date for the special meeting. As
    of the record date, there were 11,624,837&#160;shares of Axsys
    common stock outstanding. You will have one vote on each matter
    submitted to a vote at the special meeting for each share of
    Axsys common stock that you owned as of the close of business on
    the record date.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<A name='110'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Voting
    and Proxies</FONT></I></B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Stockholders can vote or submit a proxy for their shares of
    Axsys common stock on the matters presented at the special
    meeting in four ways. See and read carefully &#147;Proposals to
    be Considered at the Special Meeting&#160;&#151;
    Voting&#160;&#151; Voting and Proxies&#148; beginning on page 13.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;<I>By Proxy.</I>&#160;&#160;You can cause your shares
    to be voted by signing, dating and returning the enclosed proxy
    card. If you do this, the proxies will vote your shares of Axsys
    common stock in the manner you indicate. All properly executed
    proxies that we receive prior to the vote at the special
    meeting, and that are not revoked, will be voted in accordance
    with the instructions indicated on the proxies. If you do not
    indicate instructions on the proxy&#160;card, your shares of
    Axsys common stock will be voted <B>FOR </B>the adoption of the
    merger agreement.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;<I>By Telephone.</I>&#160;&#160;After reading the proxy
    materials and with your proxy and voting instruction form in
    front of you, you may call the toll-free number 1-866-540-5760
    using a touch-tone telephone. You will be prompted to enter your
    control number from your proxy and voting instruction form. This
    number will identify you and Axsys. Then you can follow the
    simple instructions that will be given to you to record your
    proxy.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (c)&#160;<I>Over the Internet.</I>&#160;&#160;After reading the
    proxy materials and with your proxy and voting instruction form
    in front of you, you may use your computer to access the Web
    site
    <U><FONT style="white-space: nowrap">http://www.proxyvoting.com/axys</FONT></U>.
    You will be prompted to enter your control number from your
    proxy and voting instruction form. This number will identify you
    and Axsys. Then you can follow the simple instructions that will
    be given to you to record your proxy.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (d)&#160;<I>In Person.</I>&#160;&#160;You may attend the special
    meeting and cast your vote in person.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Internet and telephone proxy submission procedures have been
    set up for your convenience and have been designed to
    authenticate your identity, allow you to give voting
    instructions and confirm that those instructions have been
    recorded properly.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    2
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If you are a participant in the Axsys 401(k) Retirement Plan and
    hold shares of Axsys common stock within the 401(k) plan, you
    will receive a proxy card that covers shares credited to your
    plan account. That proxy card serves as a voting instruction for
    the trustee of the plan in which you are a participant.
    Participants who wish to vote via the Internet may submit their
    voting instructions at
    <U><FONT style="white-space: nowrap">http://www.proxyvoting.com/axys-esop</FONT></U>.
    If you do not return that proxy card to the plan trustee, or do
    not provide voting instructions via the Internet, the trustee
    will not vote the Axsys shares credited to your account.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The trustee will vote unallocated shares of Axsys common stock
    held in the 401(k) plan in direct proportion to the voting of
    allocated shares in the plan for which voting instructions have
    been received unless otherwise required by applicable law.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Brokers or banks holding shares of Axsys common stock in
    &#147;street name&#148; may vote your shares of Axsys common
    stock on the adoption of the merger agreement and adjournments
    of the special meeting, if necessary, <B>only </B>if you provide
    instructions on how to vote. Brokers or banks will provide you
    with directions on how to instruct the broker or bank to vote
    your shares of Axsys common stock, and you should carefully
    follow these instructions.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    You may revoke your proxy at any time prior to the vote at the
    special meeting by delivering to Axsys&#146; Corporate Secretary
    a signed notice of revocation or submitting a later-dated,
    signed proxy (either manually, telephonically or over the
    Internet) following the instructions provided on the proxy card.
    You also may revoke your proxy by attending the special meeting
    and voting in person. Attendance at the special meeting will
    not, in and of itself, result in the revocation of a proxy or
    cause your shares of Axsys common stock to be voted.
</DIV>
<A name='111'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Quorum</FONT></I></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    A quorum of stockholders is necessary to hold a valid meeting.
    Under our Amended and Restated By-Laws, the holders of a
    majority of the outstanding shares of Axsys common stock,
    present in person or by proxy, constitute a quorum.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If a quorum is not present, the special meeting will be
    postponed until the holders of the number of votes required to
    constitute a quorum attend.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If you submit a properly executed proxy card, even if you
    abstain from voting, your shares of Axsys common stock will be
    counted for purposes of determining whether a quorum is present
    at the special meeting. If additional votes must be solicited to
    adopt the merger agreement, it is expected that the special
    meeting will be postponed or adjourned to solicit additional
    proxies.
</DIV>
<A name='112'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Vote
    Required</FONT></I></B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Adoption of the merger agreement requires the affirmative vote
    of the holders of at least a majority of shares of Axsys common
    stock outstanding and entitled to vote at the special meeting.
    If a quorum is present, a proposal to approve an adjournment of
    the special meeting requires the affirmative vote of a majority
    of the votes cast by the stockholders entitled to vote, present
    in person or by proxy at the special meeting. As of the record
    date, there were 11,624,837&#160;shares of Axsys common stock
    outstanding. Mr.&#160;Bershad, who owns in the aggregate
    1,666,753, or approximately 14.3%, of the shares of our common
    stock entitled to vote at the special meeting, has entered into
    a voting agreement under which he has agreed to vote or cause to
    be voted all of his shares <B>FOR </B>the adoption of the merger
    agreement.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<A name='113'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Effect
    of Abstentions and Broker Non-Votes on Voting</FONT></I></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Abstentions and shares not in attendance and not voted at the
    special meeting will have the same effect as a vote <B>AGAINST
    </B>the proposal to adopt the merger agreement and will have no
    effect on the proposal to adjourn the special meeting. Because
    brokers or banks holding shares of Axsys common stock in
    &#147;street name&#148; may vote your shares of Axsys common
    stock on the adoption of the merger agreement and adjournments
    of the special meeting, if necessary, only if you provide
    instructions on how to vote, your failure to provide
    instructions will result in your shares not being present at the
    meeting and not being voted on either proposal. Consequently,
    there cannot be any broker non-votes occurring in connection
    with either proposal at the special meeting. It is very
    important that <B>ALL </B>
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    3
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    of our stockholders vote their shares of Axsys common stock, so
    please promptly complete and return the enclosed proxy card.
</DIV>
<A name='114'>
<DIV style="margin-top: 16pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Expenses
    of Proxy Solicitation</FONT></I></B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
</A>
</A>
<DIV style="margin-top: 8pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our directors, officers and other employees may solicit proxies
    in person, by telephone, electronically, by mail or other means,
    but they will not be specifically compensated for these
    services. Brokers, banks and other persons will be reimbursed by
    us for expenses they incur in forwarding proxy materials to
    obtain voting instructions from beneficial stockholders. We have
    also hired Georgeson, Inc., which is referred to as Georgeson,
    to assist in the solicitation of proxies. The total cost of
    solicitation of proxies will be borne by us. For a description
    of the costs and expenses to us of soliciting proxies, see
    &#147;Proposals to be Considered at the Special
    Meeting&#160;&#151; Solicitation Costs&#148; on page 15.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 8pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Stockholders should not send in their stock certificates with
    their proxies.</I>&#160;&#160;A letter of transmittal with
    instructions for the surrender of certificates representing
    shares of Axsys common stock will be mailed to stockholders if
    the merger is completed.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<A name='115'>
<DIV style="margin-top: 16pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Board
    Recommendation (page&#160;21)</FONT></B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
</A>
<DIV style="margin-top: 8pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Board has found and declared that the merger agreement and
    the merger are advisable to and in the best interests of the
    Company and its stockholders, has unanimously approved the
    merger agreement and unanimously recommends that our
    stockholders vote <B>FOR </B>the adoption of the merger
    agreement. The Board considered many factors in reaching its
    conclusion, including, without limitation, the value that
    stockholders would realize in the merger compared to the value
    likely to be realized by stockholders in the event the Company
    remained independent, the current and historical market prices
    of Axsys shares relative to the $54.00 per share merger
    consideration, and the fact that the merger consideration
    consists entirely of cash. See and read carefully &#147;The
    Merger&#160;&#151; Axsys&#146; Reasons for the Merger&#148;
    beginning on page&#160;19.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 8pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Board also unanimously recommends that you vote <B>FOR
    </B>any adjournment of the special meeting, if necessary, to
    permit solicitation of further proxies if there are not
    sufficient votes at the time of the special meeting to adopt the
    merger agreement.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<A name='116'>
<DIV style="margin-top: 16pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">The
    Merger and the Merger Agreement (pages&#160;16 &#038;
    38)</FONT></B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
</A>
<DIV style="margin-top: 8pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The rights and obligations of the parties to the merger
    agreement are governed by the specific terms and conditions of
    the merger agreement and not by any summary or other information
    in this proxy statement. Therefore, the information in this
    proxy statement regarding the merger agreement and the merger is
    qualified in its entirety by reference to the merger agreement,
    a copy of which is attached as <U>Annex&#160;A</U> to this proxy
    statement. We encourage you to read the merger agreement
    carefully and in its entirety because it is the principal legal
    agreement that governs the merger.
</DIV>
<A name='117'>
<DIV style="margin-top: 16pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Structure
    of the Merger</FONT></I></B>
</DIV>
</A>
<DIV style="margin-top: 8pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    At the effective time of the merger, Merger Sub, an indirect,
    wholly owned subsidiary of General Dynamics, will be merged with
    and into Axsys. Axsys will continue as the surviving corporation
    of the merger and become an indirect, wholly owned subsidiary of
    General Dynamics.
</DIV>
<A name='118'>
<DIV style="margin-top: 16pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Axsys
    Common Stock, Including Restricted Common Stock</FONT></I></B>
</DIV>
</A>
<DIV style="margin-top: 8pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    At the effective time of the merger, each outstanding share of
    Axsys common stock, including restricted stock, which will
    become fully vested, will be converted into the right to receive
    $54.00 in cash, without interest, less any applicable
    withholding tax. After the effective time of the merger, shares
    of Axsys common stock will no longer be publicly traded.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    4
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='119'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Axsys
    Stock Options</FONT></I></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Pursuant to the merger agreement, at the effective time of the
    merger, each option outstanding immediately prior to the
    effective time of the merger will become fully vested and will
    be converted into the right to receive the excess, if any, of
    $54.00 (without interest) over the exercise price per share of
    the stock option multiplied by the number of shares of Axsys
    common stock subject to the stock option, less any applicable
    withholding tax. No consideration will be payable in respect of
    any options with an exercise price per share equal to or in
    excess of $54.00 as of immediately prior to the effective time
    of the merger, and all such options will be cancelled
    automatically at the effective time of the merger.
</DIV>
<A name='120'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Opinion
    of Jefferies&#160;&#038; Company, Inc.</FONT></I></B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Jefferies&#160;&#038; Company, Inc., which is referred to as
    Jefferies, has delivered its opinion to the Board to the effect
    that, as of June&#160;3, 2009 and based upon and subject to the
    various considerations and assumptions set forth therein, the
    merger consideration to be received by the holders of shares of
    Axsys common stock pursuant to the merger agreement was fair,
    from a financial point of view, to those holders. The full text
    of the written opinion of Jefferies, dated June&#160;3, 2009, is
    attached to this proxy statement as <U>Annex&#160;C</U>. <B>We
    urge you to read that opinion carefully and in its entirety.
    Jefferies&#146; opinion was provided to the Board in connection
    with the Board&#146;s consideration of the merger and addresses
    only the fairness, from a financial point of view and as of the
    date of Jefferies&#146; opinion, of the merger consideration to
    be received by the holders of Axsys common stock pursuant to the
    merger agreement and does not address any other aspect of the
    merger. Jefferies&#146; opinion does not constitute a
    recommendation as to how any holder of Axsys common stock should
    vote on the merger or any matter related thereto. </B>Axsys has
    agreed to pay Jefferies a fee for its services, based upon a
    percentage of the transaction value, in the amount of
    approximately $7&#160;million, of which $1.5&#160;million was
    earned upon delivery of Jefferies&#146; opinion, and the balance
    of which is payable contingent upon consummation of the merger,
    as described in greater detail on page 21.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<A name='121'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Conditions
    to the Merger</FONT></I></B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Consummation of the merger is subject to customary conditions,
    including, among others, (i)&#160;adoption of the merger
    agreement by Axsys&#146; stockholders, (ii)&#160;expiration or
    termination of the applicable waiting period of the
    <FONT style="white-space: nowrap">Hart-Scott-Rodino</FONT>
    Antitrust Improvements Act of 1976, as amended, which is
    referred to as the HSR Act, (iii)&#160;absence of any order or
    injunction prohibiting the consummation of the merger,
    (iv)&#160;the accuracy of representations and warranties with
    respect to Axsys&#146; business and compliance by Axsys with its
    covenants contained in the merger agreement and
    (v)&#160;stockholders owning no more than 12% of Axsys
    outstanding common stock dissenting from the merger.
    Consummation of the merger is not subject to any financing
    conditions, GD AIS has represented to us that it has sufficient
    financial resources to consummate the transactions and General
    Dynamics has guaranteed GD AIS&#146;s performance under the
    merger agreement. See and read carefully &#147;The Merger
    Agreement&#160;&#151; Conditions of the Merger&#148; beginning
    on page 50. We can offer no assurance that all of the conditions
    will be satisfied or waived or that the merger will occur.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<A name='122'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Termination
    of the Merger Agreement and Termination Fees</FONT></I></B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The merger agreement may be terminated by the mutual written
    consent of us and GD AIS or by either us or GD AIS, under
    certain specified circumstances. Upon termination of the merger
    agreement under certain specified circumstances, we may be
    required to pay a termination fee of $23.6&#160;million to GD
    AIS <FONT style="white-space: nowrap">and/or</FONT>
    may be required to reimburse GD AIS and General Dynamics for
    certain expenses incurred in connection with the merger of up to
    $2.0&#160;million. See and read carefully &#147;The Merger
    Agreement&#160;&#151; Termination&#148; beginning on page 51,
    &#147;The Merger Agreement&#160;&#151; Termination Fees&#148;
    beginning on page 52 and &#147;The Merger Agreement&#160;&#151;
    Effect of Termination&#148; beginning on page 52.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    5
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='123'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">No
    Solicitation</FONT></I></B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The merger agreement restricts our ability to solicit or engage
    in discussions or negotiations with third parties regarding
    proposals to acquire a significant interest in us. However,
    subject to specified conditions, we may furnish information to,
    or enter into discussions or negotiations with a third party in
    response to an unsolicited acquisition proposal from such third
    party if our Board determines in good faith (after consultation
    with outside legal counsel and its financial advisor) such
    actions would reasonably be expected to result in such
    acquisition proposal becoming a superior proposal and the Board
    determines in good faith that the failure to take such actions
    would violate its fiduciary duties. See and read carefully
    &#147;The Merger Agreement&#160;&#151; Covenants and
    Agreements&#160;&#151; No Solicitation&#148; beginning on page
    46.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<A name='124'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Governmental
    Review</FONT></I></B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The merger is subject to review under the HSR Act. Under the
    provisions of the HSR Act, the merger cannot be completed until
    the companies have made required notifications, given certain
    information and materials to the U.S.&#160;Federal Trade
    Commission, which is referred to as the FTC, and to the
    antitrust division of the U.S.&#160;Department of Justice, which
    is referred to as the Antitrust Division, and a required
    <FONT style="white-space: nowrap">30-day</FONT>
    waiting period has expired or been terminated. We and GD AIS
    initially filed the notifications required under the HSR Act
    with the FTC and the Antitrust Division on June&#160;8, 2009. On
    July&#160;8, 2009, GD AIS withdrew its original notifications
    and on July&#160;9, 2009, re-filed them with the FTC and
    Antitrust Division in order to provide more time for review. The
    <FONT style="white-space: nowrap">30-day</FONT>
    waiting period, which cannot expire on a Saturday, Sunday or a
    U.S.&#160;federal holiday, will expire at 11:59&#160;p.m.
    Eastern Time on August&#160;10, 2009, unless the FTC or the
    Antitrust Division earlier terminates the waiting period or
    makes a request for more information related to the merger. See
    and read carefully &#147;The Merger&#160;&#151; Governmental and
    Regulatory Matters&#148; beginning on page 31.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<A name='125'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Voting
    Agreement (page&#160;54)</FONT></B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In connection with the merger agreement, Mr.&#160;Bershad, who
    beneficially owns 1,666,753, or approximately 14.3%, of the
    shares of our common stock entitled to vote at the special
    meeting, entered into a voting agreement with GD AIS and Merger
    Sub and agreed to vote or cause to be voted all of his shares of
    Axsys common stock at the time of the special meeting for the
    adoption of the merger agreement at the special meeting. The
    information in this proxy statement regarding the voting
    agreement is qualified in its entirety by reference to the
    voting agreement, a copy of which is attached as
    <U>Annex&#160;B</U> to this proxy statement.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<A name='126'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Certain
    United States Federal Income Tax Consequences
    (page&#160;32)</FONT></B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Subject to the exceptions discussed below in &#147;The
    Merger&#160;&#151; Certain United States Federal Income Tax
    Consequences,&#148; a holder of shares of Axsys common stock
    will recognize taxable gain or loss for United States federal
    income tax purposes equal to the difference between (1)&#160;the
    amount of cash such holder receives and (2)&#160;the adjusted
    tax basis of such holder&#146;s shares of Axsys common stock
    exchanged therefor.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    You should read &#147;The Merger&#160;&#151; Certain United
    States Federal Income Tax Consequences&#148; beginning on
    page&#160;32 for a more complete discussion of certain United
    States federal income tax consequences of the merger. Tax
    matters can be complicated, and the tax consequences of the
    merger to you will depend on your particular circumstances. We
    urge you to consult your own tax advisor to fully understand the
    tax consequences of the merger to you (including the application
    and effect of any state, local, or foreign income and other tax
    laws).
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<A name='127'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Interests
    of Axsys Directors and Executive Officers in the Merger
    (page&#160;28)</FONT></B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    When considering the recommendation of the Board with respect to
    the adoption of the merger agreement, you should be aware that
    some of our directors and executive officers have interests in
    the merger that may be different from, or in addition to, their
    interests as stockholders and the interests of stockholders
    generally. The Board was aware of these interests during its
    deliberations on the merits of the merger and in deciding to
    recommend that you vote for the adoption of the merger agreement
    at the special meeting. For a more detailed discussion of these
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    6
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
     interests, see &#147;The Merger&#160;&#151; Interests of Axsys
    Directors and Executive Officers in the Merger&#148; beginning
    on page&#160;28.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<A name='128'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Appraisal
    Rights of Axsys Stockholders (page&#160;33)</FONT></B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Holders of shares of Axsys common stock who do not wish to
    accept the consideration payable pursuant to the merger
    agreement may seek, under Section&#160;262 of the General
    Corporation Law of the State of Delaware, which is referred to
    as the DGCL, judicial appraisal of the fair value of their
    shares by the Delaware Court of Chancery. This value could be
    more than, less than, or the same as the merger consideration
    for shares of Axsys common stock. Failure to strictly comply
    with all procedures required by Section&#160;262 of the DGCL
    will result in a loss of the right to appraisal, in which event,
    each share held by the Axsys stockholder will be deemed to have
    been converted into the right to receive the $54.00 merger
    consideration, payable in cash (without interest) pursuant to
    the merger agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Merely voting against the adoption of the merger agreement will
    not preserve your right to appraisal under the DGCL. Also,
    because a submitted proxy not marked &#147;against&#148; or
    &#147;abstain&#148; will be voted &#147;for&#148; the proposal
    to adopt the merger agreement, the submission of a proxy not
    marked &#147;against&#148; or &#147;abstain&#148; will result in
    the waiver of appraisal rights. If you hold shares in the name
    of a broker or other nominee, you must cause your nominee to
    take the steps necessary to enable you to demand appraisal for
    your shares.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <U>Annex&#160;D</U> to this proxy statement contains the full
    text of Section&#160;262 of the DGCL, which relates to appraisal
    rights. We encourage you to read these provisions carefully and
    in their entirety.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    7
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='129'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">QUESTIONS
    AND ANSWERS ABOUT THE SPECIAL MEETING AND THE MERGER</FONT></B>
</DIV>
</A>
<A name='130'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">The
    Merger</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR>
    <TD valign="top">
    <B>Q. </B></TD>
    <TD></TD>
    <TD valign="bottom">
    <B>Why am I receiving this proxy statement?</B></TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    A. </TD>
    <TD></TD>
    <TD valign="bottom">
    GD AIS has agreed to acquire Axsys under the terms of the merger
    agreement that is described in this proxy statement. A copy of
    the merger agreement is attached to this proxy statement as
    <U>Annex&#160;A</U>.</TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR>
    <TD valign="top">
</TD>
    <TD></TD>
    <TD valign="bottom">
    In order to complete the merger, our stockholders must vote to
    adopt the merger agreement. We are seeking to obtain this
    approval at the special meeting to be held on September
    <B>[&#160;&#160;]</B>, 2009. The approval of this proposal by
    our stockholders is a condition to the effectiveness of the
    merger. See &#147;The Merger Agreement&#160;&#151; Conditions of
    the Merger&#148; beginning on page 50.</TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR>
    <TD valign="top">
</TD>
    <TD></TD>
    <TD valign="bottom">
    This proxy statement, which you should read carefully, contains
    important information about the merger, the merger agreement and
    the special meeting of our stockholders. The enclosed voting
    materials allow you to vote your shares without attending the
    special meeting.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
</TD>
    <TD></TD>
    <TD valign="bottom">
    Your vote is very important. We encourage you to vote as soon as
    possible.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    <B>Q. </B></TD>
    <TD></TD>
    <TD valign="bottom">
    <B>What is the position of the Board regarding the merger?</B></TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    A. </TD>
    <TD></TD>
    <TD valign="bottom">
    The Axsys Board of Directors, which is referred to as the Board,
    has unanimously approved the merger agreement and the
    transactions contemplated by the merger agreement, including the
    merger, and has determined that the merger is advisable to and
    in the best interests of Axsys and its stockholders. The Board
    unanimously recommends that Axsys stockholders vote <B>FOR
    </B>the proposal to adopt the merger agreement at the special
    meeting. See &#147;The Merger&#160;&#151; Axsys&#146; Reasons
    for the Merger&#148; beginning on page&#160;19.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    <B>Q. </B></TD>
    <TD></TD>
    <TD valign="bottom">
    <B>What vote of Axsys stockholders is required to adopt the
    merger agreement?</B></TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    A. </TD>
    <TD></TD>
    <TD valign="bottom">
    The adoption of the merger agreement requires the affirmative
    vote of the holders of at least a majority of the shares of
    Axsys common stock outstanding and entitled to vote at the
    special meeting. If an Axsys stockholder does not vote, it will
    have the same effect as a vote <B>AGAINST</B> the adoption of
    the merger agreement. Mr.&#160;Bershad, who is our Chairman of
    the Board and Chief Executive Officer and who owns in the
    aggregate 1,666,753, or approximately 14.3%, of the shares of
    our common stock entitled to vote at the special meeting, has
    entered into a voting agreement under which he has agreed to
    vote or cause to be voted all of his shares of Axsys common
    stock <B>FOR </B>the adoption of the merger agreement.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    <B>Q. </B></TD>
    <TD></TD>
    <TD valign="bottom">
    <B>How do Axsys directors and executive officers intend to vote
    their shares of Axsys common stock in respect of adoption of the
    merger agreement?</B></TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR>
    <TD valign="top">
    A. </TD>
    <TD></TD>
    <TD valign="bottom">
    All of our directors and all of our executive officers, who
    collectively own approximately 16.1% of the shares of our common
    stock entitled to vote at the special meeting, have informed us
    that they currently intend to vote all of their shares of Axsys
    common stock <B>FOR </B>the adoption of the merger agreement.
    Consequently, approximately 33.9% of our shares of common stock,
    or approximately 3,936,700 shares of common stock, not held by
    directors or executive officers must be voted in favor of
    adoption of the merger agreement for this proposal to be
    approved.</TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR>
    <TD valign="top">
    <B>Q. </B></TD>
    <TD></TD>
    <TD valign="bottom">
    <B>When does Axsys expect the merger to be completed?</B></TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    A. </TD>
    <TD></TD>
    <TD valign="bottom">
    We are working to complete the merger as quickly as reasonably
    practical. In addition to obtaining stockholder approval, we
    must satisfy all other closing conditions, including the
    expiration or termination of applicable regulatory waiting
    periods. We currently expect to complete the merger in the third
    quarter of 2009.</TD>
</TR>

<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    <B>Q. </B></TD>
    <TD></TD>
    <TD valign="bottom">
    <B>What will happen to my shares of Axsys common stock after the
    merger?</B></TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    A. </TD>
    <TD></TD>
    <TD valign="bottom">
    Upon completion of the merger, each issued and outstanding share
    of Axsys common stock will automatically be converted into the
    right to receive $54.00 in cash, without interest, which is
    referred to as the merger consideration.</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    8
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR>
    <TD valign="top">
    <B>Q. </B></TD>
    <TD></TD>
    <TD valign="bottom">
    <B>Should I send in my stock certificates now?</B></TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    A. </TD>
    <TD></TD>
    <TD valign="bottom">
    No.&#160;Please do not send in your stock certificates with your
    proxy. If the merger is completed, within two business days of
    the effective date of the merger a separate letter of
    transmittal with instructions for the surrender of your Axsys
    stock certificates will be mailed to you. Stockholders can
    expect to receive payment following receipt by the disbursing
    agent of a completed and duly executed letter of transmittal and
    the certificate(s) representing the shares of Axsys common stock
    owned by such stockholder.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    <B>Q. </B></TD>
    <TD></TD>
    <TD valign="bottom">
    <B>Who can help answer my questions about the merger?</B></TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    A. </TD>
    <TD></TD>
    <TD valign="bottom">
    If you have any questions about the merger or if you need
    additional copies of this proxy statement or the enclosed proxy
    card, you should contact us at: Axsys Technologies, Inc., 175
    Capital Boulevard, Suite&#160;103, Rocky Hill, Connecticut
    06067, Attention: Corporate Secretary, or you may contact
    Georgeson, our proxy solicitor, at:</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="36%"></TD>
    <TD width="1%"></TD>
    <TD width="63%"></TD>
</TR>

<TR>
    <TD valign="top">
</TD>
    <TD></TD>
    <TD valign="bottom">
    Georgeson, Inc.<BR>
    199 Water Street&#160;&#151;
    26<SUP style="font-size: 85%; vertical-align: top">th</SUP>

    Floor<BR>
    New York, NY 10038<BR>
    Banks and Brokers Call: (212) 440-9800<BR>
    All Others Call Toll Free: (888) 264-6994</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="31%"></TD>
    <TD width="1%"></TD>
    <TD width="68%"></TD>
</TR>

<TR>
    <TD valign="top">
</TD>
    <TD></TD>
    <TD valign="bottom">
    <A name='131'><B>Other Special Meeting Proposals</B></A></TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR>
    <TD valign="top">
    <B>Q. </B></TD>
    <TD></TD>
    <TD valign="bottom">
    <B>On what other proposals am I being asked to vote at the
    special meeting?</B></TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    A. </TD>
    <TD></TD>
    <TD valign="bottom">
    At the special meeting, in addition to voting on the adoption of
    the merger agreement, Axsys stockholders may&#160;be asked to
    approve adjournments of the special meeting, if necessary, to
    permit further solicitation of proxies if there are not
    sufficient votes at the time of the special meeting to adopt the
    merger agreement.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    <B>Q. </B></TD>
    <TD></TD>
    <TD valign="bottom">
    <B>What vote is necessary to approve an adjournment of the
    special meeting?</B></TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    A. </TD>
    <TD></TD>
    <TD valign="bottom">
    The proposal to approve adjournments of the special meeting
    requires the affirmative vote of a majority of the votes cast by
    the stockholders entitled to vote, present in person or by proxy
    at the special meeting. If an Axsys stockholder does not vote,
    it will have no effect on the outcome of any vote to adjourn the
    special meeting.</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="31%"></TD>
    <TD width="1%"></TD>
    <TD width="68%"></TD>
</TR>

<TR>
    <TD valign="top">
</TD>
    <TD></TD>
    <TD valign="bottom">
    <A name='132'><B>Procedures</B></A></TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR>
    <TD valign="top">
    <B>Q. </B></TD>
    <TD></TD>
    <TD valign="bottom">
    <B>When and where is the special meeting?</B></TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR>
    <TD valign="top">
    A. </TD>
    <TD></TD>
    <TD valign="bottom">
    The special meeting will be held at 10:00&#160;a.m. (Eastern
    Time), on September&#160;<B>[&#160;&#160;]</B>, 2009, at
    Hartford Marriott Rocky Hill at Corporate Ridge,
    100&#160;Capital Boulevard, Rocky Hill, Connecticut, unless
    postponed to a later date.</TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR>
    <TD valign="top">
    <B>Q. </B></TD>
    <TD></TD>
    <TD valign="bottom">
    <B>If I am going to attend the special meeting, should I return
    my proxy card(s)?</B></TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR>
    <TD valign="top">
    A. </TD>
    <TD></TD>
    <TD valign="bottom">
    Yes. Returning your signed and dated proxy card(s) ensures that
    your shares will be represented and voted at the special
    meeting. You may revoke your proxy at any time prior to the vote
    at the special meeting by delivering to our Corporate Secretary
    a signed notice of revocation or submitting a later-dated,
    signed proxy (either manually, telephonically or over the
    Internet) following the instructions provided on the proxy card.
    You also may revoke your proxy by attending the special meeting
    and voting in person. See &#147;Summary&#160;&#151; The Special
    Meeting&#160;&#151; Voting and Proxies&#148; on page 2.</TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR>
    <TD valign="top">
    <B>Q. </B></TD>
    <TD></TD>
    <TD valign="bottom">
    <B>If my Axsys shares are held in &#147;street name&#148; by my
    broker or bank, will my broker or bank vote my shares for me?</B></TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    A. </TD>
    <TD></TD>
    <TD valign="bottom">
    Your broker or bank will vote your shares of Axsys common stock
    for you on the adoption of the merger agreement and approval of
    an adjournment of the special meeting, if necessary, <B>only
    </B>if you provide instructions on how to vote. You should
    follow the directions provided by your broker or bank regarding
    how to instruct your broker or bank to vote your shares of Axsys
    common stock. If you do not provide instructions to your bank or
    broker, your shares of Axsys common stock will not be voted on
    the proposal to adopt the merger agreement, which will have the
    effect of a vote <B>AGAINST </B>the adoption of the merger
    agreement. If you do not provide </TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    9
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR>
    <TD valign="top">
</TD>
    <TD></TD>
    <TD valign="bottom">
    instructions to your bank or broker, your shares of Axsys common
    stock will not be voted on a proposal to adjourn the special
    meeting, if necessary, which will have no effect on the outcome
    of any vote to adjourn the special meeting.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    <B>Q. </B></TD>
    <TD></TD>
    <TD valign="bottom">
    <B>How do I vote my Axsys common stock held in the Axsys 401(k)
    Retirement Plan?</B></TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR>
    <TD valign="top">
    A. </TD>
    <TD></TD>
    <TD valign="bottom">
    If you are a participant in the Axsys 401(k) Retirement Plan and
    hold shares of Axsys common stock within the 401(k) plan, you
    will receive a proxy card that covers shares credited to your
    plan account. That proxy card serves as a voting instruction for
    the trustee of the plan in which you are a participant.
    Participants who wish to vote via the Internet may submit their
    voting instructions at
    <U><FONT style="white-space: nowrap">http://www.proxyvoting.com/axys-esop</FONT></U>.
    If you do not return the proxy card to the plan trustee or do
    not provide voting instructions via the Internet, the trustee
    will not vote the Axsys shares credited to your account.</TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR>
    <TD valign="top">
</TD>
    <TD></TD>
    <TD valign="bottom">
    The trustee will vote unallocated shares of Axsys common stock
    held in the 401(k) plan in direct proportion to the voting of
    allocated shares in the plan for which voting instructions have
    been received unless otherwise required by applicable law.</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    <B>Q. </B></TD>
    <TD></TD>
    <TD valign="bottom">
    <B>Where can I find more information about Axsys?</B></TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="3%"></TD>
    <TD width="1%"></TD>
    <TD width="96%"></TD>
</TR>

<TR>
    <TD valign="top">
    A. </TD>
    <TD></TD>
    <TD valign="bottom">
    You can find more information about us from various sources
    described in &#147;Additional Information&#148; on page&#160;59.</TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    10
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='133'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">FORWARD-LOOKING
    STATEMENTS MAY PROVE INACCURATE</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Certain statements and assumptions in this proxy statement are
    based on &#147;forward-looking&#148; information and involve
    risks and uncertainties. We believe that such statements are
    &#147;forward-looking statements&#148; within the meaning of the
    Private Securities Litigation Reform Act of 1995. These
    statements include those that may predict, forecast, indicate or
    imply future results, performance or achievements. These
    statements are subject to numerous risks, assumptions and
    uncertainties that could cause actual results, performance or
    achievements to differ materially from those suggested by our
    forward-looking statements. Although we believe that the
    assumptions on which our forward-looking statements are based
    are reasonable, any of those assumptions could prove to be
    inaccurate, and, as a result, the forward-looking statements
    could be incorrect. Such risks, assumptions and uncertainties
    include the ability to obtain required regulatory approvals for
    the transaction; the failure of Axsys stockholders to adopt the
    merger agreement; the occurrence of any event, change or other
    circumstance that could give rise to the termination of the
    merger agreement; the outcome of any legal proceeding that may
    be instituted against us and others following the announcement
    of the merger agreement; the failure to close for any other
    reason; the amount of the costs, fees, expenses and charges
    related to the merger; the effect of the announcement of the
    merger on our customer relationships, operating results and
    business generally, including the ability to retain key
    employees; and disruption from the transaction making it more
    difficult to maintain relationships with customers, employees or
    suppliers. Additional important factors, which could cause
    actual results to differ materially, include without limitation:
    changes in the U.S.&#160;federal government spending priorities
    including, without limitation, as a result of the current
    economic downturn; the Company&#146;s ability to compete in the
    industries in which it operates, including the introduction of
    competing products or technologies by other companies
    <FONT style="white-space: nowrap">and/or</FONT>
    pricing pressures from competitors
    <FONT style="white-space: nowrap">and/or</FONT>
    customers; the potential for the Company&#146;s backlog to be
    reduced or cancelled; the Company&#146;s ability to implement
    its acquisition strategy and integrate its acquired companies
    successfully; the Company&#146;s ability to manage costs under
    the Company&#146;s fixed-price contracts effectively; and
    changes in general economic and business conditions. These
    statements reflect the Company&#146;s current beliefs and are
    based upon information currently available to the Company. We do
    not undertake any obligation to update or release any revisions
    to any forward- looking statements or to report any events or
    circumstances after the date of this proxy statement or to
    reflect the occurrence of unanticipated events, except as
    required by law.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Words such as &#147;anticipates,&#148; &#147;believes,&#148;
    &#147;estimates,&#148; &#147;expects,&#148; &#147;intends,&#148;
    &#147;plans,&#148; &#147;hopes,&#148; &#147;targets&#148; or
    similar expressions are intended to identify forward-looking
    statements, which speak only as to the date of this proxy
    statement. It is not possible to predict all risk factors or to
    estimate the impact of these factors. Accordingly, stockholders
    should not place undue reliance on our forward-looking
    statements.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    11
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='134'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">THE
    SPECIAL MEETING</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are furnishing this proxy statement to our stockholders as
    part of the solicitation of the enclosed proxy card by our Board
    for use at the special meeting in connection with the proposed
    merger and the other items to be voted on at the special
    meeting. This proxy statement provides our stockholders with the
    information they need to know to be able to vote or instruct
    their vote to be cast at the special meeting.
</DIV>
<A name='135'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Date,
    Time and Place</FONT></B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We will hold the special meeting on
    September&#160;<B>[&#160;&#160;]</B>, 2009 at 10:00&#160;a.m.
    (Eastern Time), at Hartford Marriott Rocky Hill at Corporate
    Ridge, 100&#160;Capital Boulevard, Rocky Hill, Connecticut,
    unless postponed to a later date.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<A name='136'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Record
    Date; Stockholders Entitled to Vote</FONT></B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The record date for the special meeting is July&#160;30, 2009.
    Record holders of shares of Axsys common stock at the close of
    business on the record date are entitled to vote or have their
    votes cast at the special meeting. On the record date, there
    were 11,624,837 outstanding shares of Axsys common stock.
    Stockholders will have one vote for the merger and any other
    matter properly brought before the special meeting for each
    share of Axsys common stock they owned at the close of business
    on the record date.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<A name='137'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Quorum</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    A quorum of stockholders is necessary to hold a valid meeting.
    Under our Amended and Restated By-Laws, the holders of a
    majority of the outstanding shares of Axsys common stock,
    present in person or by proxy, constitute a quorum. Abstentions
    are counted as present for establishing a quorum.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If a quorum is not present, the special meeting will be
    postponed until the holders of the number of votes required to
    constitute a quorum attend.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If you submit a properly executed proxy card, even if you
    abstain from voting or vote against the adoption of the merger
    agreement, your shares of Axsys common stock will be counted for
    purposes of calculating whether a quorum is present at the
    special meeting. If additional votes must be solicited to adopt
    the merger agreement, it is expected that the meeting will be
    postponed or adjourned to solicit additional proxies.
</DIV>
<A name='138'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">PROPOSALS&#160;TO
    BE CONSIDERED AT THE SPECIAL MEETING</FONT></B>
</DIV>
</A>
<A name='139'>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">ITEM&#160;1&#160;&#151;
    THE MERGER</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    As discussed elsewhere in this proxy statement, our stockholders
    will consider and vote on a proposal to adopt the merger
    agreement. You should carefully read this proxy statement in its
    entirety for more detailed information concerning the merger
    agreement and the merger. In particular, you should read in its
    entirety the merger agreement, which is attached as
    <U>Annex&#160;A</U> to this proxy statement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>The Board unanimously recommends that Axsys stockholders vote
    FOR the adoption of the merger agreement.</B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If you return a properly executed proxy card but do not indicate
    instructions on your proxy card, your shares of Axsys common
    stock represented by such proxy card will be voted <B>FOR
    </B>the adoption of the merger agreement.
</DIV>
<A name='140'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">ITEM&#160;2&#160;&#151;
    APPROVE AN ADJOURNMENT OF THE<BR>
    SPECIAL MEETING, IF NECESSARY, TO PERMIT<BR>
    FURTHER SOLICITATION OF PROXIES</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Stockholders may be asked to vote on a proposal to adjourn the
    special meeting, if necessary, to permit further solicitation of
    proxies if there are not sufficient votes at the time of the
    special meeting to adopt the merger agreement.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    12
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>The Board unanimously recommends that stockholders vote FOR a
    proposal to adjourn the special meeting.</B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If you return a properly executed proxy card but do not indicate
    instructions on your proxy card, your shares of Axsys common
    stock represented by such proxy card will be voted <B>FOR </B>a
    proposal to adjourn the special meeting.
</DIV>
<A name='141'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Stockholder
    Vote Required to Adopt the Proposals at the Special
    Meeting</FONT></B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Adoption of the merger agreement requires the affirmative vote
    of the holders of at least a majority of shares of Axsys common
    stock outstanding and entitled to vote at the special meeting.
    Mr.&#160;Bershad, who owns in the aggregate 1,666,753, or
    approximately 14.3%, of the shares of our common stock entitled
    to vote at the special meeting, has entered into a voting
    agreement under which he has agreed to vote or cause to be voted
    all of his shares <B>FOR </B>the adoption of the merger
    agreement. All of our directors and all of our executive
    officers, who collectively own approximately 16.1% of the shares
    of Axsys common stock entitled to vote at the special meeting,
    have informed us that they intend to vote all of their shares of
    Axsys common stock <B>FOR</B> the adoption of the merger
    agreement. Consequently, approximately 33.9% of our shares of
    common stock, or approximately 3,936,700&#160;shares of common
    stock, not held by directors or executive officers must be voted
    in favor of adoption of the merger agreement for this proposal
    to be approved.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Abstentions and shares not in attendance at the special meeting
    will have the same effect as a vote <B>AGAINST </B>the proposal
    to adopt the merger agreement. An abstention occurs when a
    stockholder marks a proxy card to abstain from voting for or
    against a proposal.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If a quorum is present, approval of adjournments of the special
    meeting requires the affirmative vote of a majority of the votes
    cast by the stockholders entitled to vote present in person or
    represented by proxy at the special meeting. Abstentions and
    shares not in attendance at the special meeting will have no
    effect on the outcome of any vote to adjourn the special meeting.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Because brokers and banks holding shares of Axsys common stock
    in &#147;street name&#148; may vote your shares of Axsys common
    stock on the adoption of the merger agreement and adjournments
    of the special meeting, if necessary, only if you provide
    instructions on how to vote, your failure to provide
    instructions will result in your shares not being present at the
    meeting and not being voted on either proposal.  Consequently,
    there cannot be any broker non-votes occurring in connection
    with either proposal at the special meeting.
</DIV>
<A name='142'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Voting</FONT></B>
</DIV>
</A>
<A name='143'>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Voting
    and Proxies</FONT></I></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Stockholders who hold shares of Axsys common stock can vote or
    submit a proxy for shares on matters presented at the special
    meeting in four ways:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;<I>By Proxy.</I>&#160;&#160;You can cause your shares
    to be voted by signing, dating and returning the enclosed proxy
    card. If you do this, the proxies will vote your shares of Axsys
    common stock in the manner you indicate. All properly executed
    proxy cards that we receive prior to the vote at the special
    meeting, and that are not revoked, will be voted in accordance
    with the instructions indicated on the proxy cards. If you sign,
    date and return but do not indicate instructions on the card,
    your shares of Axsys common stock will be voted <B>FOR </B>the
    adoption of the merger agreement.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;<I>By Telephone.</I>&#160;&#160;After reading the proxy
    materials and with your proxy and voting instruction form in
    front of you, you may call the toll-free number 1-866-540-5760
    using a touch-tone telephone. You will be prompted to enter your
    control number from your proxy and voting instruction form. This
    number will identify you and Axsys. Then you can follow the
    simple instructions that will be given to you to record your
    proxy.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (c)&#160;<I>Over the Internet.</I>&#160;&#160;After reading the
    proxy materials and with your proxy and voting instruction form
    in front of you, you may use your computer to access the Web
    site
    <U><FONT style="white-space: nowrap">http://www.proxyvoting.com/axys</FONT></U>.
    You will be prompted to enter your control number from your
    proxy and voting instruction form. This number will identify you
    and Axsys. Then you can follow the simple instructions that will
    be given to you to record your proxy.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    13
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (d)&#160;<I>In Person.</I>&#160;&#160;You may attend the special
    meeting and cast your vote in person.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Internet and telephone proxy submission procedures have been
    set up for your convenience and have been designed to
    authenticate your identity, allow you to give voting
    instructions and confirm that those instructions have been
    recorded properly.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If you are a participant in the Axsys 401(k) Retirement Plan and
    hold shares of Axsys common stock within the 401(k) plan, you
    will receive a proxy card that covers shares credited to your
    plan account. This proxy card serves as a voting instruction for
    the trustee of the plan in which you are a participant.
    Participants who wish to vote via the Internet may submit their
    voting instructions at
    <U><FONT style="white-space: nowrap">http://www.proxyvoting.com/axys-esop</FONT></U>.
    If you do not return the proxy card to the plan trustee, or do
    not provide voting instructions via the Internet, the trustee
    will not vote the Axsys shares credited to your account.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The trustee will vote unallocated shares of Axsys common stock
    held in the 401(k) plan in direct proportion to the voting of
    allocated shares in the plan for which voting instructions have
    been received unless otherwise required by applicable law.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Brokers or banks holding shares of Axsys common stock in
    &#147;street name&#148; may vote your shares of Axsys common
    stock on the adoption of the merger agreement and adjournments
    of the special meeting, if necessary, <B>only </B>if you provide
    instructions on how to vote. Brokers or banks will provide you
    with directions on how to instruct the broker or bank to vote
    your shares of Axsys common stock, and you should carefully
    follow these instructions. If you do not provide instructions to
    your bank or broker, your shares of Axsys common stock will not
    be voted on the proposal to adopt the merger agreement, which
    will have the effect of a vote <B>AGAINST </B>adoption of the
    merger agreement. If you do not provide instructions to your
    bank or broker, your shares of Axsys common stock will not be
    voted on a proposal to adjourn the special meeting, if
    necessary, which will have no effect on the outcome of any vote
    to adjourn the special meeting.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If you have any questions about how to vote or direct a vote in
    respect of your shares of Axsys common stock, you may contact
    our Investor Relations Department by phone at <B>1-860-594-5751
    </B>or by submitting a question to Georgeson at:
</DIV>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <FONT style="font-family: 'Times New Roman', Times">Georgeson,
    Inc.<BR>
    199 Water Street&#160;&#151;
    26<SUP style="font-size: 85%; vertical-align: top">th</SUP>

    Floor<BR>
    New York, NY 10038<BR>
    Banks and Brokers Call: (212) 440-9800<BR>
    All Others Call Toll Free: (888) 264-6994
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>Stockholders should not send in their stock certificates with
    their proxy cards.</I>&#160;&#160;A letter of transmittal with
    instructions for the surrender of certificates representing
    shares of Axsys common stock will be mailed to stockholders if
    the merger is completed.
</DIV>
<A name='144'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Revocation
    of Proxies</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Any proxy given by an Axsys stockholder may be revoked at any
    time before it is voted at the special meeting by doing any of
    the following:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    delivering a written notice bearing a date later than the date
    of the first proxy to Axsys&#146; Corporate Secretary stating
    that the first proxy is revoked;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    completing, signing and delivering a proxy card (either
    manually, telephonically or over the Internet) relating to the
    same shares of Axsys common stock and bearing a later date than
    the date of the previous proxy;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    attending the special meeting and voting in person.
</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    14
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='145'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Solicitation
    Costs</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We are soliciting the enclosed proxy card on behalf of our
    Board. In addition to solicitation by mail, our directors,
    officers and employees may solicit proxies in person, by
    telephone or by electronic means. These persons will not be
    specifically compensated for doing this.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have retained Georgeson to assist in the solicitation
    process. We will pay Georgeson a fee of $18,500 plus
    reimbursement of
    <FONT style="white-space: nowrap">out-of-pocket</FONT>
    costs and expenses. We also have agreed to indemnify Georgeson
    against various liabilities and expenses that relate to or arise
    out of its solicitation of proxies (subject to certain
    exceptions).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We will ask banks, brokers and other custodians, nominees and
    fiduciaries to forward our proxy solicitation materials to the
    beneficial owners of shares of Axsys common stock held of record
    by such nominee holders. We will reimburse these nominee holders
    for their customary clerical and mailing expenses incurred in
    forwarding the proxy solicitation materials to the beneficial
    owners.
</DIV>
<A name='146'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Exchange
    of Stock Certificates</FONT></B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our stockholders should not send stock certificates with their
    proxies. Separate transmittal documents for the surrender of
    shares of Axsys common stock in exchange for the merger
    consideration will be mailed to our stockholders promptly
    following the effective date of the merger. See &#147;The Merger
    Agreement&#160;&#151; Payment for Shares&#148; beginning on page
    39.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    15
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='147'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">THE
    MERGER</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The discussion in this proxy statement of the merger and the
    principal terms of the merger agreement is subject to, and is
    qualified in its entirety by reference to, the merger agreement,
    a copy of which is attached to this proxy statement as
    <U>Annex&#160;A</U>. You should read the entire merger agreement
    carefully.
</DIV>
<A name='148'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Background
    of the Merger</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Board, as part of its ongoing oversight and planning,
    regularly reviews and evaluates Axsys&#146; business strategy
    and strategic alternatives with the goal of enhancing
    stockholder value. As part of these reviews and evaluations, the
    Board and management on various occasions have received advice
    from outside financial advisors and have periodically considered
    a sale of the Company. Most recently, the Board had engaged a
    financial advisor in late 2003 to formally evaluate the
    potential interest in an acquisition of Axsys. In that regard,
    the Board had instructed management to continually evaluate when
    a sale might be opportune.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Between early 2004 and late 2007, Axsys, under the guidance of
    the Board, engaged in a number of strategic actions to enhance
    stockholder value as it evaluated the opportunities for a
    possible sale. In particular, in addition to organic
    development, Axsys acquired Telic Optics, Inc. and Diversified
    Optical Products, Inc. and substantially all of the assets of
    Cineflex LLC. In addition, Axsys disposed of its distributed
    products business. During that same period of time,
    notwithstanding the success of these various strategic
    transactions, various members of the Board had continued to
    express concern over the increasing unevenness of Axsys&#146;
    business.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In late 2008, Stephen W. Bershad, Chairman and Chief Executive
    Officer of Axsys, had multiple conversations with David Baxt,
    Group Head, Aerospace&#160;&#038; Defense, at Jefferies, who had
    previously worked with Mr.&#160;Bershad and Axsys for several
    years, regarding whether it might be an appropriate time to
    consider selling Axsys. In particular, during the later part of
    2008, Mr.&#160;Baxt contacted Mr.&#160;Bershad on multiple
    occasions to inform him of conversations Mr.&#160;Baxt had with
    various companies where third parties had mentioned Axsys in the
    context of a possible acquisition. Messrs.&#160;Bershad and Baxt
    discussed their belief that the Company&#146;s recent
    performance and prospects likely made Axsys an attractive
    acquisition target. While Axsys&#146; stock price was not
    discussed in detail, Messrs.&#160;Bershad and Baxt discussed
    their belief that a stock price over $60 per share was probably
    too high to commence a robust marketing process to sell Axsys.
    When the stock price dropped into the low $50&#146;s,
    Messrs.&#160;Bershad and Baxt agreed that the common stock price
    was at a level where the possibility of a sale pursuant to a
    structured process could be explored. Finally, they discussed
    how the current economy was negatively affecting the credit
    markets, which could make financing a deal difficult for
    companies that did not have strong balance sheets, but that many
    companies in the defense industry had sufficiently strong
    balance sheets to consider participating in a structured auction
    process to acquire Axsys.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Based on these conversations with the Board and Jefferies,
    management determined the time was appropriate to evaluate the
    level of potential interest in an acquisition of Axsys in a
    structured manner and engage a financial advisor to assist it in
    running a formal process. Subsequently, on January&#160;26,
    2009, Axsys engaged Jefferies to provide financial advice and
    assistance in connection with a possible sale of Axsys.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In early February 2009, Jefferies, on behalf of Axsys, began
    contacting a number of defense and aerospace companies and
    private equity firms in order to determine whether any of those
    entities would be interested in considering an acquisition of
    Axsys. The entities selected to be contacted were chosen based
    on factors including perceived interest in the businesses in
    which Axsys operates, familiarity with the defense and aerospace
    industries, financial position and ability to consummate an
    acquisition of Axsys.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    During this period, Jefferies contacted or had initial
    discussions with 24 parties potentially interested in a
    transaction involving Axsys, including General Dynamics and 17
    other potential strategic buyers and six private equity firms.
    Sixteen of these parties, which did not include General Dynamics
    but included 10 other potential strategic buyers and six private
    equity firms, executed confidentiality agreements. Each of these
    16 parties received certain summary non-public information
    regarding Axsys and were requested to provide a non-binding,
    preliminary indication of interest by March&#160;10, 2009.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Prior to the March&#160;10, 2009 deadline for the submission of
    preliminary indications of interest, Jefferies had extensive
    conversations with management about the status of the various
    bidders and which ones seemed likely to
</DIV>

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    <BR>
    16
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    submit a preliminary indication of interest, although no bidder
    submitted a preliminary indication of interest by the
    March&#160;10, 2009 deadline.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On March&#160;11, 2009, in response to press reports, Axsys
    announced that it had retained Jefferies as its financial
    advisor to explore a possible sale of the Company. Following
    this announcement Jefferies had discussions with an additional
    11 parties, including seven potential strategic buyers and four
    private equity firms, to explore their possible interest in
    acquiring Axsys. Of this group, four entities, including one
    potential strategic buyer and three private equity firms,
    executed confidentiality agreements and received the summary
    non-public information regarding Axsys that had previously been
    distributed to other potential bidders.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Board next met for a regularly scheduled meeting on
    March&#160;12, 2009. Based on its conversations with Jefferies,
    management discussed with the Board  the status of the various
    bidders&#146; participation in the process. After extensive
    discussion, the Board authorized management and Jefferies to
    continue discussions with potential bidders.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Over the next week, Jefferies had multiple conversations with
    the bidders remaining in the process to encourage them to submit
    a formal indication of interest. Jefferies was informed by
    various bidders that, due to the publicity surrounding the fact
    that Axsys was evaluating a possible sale of the Company, they
    were not prepared to submit a formal indication of interest at a
    specific price or ranges of prices. Axsys was not aware of any
    potential bidders that actually dropped out of, or did not
    participate in, the sale process due to concerns about
    publicity. Three strategic bidders, however, provided
    conditional preliminary indications of interest that were
    interpreted to imply a per share price ranging from the upper
    $40&#146;s to the low $50&#146;s. After extensive discussion
    between Jefferies and management, these three bidders were
    invited to continue in the sale process.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On April&#160;13, 2009, General Dynamics executed a
    confidentiality agreement with Axsys and received the summary
    non-public information regarding Axsys that had previously been
    distributed to other potential bidders. Previously, General
    Dynamics had declined to participate in the auction process and
    had not received any diligence materials.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Throughout the remainder of March and April, the bidders
    continued their financial and legal due diligence review of
    Axsys, which included discussions and meetings with Axsys&#146;
    management and review of certain non-public information pursuant
    to the terms of the confidentiality agreements between the
    bidders and the Company. In addition, four parties, consisting
    of General Dynamics and the three parties that had submitted
    oral indications of interest, attended presentations conducted
    by Axsys&#146; management.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On April&#160;30, 2009, a final bid instruction letter, which
    enclosed a draft merger agreement, was distributed to the four
    bidders who had attended the management presentations. These
    bidders were requested to submit final bids by May&#160;12,
    2009. These parties also continued their respective due
    diligence investigations of Axsys, to varying degrees, during
    this period.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On May&#160;7, 2009, the Board met for a regularly scheduled
    meeting and received an update from management on the sale
    process. In particular, management discussed the status of the
    various bidders remaining in the process and the reasons
    disclosed by other bidders to Jefferies why they dropped out of,
    or passed on the opportunity to participate in, the sale
    process. Some of the bidders dropped out of, or passed on the
    opportunity to participate in, the sale process because they
    lacked the financial capacity to purchase Axsys or because the
    transaction lacked strategic importance to such bidders.
    Management, however, noted and discussed with the Board that the
    general feedback from the bidders on Axsys&#146; business was
    positive. Management viewed the remaining bidders as competitive
    in light of their discussion with the Board.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On May&#160;13, 2009, General Dynamics submitted an offer of
    $645&#160;million, which equated to approximately $53.00 per
    share, to purchase 100% of the outstanding equity of Axsys.
    General Dynamics also delivered a markup of the merger agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On May&#160;15, 2009, one other bidder submitted an offer to
    purchase 100% of the outstanding equity of Axsys, while the two
    other bidders who had received bid packages declined to make
    final bids.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Between receipt of the two bids and May&#160;21, 2009,
    representatives of Axsys, including representatives of
    Jefferies, had multiple conversations with representatives of
    General Dynamics and the other bidder concerning
</DIV>

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    <BR>
    17
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    price and various due diligence matters. During these
    conversations, General Dynamics and the other bidder were
    requested to provide their best and final offers. On
    May&#160;20, 2009, General Dynamics raised its bid to $53.50 per
    share subject to the resolution of certain third party contract
    liability issues. The other bidder declined to increase its
    offer.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On May&#160;21, 2009, the Board met with management, outside
    legal counsel and Jefferies to consider the two final bids that
    had been submitted. Management updated the Board on the process
    since the May&#160;7, 2009 Board meeting and gave a general
    overview of the bids and discussions with the bidders.
    Axsys&#146; legal counsel reviewed with the Board members their
    fiduciary duties in the context of a sale transaction and
    discussed the possible timeline until a possible closing. In
    addition to summarizing each of the bids and updating the Board
    on the status of discussions with each of the bidders, Jefferies
    reviewed with the Board its preliminary valuation analysis of
    Axsys in relation to each proposal, which preliminary valuation
    analysis was subsumed by the final valuation analysis that was
    presented by Jefferies to the Board on June&#160;3, 2009 and
    described below under the caption&#160;&#151; &#147;Opinion of
    Jefferies&#160;&#038; Company, Inc.&#148; After discussing the
    two bids, the Board determined that the General Dynamics bid was
    superior as the other bid was at a lower cash price and the
    other bidder had not supplied comments to the draft merger
    agreement or completed as much due diligence as General
    Dynamics, giving General Dynamics a significant timing
    advantage, and the other bidder had potential regulatory issues
    that General Dynamics did not have because the other bidder was
    a foreign company. At the conclusion of the meeting, the Board
    authorized management, Jefferies and legal counsel to negotiate
    with General Dynamics and its advisors to arrive at a final
    negotiated deal by Wednesday, June&#160;3, 2009, at or above
    $53.50 per share and on terms generally consistent with the
    terms set forth in the latest draft of the merger agreement.
    General Dynamics had previously informed Axsys that General
    Dynamics&#146; Board of Directors would not be able to meet
    before June&#160;3, 2009 to formally approve the acquisition of
    Axsys.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Later in the day on May&#160;21, 2009, General Dynamics adjusted
    its bid price to $54.00 per share based on information provided
    to it with respect to the correct number of fully diluted Axsys
    shares outstanding.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Between May&#160;22, 2009 and June&#160;3, 2009, legal counsel
    to Axsys and legal counsel to General Dynamics negotiated the
    terms of the merger agreement, in particular, closing
    conditions, termination events and termination fees and related
    triggers, and General Dynamics concluded its due diligence
    review of Axsys.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On the morning of June&#160;3, 2009, the Board convened a
    meeting to consider the proposed merger with General Dynamics.
    The Board reviewed with Axsys&#146; management and legal and
    financial advisors the status of negotiations with General
    Dynamics and the proposed terms and conditions of the merger.
    Axsys&#146; legal counsel reviewed with the Board members the
    material terms and conditions of the merger agreement, as
    reflected in the then current draft. Counsel also summarized
    certain contractual obligations, conditions and termination
    rights relating to obtaining antitrust and other regulatory
    approvals, as well as the provisions and termination fees
    applicable in situations in which the transaction was made the
    subject of competitive bids from third parties or in which the
    Board withdrew its recommendation of the merger. Representatives
    of Jefferies then reviewed the financial aspects of the proposed
    merger. At the conclusion of its presentation, Jefferies
    delivered its opinion to the Board to the effect that, as of
    June&#160;3, 2009 and based upon and subject to the various
    considerations and assumptions set forth therein, the merger
    consideration to be received by the holders of shares of Axsys
    common stock pursuant to the merger agreement was fair, from a
    financial point of view, to those holders. Following a thorough
    discussion, the Board unanimously determined that the merger is
    advisable to, and in the best interests of, Axsys and its
    stockholders and approved and adopted the merger and the merger
    agreement, resolved to recommend that Axsys stockholders vote to
    adopt the merger agreement, and authorized its executive
    officers to execute and deliver the merger agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Also on June&#160;3, 2009, General Dynamics requested to have GD
    AIS enter into the merger agreement as a principal instead of
    General Dynamics for internal organizational purposes at General
    Dynamics. General Dynamics determined that having GD AIS be the
    acquirer would best position Axsys within General Dynamics&#146;
    overall corporate structure. In return for designating GD AIS as
    the acquirer, Axsys negotiated for General Dynamics to guarantee
    GD AIS&#146; obligations under the merger agreement. GD AIS
    considered and approved the terms of the acquisition as
    originally negotiated by General Dynamics, but GD AIS itself did
    not participate in the negotiation process. Later that day, the
    Boards of Directors of General Dynamics and GD AIS approved the
    merger agreement.
</DIV>

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    <BR>
    18
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    On June&#160;4, 2009, the parties executed and delivered the
    merger agreement and announced the signing of the merger
    agreement.
</DIV>
<A name='149'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Axsys&#146;
    Reasons for the Merger</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    During the course of reaching its decision to adopt and approve
    the merger and the transactions contemplated by the merger
    agreement, the Board considered a number of factors and
    consulted the Company&#146;s senior management and outside
    financial and legal advisors.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Board considered a number of potentially positive factors in
    its deliberations, including, among other matters:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    discussions with management regarding the Company&#146;s
    business, financial condition, results of operations,
    competitive position, business strategy, strategic options and
    prospects, as well as the risks involved in achieving these
    prospects, the nature of the Company&#146;s business and the
    industry in which it competes, and current industry, economic
    and market conditions, both on a historical and on a prospective
    basis, as set forth in detail in Axsys&#146; public filings,
    including its periodic reports on
    <FONT style="white-space: nowrap">Form&#160;10-K</FONT>
    and
    <FONT style="white-space: nowrap">Form&#160;10-Q,</FONT>
    which led the Board to conclude that the merger presented an
    opportunity for Axsys stockholders to realize greater value than
    the value likely to be realized by stockholders in the event the
    Company remained independent;
</TD>
</TR>

</TABLE>


<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the prospects of continuing to operate Axsys in accordance with
    the existing business plan, the value to stockholders of such
    alternative and the timing and likelihood of actually achieving
    additional value from remaining independent;
</TD>
</TR>

</TABLE>


<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    that the merger was agreed to only after a lengthy auction
    process pursuant to which a total of 35 potential purchasers
    were contacted, which process included, for certain parties,
    management presentations, due diligence sessions, the submission
    of three non-binding preliminary indications of interest, and
    the submission of two final bids;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the merger was agreed to by the Board after the announcement by
    Axsys on March&#160;11, 2009, announcing that Axsys was
    evaluating the possible sale of the Company and had engaged
    Jefferies as its financial advisor, which created significant
    publicity concerning the possibility that the Company may be
    sold, and the passage of a significant period of time between
    issuance of the press release and adoption and approval of the
    merger agreement;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the fact that no other offers to acquire Axsys were made
    following our March&#160;11, 2009 press release regarding the
    possible sale of the Company, other than offers from potential
    purchasers involved in the auction process;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the current and historical market prices of Axsys&#146; shares
    relative to the $54.00 per share merger consideration, and the
    fact that the merger consideration represents a 7.2% premium
    over the closing price of shares of Axsys&#146; common stock on
    June&#160;2, 2009 (the last full trading day prior to the
    Board&#146;s approval of the merger) and a 97.3% premium over
    the closing price of shares of Axsys&#146; common stock on
    March&#160;10, 2009 (the last full trading day prior to the
    press release announcing that Axsys was evaluating the possible
    sale of the Company and had engaged Jefferies as its financial
    advisor);
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the Board&#146;s assessment that Axsys&#146; common stock price
    was not likely to remain above the $54.00 per share merger
    consideration were the merger not consummated;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the belief of the Board, after consulting with Jefferies and
    management regarding the discussions and negotiations conducted
    with General Dynamics, that the Board had obtained the highest
    price per share that General Dynamics was willing to pay;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the fact that the merger consideration consists entirely of
    cash, which provides certainty of value to holders of shares of
    Axsys common stock compared to a transaction in which
    stockholders receive stock or other securities;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the financial analyses of Jefferies presented to the Board on
    June&#160;3, 2009 as well as the opinion of Jefferies, dated as
    of June&#160;3, 2009, to the Board as to the fairness, from a
    financial point of view and as of the date of the
</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    19
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV align="left" style="margin-left: 6%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
     opinion, of the merger consideration to be received by the
    holders of shares of Axsys common stock pursuant to the merger
    agreement, as more fully described below under the
    caption&#160;&#151; &#147;Opinion of Jefferies&#160;&#038;
    Company, Inc.&#148; beginning on page 21. The full text of the
    opinion is attached to this proxy statement as
    <U>Annex&#160;C</U> and incorporated by reference into this
    proxy statement;
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the fact that Axsys stockholders will have appraisal rights, as
    described in the section entitled &#147;&#151;&#160;Appraisal
    Rights of Axsys Stockholders&#148; beginning on page 33;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the terms of the merger agreement, as reviewed by the Board with
    the Company&#146;s legal advisors, including:
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="6%"></TD>
    <TD width="2%"></TD>
    <TD width="92%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    sufficient operating flexibility for the Company to conduct its
    business in the ordinary course between the execution and
    delivery of the merger agreement and consummation of the merger;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the fact that the completion of the merger is not conditioned on
    GD AIS obtaining financing;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the fact that the conditions required to be satisfied prior to
    completion of the merger are customary and can be expected to be
    fulfilled in the ordinary course and the corresponding
    likelihood that the merger will be consummated;
</TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="6%"></TD>
    <TD width="2%"></TD>
    <TD width="92%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the Company&#146;s ability to furnish information to and conduct
    negotiations with third parties under certain circumstances, as
    more fully described in &#147;The Merger Agreement&#160;&#151;
    Covenants and Agreements&#160;&#151; No Solicitation&#148;
    beginning on page 46;&#160;and
</TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="6%"></TD>
    <TD width="2%"></TD>
    <TD width="92%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the Board&#146;s ability to recommend a more favorable
    unsolicited acquisition proposal to Company stockholders and the
    Company&#146;s corresponding right to terminate the merger
    agreement upon the payment of a $23.6&#160;million termination
    fee to GD AIS and reimbursement up to an aggregate of
    $2.0&#160;million for certain
    <FONT style="white-space: nowrap">out-of-pocket</FONT>
    expenses of GD AIS and General Dynamics incurred in connection
    with the merger;
</TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    General Dynamics&#146; financial capability, as indicated by its
    market capitalization of over $20&#160;billion, cash and cash
    equivalents on its balance sheet as of December&#160;31, 2008 of
    over $1.6&#160;billion and its investment grade corporate credit
    rating;&#160;and
</TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the view of the Board, based upon the advice of senior
    management after consultation with legal counsel, that the
    regulatory approvals necessary to complete the merger could be
    obtained.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Board also considered a number of potentially negative
    factors in its deliberations concerning the merger, including,
    but not limited to:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the risk that, notwithstanding the likelihood of the merger
    being completed, the merger might not be completed, including
    the effect of the pendency of the merger and such failure to be
    completed may have on:
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="6%"></TD>
    <TD width="2%"></TD>
    <TD width="92%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the trading price of shares of Axsys common stock;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Axsys&#146; operating results, including the costs incurred in
    connection with the merger;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Axsys&#146; ability to attract and retain key personnel;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Axsys&#146; ability to maintain sales;
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    that the Company will no longer exist as a publicly traded
    company and that stockholders will no longer participate in the
    future growth of the business, including any growth related to
    the recovery of the general economy;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    that, under the terms of the merger agreement, the Company
    cannot solicit other acquisition proposals, the Company must pay
    GD AIS a termination fee
    <FONT style="white-space: nowrap">and/or</FONT>
    reimburse certain expenses incurred in connection with the
    merger if the merger agreement is terminated under certain
    circumstances, which may deter other parties from proposing an
    alternative transaction that may be more advantageous to
    stockholders;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the fact that gains from an all-cash transaction would generally
    be taxable to stockholders for United States federal income tax
    purposes;
</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    20
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    that if the merger does not close, the Company&#146;s employees
    will have expended extensive time and efforts to attempt to
    complete the transaction and will have experienced significant
    distractions from their work during the pendency of the
    transaction;
</TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the conditions to GD AIS&#146; obligation to complete the
    merger, and the right of GD AIS to terminate the merger
    agreement under certain circumstances, see &#147;The Merger
    Agreement&#160;&#151; Termination&#148; beginning on page
    51;&#160;and
</TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    risks and contingencies related to the announcement and pendency
    of the merger, including the likely impact on customer
    relationships and the potential effect of the merger on existing
    relationships with other third parties.
</TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    During its consideration of the merger, the Board was also aware
    that some of our directors and executive officers have interests
    in the merger that may be in addition to or differ from those of
    our stockholders generally, as described in
    &#147;&#151;&#160;Interests of Axsys Directors and Executive
    Officers in the Merger&#148; beginning on page 28. These
    interests did not have any effect on the Board&#146;s
    deliberations of the proposed merger.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    This summary is not meant to be an exhaustive description of the
    information and factors considered by the Board but is believed
    to address the material information and factors considered by
    the Board. In view of the wide variety of factors considered by
    the Board, it is not possible to quantify or to give relative
    weights to the various factors. After taking into consideration
    all of the factors set forth above, as well as other factors not
    specifically described above, the Board unanimously concluded
    that the merger is advisable to, and in the best interests of,
    Axsys and its stockholders and approved and adopted the merger
    agreement and the transactions contemplated by the merger
    agreement.
</DIV>
<A name='150'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Recommendation
    of the Board</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    At its meeting on June&#160;3, 2009, the Board met to consider
    the merger agreement and after due consideration, unanimously
    adopted and approved the merger agreement and determined that
    the merger agreement and the related transactions are advisable
    to and in the best interests of Axsys and its stockholders, and
    the Board unanimously recommends that Axsys stockholders vote
    <B>FOR </B>the adoption of the merger agreement.
</DIV>
<A name='151'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Opinion
    of Jefferies&#160;&#038; Company, Inc.</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Jefferies served as Axsys&#146; financial advisor in connection
    with the merger. On June&#160;3, 2009, Jefferies rendered to the
    Board its opinion as investment bankers to the effect that, as
    of that date and based upon and subject to the various
    considerations and assumptions set forth therein, the merger
    consideration of $54.00 per share in cash to be received by
    holders of Axsys common stock pursuant to the merger agreement
    was fair, from a financial point of view, to those holders.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The full text of Jefferies&#146; opinion, which sets forth the
    assumptions made, matters considered and limitations on the
    scope of review undertaken by Jefferies in rendering its
    opinion, is attached to this proxy statement as
    <U>Annex&#160;C</U>. Axsys encourages stockholders to read the
    Jefferies opinion carefully and in its entirety. Jefferies&#146;
    opinion was provided to the Board in connection with the
    Board&#146;s consideration of the merger and addresses only the
    fairness, from a financial point of view and as of the date of
    Jefferies&#146; opinion, of the merger consideration to be
    received by the holders of Axsys common stock pursuant to the
    merger agreement and does not address any other aspect of the
    merger. Jefferies&#146; opinion does not constitute a
    recommendation as to how any holder of Axsys common stock should
    vote on the merger or any matter related thereto.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In arriving at its opinion, Jefferies, among other things:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    reviewed a draft dated June&#160;3, 2009 of the merger agreement
    and a draft dated June&#160;3, 2009 of the voting agreement,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    reviewed certain publicly available financial and other
    information about Axsys,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    reviewed certain information furnished to Jefferies by
    Axsys&#146; management, including financial forecasts and
    analyses, relating to the business, operations and prospects of
    Axsys,
</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    21
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    held discussions with members of senior management of Axsys
    concerning the matters described in the prior two bullet points,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    reviewed the share trading price history and valuation multiples
    for Axsys common stock and compared them with those of certain
    publicly traded companies that Jefferies deemed relevant,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    compared the proposed financial terms of the merger with the
    financial terms of certain other transactions that Jefferies
    deemed relevant,&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    conducted such other financial studies, analyses and
    investigations as Jefferies deemed appropriate.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In Jefferies&#146; review and analysis and in rendering its
    opinion, Jefferies assumed and relied upon, but did not assume
    any responsibility to independently investigate or verify, the
    accuracy and completeness of all financial and other information
    that was supplied or otherwise made available by Axsys to it or
    that was publicly available (including, without limitation, the
    information described above), or that was otherwise reviewed by
    it. In its review, Jefferies relied on assurances of the
    management of Axsys that management was not aware of any facts
    or circumstances that would make such information inaccurate or
    misleading. In its review, Jefferies did not obtain any
    independent evaluation or appraisal of any of the assets or
    liabilities of, nor did Jefferies conduct a physical inspection
    of any of the properties or facilities of, Axsys. Jefferies was
    not furnished with any such evaluations or appraisals of such
    physical inspections and did not assume any responsibility to
    obtain any such evaluations or appraisals.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    With respect to the financial forecasts provided to and examined
    by Jefferies, Jefferies&#146; opinion noted that projecting
    future results of any company is inherently subject to
    uncertainty. Axsys informed Jefferies, however, and Jefferies
    assumed, that such financial forecasts were reasonably prepared
    on bases reflecting the best currently available estimates and
    good faith judgments of the management of Axsys as to the future
    financial performance of Axsys. Jefferies expressed no opinion
    as to Axsys&#146; financial forecasts or the assumptions on
    which they were made.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Jefferies&#146; opinion was based on economic, monetary,
    regulatory, market and other conditions existing and which could
    be evaluated as of the date of its opinion. Jefferies expressly
    disclaimed any undertaking or obligation to advise any person of
    any change in any fact or matter affecting Jefferies&#146;
    opinion of which Jefferies became aware after the date of its
    opinion.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Jefferies made no independent investigation of any legal or
    accounting matters affecting Axsys, and Jefferies assumed the
    correctness in all respects material to Jefferies&#146; analysis
    of all legal and accounting advice given to Axsys and the Board,
    including, without limitation, advice as to the legal,
    accounting and tax consequences of the terms of, and
    transactions contemplated by, the merger agreement to Axsys and
    its stockholders. In addition, in preparing its opinion,
    Jefferies did not take into account any tax consequences of the
    transaction to any holder of Axsys common stock. In rendering
    its opinion, Jefferies assumed that the final form of the merger
    agreement and the voting agreement would be substantially
    similar to the last drafts reviewed by it. Jefferies also
    assumed that in the course of obtaining the necessary regulatory
    or third party approvals, consents and releases for the merger,
    no delay, limitation, restriction or condition would be imposed
    that would have an adverse effect on Axsys or the contemplated
    benefits of the merger in any way meaningful to Jefferies&#146;
    analysis.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Jefferies&#146; opinion was for the use and benefit of the Board
    in its consideration of the merger, and Jefferies&#146; opinion
    did not address the relative merits of the transactions
    contemplated by the merger agreement as compared to any
    alternative transaction or opportunity that might be available
    to Axsys, nor did it address the underlying business decision by
    Axsys to engage in the merger or the terms of the merger
    agreement or the documents referred to therein. Jefferies&#146;
    opinion does not constitute a recommendation as to how any
    holder of shares of Axsys common stock should vote on the merger
    or any matter relating thereto. In addition, Jefferies was not
    asked to address, and its opinion did not address, the fairness
    to, or any other consideration of, the holders of any class of
    securities, creditors or other constituencies of Axsys, other
    than the holders of Axsys common stock. Jefferies expressed no
    opinion as to the price at which shares of Axsys common stock
    will trade at any time. Jefferies did not express any view or
    opinion as to the fairness, financial or otherwise, of the
    amount or nature of any compensation payable to or to be
    received by any of Axsys&#146; officers, directors or employees,
    or any class of such persons, in connection with the merger
    relative to the merger consideration to be received by holders
    of shares of Axsys common stock.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    22
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In preparing its opinion, Jefferies performed a variety of
    financial and comparative analyses. The preparation of a
    fairness opinion is a complex process involving various
    determinations as to the most appropriate and relevant
    quantitative and qualitative methods of financial analysis and
    the applications of those methods to the particular
    circumstances and, therefore, is not necessarily susceptible to
    partial analysis or summary description. Jefferies believes that
    its analyses must be considered as a whole. Considering any
    portion of Jefferies&#146; analyses or the factors considered by
    Jefferies, without considering all analyses and factors, could
    create a misleading or incomplete view of the process underlying
    the conclusion expressed in Jefferies&#146; opinion. In
    addition, Jefferies may have given various analyses more or less
    weight than other analyses, and may have deemed various
    assumptions more or less probable than other assumptions, so
    that the range of valuations resulting from any particular
    analysis described below should not be taken to be
    Jefferies&#146; view of Axsys&#146; actual value. In this
    regard, as noted below, less weight was given by Jefferies to
    the premiums paid analysis for the periods
    <FONT style="white-space: nowrap">1-day</FONT> and
    4-weeks prior to June&#160;2, 2009, that Jefferies noted was not
    particularly meaningful. Accordingly, the conclusions reached by
    Jefferies are based on all analyses and factors taken as a whole
    and also on the application of Jefferies&#146; own experience
    and judgment.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In performing its analyses, Jefferies made numerous assumptions
    with respect to industry performance, general business,
    economic, monetary, regulatory, market and other conditions and
    other matters, many of which are beyond Axsys&#146; and
    Jefferies&#146; control. The analyses performed by Jefferies are
    not necessarily indicative of actual values or actual future
    results, which may be significantly more or less favorable than
    suggested by such analyses. In addition, analyses relating to
    the per share value of Axsys common stock do not purport to be
    appraisals or to reflect the prices at which Axsys common stock
    may actually be sold. The analyses performed were prepared
    solely as part of Jefferies&#146; analysis of the fairness, from
    a financial point of view, of the merger consideration to be
    received by holders of Axsys common stock pursuant to the
    merger, and were provided to the Board in connection with the
    delivery of Jefferies&#146; opinion.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following is a summary of the material financial and
    comparative analyses performed by Jefferies in connection with
    Jefferies&#146; delivery of its opinion. The financial analyses
    summarized below include information presented in tabular
    format. In order to fully understand Jefferies&#146; financial
    analyses, the tables must be read together with the text of each
    summary. The tables alone do not constitute a complete
    description of the financial analyses. Considering the data
    described below without considering the full narrative
    description of the financial analyses, including the
    methodologies and assumptions underlying the analyses, could
    create a misleading or incomplete view of Jefferies&#146;
    financial analyses.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Transaction
    Overview</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Based upon the approximately 11.8&#160;million shares of Axsys
    common stock that were outstanding as of May&#160;19, 2009 on a
    fully diluted basis (calculated using the treasury stock
    method), Jefferies noted that the merger consideration of $54.00
    per share implied an equity value of approximately
    $638.6&#160;million. Net of approximately $26.1&#160;million of
    cash and cash equivalents (as of March&#160;28, 2009), Jefferies
    noted that the merger consideration implied an enterprise value
    of approximately $612.5&#160;million. Jefferies also noted that
    the merger consideration of $54.00 per share of Axsys common
    stock represented:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a premium of 8.2% over the closing price per share of Axsys
    common stock on June&#160;1, 2009 of $49.93,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a premium of 97.3% over the closing price per share of Axsys
    common stock on March&#160;10, 2009 of $27.37, which was the
    last trading day prior to the issuance of Axsys&#146; press
    release announcing that Axsys was evaluating the possible sale
    of the Company and had engaged Jefferies as its financial
    advisor,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a premium of 121.8% over the lowest
    <FONT style="white-space: nowrap">intra-day</FONT>
    trading price per share of Axsys common stock on March&#160;10,
    2009 of $24.35, which was the lowest trading price of Axsys
    common stock during the 52-week period ending June&#160;1,
    2009,&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a discount of 32.2% from the highest
    <FONT style="white-space: nowrap">intra-day</FONT>
    trading price per share of Axsys common stock on August&#160;13,
    2008 of $79.69, which was the highest trading price of Axsys
    common stock during the 52-week period ending June&#160;1, 2009.
</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    23
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Historical
    Trading Analysis</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Jefferies reviewed the share price trading history of Axsys
    common stock for the two-year period ending June&#160;1, 2009 on
    a stand-alone basis and also in relation to the NASDAQ
    Composite, the Standard&#160;&#038; Poor&#146;s 500 Index, and a
    composite index consisting of the enterprise companies listed
    below in the defense electronics, intelligence, surveillance and
    reconnaissance (&#147;ISR&#148;) and homeland security markets,
    which are referred to as the &#147;Axsys Selected Comparable
    Companies&#148;. Jefferies selected the Axsys Selected
    Comparable Companies because their businesses, end markets and
    operating profiles are reasonably similar to that of Axsys.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Applied Signal Technology, Inc.,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Argon ST, Inc.,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    FLIR Systems Inc.,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    L-3 Communications Holdings, Inc.,&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Raytheon Company.
</TD>
</TR>

</TABLE>


<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The historical trading analysis was presented to the Board
    solely for informational purposes to provide it with background
    information and perspective with respect to the relative
    historical share price of Axsys common stock. This analysis
    showed that during the two-year period ending June&#160;1, 2009,
    the trading price of Axsys common stock rose 141.3%, the NASDAQ
    Composite Index declined 30.0%, the Standard&#160;&#038;
    Poor&#146;s 500 Index declined 38.6%, and the composite index
    consisting of the Axsys Selected Comparable Companies declined
    16.9%. This analysis also showed that from March&#160;10, 2009,
    which was the date one day prior to the date on which Axsys
    announced it was evaluating the possible sale of the Company and
    had engaged Jefferies as its financial advisor, to
    March&#160;12, 2009, the closing trading price of Axsys common
    stock rose 49.1%.
</DIV>


<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Comparable
    Public Company Analysis</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Using publicly available information and information provided by
    Axsys&#146; management, Jefferies analyzed the trading multiples
    of Axsys and the corresponding trading multiples of the Axsys
    Selected Comparable Companies. In its analysis, Jefferies
    derived and compared multiples for Axsys and the Axsys Selected
    Comparable Companies, calculated as follows:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the enterprise value divided by latest twelve months, or LTM,
    earnings before interest, taxes, depreciation and amortization,
    or EBITDA, which is referred to as &#147;Enterprise Value/LTM
    EBITDA,&#148;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the enterprise value divided by estimated EBITDA for calendar
    year 2009, which is referred to as &#147;Enterprise Value/2009E
    EBITDA.&#148;
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    This analysis indicated the following:
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Comparable
    Public Company Multiples</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="73%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Benchmark</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>High</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Low</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Mean</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Median</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Enterprise Value/LTM EBITDA
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9.8
</TD>
<TD nowrap align="left" valign="bottom">
    x
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5.9
</TD>
<TD nowrap align="left" valign="bottom">
    x
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8.5
</TD>
<TD nowrap align="left" valign="bottom">
    x
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9.5
</TD>
<TD nowrap align="left" valign="bottom">
    x
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Enterprise Value/2009E EBITDA
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9.3
</TD>
<TD nowrap align="left" valign="bottom">
    x
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5.5
</TD>
<TD nowrap align="left" valign="bottom">
    x
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7.9
</TD>
<TD nowrap align="left" valign="bottom">
    x
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9.0
</TD>
<TD nowrap align="left" valign="bottom">
    x
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Using a reference range of 8.5x to 10.0x Axsys&#146; LTM EBITDA
    of approximately $48.9&#160;million, Jefferies determined an
    implied enterprise value for Axsys, then added cash and cash
    equivalents to determine an implied equity value. After
    accounting for the vesting of in-the-money stock options (using
    the treasury stock method), this analysis indicated a range of
    implied values per share of Axsys common stock of approximately
    $37.46 to $43.62 using LTM EBITDA, compared to the merger
    consideration of $54.00 per share of Axsys common stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Using a reference range of 8.0x to 9.5x Axsys&#146; 2009E EBITDA
    of approximately $56.9&#160;million (which amount included
    Axsys&#146; actual EBITDA for the fiscal quarter ended
    March&#160;31, 2009), Jefferies determined an implied enterprise
    value for Axsys, then added cash and cash equivalents to
    determine an implied equity value. After accounting for the
    vesting of in-the-money stock options (using the treasury stock
    method), this analysis indicated a
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    24
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    range of implied values per share of Axsys common stock of
    approximately $40.78 to $47.95 using 2009E EBITDA, compared to
    the merger consideration of $54.00 per share of Axsys common
    stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    No company utilized in the comparable public company analysis is
    identical to Axsys. In evaluating the selected companies,
    Jefferies made judgments and assumptions with regard to industry
    performance, general business, economic, market and financial
    conditions and other matters, many of which are beyond
    Axsys&#146; and Jefferies&#146; control. A purely mathematical
    analysis is not in itself a meaningful method of using
    comparable company data.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Selected
    Comparable Transactions Analysis</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Using publicly available information and other information,
    Jefferies examined the nine transactions listed below and
    announced during the past 3 years involving companies providing
    services and products to the defense electronics, ISR and
    homeland security markets with enterprise values between
    $27.0&#160;million and $5.2&#160;billion. Jefferies selected
    these transactions because they involved companies with
    businesses, end markets and operating profiles that are
    reasonably similar to that of Axsys, and each of these
    transactions involved a cash acquisition by a strategic buyer of
    a privately-owned company or business (other than Finmeccanica
    SpA&#146;s acquisition of DRS Technologies, Inc.). The
    transactions considered and the month and year each transaction
    was announced were as follows:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="34%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="32%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="32%">&nbsp;</TD>	<!-- colindex=03 type=maindata -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Month and Year Announced</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Target</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Acquiror</B>
</DIV>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    July 2006
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Rockwell Scientific Company LLC
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Teledyne Technologies Incorporated
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    October 2006
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Overwatch Systems, LLC
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Textron Inc.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    April 2007
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Cineflex, LLC
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Axsys Technologies, Inc.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    September 2007
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Cedip Infrared Systems
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    FLIR Systems, Inc.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    March 2008
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Northrop Grumman&#146;s Electro-Optical Systems (EOS) business
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    L-3 Communications Corporation
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    May 2008
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Radyne Corp.
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Comtech Telecommunications Corp.
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    May 2008
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    M/A-COM, Inc.
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Cobham plc
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    May 2008
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    DRS Technologies, Inc.
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Finmeccanica SpA
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    December 2008
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Racal Acoustics Global Limited
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Esterline Technologies Corporation
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Using publicly available estimates and other information for
    each of these transactions, Jefferies reviewed the enterprise
    value as a multiple of the target company&#146;s LTM EBITDA
    immediately preceding announcement of the transaction, which is
    referred to below as &#147;Enterprise Value/LTM EBITDA.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    This analysis indicated the following:
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Selected
    Comparable Transactions Multiples</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="72%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Benchmark</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>High</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Low</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Mean</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Median</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Enterprise Value/LTM EBITDA
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13.6
</TD>
<TD nowrap align="left" valign="bottom">
    x
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    6.8
</TD>
<TD nowrap align="left" valign="bottom">
    x
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10.8
</TD>
<TD nowrap align="left" valign="bottom">
    x
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10.9x
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Using a reference range of 10.0x to 12.0x Axsys&#146; LTM
    EBITDA, Jefferies determined an implied enterprise value for
    Axsys, then added cash and cash equivalents to determine an
    implied equity value. After accounting for the vesting of
    in-the-money stock options (using the treasury stock method),
    this analysis indicated a range of implied values per share of
    Axsys common stock of approximately $43.62 to $51.83, compared
    to the merger consideration of $54.00 per share of Axsys common
    stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    No transaction utilized as a comparison in the comparable
    transaction analysis is identical to the merger. In evaluating
    the merger, Jefferies made numerous judgments and assumptions
    with regard to industry performance, general business, economic,
    market, and financial conditions and other matters, many of
    which are beyond Axsys&#146; and Jefferies&#146; control. A
    purely mathematical analysis is not in itself a meaningful
    method of using comparable transaction data.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    25
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Discounted
    Cash Flow Analysis</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Jefferies performed a discounted cash flow analysis to estimate
    the present value of the free cash flows of Axsys through the
    fiscal year ending December&#160;31, 2013 using Axsys
    management&#146;s financial projections, discount rates ranging
    from 11.0% to 12.0%, and perpetual growth rates of free cash
    flow after fiscal year 2013 ranging from 3.0% to 5.0%. To
    determine the implied total equity value for Axsys, Jefferies
    added cash and cash equivalents to the implied enterprise value
    for Axsys. After accounting for the vesting of in-the-money
    stock options, this analysis indicated a range of implied values
    per share of Axsys common stock of approximately $33.35 to
    $47.00, compared to the merger consideration of $54.00 per share
    of Axsys common stock.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Premiums
    Paid Analysis</FONT></I></B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Using publicly available information, Jefferies analyzed the
    premiums offered in 18 selected merger and acquisition
    transactions (which transactions were not presented to the
    Board) over the past five years within selected industries,
    including aerospace&#160;&#038; defense and government services,
    involving public companies having enterprise values between
    $500&#160;million and $2&#160;billion.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    For each of these transactions, Jefferies calculated the premium
    represented by the offer price over the target company&#146;s
    closing share price one day and four weeks prior to the
    transaction&#146;s announcement. This analysis indicated the
    following median premiums for those time periods prior to
    announcement:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="91%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="5%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Median<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Time Period Prior to Announcement</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Premium</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    1&#160;day
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    23.8
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    4&#160;weeks
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    28.3
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Using these median premia and the closing prices per share of
    Axsys common stock
    <FONT style="white-space: nowrap">1-day</FONT> and
    4-weeks prior to March&#160;11, 2009, which was the date that
    Axsys announced it was evaluating the possible sale of the
    Company and had engaged Jefferies as its financial advisor, this
    analysis indicated a range of implied value per share of Axsys
    common stock of approximately $33.55 to $49.14, compared to the
    merger consideration of $54.00 per share of Axsys common stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Jefferies also performed a premiums paid analysis using the
    adjusted closing prices per share of Axsys common stock on the
    dates <FONT style="white-space: nowrap">1-day</FONT>
    and 4-weeks prior to June&#160;2, 2009, respectively. The
    closing prices per share of Axsys common stock were adjusted to
    reflect the average change in the trading prices of the Axsys
    Selected Comparable Companies during the period from
    March&#160;10, 2009, to May&#160;5, 2009 (which was the date
    four weeks prior to the date of Jefferies&#146; analysis) and to
    June&#160;1, 2009 (which was the date one day prior to the date
    of Jefferies&#146; analysis), respectively. During the period
    from March&#160;10, 2009 to May&#160;5, 2009, the average change
    in the trading prices of the Axsys Selected Comparable Companies
    was up 34.2%, and during the period from March&#160;10, 2009 to
    June&#160;1, 2009, the average change in the trading prices of
    the Axsys Selected Comparable Companies was up 28.6%. This
    analysis indicated a range of median implied values per share of
    Axsys common stock of approximately $43.14 to $47.67, compared
    to the merger consideration of $54.00 per share of Axsys common
    stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition, Jefferies performed a premiums paid analysis using
    the closing prices per share of Axsys common stock for the
    periods
    <FONT style="white-space: nowrap">1-day</FONT> and
    4-weeks prior to June&#160;2, 2009 which was the date one day
    prior to the date of Jefferies&#146; analysis. This analysis
    indicated a range of median implied value per share of Axsys
    common stock of approximately $55.55 to $62.39, compared to the
    merger consideration of $54.00 per share of Axsys common stock.
    However, Jefferies noted that this analysis was not particularly
    meaningful because Axsys common stock was likely trading in
    anticipation of a transaction announcement following the
    announcement by Axsys on March&#160;11, 2009 that it was
    evaluating a potential sale.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">General</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The type and amount of consideration payable in the merger was
    determined through negotiations between Axsys and General
    Dynamics, rather than by any financial advisor, and was approved
    by the Board. The decision to
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    26
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    enter into the merger agreement was solely that of the Board. As
    described above, Jefferies&#146; opinion was one of many factors
    taken into consideration by the Board in making its
    determination to approve the merger and should not be considered
    determinative of the views of the Board or management with
    respect to the merger or the merger consideration.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Jefferies was selected by the Board based on Jefferies&#146;
    qualifications, expertise and reputation. Jefferies is an
    internationally recognized investment banking and advisory firm.
    Jefferies, as part of its investment banking business, is
    regularly engaged in the valuation of businesses and securities
    in connection with mergers and acquisitions, negotiated
    underwritings, competitive biddings, secondary distributions of
    listed and unlisted securities, private placements, financial
    restructurings and other financial services.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In the ordinary course of business, Jefferies and its affiliates
    may trade or hold securities of Axsys or General Dynamics
    <FONT style="white-space: nowrap">and/or</FONT> their
    respective affiliates for its own account and for the accounts
    of its customers and, accordingly, may at any time hold long or
    short positions in those securities.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Pursuant to an engagement agreement between Axsys and Jefferies
    dated January&#160;26, 2009, Axsys has agreed to pay Jefferies a
    fee for its services, based upon a percentage of the transaction
    value, in the amount of approximately $7&#160;million, of which
    $1.5&#160;million was earned upon delivery of Jefferies&#146;
    opinion, and the balance of which is payable contingent upon
    consummation of the merger. In addition, Axsys has agreed to
    reimburse Jefferies for reasonable expenses incurred, including
    certain fees and disbursements of Jefferies&#146; legal counsel.
    Axsys also has agreed to indemnify Jefferies and certain related
    parties against liabilities arising out of or in connection with
    the services rendered and to be rendered by it under its
    engagement, including liabilities arising under federal
    securities laws.
</DIV>
<A name='152'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Certain
    Financial Information</FONT></B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In the course of the sale process described under
    &#147;&#151;&#160;Background of the Merger,&#148; we provided
    General Dynamics and certain other potential purchasers who
    signed confidentiality agreements selected, non-public financial
    projections prepared by our senior management. Axsys does not as
    a matter of course make public projections as to future
    performance or earnings, and the portions of these financial
    projections set forth below are included in this proxy statement
    only because this information was provided to General Dynamics
    and certain other potential purchasers on a confidential basis
    in connection with Axsys&#146; sale process. You should note
    that these financial projections constitute forward-looking
    statements. See &#147;Forward-Looking Statements May Prove
    Inaccurate&#148; on page 11.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Axsys advised the recipients of the financial projections that
    such projections are subjective in many respects. The financial
    projections are based on a variety of estimates and assumptions
    of our senior management regarding our business, industry
    performance, general business, economic, market and financial
    conditions and other matters, all of which are difficult to
    predict and many of which are beyond our control. In particular,
    these forward-looking statements were based on numerous
    assumptions that are now out-dated. You should not regard the
    inclusion of these projections in this proxy statement as an
    indication that Axsys, General Dynamics, Jefferies or any of
    their respective affiliates or representatives considered or
    consider the projections to be a reliable prediction of actual
    future events, and you should not rely on the projections as
    such. Accordingly, there can be no assurance that the
    assumptions made in preparing the projections will prove
    accurate. If the assumptions do not prove accurate, the
    projections will not be accurate. It is expected that there will
    be differences between actual and projected results, and actual
    results may be materially greater or less than those contained
    in the projections. It is highly likely that the contribution of
    Axsys&#146; business to the consolidated results of General
    Dynamics will be different from Axsys&#146; performance on a
    stand alone basis. In addition, if the merger is not
    consummated, we may not be able to achieve these financial
    projections. None of Axsys, General Dynamics or any of their
    respective affiliates or representatives has made or makes any
    representations to any person regarding the ultimate performance
    of Axsys compared to the information contained in the
    projections.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The financial projections have been prepared by Axsys&#146;
    senior management. Neither Axsys&#146; independent auditors, nor
    any other independent accountants, have compiled, examined or
    performed any procedures with respect to the financial
    projections set forth below, nor have they expressed any opinion
    or any other form of assurance with respect thereto. The
    financial projections were not prepared with a view toward
    public disclosure or
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    27
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    compliance with the guidelines established by the American
    Institute of Certified Public Accountants for preparation and
    presentation of prospective financial information. We do not
    intend to update these out-dated financial projections or to
    make other projections public in the future.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The financial projections included (in millions of dollars):
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="83%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2009</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2010</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Revenue
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    280.0
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    322.4
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Gross Profit
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    97.6
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    113.7
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    EBITDA (excluding corporate expenses)(1)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    64.6
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    75.3
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    EBITDA (including corporate expenses)(1)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    55.4
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    65.6
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=60 -->

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    The projections were calculated both on a stand-alone basis
    (including corporate expenses) and as if acquired (excluding
    corporate expenses).</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In mid-April 2009, Axsys revised its 2009 projections, adjusting
    revenue to $278.0&#160;million and gross profit to
    $96.5&#160;million.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The foregoing financial projections are based upon numerous
    estimates and assumptions including, without limitation, the
    following:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    continued positive trends within Axsys&#146; target markets;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    continued development and expansion of Axsys&#146; product
    offering, particularly with regard to integrated camera and
    gyrostabilized systems;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    further penetration of Axsys&#146; growing end markets, such as
    the asymmetric warfare, homeland security, intelligence and
    commercial sectors;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    movement up the value chain on defense and space programs
    related to both new initiatives and refurbishment of existing
    platforms;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    expansion of international sales channels;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    continued improvement in Axsys&#146; gross profit
    margins;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    continued improvements in Axsys&#146; EBITDA margins.
</TD>
</TR>

</TABLE>
<A name='153'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Interests
    of Axsys Directors and Executive Officers in the
    Merger</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In considering the Board&#146;s recommendation to vote for the
    proposal to adopt the merger agreement, Axsys stockholders
    should be aware that some of the directors and executive
    officers of Axsys have interests in the merger that may be
    different from, or in addition to, the interests of Axsys
    stockholders generally and that may create potential conflicts
    of interest. The Board was aware of and considered the interests
    of the Company&#146;s directors and executive officers when the
    Board considered, adopted and approved the merger agreement and
    determined to recommend to Axsys stockholders that they vote for
    the proposal to adopt the merger agreement. These interests did
    not have any effect on the Board&#146;s deliberations of the
    proposed merger.
</DIV>
<A name='154'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Treatment
    of Stock Options</FONT></I></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Under the terms of the merger agreement, each outstanding stock
    option held by our employees (including our executive officers)
    and directors that is outstanding and unexercised as of
    immediately prior to the effective time of the merger (whether
    or not such stock option is vested and exercisable prior to the
    effective time) will be canceled and converted into the right to
    receive a cash payment equal to the number of shares underlying
    the option multiplied by the amount (if any) by which $54.00
    exceeds the option exercise price, less any applicable
    withholding taxes, and without interest.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    28
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table shows, for our directors and executive
    officers, the aggregate number of shares subject to outstanding
    options, whether vested or unvested and the cash-out value of
    all outstanding options with a per share exercise price less
    than $54.00. The information in the table is as of
    August&#160;3, 2009.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="76%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Aggregate<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Aggregate<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Shares<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Cash-Out<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Subject to<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Value of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Name</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>All Options</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>All Options</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Stephen W. Bershad
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    67,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,378,675
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    David A. Almeida
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    60,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,279,255
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Scott B. Conner
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    34,200
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,273,184
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Anthony J. Fiorelli, Jr.&#160;
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,220
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    409,815
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Eliot M. Fried
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    9,024
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    427,644
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Richard F. Hamm, Jr.&#160;
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    8,779
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    384,037
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Robert G. Stevens
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    13,474
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    607,580
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
<A name='155'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Treatment
    of Restricted Stock</FONT></I></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Under the terms of the merger agreement, each outstanding
    restricted share of common stock held by our employees
    (including our executive officers) and directors that is
    outstanding as of immediately prior to the effective time of the
    merger will cease to be subject to any restrictions and will be
    canceled and converted into the right to receive a cash payment
    equal to $54.00, less any applicable withholding taxes, and
    without interest.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table shows, for our executive officers and
    directors, the aggregate number of restricted shares and the
    cash-out value of such restricted shares (calculated at $54.00
    per restricted share). The information in the table is as of
    August&#160;3, 2009.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="77%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Aggregate<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Aggregate<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Cash-Out<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Number of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Value of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Restricted<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Restricted<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Name</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Shares</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Shares</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Stephen W. Bershad
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    49,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,667,600
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    David A. Almeida
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    59,880
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,233,520
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Scott B. Conner
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    59,880
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    3,233,520
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Anthony J. Fiorelli, Jr.&#160;
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    81,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Eliot M. Fried
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    81,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Richard F. Hamm, Jr.&#160;
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    81,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Robert G. Stevens
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,500
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    81,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>
<A name='156'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Employment
    Agreement and Severance Protection Agreements</FONT></I></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Axsys entered into an amended and restated employment agreement
    with Stephen W. Bershad, dated May&#160;7, 2009, as amended on
    June&#160;3, 2009, an amended and restated severance protection
    agreement with David A. Almeida, dated December&#160;22, 2008,
    as amended on May&#160;7, 2009 and June&#160;3, 2009, and an
    amended and restated severance protection agreement with Scott
    B. Conner, dated December&#160;22, 2008, as amended on
    May&#160;7, 2009 and June&#160;3, 2009. The executives&#146;
    agreements provide for severance payments to the applicable
    executive if his employment with Axsys is terminated within the
    two-year period following a change in control of Axsys under any
    of the following circumstances:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Axsys terminates the executive&#146;s employment without cause
    (as defined in his applicable agreement);
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    The executive terminates his employment for good reason (as
    defined in his applicable agreement);&#160;or
</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    29
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    The executive terminates his employment for any reason during
    the one-month period (the executive&#146;s &#147;window
    period&#148;) ending on the earlier of:
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="6%"></TD>
    <TD width="2%"></TD>
    <TD width="92%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    <B>&#149;&#160;</B>
</TD>
    <TD align="left">
    the end of the second month of the calendar year following the
    calendar year in which the change in control occurs,&#160;or
</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    <B>&#149;&#160;</B>
</TD>
    <TD align="left">
    the last day of the seventh month following the change in
    control.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The completion of the merger will constitute a change in control
    for purposes of these agreements.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If the executive&#146;s employment is terminated under any of
    the circumstances listed above within the two-year period
    following a change in control or preceding the change in control
    if the executive demonstrates the termination was at the request
    of a third party that took steps to effectuate and actually
    effectuated the change in control or the termination arose in
    connection with a change in control, the executive will be
    entitled to receive all accrued but unpaid salary, prior
    year&#146;s bonus, vacation pay and reimbursable expenses, and
    the following severance payments and benefits:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    an amount equal to 2.99 times the sum of (A)&#160;the highest
    annual rate of base salary paid to the executive during the
    <FONT style="white-space: nowrap">12-month</FONT>
    period immediately prior to the termination of his employment
    and (B)&#160;the average of the annual cash bonuses paid to the
    executive during the three calendar years prior to the year in
    which the termination of his employment occurs;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    continued life insurance, disability, medical, dental,
    prescription drug and hospitalization coverages and benefits for
    12&#160;months.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Each executive&#146;s agreement provides, with respect to the
    annual incentive bonus earned in the year in which the change in
    control occurs, that if the executive&#146;s employment is not
    terminated prior to the last day of the fiscal year in which the
    change in control occurs, the executive will receive the greater
    of the bonus he would have received for the full year based on
    actual achievement of the performance goals or the bonus he
    would have received for the full year based on Axsys&#146;
    monthly annual forecast produced immediately prior to the change
    in control and prorated based on the number of days in the
    fiscal year preceding the change in control. Each
    executive&#146;s agreement also provides that if, prior to the
    last day of the fiscal year in which the change in control
    occurs, the executive&#146;s employment is terminated by Axsys
    other than for cause, upon death, or by the executive for good
    reason or for any reason during the executive&#146;s window
    period, the executive will receive a payment for his annual
    incentive bonus equal to the greater of the bonus he would have
    received for the full year based on Axsys&#146; monthly annual
    forecast produced immediately prior to his termination date and
    prorated based on the number of days in the fiscal year
    preceding his termination date or the bonus he would have
    received for the full year based on Axsys&#146; monthly annual
    forecast produced immediately prior to the change in control and
    prorated based on the number of days in the fiscal year
    preceding the change in control.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Each executive&#146;s agreement provides that the executive is
    entitled to a
    <FONT style="white-space: nowrap">&#147;gross-up&#148;</FONT>
    payment to make him whole for any federal excise tax imposed
    under Section&#160;4999 of the Internal Revenue Code of 1986, as
    amended, which is referred to as the Code, on change in control
    payments, severance payments or benefits received by the
    executive officer (including the value of accelerated vesting of
    stock options and restricted stock upon completion of the
    merger) that are treated as &#147;excess parachute
    payments&#148; under Section&#160;280G of the Code. The purpose
    of the
    <FONT style="white-space: nowrap">gross-up</FONT>
    payment is to put the executive in the same position with
    respect to the payments and benefits he may receive in
    connection with the change in control, as described above, after
    payment of all federal, state and local taxes (including income
    taxes and the excise tax under Section&#160;4999 of the Code),
    as the executive would have been in if the excise tax under
    Section&#160;4999 of the Code had not applied.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Under each executive&#146;s agreement, Axsys is required to pay
    all reasonable legal fees and related expenses (including the
    costs of experts, evidence and counsel) incurred by the
    executive as they become due as a result of or in connection
    with (a)&#160;the executive&#146;s contesting, defending or
    disputing the basis for the termination of the executive&#146;s
    employment, (b)&#160;the executive&#146;s hearing before the
    Board as contemplated in his agreement in connection with his
    right to contest a termination of his employment for cause, or
    (c)&#160;the executive&#146;s seeking to obtain or enforce any
    right or benefit provided by his applicable agreement or by any
    other plan or arrangement maintained by Axsys under which the
    executive is or may be entitled to receive benefits.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    30
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following table summarizes the estimated amount of the
    change in control and severance benefits that would be paid to
    our executive officers if each executive officer&#146;s
    employment were terminated immediately following the merger, as
    well as the pro rata bonus payments that the executive officers
    would receive, as described above, assuming a September&#160;3,
    2009 closing date.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="36%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="10%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="6%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Severance<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Benefits<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Excise Tax and<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Pro Rata<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Name</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Payments</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Continuation</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Gross-Up(1)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Bonus</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Total</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Stephen Bershad
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    2,152,811
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    37,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,922,243
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    186,024
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    4,298,078
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    David Almeida
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,499,339
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    33,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    0
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    137,496
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,669,835
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Scott Conner
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,488,033
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    34,000
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    1,466,886
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    137,496
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    3,126,415
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=60 -->

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Under Treasury
    <FONT style="white-space: nowrap">Regulation&#160;Section&#160;1.280G-1,</FONT>
    Q&#038;A-25, any payment made pursuant to an agreement that was
    entered into within one year before a change in ownership or
    control is presumed to be contingent upon that change unless
    otherwise rebutted by clear and convincing evidence that the
    payment was not contingent on the change. As of the date of this
    proxy statement, it has not been determined whether the one-year
    presumption described in Treasury
    <FONT style="white-space: nowrap">Regulation&#160;Section&#160;1.280G-1,</FONT>
    Q&#038;A-25 may be rebutted with respect to the grants of
    restricted shares made to the executives on March&#160;11, 2009.
    For purposes of the calculation of the amount of the
    <FONT style="white-space: nowrap">gross-up</FONT>
    payment, it is assumed that the one-year presumption described
    in Treasury
    <FONT style="white-space: nowrap">Regulation&#160;Section&#160;1.280G-1,</FONT>
    Q&#038;A-25 may not be rebutted with respect to the grants of
    restricted shares made on March&#160;11, 2009. If the
    presumption is rebutted by clear and convincing evidence, the
    amount of the parachute payment attributable to the accelerated
    vesting of such shares would be significantly lower for each of
    the executives, resulting in a lower amount of a
    <FONT style="white-space: nowrap">gross-up</FONT>
    payment for Mr.&#160;Bershad and no
    <FONT style="white-space: nowrap">gross-up</FONT>
    payment for Mr.&#160;Conner.</TD>
</TR>

</TABLE>
<A name='157'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Indemnification;
    Directors&#146; and Officers&#146; Insurance</FONT></I></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The merger agreement requires that the indemnification
    provisions of the certificate of incorporation and bylaws of the
    surviving corporation as in effect at the effective time of the
    merger not be amended, modified or repealed for six years from
    the effective time of the merger in any manner that would
    adversely affect the rights of individuals who immediately prior
    to the effective time of the merger were directors, officers or
    employees of Axsys unless required by law. GD AIS also has
    agreed to indemnify the present and former employees, officers
    and directors of Axsys and to cause the surviving corporation to
    provide directors&#146; and officers&#146; liability insurance
    coverage for the benefit of the present and former officers and
    directors of Axsys that will contain substantially equivalent
    scope and amount of coverage as the policy maintained by Axsys
    immediately prior to effectiveness of the merger, subject to
    certain limitations on the amount of premiums required to be
    paid for such insurance coverage.
</DIV>
<A name='158'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Governmental
    and Regulatory Matters</FONT></B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Under the HSR Act and the rules that have been promulgated
    thereunder by the FTC, certain acquisition transactions may not
    be consummated unless information has been furnished to the
    Antitrust Division and the FTC and certain waiting period
    requirements have been satisfied. The merger is subject to these
    requirements and may not be completed until the expiration of a
    <FONT style="white-space: nowrap">30-day</FONT>
    waiting period following the filing of the required Notification
    and Report Forms, which are referred to as the forms, with the
    Antitrust Division and the FTC. Pursuant to the requirements of
    the HSR Act, Axsys completed the filing of the forms with the
    Antitrust Division and the FTC on June&#160;8, 2009. GD AIS also
    filed the forms on June&#160;8, 2009. On July&#160;8, 2009, GD
    AIS withdrew its original notifications and on July&#160;9,
    2009, refiled them with the FTC and Antitrust Division in order
    to provide more time for review. The
    <FONT style="white-space: nowrap">30-day</FONT>
    waiting period, which cannot expire on a Saturday, Sunday or a
    U.S.&#160;federal holiday, will expire at
    11:59&#160;p.m.&#160;Eastern Time on August&#160;10, 2009,
    unless the FTC or the Antitrust Division earlier terminates the
    waiting period or makes a request for more information related
    to the merger.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Antitrust Division and the FTC have the authority to
    scrutinize the legality of transactions under the antitrust
    laws. For example, the FTC could issue requests to Axsys and GD
    AIS for additional information regarding the merger. If such
    requests for additional information were made, the waiting
    period referred to above would be extended until the end of the
    30th&#160;day after both Axsys and GD AIS have substantially
    complied with the requests for additional information or such
    later time as is agreed among the parties and the FTC, unless
    the waiting period is earlier terminated because the FTC
    determines to close its review.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    31
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Further, at any time before or after the consummation of the
    merger, the Antitrust Division or the FTC could take such action
    under the antitrust laws as it deems necessary or desirable in
    the public interest, including seeking to enjoin the merger or
    seeking divestiture of certain of Axsys&#146; or GD AIS&#146;
    assets. Private parties and state attorneys general may also
    bring legal actions under the antitrust laws.
</DIV>
<A name='159'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Certain
    United States Federal Income Tax Consequences</FONT></B>
</DIV>
</A>
<A name='160'>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Summary
    Only</FONT></I></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The following is a summary of certain United States federal
    income tax consequences of the merger to Axsys stockholders
    whose shares of common stock are converted into the right to
    receive cash under the merger agreement. This summary is based
    on provisions of the Internal Revenue Code of 1986, as amended,
    United States Treasury Regulations promulgated thereunder,
    judicial opinions and administrative rulings and published
    positions of the United States Internal Revenue Service, each in
    effect as of the date of this proxy statement and all of which
    are subject to change, possibly with retroactive effect.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    This summary applies only to stockholders who hold shares of
    Axsys common stock as capital assets within the meaning of
    Section&#160;1221 of the Internal Revenue Code. This summary
    does not address the United States federal income tax
    consequences to any stockholder who, for United States federal
    income tax purposes, is a non-resident alien individual, foreign
    corporation, foreign partnership or foreign estate or trust.
    This summary does not address the federal income taxation of
    holders of options to purchase Axsys common stock. In addition,
    no information is provided with respect to the tax consequences
    of the merger under applicable state, local, foreign or United
    States federal non-income tax laws.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    This summary does not purport to consider all aspects of United
    States federal income taxation that might be relevant to Axsys
    stockholders in light of their particular circumstances and does
    not apply to stockholders that are subject to special rules
    under the United States federal income tax laws (including, for
    example, insurance companies, tax-exempt organizations,
    financial institutions, dealers in securities, persons subject
    to the alternative minimum tax, persons who hold or have held
    shares of Axsys common stock as part of a straddle, hedge,
    integrated constructive sale or conversion transaction for tax
    purposes and persons who acquired shares of Axsys common stock
    pursuant to the exercise of an employee stock option or right or
    otherwise as compensation). If a partnership (including for this
    purpose any entity or arrangement treated as a partnership for
    United States federal income tax purposes) is a beneficial owner
    of shares of Axsys common stock, the tax treatment of a partner
    in that partnership will generally depend on the status of the
    partner and the activities of the partnership.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    All holders of shares of Axsys common stock are urged to consult
    their own tax advisors to determine the particular tax
    consequences to them of the merger.
</DIV>
<A name='161'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Merger</FONT></I></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Subject to the limitations disclosed above, a stockholder who
    surrenders shares of Axsys common stock for cash pursuant to the
    merger will recognize a capital gain or loss for United States
    federal income tax purposes equal to the difference, if any,
    between the amount of cash received in the merger and the
    stockholder&#146;s adjusted tax basis in shares of Axsys common
    stock surrendered. Gain or loss will be determined separately
    for each block of shares (i.e., shares acquired at the same cost
    in a single transaction) surrendered for cash pursuant to the
    merger. Such gain or loss will be long-term capital gain or loss
    if a stockholder&#146;s holding period for such shares is more
    than one year at the time of the completion of the merger. In
    the case of individuals, long-term capital gain is currently
    eligible for reduced rates of United States federal income tax.
    There are limitations on the deductibility of capital losses.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Federal backup withholding at a rate of 28% may apply with
    respect to certain payments, including cash received in the
    merger, unless a payee (1)&#160;is a corporation or comes within
    certain other exempt categories and, when required, demonstrates
    this fact or (2)&#160;provides a correct taxpayer identification
    number, certifies as to no loss of exemption from backup
    withholding and that such stockholder is a U.S.&#160;person
    (including a U.S.&#160;resident alien) and otherwise complies
    with applicable requirements of the backup withholding rules.
    Each of our stockholders and, if applicable, each other payee
    should complete and sign the Substitute
    <FONT style="white-space: nowrap">Form&#160;W-9</FONT>
    that will be included as part of the letter of transmittal to be
    returned to the disbursing agent, in order to provide the
    information and certification
</DIV>

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    <BR>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    necessary to avoid backup withholding, unless an exemption
    applies and is established in a manner satisfactory to the
    disbursing agent.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Backup withholding is not an additional tax and any amounts
    withheld under the backup withholding rules may be allowed as a
    refund or a credit against your United States federal income tax
    liability provided that you furnish the required information to
    the United States Internal Revenue Service. Such amounts, once
    withheld, are not refundable by us or the disbursing agent.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>The summary of certain United States federal income tax
    consequences set forth above does not constitute a complete
    description of all tax consequences relating to the merger.
    Because tax matters are very complicated and individual tax
    consequences may differ depending on your facts and
    circumstances, all stockholders are urged to consult with their
    own tax advisors regarding the tax consequences of the merger to
    them, including the application of state, local and foreign tax
    laws.</B>
</DIV>
<A name='162'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Appraisal
    Rights of Axsys Stockholders</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Record holders of shares of Axsys common stock who do not vote
    in favor of the adoption of the merger agreement, and who
    otherwise comply with the applicable provisions of
    Section&#160;262 of the DGCL, will be entitled to exercise
    appraisal rights under Section&#160;262 of the DGCL in
    connection with the merger. A person having a beneficial
    interest in shares of Axsys common stock held of record in the
    name of another person, such as a broker, bank or other nominee,
    must act promptly to cause the record holder to follow the steps
    summarized below properly and in a timely manner to perfect
    appraisal rights.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>The following discussion is not a complete statement of the
    law pertaining to appraisal rights under the DGCL and is
    qualified in its entirety by the full text of Section&#160;262
    of the DGCL, which is reprinted in its entirety as
    <U>Annex&#160;D</U> and incorporated into this proxy statement
    by reference. The following summary does not constitute any
    legal or other advice nor does it constitute a recommendation
    that stockholders exercise their appraisal rights. All
    references in Section&#160;262 of the DGCL and in this summary
    to a &#147;stockholder&#148; or &#147;holder&#148; are to the
    record holder of the shares of Axsys common stock as to which
    appraisal rights are asserted.</B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Holders of shares of Axsys common stock who follow the
    procedures set forth in Section&#160;262 of the DGCL will be
    entitled to have their shares of Axsys common stock appraised by
    the Delaware Court of Chancery and to receive, in lieu of the
    merger consideration, payment in cash of the &#147;fair
    value&#148; of their shares of Axsys common stock, exclusive of
    any element of value arising from the accomplishment or
    expectation of the merger, together with interest, if any, as
    determined by that court (described more fully below).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Under Section&#160;262 of the DGCL, when a proposed merger of a
    Delaware corporation is to be submitted for adoption at a
    meeting of its stockholders, the corporation, not less than
    20&#160;days prior to the meeting, must notify each of its
    stockholders entitled to appraisal that appraisal rights are so
    available, and must include in this required notice a copy of
    Section&#160;262 of the DGCL.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    This proxy statement constitutes the required notice to the
    holders of the shares of Axsys common stock in respect of the
    merger, and Section&#160;262 of the DGCL is attached to this
    proxy statement as <U>Annex&#160;D</U>. Any Axsys stockholder
    who wishes to exercise appraisal rights in connection with the
    merger or who wishes to preserve the right to do so should
    review the following discussion and <U>Annex&#160;D</U>
    carefully, because failure to comply timely and properly with
    the procedures specified in <U>Annex&#160;D</U> will result in
    the loss of appraisal rights under the DGCL. Moreover, because
    of the complexity of the procedures for exercising the right to
    seek appraisal of shares of Axsys common stock, Axsys believes
    that if a stockholder considers exercising such rights, such
    stockholder should seek the advice of legal counsel.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>A holder of Axsys common stock wishing to exercise appraisal
    rights must not vote in favor of the adoption of the merger
    agreement, and must deliver to Axsys before the taking of the
    vote on the adoption of the merger agreement at the Axsys
    special meeting a written demand for appraisal of their shares
    of Axsys common stock. This written demand for appraisal must be
    in addition to and separate from any proxy or vote on the
    adoption of the merger agreement. Neither abstaining from voting
    or failing to vote on the adoption of the merger agreement or
    instructing or effecting a vote against the adoption of the
    merger agreement will in </B>
</DIV>

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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>and of itself constitute a written demand for appraisal
    satisfying the requirements of Section&#160;262 of the DGCL.
    This demand must reasonably inform Axsys of the identity of the
    stockholder and of the stockholder&#146;s intent thereby to
    demand appraisal of their shares in connection with the merger.
    A stockholder&#146;s failure to make the written demand prior to
    the taking of the vote on the adoption of the merger agreement
    at the special meeting of stockholders will constitute a waiver
    of appraisal rights. A holder of Axsys common stock wishing to
    exercise appraisal rights must be the record holder of the
    shares of Axsys common stock on the date the written demand for
    appraisal is made and must continue to hold the shares of Axsys
    common stock through the effective date of the merger.
    Accordingly, a holder of Axsys common stock who is the record
    holder of Axsys common stock on the date the written demand for
    appraisal is made, but who thereafter transfers the shares of
    Axsys common stock prior to the effective date of the merger,
    will lose any right to appraisal in respect of those shares of
    Axsys common stock.</B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    A proxy card that is signed and does not contain voting
    instructions will, unless revoked, be voted in favor of the
    adoption of the merger agreement, and it will constitute a
    waiver of the stockholder&#146;s right of appraisal and will
    nullify any previously delivered written demand for appraisal.
    <B>Therefore, a stockholder who votes by proxy and who wishes to
    exercise appraisal rights must vote AGAINST adoption of the
    merger agreement, or abstain from voting on the adoption of the
    merger agreement</B>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>Only a holder of record of Axsys common stock on the date of
    the making of a demand for appraisal will be entitled to assert
    appraisal rights for the shares of Axsys common stock registered
    in that holder&#146;s name. </B>A demand for appraisal in
    respect of shares of Axsys common stock should be executed by or
    on behalf of the holder of record, fully and correctly, as the
    holder&#146;s name appears on the holder&#146;s stock
    certificates, should specify the holder&#146;s name and mailing
    address and the number of shares registered in the holder&#146;s
    name and must state that the person intends to demand appraisal
    of the holder&#146;s shares, in connection with the merger. If
    the shares of Axsys common stock are held of record by a person
    other than the beneficial owner, including a broker, fiduciary
    (such as a trustee, guardian or custodian), depository or other
    nominee, execution of the demand should be made in that
    capacity, and if the Axsys common stock is held of record by
    more than one holder as in a joint tenancy or tenancy in common,
    the demand should be executed by or on behalf of all joint
    holders. An authorized agent, including an agent for one or more
    joint holders, may execute a demand for appraisal on behalf of a
    holder of record. The agent, however, must identify the record
    holder or holders and expressly disclose the fact that, in
    executing the demand, the agent is acting as agent for the
    record holder or holders. A record holder such as a broker, bank
    or nominee who holds Axsys common stock as nominee for several
    beneficial owners may exercise appraisal rights with respect to
    the shares of Axsys common stock held for one or more beneficial
    owners while not exercising appraisal rights with respect to the
    Axsys common stock held for other beneficial owners. In this
    case, the written demand should set forth the number of shares
    of Axsys common stock as to which appraisal is sought. When no
    number of shares of Axsys common stock is expressly mentioned,
    the demand will be presumed to cover all Axsys common stock in
    brokerage accounts or other nominee forms held by such record
    holder, and those who hold shares in brokerage accounts or other
    nominee forms and who wish to exercise appraisal rights under
    Section&#160;262 of the DGCL are urged to consult with their
    brokers to determine the appropriate procedures for the making
    of a demand for appraisal by such a nominee.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>All written demands for appraisal pursuant to
    Section&#160;262 of the DGCL should be sent or delivered to
    Axsys Technologies, Inc., 175 Capital Boulevard, Suite&#160;103,
    Rocky Hill, Connecticut 06067, Attention: Corporate
    Secretary.</B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    At any time within 60&#160;days after the effective date of the
    merger, any stockholder who has not commenced an appraisal
    proceeding or joined that proceeding as a named party may
    withdraw his, her or its demand for appraisal and accept the
    consideration offered pursuant to the merger agreement by
    delivering to Axsys, as the surviving corporation, a written
    withdrawal of the demand for appraisal. However, any such
    attempt to withdraw the demand made more than 60&#160;days after
    the effective date of the merger will require written approval
    of the surviving corporation. No appraisal proceeding in the
    Delaware Court of Chancery will be dismissed as to any
    stockholder without the approval of the Delaware Court of
    Chancery, and such approval may be conditioned upon such terms
    as the Court deems just; provided, however, that any stockholder
    who has not commenced an appraisal proceeding or joined that
    proceeding as a named party may withdraw his, her or its demand
    for appraisal and accept the merger consideration offered
    pursuant to the merger agreement within 60&#160;days after the
    effective date of the merger. If the
</DIV>

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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    surviving corporation does not approve a request to withdraw a
    demand for appraisal when that approval is required, or, except
    with respect to any stockholder who withdraws such
    stockholder&#146;s right to appraisal in accordance with the
    proviso in the immediately preceding sentence, if the Delaware
    Court of Chancery does not approve the dismissal of an appraisal
    proceeding, the stockholder will be entitled to receive only the
    appraised value determined in any such appraisal proceeding,
    which value could be less than, equal to or more than the
    consideration being offered pursuant to the merger agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Within 10&#160;days after the effective date of the merger,
    Axsys, or the surviving company, will notify each former Axsys
    stockholder who has properly asserted appraisal rights under
    Section&#160;262 of the DGCL, and has not voted in favor of the
    adoption of the merger agreement, of the date the merger became
    effective.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Within 120&#160;days after the effective date of the merger, but
    not thereafter, the surviving company or any former Axsys
    stockholder who has complied with the statutory requirements
    summarized above and is entitled to appraisal rights under
    Section&#160;262 of the DGCL may commence an appraisal
    proceeding by filing a petition in the Delaware Court of
    Chancery, with a copy served on the surviving corporation in the
    case of a petition filed by the stockholder, demanding a
    determination of the fair value of the shares of Axsys common
    stock that are entitled to appraisal rights. None of GD AIS, the
    surviving company or Axsys is under any obligation to and none
    of them has any present intention to file a petition with
    respect to the appraisal of the fair value of the shares of
    Axsys common stock, and stockholders seeking to exercise
    appraisal rights should not assume that the surviving company,
    Axsys or GD AIS will file a petition. Accordingly, it is the
    obligation of Axsys stockholders wishing to assert appraisal
    rights to take all necessary action to perfect and maintain
    their appraisal rights within the time prescribed in
    Section&#160;262 of the DGCL.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Within 120&#160;days after the effective date of the merger, any
    former Axsys stockholder who has complied with the requirements
    for exercise of appraisal rights will be entitled, upon written
    request, to receive from the surviving company a statement
    setting forth the aggregate number of shares of Axsys common
    stock not voted in favor of adoption of the merger agreement,
    and with respect to which demands for appraisal have been
    received and the aggregate number of former holders of these
    shares of Axsys common stock. The statement must be mailed
    within 10&#160;days after a written request therefor has been
    received by the surviving company or within 10&#160;days after
    expiration of the period for delivery of demands for appraisal
    under Section&#160;262 of the DGCL, whichever is later.
    Notwithstanding the foregoing, a person who is the beneficial
    owner of shares of Axsys common stock held either in a voting
    trust or by a nominee on behalf of such person may, in such
    person&#146;s own name, file a petition or request from the
    surviving corporation the statement described in this paragraph.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If a petition for an appraisal is filed timely with the Delaware
    Court of Chancery by a former Axsys stockholder and a copy
    thereof is served upon the surviving company, the surviving
    company will then be obligated within 20&#160;days of service to
    file with the Delaware Register in Chancery a duly verified list
    containing the names and addresses of all former Axsys
    stockholders who have demanded appraisal of their shares of
    Axsys common stock and with whom agreements as to the value of
    their shares have not been reached. After notice to such former
    Axsys stockholders as required by the Delaware Court of
    Chancery, the Delaware Court of Chancery is empowered to conduct
    a hearing on such petition to determine those former Axsys
    stockholders who have complied with Section&#160;262 of the DGCL
    and who have become entitled to appraisal rights thereunder. The
    Delaware Court of Chancery may require the former Axsys
    stockholders who demanded appraisal of their shares of Axsys
    common stock to submit their stock certificates to the Delaware
    Register in Chancery for notation thereon of the pendency of the
    appraisal proceeding. If any former stockholder fails to comply
    with such direction, the Delaware Court of Chancery may dismiss
    the proceedings as to that former stockholder.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    After determining which, if any, former Axsys stockholders are
    entitled to appraisal, the appraisal proceeding shall be
    conducted in accordance with the rules of the Delaware Court of
    Chancery, including any rules specifically governing appraisal
    proceedings, and the Delaware Court of Chancery will appraise
    such holders&#146; shares of Axsys common stock, determining
    their &#147;fair value,&#148; exclusive of any element of value
    arising from the accomplishment or expectation of the merger,
    together with interest, if any, to be paid upon the amount
    determined to be the fair value. Unless the Delaware Court of
    Chancery in its discretion determines otherwise for good cause
    shown, interest from the effective date of the merger through
    the date of payment of the judgment shall be compounded
    quarterly and shall accrue at 5% over the Federal Reserve
    discount rate (including any surcharge) as established from time
    to
</DIV>

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    time during the period between the effective date of the merger
    and the date of payment of the judgment. Axsys stockholders
    considering seeking appraisal should be aware that the fair
    value of their shares of Axsys common stock as determined under
    Section&#160;262 of the DGCL could be more than, the same as, or
    less than the value of the consideration they would receive
    pursuant to the merger agreement if they did not seek appraisal
    of their shares of Axsys common stock and that the investment
    banking opinion as to fairness from a financial point of view
    included in this proxy statement is not necessarily an opinion
    as to fair value under Section&#160;262 of the DGCL. Although
    Axsys believes that the merger consideration is fair, no
    representation is made as to the outcome of the appraisal of
    fair value as determined by the Delaware Court of Chancery, and
    stockholders should recognize that such an appraisal could
    result in a determination of a value higher or lower than, or
    the same as, the merger consideration. Neither GD AIS nor Axsys
    anticipates offering more than the applicable merger
    consideration to any stockholder of Axsys exercising appraisal
    rights, and each reserves the right to assert, in any appraisal
    proceeding, that for purposes of Section&#160;262 of the DGCL,
    the &#147;fair value&#148; of a share of Axsys common stock is
    less than the applicable merger consideration. The Delaware
    courts have stated that the methods which are generally
    considered acceptable in the financial community and otherwise
    admissible in court may be considered in the appraisal
    proceedings.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In determining &#147;fair value,&#148; the Delaware Court of
    Chancery is required to take into account all relevant factors.
    In <I>Weinberger </I>v. <I>UOP, Inc.</I>, the Delaware Supreme
    Court discussed the factors that could be considered in
    determining fair value in an appraisal proceeding, stating that
    &#147;proof of value by any techniques or methods which are
    generally considered acceptable in the financial community and
    otherwise admissible in court&#148; should be considered and
    that &#147;[f]air price obviously requires consideration of all
    relevant factors involving the value of a company.&#148; The
    Delaware Supreme Court has stated that in making this
    determination of fair value the court must consider market
    value, asset value, dividends, earnings prospects, the nature of
    the enterprise and any other facts which could be ascertained as
    of the date of the merger which throw any light on future
    prospects of the merged corporation. Section&#160;262 of the
    DGCL provides that fair value is to be &#147;exclusive of any
    element of value arising from the accomplishment or expectation
    of the merger.&#148; In <I>Cede&#160;&#038; Co. </I>v.
    <I>Technicolor, Inc.</I>, the Delaware Supreme Court stated that
    such exclusion is a &#147;narrow exclusion [that] does not
    encompass known elements of value,&#148; but which rather
    applies only to the speculative elements of value arising from
    such accomplishment or expectation. In <I>Weinberger</I>, the
    Delaware Supreme Court construed Section&#160;262 of the DGCL to
    mean that &#147;elements of future value, including the nature
    of the enterprise, which are known or susceptible of proof as of
    the date of the merger and not the product of speculation, may
    be considered.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition, Delaware courts have decided that a
    stockholder&#146;s statutory appraisal remedy may or may not be
    a dissenter&#146;s exclusive remedy, depending on the factual
    circumstances. Depending on such circumstances and the
    court&#146;s findings of fact and view of the equities, a court
    could grant additional remedies in the form of injunctive
    relief, money damages for breach of fiduciary duties, rescission
    or rescissory damages.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If a petition for appraisal is not timely filed, then the right
    to an appraisal will cease. The costs of the appraisal action
    (which do not include attorneys&#146; fees or the fees and
    expenses of experts) may be determined by the Delaware Court of
    Chancery and levied upon the parties as the Delaware Court of
    Chancery deems equitable under the circumstances. Upon
    application of a former Axsys stockholder, the Delaware Court of
    Chancery may also order that all or a portion of the expenses
    incurred by any former Axsys stockholder in connection with an
    appraisal proceeding, including, without limitation, reasonable
    attorneys&#146; fees and the fees and expenses of experts used
    in the appraisal proceeding, be charged pro rata against the
    value of all of the shares of Axsys common stock entitled to
    appraisal.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Any holder of Axsys common stock who has duly demanded an
    appraisal in compliance with Section&#160;262 of the DGCL will
    not, after the consummation of the merger, be entitled to vote
    the shares of Axsys common stock subject to this demand for any
    purpose or be entitled to the payment of dividends or other
    distributions on those shares of Axsys common stock (except
    dividends or other distributions payable to holders of record of
    Axsys common stock as of a record date prior to the effective
    date of the merger).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If any stockholder who properly demands appraisal of his, her or
    its Axsys common stock under Section&#160;262 of the DGCL fails
    to perfect, or effectively withdraws or loses, his, her or its
    right to appraisal, as provided in Section&#160;262 of the DGCL,
    that stockholder&#146;s shares of Axsys common stock will be
    deemed to have been converted at the effective date of the
    merger into the right to receive the merger consideration
    payable (without interest)
</DIV>

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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    pursuant to the merger agreement. An Axsys stockholder will fail
    to perfect, or effectively lose, his, her or its right to
    appraisal if, among other things, no petition for appraisal is
    filed within 120&#160;days after the effective date of the
    merger. In addition, as indicated above, a stockholder may
    withdraw his, her or its demand for appraisal in accordance with
    Section&#160;262 of the DGCL and accept the merger consideration
    offered pursuant to the merger agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Failure to follow strictly the steps required by
    Section&#160;262 of the DGCL for perfecting appraisal rights
    will result in the loss of these rights, in which event the
    shares held by the Axsys stockholder will be deemed to have been
    converted into the right to receive the merger consideration
    payable (without interest) pursuant to the merger agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <B>Any stockholder wishing to exercise appraisal rights is urged
    to consult with legal counsel prior to attempting to exercise
    such rights.</B>
</DIV>
<A name='163'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Termination
    of Listing of Shares of Axsys Common Stock</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Shares of Axsys common stock are currently authorized for
    listing on the Nasdaq Global Select Market under the symbol
    &#147;AXYS.&#148; Following the consummation of the merger, the
    listing of shares of Axsys common stock on the Nasdaq Global
    Select Market will terminate.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <A name='201'><B><FONT style="font-family: 'Times New Roman', Times">Certain
    Litigation Related to the Merger</FONT></B></A>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Three class action lawsuits are pending in the Connecticut and
    Delaware state courts relating to the merger. Two such actions,
    filed on June 10 and June&#160;25, 2009, respectively, are
    pending in the Superior Court for the Judicial District of
    Hartford, Connecticut, each on behalf of a putative class of
    Axsys stockholders and each naming Axsys, all of the members of
    the Board, GD AIS and General Dynamics as defendants. The
    Connecticut actions were consolidated on July&#160;7, 2009,
    under the caption <I>Chalverus&#160;v. Bershad</I>, Case
    <FONT style="white-space: nowrap">No.&#160;HHD-CV09-4044848-S.</FONT>
    The third class action lawsuit relating to the merger is pending
    in the Delaware Chancery Court, captioned <I>Holzer&#160;v.
    Bershad</I>, Case No.&#160;4702. The action, filed on behalf of
    a putative class of Axsys stockholders, names as defendants
    Axsys, all of the members of the Board, GD AIS and Merger Sub.
    The plaintiffs in the Connecticut and Delaware lawsuits
    generally allege that, in connection with approving the merger,
    the Axsys directors breached their fiduciary duties of care,
    good faith and fair dealing, loyalty and disclosure owed to the
    Axsys stockholders. The plaintiffs in the Connecticut case
    further allege that GD AIS and General Dynamics, and the
    plaintiff in the Delaware action further alleges that GD AIS and
    Merger Sub, have aided and abetted the Axsys directors in the
    breach of their fiduciary duties. In addition to monetary
    <FONT style="white-space: nowrap">and/or</FONT>
    rescissory damages with interest, the plaintiffs seek, among
    other things, a determination that the lawsuit is a proper class
    action and that the plaintiffs are proper class representatives,
    a declaration that the defendants breached their fiduciary
    duties to the plaintiffs and the other Axsys stockholders
    <FONT style="white-space: nowrap">and/or</FONT> aided
    and abetted such breaches, an accounting for all profits and any
    special benefits obtained by any defendants as a result of their
    breaches of their fiduciary duties, orders preliminarily and
    permanently enjoining the merger transaction, or rescinding or
    setting aside the merger if consummated, an award of the costs
    of the lawsuit, including reasonable attorneys&#146; and
    experts&#146; fees and other costs and expenses, and such other
    relief as the courts may find just and proper.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Based on our review of the complaints, we believe that these
    lawsuits and the underlying claims are without merit. Axsys
    intends to defend the lawsuits vigorously.
</DIV>

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    37
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<A name='164'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">THE
    MERGER AGREEMENT</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>The following description of the merger agreement describes
    the material provisions of the merger agreement but does not
    purport to describe all of the terms of the merger agreement.
    The full text of the merger agreement is attached to this proxy
    statement as <U>Annex&#160;A</U> and incorporated by reference
    into this proxy statement. You are urged to read the merger
    agreement in its entirety because it is the legal document that
    governs the merger.</I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The provisions contained in the merger agreement are intended to
    govern the contractual rights and relationships, and to allocate
    risks, between Axsys and GD AIS with respect to the merger. The
    representations and warranties made by Axsys and GD AIS to one
    another in the merger agreement were negotiated between the
    parties, and any inaccuracies in the representations and
    warranties may be waived by the beneficiary of such
    representations and warranties. Moreover, the representations
    and warranties are qualified in a number of important respects,
    including through the use of exceptions for certain matters
    disclosed by the party that made the representations and
    warranties to the other party. None of the representations and
    warranties will survive the closing of the merger.
</DIV>
<A name='165'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">The
    Merger</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    At the effective time of the merger, Merger Sub, an indirect,
    wholly owned subsidiary of General Dynamics, will merge with and
    into Axsys. The separate corporate existence of Merger Sub will
    cease and Axsys will continue as the surviving corporation and
    will become an indirect, wholly owned subsidiary of General
    Dynamics. Merger Sub was created solely for purposes of the
    merger and has no material assets or operations of its own.
</DIV>
<A name='166'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Closing
    and Effective Time of the Merger</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The merger will become effective at the time a certificate of
    merger is filed with the Secretary of State of the State of
    Delaware or such later date or time as Axsys and GD AIS mutually
    agree and specify in the certificate of merger, which is
    referred to as the effective time of the merger.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The closing of the merger will take place on the second business
    day after satisfaction or waiver of the conditions described
    below under &#147;&#151;&#160;Conditions of the Merger&#148;
    beginning on page 50 (other than those conditions that by their
    nature are to be satisfied at the closing but subject to the
    fulfillment or waiver of those conditions), unless otherwise
    agreed by Axsys and GD AIS.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<A name='167'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Consideration
    to be Received in the Merger</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The merger agreement provides that, at the effective time of the
    merger, each issued and outstanding share of Axsys common stock
    immediately prior to the effective time of the merger, subject
    to certain exceptions, will be converted into the right to
    receive $54.00 in cash, without interest. At that time, except
    with respect to dissenting shares as described below, each
    holder of shares of Axsys common stock will no longer have any
    rights with respect to such shares of common stock, except for
    the right to receive the merger consideration.
</DIV>
<A name='168'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Cancellation
    of Shares</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Each share of Axsys common stock held by Axsys (including as
    treasury stock), General Dynamics, GD AIS, Merger Sub and any of
    their respective subsidiaries immediately prior to the effective
    time of the merger automatically will be cancelled and will not
    be entitled to any merger consideration nor any other payment or
    distribution.
</DIV>
<A name='169'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Treatment
    of Stock Options and Restricted Stock</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Only stock options and shares of restricted stock have been
    issued and are outstanding under Axsys&#146; stock incentive
    plan. At the effective time of the merger, each share of Axsys
    restricted common stock outstanding as of immediately prior to
    the effective time of the merger will become fully vested and
    then will be cancelled and converted into the right to receive
    $54.00 in cash, without interest, less any applicable
    withholding tax.
</DIV>

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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    At the effective time of the merger, each option outstanding as
    of immediately prior to the effective time of the merger will
    become fully vested and then will be cancelled and converted
    into the right to receive the excess, if any, of $54.00 over the
    exercise price per share of the stock option multiplied by the
    number of shares of Axsys common stock subject to the stock
    option, without interest, less any applicable withholding tax.
    No consideration will be payable in respect of any options with
    an exercise price per share equal to or in excess of $54.00 as
    of immediately prior to the effective time of the merger, and
    all such options will be cancelled automatically at the
    effective time of the merger.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    GD AIS will, or will cause the surviving corporation to, pay to
    holders of Axsys stock options and restricted shares the option
    consideration or restricted share consideration, as the case may
    be, payable as described above as soon as practicable after the
    effective time of the merger and in any case within five
    business days thereafter.
</DIV>
<A name='170'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Dissenters&#146;
    Shares</FONT></B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Shares of Axsys common stock held by any Axsys stockholder that
    neither votes in favor of the adoption of the merger agreement
    nor consents thereto in writing and that properly demands
    payment for its shares in compliance with the appraisal rights
    under Section&#160;262 of the DGCL will not be converted into
    the right to receive the merger consideration. Axsys
    stockholders properly exercising appraisal rights will be
    entitled to payment as further described above under &#147;The
    Merger&#160;&#151; Appraisal Rights of Axsys Stockholders&#148;
    beginning on page 33. However, if any Axsys stockholder
    withdraws his or her demand for appraisal (in accordance with
    Section&#160;262 of the DGCL) or otherwise loses the right to
    appraisal, then that Axsys stockholder will not be paid in
    accordance with Section&#160;262 of the DGCL, and the shares of
    Axsys common stock held by such Axsys stockholder will be
    converted as of the effective time of the merger into the right
    to receive the merger consideration, without interest.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<A name='171'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Payment
    for Shares</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Prior to the effective time of the merger, Axsys and GD AIS will
    mutually agree upon a disbursing agent to act as disbursing
    agent for the payment of the merger consideration. Prior to the
    effective time of the merger, GD AIS will deposit, or cause to
    be deposited, with the paying agent funds sufficient to pay the
    merger consideration.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Promptly after the effective time of the merger, but in no event
    later than two business days after the effective time of the
    merger, the disbursing agent will mail or deliver to all record
    holders of shares of Axsys common stock as of immediately prior
    to the effective time of the merger a letter of transmittal
    containing instructions on how to surrender stock certificates
    in exchange for the merger consideration. Following delivery of
    a stock certificate for cancellation along with a valid letter
    of transmittal, duly executed and completed in accordance with
    the instructions thereto, the holder of such certificate will be
    provided with, in exchange for the stock certificate, cash in an
    amount equal to the merger consideration in respect of the
    shares of Axsys common stock represented by such certificate,
    without interest. <B>Each certificate representing shares of
    Axsys common stock that is surrendered will be cancelled. Do not
    send stock certificates with your proxy card.</B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Payment of the merger consideration may be made to a person
    other than the person in whose name the surrendered certificate
    is registered if:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the person requesting the payment shall pay any transfer or
    other taxes resulting from the payment of the merger
    consideration to a person other than the registered holder of
    that certificate, or required for any other reason relating to
    such holder or requesting person, or shall establish to the
    reasonable satisfaction of the disbursing agent that any such
    tax has been paid or is inapplicable;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the certificate is properly endorsed or otherwise in proper form
    for transfer.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Notwithstanding the foregoing, the procedures described above
    will not apply to restricted stock, which will be governed by
    the procedures set forth above under &#147;Treatment of Stock
    Options and Restricted Stock.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    After the completion of the merger, no transfers of shares of
    Axsys common stock will be made on the transfer books of the
    surviving corporation.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If your Axsys common stock certificate has been lost, stolen or
    destroyed, you will be entitled to obtain payment of the merger
    consideration only by signing an affidavit (in form and
    substance reasonably acceptable to
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    39
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    GD AIS) to that effect and, if required by GD AIS or the
    disbursing agent, posting a bond in such an amount as GD AIS or
    the disbursing agent may direct as indemnity against claims by
    any other party related to your lost, stolen or destroyed Axsys
    common stock certificate.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    From and after the effective time of the merger, the holders of
    certificates representing shares of Axsys common stock will
    cease to have any rights as stockholders of the surviving
    corporation, except as otherwise expressly provided in the
    merger agreement or by applicable law, and GD AIS will be
    entitled to treat each certificate that has not yet been
    surrendered for exchange solely as evidence of the right to
    receive the consideration into which the Axsys common stock
    formerly evidenced by such certificate has been converted
    pursuant to the merger.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The merger consideration paid in the merger to any Axsys
    stockholder will be subject to reduction for the withholding of
    any federal taxes payable by such stockholder.
</DIV>
<A name='172'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Representations
    and Warranties</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The merger agreement contains a number of representations and
    warranties made by Axsys, including representations and
    warranties relating to:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    corporate organization, good standing, ownership of subsidiaries
    and similar matters;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    corporate power and authority to enter into the merger agreement
    and due execution, delivery and enforceability of the merger
    agreement;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    absence of required governmental or third party consents in
    connection with the execution and delivery of the merger
    agreement or the closing of the merger;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the absence of conflicts with charter documents or certain
    contracts;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our capital structure and equity securities;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    accuracy and sufficiency of reports and financial statements
    filed with the SEC;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    material legal proceedings;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    compliance with applicable law and regulatory matters, including
    the Sarbanes-Oxley Act;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    material contracts;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    tax matters;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    employee compensation and benefits matters and matters relating
    to the Employee Retirement Income Securities Act of 1974, as
    amended;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    labor and employee matters;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    environmental matters and compliance with environmental laws;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    intellectual property;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    assets and property, including the leasing of certain real
    property;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    maintenance of certain insurance policies;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the inapplicability of state takeover statutes and takeover
    provisions contained in our organizational documents;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the absence of brokers&#146; fees payable in connection with the
    merger;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    receipt of a fairness opinion from Jefferies;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    material suppliers, material customers, and similar matters.
</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    40
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The merger agreement also contains a number of representations
    and warranties by GD AIS and Merger Sub, including
    representations and warranties relating to:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    corporate organization, good standing and similar matters;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    corporate power and authority to enter into the merger agreement
    and due execution, delivery and enforceability of the merger
    agreement;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    absence of required governmental or third party consents in
    connection with the execution and delivery of the merger
    agreement or the closing of the merger;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the absence of conflicts with charter documents or certain
    contracts;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    capital structure and equity securities of Merger Sub;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the operations of Merger Sub since its formation;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    ownership of shares of Axsys common stock by GD AIS and Merger
    Sub;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the accuracy of information regarding GD AIS, General Dynamics,
    and Merger Sub supplied to Axsys for inclusion in this proxy
    statement;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    sufficiency of financial resources to consummate the
    transactions through the closing;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    acknowledgment by GD AIS that it has had access to Axsys,
    including to its books, records and facilities, in connection
    with the transactions.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Significant portions of the representations and warranties of
    Axsys, GD AIS and Merger Sub are qualified as to
    &#147;materiality&#148; or &#147;material adverse effect.&#148;
    Under the merger agreement, a material adverse effect means,
    when used in connection with Axsys, any effect, event, change,
    occurrence, state of facts, development or circumstance that
    (individually or in the aggregate) has had, or would reasonably
    be expected to have, a material adverse effect on (i)&#160;the
    condition (financial or otherwise), assets, liabilities, results
    of operations or business of Axsys and its subsidiaries, taken
    as a whole, or (ii)&#160;the ability of Axsys to perform its
    obligations under the merger agreement or to consummate the
    transactions by the termination date except, in the case of
    clause (i), any such effect resulting from any of the following:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    changes after the date of the merger agreement in United States
    generally accepted accounting principles, which are referred to
    as GAAP, U.S.&#160;regulatory accounting requirements or
    applicable laws;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    changes or developments in general economic or political
    conditions, including acts of war (whether or not declared),
    sabotage, insurrection, terrorism and armed hostilities;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    changes in any financial, banking, credit or securities markets
    (including any disruption thereof);
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    changes in the stock price or trading volume of the shares of
    Axsys common stock (provided that the facts or circumstances
    giving rise to or contributing to such change in stock price or
    trading volume, if not otherwise excluded under the definition
    of material adverse effect, may be taken into account in
    determining whether there has been, or would reasonably be
    expected to be, a material adverse effect with respect to Axsys);
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    general changes in industries in which Axsys operates;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    natural disasters;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any failure of Axsys to meet revenue, backlog or earnings
    projections or forecasts (whether internal or published by Axsys
    or third parties) or any decline in Axsys&#146; credit rating
    (provided that the facts or circumstances giving rise to or
    contributing to such failure to meet revenue, backlog or
    earnings projections or forecasts or decline in Axsys&#146;
    credit rating, if not otherwise excluded under the definition of
    material adverse effect, may be taken into account in
    determining whether there has been, or would reasonably be
    expected to be, a material adverse effect with respect to Axsys);
</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    41
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    changes resulting from the announcement of the merger agreement
    or the consummation of the merger and the related
    transactions;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any effect arising out of any action taken or omitted to be
    taken by Axsys with the prior written consent of GD AIS or
    Merger Sub,
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    except to the extent in the case of the first, second, third,
    fifth or sixth bullet points above that such change, effect,
    event, occurrence, state of facts, development or circumstance
    materially and disproportionately has had, or would reasonably
    be expected to have, a greater adverse impact on Axsys as
    compared to the adverse impact on the competitors of Axsys, but
    taking into account in determining whether there has been, or
    would reasonably be expected to be, a material adverse effect
    with respect to Axsys only such materially disproportionate
    greater adverse impact.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    When used in connection with GD AIS or Merger Sub, a material
    adverse effect means any change, effect, occurrence, state of
    facts, development or circumstance that, individually or in the
    aggregate, has had, or would reasonably be expected to have, a
    material and adverse effect on the ability of GD AIS or Merger
    Sub to perform their respective obligations under the merger
    agreement or to consummate the transactions by the termination
    date.
</DIV>
<A name='173'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Covenants
    and Agreements</FONT></B>
</DIV>
</A>
<A name='174'>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Conduct
    of Business of Axsys</FONT></I></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have agreed that during the period from the date of the
    merger agreement until the effective time of the merger or the
    earlier termination of the merger agreement, subject to certain
    exceptions, we shall conduct our business and cause to be
    conducted the businesses of our subsidiaries in the ordinary
    course of business and shall use reasonable best efforts to
    preserve intact our respective business organizations, keep
    available the services of our respective current officers and
    employees, preserve the goodwill of those having material
    business relationships with us and our subsidiaries, preserve
    our respective material relationships with customers, creditors
    and suppliers, maintain our respective books, accounts and
    records and comply in all material respects with applicable laws.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Without limiting the generality of the foregoing, except as
    expressly required by the merger agreement or as required by
    applicable law, without the prior written consent of GD AIS,
    from the date of the merger agreement until the effective time
    of the merger or the earlier termination of the merger
    agreement, Axsys shall not, and shall cause each of its
    subsidiaries not to:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    enter into any new material line of business or change its
    material operating policies;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    other than with respect to certain Axsys stock options or
    restricted shares of Axsys common stock, (1)&#160;issue, sell,
    grant or otherwise permit to become outstanding or dispose of or
    encumber or pledge, or authorize or propose the creation of, any
    additional shares of its capital stock or any other securities
    (including long term debt) or any rights with respect to shares
    of its capital stock or any other securities, or (2)&#160;permit
    any additional shares of its capital stock to become subject to
    new grants under a certain Company stock plan or otherwise;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    (1)&#160;make, declare, pay or set aside for payment any
    dividend on or in respect of, or declare or make any actual,
    constructive or deemed distribution on, any shares of its
    capital stock, other than dividends from Axsys&#146; wholly
    owned subsidiaries to it or another of its wholly owned
    subsidiaries, or (2)&#160;authorize or effect, directly or
    indirectly, any adjustment, split, combination, redemption or
    reclassification, or purchase of or otherwise acquire, any
    shares of its capital stock or any other securities exercisable
    or exchangeable for or convertible into shares of its capital
    stock, or amend any terms of any outstanding security of Axsys;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    sell, transfer, mortgage, encumber, lease, license or otherwise
    dispose of any of its assets, businesses or properties,
    including any shares of capital stock of its subsidiaries,
    except for sales, transfers, mortgages, encumbrances, leases,
    licenses or other dispositions in the ordinary course of
    business pursuant to a transaction that, together with any other
    such transactions, is not material to Axsys and its
    subsidiaries, taken as a whole;
</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    42
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    other than in the ordinary course of business, acquire (whether
    by purchase of assets, purchase of stock, merger or otherwise)
    (1)&#160;all or any portion of the assets, business, properties
    or shares of stock or other securities of any other person or
    entity or (2)&#160;any equity interest of any entity or any
    business or division of any business, or enter into any joint
    venture, partnership agreement, joint development agreement,
    strategic alliance agreement or other similar agreement;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    amend or propose to amend its organizational documents,
    including certificates of incorporation or bylaws;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    implement or adopt any change in its financial accounting
    principles, practices or methods, other than as may be required
    as a result of changes after the date of the merger agreement in
    GAAP or regulatory accounting requirements applicable to
    U.S.&#160;publicly owned business organizations generally;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    except as expressly required by the terms of certain benefit
    arrangements: (1)&#160;enter into, amend, modify or renew any
    employment, consulting, change in control or similar contract,
    agreement or arrangement with any director, officer or employee;
    (2)&#160;increase the compensation payable or to become payable
    to any director, officer or employee (excluding increases in
    cash compensation in the ordinary course of business);
    (3)&#160;increase any bonus, insurance, pension or other benefit
    plan, payment or arrangement made to, for or with any such
    directors, officers or employees; (4)&#160;grant any severance
    or termination pay to any executive officer or director, or to
    any other employee (excluding payments made in connection with
    the termination of employees who are not executive officers in
    amounts consistent with its policies and past practice or
    pursuant to certain written agreements in effect as of the date
    of the merger agreement); or (5)&#160;issue or grant any
    stock-based awards;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    enter into, establish, adopt, amend, modify or renew any
    pension, retirement, stock option, stock purchase, savings,
    profit sharing, deferred compensation, bonus, group insurance or
    other employee benefit, incentive or welfare contract, plan or
    arrangement or any trust agreement in respect of any director,
    officer or employee or take any action to accelerate the vesting
    or exercisability of stock options or restricted shares of Axsys
    common stock or other compensation or benefits payable
    thereunder, except (1)&#160;as may be required by applicable law
    or by the terms of certain benefit arrangements or
    (2)&#160;amendments that do not increase benefits or result in
    increased administrative costs;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    (1)&#160;create, incur, endorse, assume or otherwise become
    liable for or suffer to exist any indebtedness for borrowed
    money or guarantee any such indebtedness other than borrowings
    in the ordinary course of business pursuant to Axsys&#146; and
    its subsidiaries&#146; revolving credit arrangements or under
    capital leases, in each case, in effect on the date of the
    merger agreement, (2)&#160;issue, sell or amend any debt
    securities or other rights to acquire any debt securities of
    Axsys or any of its subsidiaries, (3)&#160;guarantee any debt
    securities of others, (4)&#160;enter into any &#147;keep
    well&#148; or other covenants to maintain any financial
    condition or enter into any arrangement having the economic
    effect of the foregoing, (5)&#160;other than to wholly owned
    subsidiaries of Axsys, make any loans, advances or capital
    contributions to, or material investment in, any person or
    entity, (6)&#160;pledge or otherwise encumber shares of capital
    stock of Axsys or any of its subsidiaries (other than liens
    permitted by the merger agreement), or (7)&#160;mortgage, pledge
    or otherwise encumber any of its material assets (other than
    liens permitted by the merger agreement);
</TD>
</TR>

<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    make or change any material tax election, settle or compromise
    any material tax liability, change in any material respect any
    accounting method in respect of taxes, file any amendment to a
    material tax return, enter into any closing agreement, settle
    any material claim or material assessment of taxes, enter into
    any agreement or waiver extending the period for assessment or
    collection of any material taxes of Axsys or any of its
    subsidiaries, or fail to pay or withhold, or otherwise properly
    reserve for, any material taxes of Axsys or any of its
    subsidiaries;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    enter into any contract, agreement or commitment (excluding
    government contracts) of a character that would constitute a
    material contract under the merger agreement or be required to
    be disclosed to GD AIS pursuant to the merger agreement, if such
    contract, agreement or commitment had been entered into prior to
    the date of the merger agreement, or terminate, renew or amend
    in any material respect any material contract, in each case,
    other than in the ordinary course of business;
</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    43
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    enter into any agreement, contract or binding commitment
    containing any covenant directly or indirectly limiting the
    freedom of Axsys or any of its subsidiaries to engage in any
    line of business, compete with any person or entity, or sell any
    product or service (including any &#147;most favored
    nation&#148; clauses), or which, following the consummation of
    the merger, could so limit GD AIS or any of its affiliates
    (including the surviving corporation), including any contract
    clause, mitigation plan, or other limitation with respect to
    &#147;Organizational Conflicts of Interest,&#148; as that term
    is used in Federal Acquisition Regulation&#160;Subpart 9.5;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    enter into any government contract or submit any bid for a
    government contract that (1)&#160;would reasonably be expected
    to result in a financial loss greater than $100,000,
    (2)&#160;involves unusual risk in performance or compliance with
    schedule requirements or contains non-customary terms and
    conditions or (3)&#160;would, under the federal rules covering
    &#147;Organizational Conflicts of Interest,&#148; as that term
    is used in Federal Acquisition Regulation&#160;Subpart 9.5,
    limit GD AIS, the surviving corporation or any of their
    respective subsidiaries from engaging in any line of business,
    competing with any person or entity or selling any product or
    service;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    take, or omit to take, any action that would reasonably be
    expected to result in any of the conditions to the merger set
    forth in the merger agreement not being satisfied in a timely
    manner;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    waive, release or assign any material rights, claims or benefits
    of Axsys or any of its subsidiaries under any material contract,
    other than in the ordinary course of business;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    make any capital expenditures, capital additions or capital
    improvements in amounts exceeding $5,000,000 in the aggregate,
    or manufacture any demonstration equipment with a cost exceeding
    $2,000,000 in the aggregate;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    engage in any &#147;reportable transaction,&#148; including any
    &#147;listed transaction,&#148; within the meaning of Code
    Section&#160;6011 or any other applicable federal law, including
    any Internal Revenue Service ruling, procedure, notice or other
    pronouncement;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    other than in the ordinary course of business, pay, discharge or
    satisfy any material claim, liability or obligation, or settle
    or compromise any material pending or threatened suit, action or
    proceeding requiring payments by Axsys in excess of $250,000 in
    the aggregate;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    materially change the amount or nature of any insurance
    coverage, other than in the ordinary course of business;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    enter into, amend, modify, terminate or engage in any contract,
    agreement, commitment or transaction with any executive officer
    or director of Axsys, or any person or entity owning 5% or more
    of the shares of Axsys common stock, or any relative of any such
    person or entity directly or indirectly controlled by such
    person or entity;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    enter into any contract or binding commitment with respect to
    any of the foregoing, or otherwise resolve or commit to do any
    of the foregoing.
</TD>
</TR>

</TABLE>
<A name='175'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Additional
    Reports</FONT></I></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    From the date of the merger agreement to the effective time of
    the merger, Axsys has agreed to timely file with, or furnish to,
    the SEC all forms, statements, reports, certifications,
    schedules and other documents (including all exhibits and
    amendments thereto) required to be filed or furnished by it
    under the Exchange Act
    <FONT style="white-space: nowrap">and/or</FONT> the
    Securities Act. Axsys has agreed to furnish to GD AIS drafts of
    all such forms, statements, reports, certifications, schedules
    and other documents a reasonable time prior to filing with, or
    furnishing to, the SEC, and copies of any such forms,
    statements, reports, certifications, schedules and other
    documents that it files with, or furnishes to, the SEC on or
    after the date of the merger agreement.
</DIV>
<A name='176'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Reasonable
    Best Efforts, Antitrust Filings&#160;&#038;
    Cooperation</FONT></I></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Subject to certain limitations, we, GD AIS and Merger Sub have
    each agreed to use our reasonable best efforts to take, or cause
    to be taken, all actions, and to do, or cause to be done, and to
    assist and cooperate with the other party in doing, all things,
    necessary, proper or advisable to consummate and make effective,
    as promptly as
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    44
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
     practicable prior to the termination date, the transactions in
    accordance with the terms of the merger agreement and the voting
    agreement, including:
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the taking of all acts necessary to cause the conditions to the
    merger to each be satisfied as promptly as practicable;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the obtaining of all actions or nonactions, waivers, consents
    and approvals from governmental authorities and the making of
    all registrations, notices and filings (including filings with
    governmental authorities), in each case, that are required in
    connection with the merger agreement and the merger and the
    taking of all steps as may be necessary to obtain an approval or
    waiver from, or to avoid an action or proceeding by, any
    governmental authority.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition, we and GD AIS have each agreed to:
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    duly file with the FTC and the Antitrust Division the
    notification and report forms, referred to as the HSR Filings,
    required under the HSR Act, which HSR Filings were made by Axsys
    and GD AIS on June&#160;8, 2009, and the HSR Filings made by GD
    AIS were withdrawn on July&#160;8, 2009, and refiled by GD AIS
    on July&#160;9, 2009;&#160;and
</TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    duly make all notifications and other filings required under any
    other applicable antitrust law (together with the HSR Filings,
    referred to as the antitrust filings) that Axsys and GD AIS deem
    advisable or appropriate or that may be required by the
    applicable antitrust authority, in each case with respect to the
    transactions and as promptly as practicable.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Axsys and GD AIS will each use its respective reasonable best
    efforts to obtain early termination of the applicable waiting
    period, if any, under all antitrust laws. Notwithstanding
    anything to the contrary contained in the merger agreement,
    nothing contained in the merger agreement will be deemed to
    require General Dynamics or GD AIS to enter into any agreement,
    consent decree or other commitment requiring General Dynamics,
    GD AIS or any of their subsidiaries to (1)&#160;divest, hold
    separate or otherwise limit the use of any assets of Axsys or
    its subsidiaries, or General Dynamics, GD AIS or their
    subsidiaries, (2)&#160;litigate, pursue or defend any action or
    proceeding challenging any of the transactions as violative of
    any antitrust laws, (3)&#160;other than filing fees required by
    the HSR Act, make any out of pocket expenditures of more than a
    de minimis amount or incur any obligations or liabilities, in
    each case, in order to comply with the provisions of the merger
    agreement or (4)&#160;take any other action that would, or would
    reasonably be expected to, materially and adversely affect
    General Dynamics, GD AIS or any of their subsidiaries (including
    after the effective time of the merger, the surviving
    corporation).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Further, we, GD AIS and Merger Sub, except as prohibited by any
    applicable representative of any applicable governmental
    authority, and subject to any applicable laws, have each agreed
    to:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    furnish to the other party upon reasonable request all
    information concerning itself, its subsidiaries, directors,
    officers and stockholders and such other matters as may be
    reasonably necessary or advisable in connection with any filing,
    notice or application made by or on behalf of such other party
    or any of its subsidiaries with or to any third party or
    governmental authority in connection with the merger;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    promptly notify the other parties of any written communication
    received from any antitrust authority, any state attorney
    general or any other governmental authority relating to the
    merger agreement or the merger, and permit the other parties a
    reasonable opportunity to review in advance any proposed written
    communication to any of the foregoing with respect to the merger;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    not participate or agree to participate in any substantive
    meeting or discussion with any governmental authority in respect
    of any filings, investigation or inquiry concerning the merger
    agreement or the merger unless it consults with the other
    parties in advance and, to the extent permitted by such
    governmental authority, gives the other parties the opportunity
    to attend and participate thereat;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    furnish the other parties with copies of all correspondence,
    filings and written communications (and memoranda setting forth
    the substance thereof) between such party and its subsidiaries
    and their respective representatives, on the one hand, and any
    governmental authority or members or their respective staffs, on
    the other hand, with respect to the merger agreement and the
    merger.
</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    45
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Each party shall respond as promptly as reasonably practicable
    under the circumstances to any inquiries received from any
    antitrust authority for additional information or documentation
    and to all inquiries and requests received from any state
    attorney general or other governmental authority in connection
    with antitrust matters relating to the merger agreement or the
    merger, including the antitrust filings, and not extend any
    waiting period under the HSR Act or enter into any agreement
    with any antitrust authority not to consummate the merger
    without the prior written consent of the other parties.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    GD AIS has agreed to cause Merger Sub to comply with all of
    Merger Sub&#146;s obligations under or related to the merger
    agreement and the merger.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<A name='177'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Stockholder
    Approvals</FONT></I></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have agreed to submit the merger agreement for adoption by
    Axsys stockholders at the special meeting as soon as possible
    after the date of the merger agreement. At the special meeting,
    GD AIS and Merger Sub have agreed to cause all shares owned by
    them and their respective subsidiaries to be voted in favor of
    the adoption of the merger agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have agreed to use our reasonable best efforts to solicit
    proxies from Axsys stockholders in favor of the adoption of the
    merger agreement and take all actions reasonably necessary or
    advisable to secure Axsys stockholder approval.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our obligations will not be affected by the commencement, public
    proposal, public disclosure or communication to us of any
    acquisition proposal or superior proposal or any withdrawal of
    the recommendation by the Board. Subject to the Board
    withholding, withdrawing, qualifying or modifying its
    recommendation pursuant to and in accordance with specific
    provisions of the merger agreement, Axsys, acting through its
    Board, will make its Board recommendation at the special meeting.
</DIV>
<A name='178'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Access
    to Information; Confidentiality</FONT></I></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Subject to certain limitations, prior to the effective time of
    the merger or the earlier termination of the merger agreement,
    Axsys will afford to GD AIS and its representatives such access
    to the officers, employees, agents, books, records and
    properties of Axsys and its subsidiaries as GD AIS may
    reasonably request. Any information provided will be held in
    confidence to the extent required by the provisions of the
    confidentiality agreement between us and General Dynamics.
</DIV>
<A name='179'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">No
    Solicitation</FONT></I></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have agreed that we will not, and we will cause our
    subsidiaries and our and their directors, officers, employees
    and representatives (including any investment banker, attorney,
    accountant or other advisor or representative retained by us or
    any of our subsidiaries) not to directly or indirectly:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    initiate, facilitate, solicit or knowingly encourage inquiries
    or proposals that constitute, or might reasonably be expected to
    lead to, any acquisition proposal;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    except as permitted below, initiate or engage with any third
    party in any discussions or negotiations concerning, or furnish
    any information to any third party in connection with, any
    acquisition proposal or otherwise knowingly facilitate other
    inquiries or the making of any proposal that constitutes, or
    that might reasonably be expected to lead to, any acquisition
    proposal;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    except as permitted below, enter into any letter of intent,
    agreement, arrangement or undertaking with respect to any
    acquisition proposal or approve or resolve to approve any
    acquisition proposal, or enter into any agreement, arrangement
    or understanding that would require Axsys to abandon, terminate
    or fail to consummate the merger or any of the other related
    transactions.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The merger agreement provides that if, at any time prior to the
    time that our stockholders adopt the merger agreement, we
    receive an unsolicited acquisition proposal which did not result
    from a breach of the merger
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    46
</DIV><!-- END PAGE WIDTH -->
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    agreement, we may furnish information to, or enter into
    discussions or negotiations with, any person or entity that has
    made such unsolicited acquisition proposal if, and only to the
    extent that:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the unsolicited acquisition proposal constitutes a superior
    proposal or our Board, after consulting with our outside legal
    counsel and financial advisors, determines in good faith that,
    after furnishing such information and entering into such
    discussions or negotiations, the acquisition proposal would
    reasonably be expected to result in a superior proposal;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    after consultation with our outside legal counsel, our Board
    determines in good faith that the failure to take such action
    would violate its fiduciary duties under applicable law;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    we are otherwise in compliance with our obligations with respect
    to the no solicitation provision of the merger agreement as
    outlined herein;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    we provide notice to GD AIS that we are furnishing information
    to, or entering into discussions or negotiations with, such
    person or entity, at least two business days prior to furnishing
    such information to, or entering into discussions or
    negotiations with, such person or entity;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    prior to furnishing such information, we receive from such
    person an executed confidentiality agreement on customary terms
    similar to and no less favorable to us than those contained in
    the confidentiality agreement between us and General
    Dynamics;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    we keep GD AIS informed, on a reasonably current basis, of the
    status of any discussions or negotiations.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We shall as promptly as reasonably practicable (and in any event
    within two business days after receipt) notify GD AIS of the
    existence of any proposal or inquiry received by Axsys that has
    led to, or might reasonably be expected to lead to, any
    acquisition proposal, including a copy of any such proposal or
    inquiry, and the identity of the third party making the proposal
    or inquiry. We will keep GD AIS reasonably apprised of any
    material developments with respect to such proposal or inquiry
    (including providing GD AIS with copies of all drafts and
    versions of agreements relating to such acquisition proposal)
    and promptly make available to GD AIS any non-public information
    concerning Axsys or any of its subsidiaries furnished to any
    third party that has not previously been provided to GD AIS. We
    will give GD AIS prompt notice after any determination by our
    Board that an acquisition proposal is, or would reasonably be
    likely to result in, a superior proposal.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Immediately prior to execution of the merger agreement, we
    terminated all negotiations that may lead to an acquisition
    proposal between Axsys and parties other than GD AIS. We have
    agreed to use our commercially reasonable efforts to effect
    prompt return or destruction of all confidential information
    furnished to any third party in connection with a possible
    acquisition proposal during the
    <FONT style="white-space: nowrap">12-month</FONT>
    period ending on the date of the merger agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Prior to the effective time of the merger or the earlier
    termination of the merger agreement, the Board will not make a
    Board change of recommendation. However, at any time prior to
    adoption of the merger agreement by the Axsys stockholders, the
    Board may, in response to a material development or change in
    circumstances occurring or arising after the date of the merger
    agreement that was neither known to the Board nor reasonably
    foreseeable as of or prior to the date of the merger agreement
    (and not relating to any acquisition proposal), which is
    referred to as an intervening event, make a Board change of
    recommendation if the Board has concluded in good faith, after
    consultation with, and taking into account the advice of, its
    outside legal counsel, that, in light of such intervening event,
    the failure of the Board to make such Board change of
    recommendation would result in a breach of its fiduciary duties
    under applicable law. Axsys shall not be entitled to exercise
    its right to make such a Board change of recommendation unless
    it has:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    provided to GD AIS at least three business days&#146; prior
    written notice (unless the intervening event arises fewer than
    three business days prior to the special meeting) advising GD
    AIS that the Board intends to take such action and specifying
    the reasons;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    during such period, if requested by GD AIS, engaged in good
    faith negotiations with GD AIS to amend the merger agreement in
    such a manner that obviates the need for such Board change of
    recommendation as a result of the intervening event.
</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    47
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    At any time prior to the merger agreement being adopted by the
    Axsys stockholders, the Board may, in response to a superior
    proposal, cause Axsys to terminate the merger agreement and
    enter into a definitive agreement providing for the transactions
    contemplated by such superior proposal; provided, however, that
    Axsys shall not terminate the merger agreement unless:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Axsys shall have complied with all the no solicitation
    provisions of the merger agreement, and with all applicable
    requirements of the merger agreement (including the payment of
    any applicable termination fee and expense reimbursement) in
    connection with such superior proposal;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    after consultation with its outside legal counsel, the Board
    determines in good faith that the failure to take such action
    would violate its fiduciary duties under applicable law.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Axsys also may not exercise its right to terminate the merger
    agreement in this manner until after the second business day
    following actual receipt by GD AIS of written notice from Axsys
    advising GD AIS that Axsys has received a superior proposal,
    specifying the material terms and conditions of the superior
    proposal and attaching the most current versions of the
    definitive agreement, all exhibits and other attachments thereto
    and agreements (such as stockholder agreements) ancillary
    thereto to effect such superior proposal, and identifying the
    party making such superior proposal and stating that the Board
    intends to cause Axsys to exercise its right to terminate the
    merger agreement (provided that prior to such termination taking
    effect, an amendment to the price or other material term of a
    superior proposal will require a new notice and a new two
    business day period with respect to the amended proposal).
    During such two business day period Axsys will negotiate in good
    faith with GD AIS so that GD AIS may propose an adjustment to
    the merger agreement for the purpose of causing the acquisition
    proposal to no longer be a superior proposal. In addition, Axsys
    may not exercise its right to terminate the merger agreement in
    this manner unless either (i)&#160;on or before the expiration
    of the two business day period following the actual receipt by
    GD AIS of any notice of a superior proposal, GD AIS does not
    make such adjustment in the terms and conditions of the merger
    agreement so that such acquisition proposal ceases to constitute
    a superior proposal or (ii)&#160;following receipt of such
    adjustment to the merger agreement within the two business day
    period, the Board concludes in good faith, after consultation
    with the Company&#146;s outside legal counsel and after taking
    into consideration the adjusted merger agreement, that the
    superior proposal continues to be a superior proposal.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Nothing described above limits our ability to take actions to
    comply with our disclosure obligations under
    <FONT style="white-space: nowrap">Rule&#160;14e-2(a)</FONT>
    of the Exchange Act with regard to an acquisition proposal or
    prohibits us from making such disclosure to our stockholders as,
    in the good faith judgment of the Board, after receiving advice
    from counsel, would be inconsistent with applicable law.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    A Board change of recommendation, as used herein, means the
    Board (1)&#160;approves or recommends, or proposes to approve or
    recommend, any acquisition proposal, (2)&#160;causes or permits
    Axsys to enter into any letter of intent, agreement in
    principle, acquisition agreement or similar agreement with
    respect to any acquisition proposal, or (3)&#160;withdraws,
    amends or modifies in a manner adverse to GD AIS or Merger Sub,
    or publicly proposes to withdraw, amend or modify in a manner
    adverse to GD AIS or Merger Sub, the Board&#146;s recommendation.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    An acquisition proposal, as used herein, means, other than the
    merger, any inquiry, proposal, indication of interest or offer
    (whether written or oral) with respect to any direct or
    indirect: (1)&#160;purchase or sale of an equity interest
    (including by means of a tender or exchange offer) representing
    more than 15% of the voting power in Axsys or any of its
    significant subsidiaries; (2)&#160;merger, consolidation, other
    business combination, reorganization, recapitalization, share
    exchange, dissolution, liquidation or similar transaction
    involving Axsys or any of its significant subsidiaries; or
    (3)&#160;purchase or sale of assets, businesses, securities or
    ownership interests representing more than 15% of the
    consolidated assets of Axsys and its subsidiaries.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    A superior proposal, as used herein, means a bona fide, written,
    unsolicited acquisition proposal (with all references to
    &#147;15%&#148; in the definition of acquisition proposal deemed
    to be &#147;a majority&#148; for the purposes of this
    definition) made by any person that is (1)&#160;not received in
    violation of the no solicitation provision of the merger
    agreement, (2)&#160;fully financed, (3)&#160;on terms that the
    Board determines in good faith, after consultation with
    Axsys&#146; financial and legal advisors, and in light of all
    relevant circumstances as the Board in good faith considers to
    be appropriate, are more favorable to Axsys and its stockholders
    than the merger from a financial point of view, and (4)&#160;is
    reasonably likely to be consummated according to its terms.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    48
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='180'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Takeover
    Laws and Provisions</FONT></I></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Each of Axsys and the Board will take all actions to cause the
    merger and related transactions (1)&#160;not to be subject to
    the requirements of any applicable takeover law and will take
    all necessary steps within its control to exempt the
    transactions from any applicable takeover law, and (2)&#160;to
    comply with any takeover provisions in the constituent documents
    of Axsys. If any takeover law or takeover provision becomes
    applicable to the merger or related transactions, each of Axsys
    and the Board will, upon the request of GD AIS or Merger Sub,
    use its best efforts to ensure that the merger or related
    transactions may be consummated as promptly as practicable on
    the terms contemplated by the merger agreement and otherwise to
    minimize the effect of such takeover law or takeover provision
    on the merger or related transactions.
</DIV>
<A name='181'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Stockholder
    Litigation</FONT></I></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Axsys will give GD AIS the opportunity to participate in the
    defense or settlement of any stockholder litigation against
    Axsys <FONT style="white-space: nowrap">and/or</FONT>
    its directors or executive officers relating to the merger or
    any related transactions, whether commenced prior to or after
    the execution and delivery of the merger agreement. Axsys has
    agreed that it will not settle or offer to settle in exchange
    for the payment of funds any litigation commenced prior to or
    after the date of the merger agreement against Axsys or any of
    its directors or executive officers by any stockholder of Axsys
    relating to the merger agreement, the merger or any other
    related transaction (unless such payment of funds will be made
    under Axsys&#146; applicable insurance policy), without the
    prior written consent of GD AIS (which consent will not be
    unreasonably withheld, conditioned or delayed).
</DIV>
<A name='182'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Indemnification
    and Insurance</FONT></I></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The merger agreement requires that the indemnification
    provisions of the certificate of incorporation and bylaws of the
    surviving corporation as in effect as of the effective time of
    the merger not be amended, modified or repealed for six years
    from the effective time of the merger in any manner that would
    adversely affect the rights of any individual who immediately
    prior to the effective time of the merger was a director,
    officer or employee of Axsys unless required by law. GD AIS also
    has agreed to indemnify the present and former employees,
    officers and directors of Axsys and to cause the surviving
    corporation to provide directors&#146; and officers&#146;
    liability insurance coverage for the benefit of the present and
    former officers and directors of Axsys that will contain
    substantially equivalent scope and amount of coverage as the
    policy maintained by Axsys immediately prior to the effective
    time of the merger, subject to certain limitations on the amount
    of premiums required to be paid for such insurance coverage.
</DIV>
<A name='183'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Employee
    Matters</FONT></I></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    GD AIS has agreed to provide for the employees and former
    employees of Axsys and its subsidiaries as of the effective time
    of the merger, referred to as the covered employees, employee
    benefits and compensation plans (including with respect to
    salary and bonus, but not equity awards), programs and
    arrangements no less favorable, in the aggregate, than those
    benefits provided by Axsys or its subsidiaries, as the case may
    be, immediately prior to the effective time of the merger and
    for a period of 12&#160;months thereafter.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    GD AIS has further agreed to:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    provide all covered employees with service credit for purposes
    of eligibility to participate, vesting and benefit accruals
    under any employee benefit or compensation plan, program or
    arrangement adopted, maintained or contributed to by GD AIS or
    any of its subsidiaries in which covered employees are eligible
    to participate, other than benefit accruals under a defined
    benefit plan, for all periods of employment with Axsys or any of
    its subsidiaries prior to the effective time of the merger to
    the extent credited by Axsys for purposes of a comparable
    plan;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    with respect to any self-insured welfare benefit plans of GD AIS
    or any of its subsidiaries, cause, and with respect to all other
    welfare benefit plans, use reasonable best efforts to cause, any
    pre-existing conditions limitations, eligibility waiting periods
    or required physical examinations to be waived with respect to
    the covered employees and their eligible dependents to the
    extent waived under the corresponding plan (for a
</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    49
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>
</TD>
    <TD align="left">
    comparable level of coverage) in which the applicable covered
    employee participated immediately prior to the effective time of
    the merger.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If Axsys&#146; or any of its subsidiaries&#146; medical, vision
    <FONT style="white-space: nowrap">and/or</FONT>
    dental benefit plans for covered employees are terminated prior
    to the end of a plan year, covered employees and their
    dependents who are then participating in a deductible-based
    medical, vision
    <FONT style="white-space: nowrap">and/or</FONT>
    dental benefit plan sponsored by Axsys or any of its
    subsidiaries will be given credit for deductibles, co-payments
    and eligible out-of-pocket expenses incurred toward deductibles,
    co-payments and out-of-pocket maximums during the portion of the
    plan year preceding the termination date (or transfer date) in a
    comparable deductible-based medical, vision
    <FONT style="white-space: nowrap">and/or</FONT>
    dental benefit plan of General Dynamics, GD AIS or any of their
    subsidiaries for the corresponding Axsys benefit plan year.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    GD AIS and Axsys, as the surviving corporation, shall honor, in
    accordance with their respective terms, all vested or accrued
    benefit obligations to, and contractual rights of, covered
    employees, including any benefits or rights arising as a result
    of the merger.
</DIV>
<A name='184'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Additional
    Covenants</FONT></I></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The merger agreement contains additional agreements between us
    and GD AIS relating to, among other things:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    consultations regarding public announcements;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    preparation and filing of this proxy statement with the SEC;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    confirmation that control of operations of Axsys between the
    signing of the merger agreement and the effective time remains
    with Axsys;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    performance under the voting agreement;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    notification of certain changes;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    release of certain confidentiality and standstill obligations.
</TD>
</TR>

</TABLE>
<A name='185'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Conditions
    of the Merger</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The obligation of each party to effect the merger is subject to
    the satisfaction or written waiver on or before the closing date
    of each of the following conditions:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    adoption of the merger agreement by Axsys stockholders;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    no governmental authority shall have enacted, issued,
    promulgated, enforced or entered any order that is then in
    effect and has the effect of making consummation of the merger
    illegal or otherwise preventing or prohibiting consummation of
    the merger, and no law shall have been adopted that makes
    consummation of the merger illegal or otherwise prevented or
    prohibited;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any applicable waiting period under the HSR Act will have
    terminated or expired.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The obligation of Axsys to effect the merger is also subject to
    the satisfaction or written waiver of the following conditions:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    accuracy as of the time of closing of the representations and
    warranties made by GD AIS and Merger Sub to the extent specified
    in the merger agreement;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    each of GD AIS and Merger Sub shall have performed or complied
    with all of the agreements, obligations and covenants in the
    merger agreement in all material respects;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    certification by GD AIS to Axsys that the two previous
    conditions have been satisfied.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The obligation of GD AIS and Merger Sub to effect the merger is
    also subject to the satisfaction or written waiver of the
    following conditions:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    accuracy as of the time of the closing of the representations
    and warranties made by us to the extent specified in the merger
    agreement;
</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    50
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Axsys shall have performed or complied with all of the
    agreements, obligations and covenants in the merger agreement in
    all material respects;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    certification by Axsys to GD AIS that the two previous
    conditions have been satisfied;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    no event, change, circumstance, condition, development or effect
    that has, or would reasonably be expected to have, a material
    adverse effect with respect to Axsys, after the date of the
    merger agreement has occurred;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    no more than 12% of the outstanding shares of Axsys common stock
    will constitute dissenting shares.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We and GD AIS can provide no assurance that all of the
    conditions precedent to the merger will be satisfied or waived
    by the party permitted to do so.
</DIV>
<A name='186'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Termination</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We and GD AIS may mutually agree in writing, at any time before
    the effective time of the merger, to terminate the merger
    agreement. Also, either GD AIS or we may terminate the merger
    agreement, without the consent of the other, before the
    effective time of the merger if:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any governmental authority of competent jurisdiction shall have
    enacted, issued, promulgated, enforced or entered any order
    (whether temporary, preliminary or permanent) that has become
    final and nonappealable and has the effect of making
    consummation of the merger illegal or otherwise preventing or
    prohibiting consummation of the merger; provided that a party
    whose breach of the merger agreement is the principal cause of
    such order will not be able to terminate under such provision of
    the merger agreement;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any law shall have been adopted, enacted or promulgated that
    makes consummation of the merger illegal or otherwise prohibited;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the adoption of the merger agreement by the Axsys stockholders
    shall not have been obtained at the special meeting or at any
    adjournment or postponement of the special meeting;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the merger shall not have been consummated on or before
    November&#160;30, 2009, referred to as the termination date;
    provided that a party whose failure to comply in all respects
    with any provision of the merger agreement results in a failure
    of a condition to the consummation of the merger will not be
    able to terminate under such provision of the merger agreement.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    GD AIS may terminate the merger agreement before the effective
    time of the merger if:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Axsys breaches any representation, warranty, covenant or
    agreement set forth in the merger agreement (other than with
    respect to Axsys&#146; no solicitation obligations) which breach
    or failure to perform results in the failure of certain
    conditions of the merger being satisfied, and such breach is not
    cured or is incapable of being cured within 15&#160;days after
    GD AIS gives Axsys written notice of such breach;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a Board change of recommendation has occurred; the Board has
    failed to include in this proxy statement the Board&#146;s
    recommendation to adopt the merger agreement; the Board has
    failed to reconfirm its recommendation within five business days
    after requested by GD AIS, provided that any such request may be
    made only after notice of any of the following events (as any of
    the following events may occur from time to time):
    (i)&#160;receipt by Axsys of an acquisition proposal,
    (ii)&#160;any material change to an acquisition proposal and
    (iii)&#160;a public announcement of any transaction to acquire a
    material portion of the shares of Axsys&#146; common stock by a
    person or entity other than Merger Sub, GD AIS or any of their
    affiliates; or the Board shall have resolved to do either of the
    foregoing;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Axsys violates or breaches in any material respect any of its
    obligations with respect to its no solicitation obligations, as
    set forth in the merger agreement;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    if for five days or more Axsys stockholders dissenting from the
    merger constitute more than 12% of the outstanding shares of
    Axsys common stock.
</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    51
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Axsys may terminate the merger agreement if:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Axsys enters into a definitive agreement with respect to a
    superior proposal at any time prior to obtaining the approval of
    the stockholders of Axsys of the merger agreement in accordance
    with the terms of the merger agreement; provided that prior to
    such termination, and as a condition precedent thereof, Axsys
    pays the termination fee and expense reimbursement in accordance
    with the provisions of the merger agreement;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    GD AIS or Merger Sub breaches any representation, warranty,
    covenant or agreement set forth in the merger agreement, which
    breach or failure to perform results in the failure of certain
    conditions of the merger being satisfied, and such breach is not
    cured or is incapable of being cured within 15&#160;days after
    Axsys gives GD AIS written notice of such breach.
</TD>
</TR>

</TABLE>
<A name='187'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Termination
    Fees</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Axsys must pay to GD AIS a $23.6&#160;million termination fee,
    referred to as the termination fee, and reimburse up to an
    aggregate of $2.0 million for the documented out-of-pocket
    expenses of GD AIS and General Dynamics incurred in connection
    with the merger, referred to as the expense reimbursement, if
    the merger agreement is terminated (1)&#160;by Axsys because
    Axsys terminates the merger agreement to enter into a definitive
    agreement with respect to a superior proposal; or (2)&#160;by GD
    AIS because the Board fails to include the Board&#146;s
    recommendation in this proxy statement, a Board change of
    recommendation occurs, or the Board resolves to do either of the
    foregoing.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If GD AIS terminates the merger agreement because Axsys breaches
    any representation, warranty, covenant or agreement set forth in
    the merger agreement (other than with respect to Axsys&#146; no
    solicitation obligations), which breach results in the failure
    of certain conditions of the merger being satisfied, and such
    breach is not cured or is incapable of being cured within
    15&#160;days after GD AIS gives Axsys written notice of such
    breach, then Axsys will pay to GD AIS the expense reimbursement.
    If there shall have existed at or prior to the time of such
    termination an acquisition proposal (whether or not such offer
    or proposal has been rejected or has been withdrawn prior to the
    time of such termination) and within 12&#160;months after such
    termination, Axsys or any of its subsidiaries accepts a written
    offer for, or otherwise enters into an agreement to consummate
    or consummates, an acquisition proposal, then upon the signing
    of a definitive agreement relating to such acquisition proposal,
    or, if no such agreement is signed, then upon consummation of
    any such acquisition proposal, in addition to the expense
    reimbursement Axsys will pay to GD AIS the termination fee.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If the merger agreement is terminated because (i)&#160;the
    merger has not been consummated on or before the termination
    date or (ii)&#160;for five days or more Axsys stockholders
    dissenting from the merger constitute more than 12% of the
    outstanding shares of Axsys common stock, then (1)&#160;if prior
    to such termination there exists an acquisition proposal
    (whether or not such offer or proposal has been rejected or has
    been withdrawn prior to the time of such termination) and
    (2)&#160;within 12&#160;months after such termination, Axsys or
    any of its subsidiaries accepts a written offer for, or
    otherwise enters into an agreement to consummate or consummates,
    an acquisition proposal, then upon the signing of a definitive
    agreement relating to such acquisition proposal, or, if no such
    agreement is signed, then upon consummation of any such
    acquisition proposal, Axsys will pay to GD AIS the expense
    reimbursement and the termination fee.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In the event that GD AIS terminates the merger agreement because
    adoption of the merger agreement shall not have been obtained at
    the special meeting or at any adjournment or postponement of the
    special meeting, Axsys will pay to GD AIS the expense
    reimbursement.
</DIV>
<A name='188'>
<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Effect of
    Termination</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If the merger agreement is terminated by either Axsys or GD AIS
    in accordance with its terms, the merger agreement will
    immediately become void and there will be no liability on the
    part of any party or their affiliates, directors, officers or
    stockholders, except for (i)&#160;payment of the termination fee
    <FONT style="white-space: nowrap">and/or</FONT>
    expense reimbursement by Axsys in certain circumstances
    (ii)&#160;the survival of certain provisions of the agreement,
    including those relating to press releases, the effect of
    termination and the termination fee, and (iii)&#160;nothing
    shall relieve Axsys, on the one had, or GD AIS or Merger Sub, on
    the other hand, from liability for fraud or any willful or
    intentional breach of the merger agreement or any willful or
    intentional misrepresentation in the merger agreement.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    52
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='189'>
<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Amendment</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    At any time before the effective time of the merger, the merger
    agreement may be amended by the parties at any time by an
    instrument in writing signed on behalf of each of the parties.
    However, after the adoption of the merger agreement at the
    special meeting no such amendment shall be made or given that
    requires further approval of Axsys stockholders under the DGCL
    unless the required approval is obtained.
</DIV>
<A name='190'>
<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Extension;
    Waiver</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    At any time before the effective time of the merger, any party
    may extend the time for the performance of any of the
    obligations or acts of the other party, waive any inaccuracies
    in any representations or warranties or waive compliance with
    any of the covenants or conditions contained in the merger
    agreement. Any agreement on the part of either party to any such
    extension or waiver shall be valid only if in a written
    instrument signed on behalf of such party.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    53
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='191'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">THE
    VOTING AGREEMENT</FONT></B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In connection with the merger agreement, Mr.&#160;Bershad and a
    holding corporation controlled by Mr.&#160;Bershad, who are
    referred to as the voting agreement stockholders and
    collectively own approximately 14.3% of the shares of our common
    stock entitled to vote at the special meeting, as of the close
    of business on the record date, entered into a voting agreement
    with GD AIS and Merger Sub. The following description of the
    voting agreement describes the material provisions of the voting
    agreement but does not purport to describe all of the terms of
    the voting agreement. The full text of the voting agreement is
    attached to this proxy statement as <U>Annex&#160;B</U> and
    incorporated by reference into this proxy statement. You are
    urged to read the voting agreement in its entirety because it is
    a legal document that relates to the rights among the voting
    agreement stockholders, GD AIS, and Merger Sub and may affect
    whether the vote required to adopt the merger agreement will be
    obtained.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<A name='192'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Voting
    Matters, Grant of Proxy and Waiver of Dissenters
    Rights</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The voting agreement stockholders have agreed to vote (or cause
    to be voted) all of their shares of Axsys common stock for the
    proposal to adopt the merger agreement at the special meeting or
    any adjournment thereof or in any other circumstance upon which
    a vote or other approval with respect to the proposal to adopt
    the merger agreement is sought or required.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In addition, the voting agreement stockholders have agreed
    (unless otherwise directed by GD AIS) to vote (or cause to be
    voted), at any Axsys stockholders meeting or any adjournment
    thereof or in any other circumstance in which their vote is
    sought or required, all of their shares of Axsys common stock
    against:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any acquisition proposal;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any action or agreement that would, or would reasonably be
    expected to, result in a breach in any respect of any covenant,
    agreement, representation or warranty of Axsys under the merger
    agreement;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any extraordinary corporate transaction, such as a merger,
    consolidation or other business combination involving Axsys or
    any of its subsidiaries;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any sale, lease or transfer of a material amount of assets of
    Axsys or any of its subsidiaries, or a reorganization,
    recapitalization, dissolution or liquidation of Axsys or its
    subsidiaries;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any change in the Board; any change in the present
    capitalization of Axsys or any amendment of Axsys&#146;
    certificate of incorporation or bylaws; any other material
    change in Axsys&#146; corporate structure or business; or any
    other action that would, or would reasonably be expected to, in
    the case of the items listed above, prevent, impede, frustrate,
    interfere with, delay, postpone or adversely affect the merger
    or the other transactions or that could facilitate an
    acquisition proposal or a superior proposal.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The voting agreement stockholders also appointed GD AIS and
    Merger Sub during and for the term of the voting agreement, as
    their true and lawful attorney-in-fact and proxy to vote,
    express consent or dissent, or otherwise utilize such voting
    power with respect to the voting agreement stockholders&#146;
    shares in connection with any proposals relating to the
    above-listed actions.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Pursuant to the terms of the voting agreement, the voting
    agreement stockholders irrevocably and unconditionally waived,
    and agreed to prevent the exercise of, any rights of appraisal,
    any dissenters&#146; rights and any similar rights relating to
    the merger or the related transactions that they may directly or
    indirectly have by virtue of the ownership of their shares of
    Axsys common stock.
</DIV>
<A name='193'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Transfer
    and Other Restrictions</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The voting agreement stockholders have agreed that, from the
    date of the voting agreement and until the earlier of the
    effective time of the merger or the termination of the merger
    agreement, they will not, directly or indirectly:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    sell, transfer or otherwise dispose of or encumber any of their
    shares of Axsys common stock (or any economic, voting or other
    direct or indirect right, title or interest therein), including,
    in each case, by operation of law;
</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    54
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    deposit their shares into a voting trust, enter into any other
    voting agreement or arrangement with respect to their shares or
    grant any proxy, power of attorney or other authorization or
    consent in or with respect to their shares;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    enter into any contract, option or other arrangement or
    undertaking with respect to the direct or indirect acquisition
    or sale, transfer, disposition of, or encumbrance on, any
    interest in or the voting of any shares of Axsys common stock or
    any other securities of Axsys (or any economic, voting or other
    direct or indirect right, title or interest therein), or any
    rights with respect thereto;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    take any other action which would, or could reasonably be
    expected to, result in a diminution of the voting power
    represented by their shares or in any way restrict, limit or
    interfere in any material respect with the performance of their
    obligations under the voting agreement;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    offer, commit or agree to take any of the foregoing actions.
</TD>
</TR>

</TABLE>
<A name='194'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Termination</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The voting agreement will terminate on the earlier of:
    (i)&#160;the mutual written agreement of the voting agreement
    stockholders and GD AIS; (ii)&#160;in the event the merger is
    consummated, the effective time of the merger; or (iii)&#160;the
    date on which the merger agreement is terminated pursuant to its
    terms. Certain general provisions will survive the termination
    and no party will be relieved for any breach of the voting
    agreement.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    55
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='195'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">MARKET
    PRICE OF AXSYS COMMON STOCK</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Shares of Axsys common stock are listed for trading on the
    Nasdaq Global Select Market under the Symbol &#147;AXYS.&#148;
    The following table sets forth, for the fiscal quarters
    indicated, the high and low sales prices per share of Axsys
    common stock. No dividends were declared on the shares of Axsys
    common stock during the period covered by the table.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="83%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>High&#160;($)</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Low&#160;($)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B><I>Fiscal Year Ended December&#160;31, 2007</I></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    First Quarter
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    17.93
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    15.71
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Second Quarter
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    21.42
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    15.81
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Third Quarter
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    31.26
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    20.98
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Fourth Quarter
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    43.63
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    28.42
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B><I>Fiscal Year Ended December&#160;31, 2008</I></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    First Quarter
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    52.39
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    34.02
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Second Quarter
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    63.89
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    45.26
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Third Quarter
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    79.69
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    49.22
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Fourth Quarter
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    73.72
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    42.10
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B><I>Fiscal Year Ending December&#160;31, 2009</I></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    First Quarter
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    55.30
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    24.35
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Second Quarter
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    53.75
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    39.25
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Third Quarter through August&#160;3, 2009
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    53.82
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    53.48
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The closing price of the shares of Axsys common stock on the
    Nasdaq Global Select Market on June&#160;3, 2009, the trading
    day prior to the announcement of the merger, was $50.00 per
    share. On August&#160;3, 2009, the most recent practicable date
    before this proxy statement was printed, the closing price for
    the shares of Axsys common stock on the Nasdaq Global Select
    Market was $53.75 per share.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    56
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='196'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">AXSYS
    COMMON STOCK OWNERSHIP</FONT></B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The information presented below regarding beneficial ownership
    of shares of our common stock is based upon representations made
    to us by our directors and officers, and is not necessarily
    indicative of beneficial ownership for any other purpose. In the
    table below, we have deemed a person to be a &#147;beneficial
    owner&#148; of a security if that person has or shares the power
    to vote or direct the voting of the security or the power to
    dispose of or direct the disposition of the security. Beneficial
    ownership includes any security with respect to which a person
    has the right to acquire sole or shared voting or investment
    power within 60&#160;days through the conversion or exercise of
    any convertible security, warrant, option or other right. The
    table sets forth as to each current director and each named
    executive officer: (1)&#160;the number of shares of common
    stock, and (2)&#160;the percent of total shares of common stock
    outstanding, that are beneficially owned. As of August&#160;3,
    2009, there were 11,624,837&#160;shares of common stock
    outstanding.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
<A name='197'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Security
    Ownership of Directors and Named Executive Officers</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 01 -->
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="80%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="4%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Shares of Common<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom">
    <B>Stock Beneficially<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="6" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Owned(1)</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Name of Beneficial Owner</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Number</B>
</TD>
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Percent</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Stephen W. Bershad(2)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,720,253
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    14.7
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    David A. Almeida(3)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    121,320
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1.0
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Scott B. Conner(4)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    97,689
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Anthony J. Fiorelli, Jr.(5)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    33,864
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Eliot M. Fried(6)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    32,537
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Richard F. Hamm, Jr.(7)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    14,779
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Robert G. Stevens(8)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    19,474
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    *
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Named executive officers and directors as a group
    (7&#160;persons)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2,039,916
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    17.3
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=60 -->

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD valign="top">
    &#160;* </TD>
    <TD></TD>
    <TD valign="bottom">
    Represents less than 1% of the outstanding shares of common
    stock.</TD>
</TR>


<TR style="line-height: 3pt; font-size: 1pt"><TD>&nbsp;</TD></TR>

<TR>
    <TD valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    Calculated in accordance with
    <FONT style="white-space: nowrap">Rule&#160;13d-3</FONT>
    under the Securities Exchange Act of 1934.</TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    Includes 53,500&#160;shares of common stock underlying options
    that are exercisable as of August&#160;3, 2009 or within
    60&#160;days after such date. Mr.&#160;Bershad owns
    972,491&#160;shares of common stock directly, 8,116&#160;shares
    through the Axsys Technologies, Inc. 401(k) Retirement Plan and
    686,146&#160;shares of common stock indirectly through SWB
    Holding Corporation, of which he is the sole shareholder and
    president.</TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD valign="top">
    (3) </TD>
    <TD></TD>
    <TD valign="bottom">
    Represents 48,000&#160;shares of common stock underlying options
    that are exercisable as of August&#160;3, 2009 or within
    60&#160;days after such date and 73,320&#160;shares of common
    stock owned directly.</TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD valign="top">
    (4) </TD>
    <TD></TD>
    <TD valign="bottom">
    Represents 22,200&#160;shares of common stock underlying options
    that are exercisable as of August&#160;3, 2009 or within
    60&#160;days after such date and 75,489&#160;shares of common
    stock owned directly.</TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD valign="top">
    (5) </TD>
    <TD></TD>
    <TD valign="bottom">
    Represents 9,220&#160;shares of common stock underlying options
    that are exercisable as of August&#160;3, 2009 or within
    60&#160;days after such date and 24,644&#160;shares of common
    stock owned directly.</TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD valign="top">
    (6) </TD>
    <TD></TD>
    <TD valign="bottom">
    Represents 9,024&#160;shares of common stock underlying options
    that are exercisable as of August&#160;3, 2009 or within
    60&#160;days after such date and 23,513&#160;shares of common
    stock owned directly.</TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD valign="top">
    (7) </TD>
    <TD></TD>
    <TD valign="bottom">
    Represents 8,779&#160;shares of common stock underlying options
    that are exercisable as of August&#160;3, 2009 or within
    60&#160;days after such date and 6,000&#160;shares of common
    stock owned directly.</TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF"><!-- TABLE 06 -->

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD valign="top">
    (8) </TD>
    <TD></TD>
    <TD valign="bottom">
    Represents 13,474&#160;shares of common stock underlying options
    that are exercisable as of August&#160;3, 2009 or within
    60&#160;days after such date and 6,000&#160;shares of common
    stock owned directly.</TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    57
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='198'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Security
    Ownership of Certain Owners</FONT></B>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Axsys knows of no person who beneficially owned, within the
    meaning of
    <FONT style="white-space: nowrap">Rule&#160;13d-3</FONT>
    under the Securities Exchange Act of 1934, more than five
    percent of the common stock outstanding, except for
    Mr.&#160;Bershad and except as set forth below. As of
    August&#160;3, 2009, 11,624,837&#160;shares of Axsys common
    stock were outstanding.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="75%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="7%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="7%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Percent<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Name and Address of Owner</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Number of Shares</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>of Class</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    General Dynamics Advanced Information Systems, Inc.(1)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1,720,253
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    14.7
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD align="left" valign="top">
    General Dynamics Corporation<BR>
    Vision Merger Sub
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: 0pt; margin-left: 10pt">
    c/o General Dynamics Corporation<BR>
    2941 Fairview Park Drive, Suite 100<BR>
    Falls Church, Virginia 22042
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Gabelli Funds, LLC(2)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    890,910
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    7.67
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
    GAMCO Asset Management Inc.<BR>
    Gabelli Securities, Inc.<BR>
    MJG Associates, Inc.<BR>
    Gabelli Foundation, Inc.<BR>
    GGCP, Inc.<BR>
    GAMCO Investors, Inc.
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Mario J. Gabelli<BR>
    One Corporate Center<BR>
    Rye, New York
    <FONT style="white-space: nowrap">10580-1435</FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Barclays Global Investors, N.A.(3)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    602,052
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    5.18
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
<TR valign="bottom" style="color: #000000; background: #CCEEFF">
<TD align="left" valign="top">
<DIV style="text-indent: 0pt; margin-left: 10pt">
    400 Howard Street<BR>
    San&#160;Francisco, CA 94105
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=60 -->

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    According to a Schedule 13D filed on June&#160;15, 2009, by GD
    AIS, Merger Sub, and General Dynamics, GD AIS, Merger Sub, and
    General Dynamics have shared voting power and may be deemed to
    beneficially own these shares as a result of the voting
    agreement and the limited proxy granted therein. The shares that
    these entities may be deemed to beneficially own are the same
    shares beneficially owned by Mr. Bershad. In the Schedule 13D
    jointly filed by these entities on June 15, 2009, each of these
    entities expressly disclaimed beneficial ownership of such
    shares (subject to the voting agreement and the limited proxy
    granted therein).</TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    According to an amended Schedule&#160;13D filed on July&#160;28,
    2009, by Gabelli Funds, LLC, GAMCO Asset Management Inc.,
    Gabelli Securities, Inc., MJG Associates, Inc., Gabelli
    Foundation, Inc., GGCP, Inc., GAMCO Investors, Inc. and Mario J.
    Gabelli, which are referred to as &#147;the GAMCO
    Investors&#148;, the GAMCO Investors have purchased and hold the
    shares reported by them for investment for one or more accounts
    over which they have shared, sole, or both investment
    <FONT style="white-space: nowrap">and/or</FONT>
    voting power, for their own account, or both. Axsys has been
    unable to determine the identities of the natural persons who
    exercise sole or shared voting and dispositive powers with
    respect to the shares held by the GAMCO Investors. This
    information is not known or reasonably available to Axsys
    because it rests within the knowledge of another person not
    affiliated with Axsys.</TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (3) </TD>
    <TD></TD>
    <TD valign="bottom">
    According to a Schedule&#160;13G filed on February&#160;6, 2009
    by Barclays Global Investors, N.A., Barclays Global Investors,
    N.A. and its affiliates have sole voting power with respect to
    477,383 of these shares and sole dispositive power with respect
    to 602,052 of these shares.</TD>
</TR>

</TABLE>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    58
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='199'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">ADDITIONAL
    INFORMATION</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We file annual, quarterly and current reports, proxy statements
    and other information with the SEC. You may read and copy this
    information at the SEC&#146;s Public Reference Room at
    100&#160;F&#160;Street N.E., Washington,&#160;D.C. 20549.
    Information on the operation of the Public Reference Room may be
    obtained by calling the SEC at (800)&#160;SEC-0330. You also may
    obtain copies of this information by mail from the Public
    Reference Room at the address set forth above, at prescribed
    rates. In addition, the SEC maintains a website that contains
    reports, proxy statements and other information about issuers
    like Axsys who file electronically with the SEC. The address of
    that site is
    <FONT style="white-space: nowrap">http://www.sec.gov.</FONT>
    Axsys SEC filings are also available, free of charge, on our
    website, at
    <FONT style="white-space: nowrap">http://www.axsys.com.</FONT>
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    You should rely only on the information contained in this proxy
    statement. We have not authorized anyone to provide you with
    information that is different from what is contained in this
    proxy statement. This proxy statement is dated August
    <B>[&#160;&#160;]</B>, 2009. You should not assume that the
    information contained in this proxy statement is accurate as of
    any date other than that date. Neither the mailing of this proxy
    statement to Axsys stockholders nor the payment of cash in the
    merger shall create any implication to the contrary.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We incorporate by reference into this proxy statement the
    documents listed below and any future filings we make with the
    Securities and Exchange Commission under Sections&#160;13(a),
    13(c), 14 or 15(d) of the Securities Exchange Act of 1934,
    including any filings after the date of this document until the
    date of the special meeting. The information incorporated by
    reference is an important part of this proxy statement. Any
    statement in a document incorporated by reference into this
    document will be deemed to be modified or superseded for
    purposes of this document to the extent a statement contained in
    this or any other subsequently filed document that is
    incorporated by reference into this document modifies or
    supersedes such statement. Any statement so modified or
    superseded will be not deemed, except as so modified or
    superseded, to constitute a part of this document.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Securities
    and Exchange Commission Filings</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="32%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="66%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Commission File Number 1-05111</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Period</B>
</DIV>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Annual Report on
    <FONT style="white-space: nowrap">Form&#160;10-K</FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Year ended December 31, 2008 (filed on February 17, 2009)
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Definitive Proxy Statement
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    For annual meeting on May 7, 2009 (filed on March 20, 2009)
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Quarterly Report on
    <FONT style="white-space: nowrap">Form&#160;10-Q</FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Quarter ended March 31, 2009 (filed on April 22, 2009) and
    June&#160;30, 2009 (filed on July&#160;28, 2009)
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Current Reports on
    <FONT style="white-space: nowrap">Form&#160;8-K</FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Filed on March 13, 2009, May 11, 2009 and June 4, 2009
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    THE COMPANY WILL MAIL WITHOUT CHARGE, UPON WRITTEN REQUEST, A
    COPY OF THE COMPANY&#146;S ANNUAL REPORT ON
    <FONT style="white-space: nowrap">FORM&#160;10-K,</FONT>
    ITS SCHEDULES AND LIST OF ITS EXHIBITS. REQUESTS SHOULD BE SENT
    TO AXSYS TECHNOLOGIES, INC., 175 CAPITAL BOULEVARD,
    SUITE&#160;103, ROCKY HILL, CONNECTICUT 06067, ATTENTION:
    CORPORATE SECRETARY.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    59
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='200'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">STOCKHOLDER
    PROPOSALS&#160;FOR ANNUAL MEETING</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Axsys does not currently expect to hold an annual meeting of
    stockholders in 2010 because Axsys will not be a separate public
    company after the merger is consummated. If the merger is not
    consummated and such a meeting is held, stockholders who intend
    to present proposals at the next annual meeting of stockholders,
    and who wish to have such proposals included in the proxy
    statement and form of proxy for such meeting, pursuant to the
    mechanism provided by SEC rules, must submit such proposals in
    writing to the Corporate Secretary of Axsys Technologies, Inc.,
    175 Capital Boulevard, Suite&#160;103, Rocky Hill, Connecticut
    06067, and such notice must be received no later than
    November&#160;21, 2009.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Stockholders who cannot or do not wish to use the mechanism
    provided by SEC rules for proposing a matter for action at the
    next annual meeting to be provided in a proxy statement must
    notify Axsys in writing of the proposal and the information
    required by the provisions of Axsys&#146; By-Laws dealing with
    stockholder proposals. The notice must be submitted in writing
    to Axsys generally not less than 60&#160;days nor more than
    90&#160;days in advance of an annual meeting. If the merger is
    not consummated and such meeting is to be held, it is presently
    anticipated that next year&#146;s annual meeting will be held on
    May&#160;6, 2010 and, accordingly, any stockholder proposal for
    next year&#146;s annual meeting submitted to Axsys on or between
    February&#160;5, 2010 and March&#160;7, 2010 will be considered
    submitted on a timely basis. Axsys reserves the right to reject,
    rule out of order, or take other appropriate action with respect
    to any proposal that does not comply with these and other
    applicable requirements. A copy of Axsys&#146; By-Laws that
    describes the advance-notice procedures can be obtained from the
    Corporate Secretary of Axsys.
</DIV>

<DIV style="margin-top: 24pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Axsys Technologies, Inc.
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    August&#160;[&#160;&#160;], 2009
</DIV>

<DIV align="left"><FONT size="1">

</FONT></DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    60
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="right" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">ANNEX&#160;A</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="right" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">EXECUTION
    COPY</FONT></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">AGREEMENT
    AND PLAN OF MERGER<BR>
    DATED AS OF JUNE 4, 2009<BR>
    BY AND AMONG<BR>
    GENERAL DYNAMICS ADVANCED INFORMATION SYSTEMS, INC.,<BR>
    VISION MERGER SUB, INC.<BR>
    AND<BR>
    AXSYS TECHNOLOGIES, INC.</FONT></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<P align="left" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><U><FONT style="font-family: 'Times New Roman', Times">TABLE
    OF CONTENTS</FONT></U></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="8%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="86%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=quadleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=quadright -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Page</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    ARTICLE&#160;I DEFINITIONS; INTERPRETATION
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    1.01
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Definitions
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    1.02
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Interpretation
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-7
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="line-height: 9pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    ARTICLE&#160;II THE MERGER
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-8
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    2.01
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    The Merger
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-8
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    2.02
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Closing
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-8
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    2.03
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Effective Time
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-8
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    2.04
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Effects of the Merger
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-8
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    2.05
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Certificate of Incorporation and Bylaws
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-8
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    2.06
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Directors and Officers
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-8
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    2.07
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Conversion or Cancellation of Shares
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-9
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    2.08
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Exchange of Certificates; Payment of the Merger Consideration
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-9
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    2.09
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Stock Incentives
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-10
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    2.10
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Appraisal Rights
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-11
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    2.11
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Withholdings
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-12
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    2.12
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Section&#160;16 Matters
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-12
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    2.13
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Further Action
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-12
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="line-height: 9pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    ARTICLE&#160;III REPRESENTATIONS AND WARRANTIES
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-12
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    3.01
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Representations and Warranties about the Company
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-12
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    3.02
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Representations and Warranties about Parent and Merger Sub
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-25
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="line-height: 9pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    ARTICLE&#160;IV COVENANTS AND AGREEMENTS TO BE PERFORMED PRIOR
    TO THE CLOSING
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-27
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    4.01
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Conduct of Business of the Company
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-27
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    4.02
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    [Reserved]
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-29
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    4.03
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Additional Reports
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-29
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    4.04
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Reasonable Best Efforts; Antitrust Filings; Cooperation
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-29
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    4.05
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Stockholder Approvals
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-30
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    4.06
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Proxy Statement
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-31
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    4.07
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Press Releases
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-32
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    4.08
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Access; Information
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-32
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    4.09
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    No Solicitation
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-32
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    4.10
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Takeover Laws and Provisions
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-35
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    4.11
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Control of Operations
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-35
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    4.12
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Stockholder Litigation
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-35
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    4.13
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Notification of Certain Matters
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-35
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    4.14
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Voting Agreement
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-35
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    4.15
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Release of Confidentiality and Standstill Obligations
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-35
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="line-height: 9pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    ARTICLE&#160;V COVENANTS AND AGREEMENTS TO BE PERFORMED
    FOLLOWING THE CLOSING
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-36
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    5.01
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Indemnification
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-36
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    5.02
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Employee Matters
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-37
</TD>
<TD>&nbsp;
</TD>
</TR>
</TABLE>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    A-i
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="8%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="86%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=quadleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=quadright -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Page</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    ARTICLE&#160;VI CONDITIONS TO THE MERGER
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-38
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    6.01
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Conditions to Each Party&#146;s Obligation to Effect the Merger
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-38
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    6.02
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Conditions to the Obligation of the Company
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-38
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    6.03
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Conditions to the Obligation of Parent and Merger Sub
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-38
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="line-height: 9pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    ARTICLE&#160;VII TERMINATION
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-39
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    7.01
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Termination
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-39
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    7.02
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Effect of Termination
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-40
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    7.03
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Termination Fee
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-40
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="line-height: 9pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    ARTICLE&#160;VIII MISCELLANEOUS
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-41
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    8.01
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Survival
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-41
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    8.02
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Waiver; Amendment; Extension of Time
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-41
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    8.03
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Counterparts; Electronic Transmission
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-41
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    8.04
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Governing Law; Jurisdiction; Venue; Service of Process; Waiver
    of Jury Trial
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-41
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    8.05
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Specific Performance
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-42
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    8.06
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Disclosure Schedule
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-42
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    8.07
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Notices
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-43
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    8.08
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="top">
    Entire Understanding; No Third Party Beneficiaries
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-43
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    8.09
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Severability
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-43
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    8.10
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Assignment; Successors
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-44
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    8.11
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Expenses
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-44
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    8.12
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Disclaimer
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-44
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    8.13
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
    Guaranty
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    A-44
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="line-height: 9pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <U>Exhibit&#160;A</U> Form of Voting Agreement
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="line-height: 9pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <U>Exhibit&#160;B</U> Certificate of Incorporation of the
    Surviving Corporation
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="line-height: 9pt">
<TD colspan="3">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <U>Schedule&#160;A</U> Company Disclosure Schedule
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD>&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    A-ii
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='204'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><U><FONT style="font-family: 'Times New Roman', Times">AGREEMENT
    AND PLAN OF MERGER</FONT></U></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    This AGREEMENT AND PLAN OF MERGER (this
    <I>&#147;Agreement&#148;</I>), dated as of June&#160;4, 2009, is
    by and among General Dynamics Advanced Information Systems,
    Inc., a Delaware corporation <I>(&#147;Parent&#148;)</I>, Vision
    Merger Sub, Inc., a Delaware corporation <I>(&#147;Merger
    Sub&#148;)</I>, and Axsys Technologies, Inc., a Delaware
    corporation (the <I>&#147;Company&#148;</I>).
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">RECITALS</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    WHEREAS, the Board of Directors of each of the Company, Parent
    and Merger Sub has approved this Agreement and deemed it
    advisable and in the best interests of their respective
    companies and stockholders to consummate the merger of Merger
    Sub with and into the Company (the <I>&#147;Merger&#148;</I>)
    upon the terms and subject to the conditions set forth herein,
    and have unanimously adopted resolutions adopting, approving and
    declaring the advisability of this Agreement, the Merger and the
    other transactions contemplated hereby;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    WHEREAS, as a condition and inducement to Parent and Merger Sub
    entering into this Agreement, certain stockholders of the
    Company are entering into a Voting Agreement with Parent and
    Merger Sub simultaneously with the execution and delivery of
    this Agreement in substantially the form attached hereto as
    <U>Exhibit&#160;A</U> (the <I>&#147;Voting Agreement&#148;</I>),
    whereby, among other things, such stockholders have agreed, upon
    the terms and subject to the conditions set forth therein, to
    vote their shares of Company Common Stock in favor of adoption
    of this Agreement;&#160;and
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    WHEREAS, pursuant to the Merger, shares of the common stock, par
    value $.01 per share, of the Company (<I>&#147;Company Common
    Stock&#148;</I>) (all such shares of Company Common Stock being
    hereinafter referred to as the <I>&#147;Shares&#148;</I>), will
    be, except as otherwise provided herein, converted into the
    right to receive the Merger Consideration (as defined herein) in
    the manner set forth herein, and the Company will become an
    indirect, wholly-owned subsidiary of Guarantor.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    NOW, THEREFORE, in consideration of the mutual representations,
    warranties, covenants and agreements contained in this
    Agreement, and such other good and valuable consideration, the
    receipt and sufficiency of which is hereby acknowledged, on the
    terms and subject to the conditions set forth in this Agreement,
    and intending to be legally bound hereby, Parent, Merger Sub and
    the Company hereby agree as follows:
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <FONT style="font-family: 'Times New Roman', Times">ARTICLE&#160;I<BR>
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <FONT style="font-family: 'Times New Roman', Times; font-variant: SMALL-CAPS">Definitions;
    Interpretation
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    1.01&#160;<I>Definitions.</I>&#160;&#160;This Agreement uses the
    following definitions:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Acquisition Proposal&#148;</I> means, other than the
    Transactions, any inquiry, proposal, indication of interest or
    offer (whether written or oral) with respect to any direct or
    indirect: (a)&#160;purchase or sale of an equity interest
    (including by means of a tender or exchange offer) representing
    more than fifteen percent (15%) of the voting power in the
    Company or any of its Significant Subsidiaries; (b)&#160;merger,
    consolidation, other business combination, reorganization,
    recapitalization, share exchange, dissolution, liquidation or
    similar transaction involving the Company or any of its
    Significant Subsidiaries; or (c)&#160;purchase or sale of
    assets, businesses, securities or ownership interests (including
    the securities of any Significant Subsidiary of the Company)
    representing more than fifteen percent (15%) of the consolidated
    assets of the Company and its Subsidiaries.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Agreement&#148;</I> has the meaning assigned in the
    Preamble.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Anti-Bribery Laws&#148;</I> has the meaning assigned in
    <U>Section&#160;3.01(j)(5)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Antitrust Authorities&#148;</I> means the Antitrust
    Division, the FTC and any other Governmental Authority of any
    other jurisdiction (whether United States, foreign or
    multinational) responsible for implementing the Antitrust Laws.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Antitrust Division&#148;</I> has the meaning assigned
    in <U>Section&#160;4.04(b)</U>.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    A-1
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Antitrust Filings&#148;</I> has the meaning assigned in
    <U>Section&#160;4.04(b)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Antitrust Laws&#148;</I> means the HSR Act and any
    other applicable competition, merger control, antitrust or
    similar Laws.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Benefit Arrangement&#148;</I> means, with respect to
    the Company, each of the following (a)&#160;under which any of
    its employees, former employees or any of its directors has any
    right to benefits, (b)&#160;that is sponsored, maintained or
    contributed to by it or its ERISA Affiliates or (c)&#160;under
    which it or its ERISA Affiliates has any liability: each
    &#147;employee benefit plan&#148; (within the meaning of
    Section&#160;3(3) of ERISA) and each stock purchase, stock
    option, equity-based grants, severance, employment,
    post-employment,
    <FONT style="white-space: nowrap">change-in-control,</FONT>
    fringe benefit, bonus, incentive, retirement, deferred
    compensation, welfare, paid time off benefits and other employee
    benefit plan, agreement, program, policy or other arrangement
    (with respect to any of the preceding, whether or not subject to
    ERISA).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Business Combination Law&#148;</I> means
    Section&#160;203 of the DGCL.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Business Day&#148;</I> means any day other than a day
    on which banks in the State of Delaware are required or
    authorized to be closed.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Certificate&#148;</I> means a certificate issued by the
    Company to a Company Stockholder representing Shares held by
    such Company Stockholder.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Certificate of Merger&#148;</I> has the meaning
    assigned in <U>Section&#160;2.03</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Closing&#148;</I> has the meaning assigned in
    <U>Section&#160;2.02</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Closing Date&#148;</I> has the meaning assigned in
    <U>Section&#160;2.02</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Code&#148;</I> means the Internal Revenue Code of 1986,
    as amended.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Company&#148;</I> has the meaning assigned in the
    Preamble.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Company Board&#148;</I> means the Board of Directors of
    the Company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Company Board Change of Recommendation&#148;</I> has
    the meaning assigned in <U>Section&#160;4.09(f)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Company Board Recommendation&#148;</I> has the meaning
    assigned in <U>Section&#160;3.01(c)(2)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Company Common Stock&#148;</I> has the meaning assigned
    in the Recitals.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Company IP Assets&#148;</I> has the meaning assigned in
    <U>Section&#160;3.01(p)(1)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Company Preferred Stock&#148;</I> means the preferred
    stock, par value $.01 per share, of the Company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Company Regulatory Filings&#148;</I> has the meaning
    assigned in <U>Section&#160;3.01(g)(1)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Company Restricted Share&#148;</I> has the meaning
    assigned in <U>Section&#160;2.09(a)(2)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Company Restricted Share Consideration&#148;</I> has
    the meaning assigned in <U>Section&#160;2.09(a)(2)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Company Stock Option&#148;</I> has the meaning assigned
    in <U>Section&#160;2.09(a)(1)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Company Stock Option Consideration&#148;</I> has the
    meaning assigned in <U>Section&#160;2.09(a)(1)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Company Stock Plan&#148;</I> means the Company&#146;s
    Amended and Restated Long-Term Stock Incentive Plan.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Company Stock-Based Award&#148;</I> means each right of
    any kind, whether vested or unvested, contingent or accrued, to
    acquire or receive Company Common Stock (other than Company
    Stock Options or Company Restricted Shares) or to receive
    benefits measured by the value of a number of Shares, that may
    be held, awarded, outstanding, credited, payable or reserved for
    issuance under the Company Stock Plan.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Company Stock-Based Award Consideration&#148;</I> has
    the meaning assigned in <U>Section&#160;2.09(a)(3)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Company Stockholder Approval&#148;</I> has the meaning
    assigned in <U>Section&#160;3.01(b)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Company Stockholders&#148;</I> has the meaning assigned
    in <U>Section&#160;3.01(c)(2)</U>.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    A-2
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Confidentiality Agreement&#148;</I> means the letter
    agreement, dated April&#160;13, 2009, by and between Guarantor
    and the Financial Advisor (as
    <FONT style="white-space: nowrap">agent-in-fact</FONT>
    for the Company).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Constituent Documents&#148;</I> means the charter or
    articles or certificate of incorporation and bylaws of a
    corporation, the certificate of partnership and partnership
    agreement of a general or limited partnership, the certificate
    of formation and limited liability company agreement of a
    limited liability company, the trust agreement of a trust and
    the comparable documents of other legal entities.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Covered Employees&#148;</I> has the meaning assigned in
    <U>Section&#160;5.02(a)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;DGCL&#148;</I> means the General Corporation Law of the
    State of Delaware.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Disbursing Agent&#148;</I> has the meaning assigned in
    <U>Section&#160;2.08(a)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Disclosure Schedule&#148;</I> has the meaning assigned
    in <U>Section&#160;8.06</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Dissenting Shares&#148;</I> has the meaning assigned in
    <U>Section&#160;2.10(a)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Dissenting Stockholders&#148;</I> has the meaning
    assigned in <U>Section&#160;2.10(a)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Effective Time&#148;</I> has the meaning assigned in
    <U>Section&#160;2.03</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Environmental Laws&#148;</I> means all applicable Laws
    regulating, relating to, or imposing liability or standards of
    conduct concerning pollution, protection of the environment or
    worker safety.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;ERISA&#148;</I> means the U.S.&#160;Employee Retirement
    Income Security Act of 1974, as amended.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;ERISA Affiliate&#148;</I> has the meaning assigned in
    <U>Section&#160;3.01(m)(3)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Exception Shares&#148;</I> means, collectively, shares
    of Company Common Stock owned or held by the Company, Guarantor,
    Parent, Merger Sub and any of their respective Subsidiaries,
    including any such shares held as treasury stock of the Company;
    provided, however, that Shares of Company Common Stock owned
    beneficially or held of record by any plan, program or
    arrangement sponsored or maintained for the benefit of any
    current or former employee of the Company, Parent, Merger Sub or
    any of their respective Subsidiaries, will not be deemed to be
    Exception Shares, regardless of whether the Company, Guarantor,
    Parent, Merger Sub or any such Subsidiary has the power,
    directly or indirectly, to vote or control the disposition of
    such shares.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Exchange Act&#148;</I> means the U.S.&#160;Securities
    Exchange Act of 1934 and the rules and regulations promulgated
    thereunder.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Expense Reimbursement&#148;</I> has the meaning
    assigned in <U>Section&#160;7.03(a)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Financial Advisor&#148;</I> has the meaning assigned in
    <U>Section&#160;3.01(t)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Financial Statements&#148;</I> has the meaning assigned
    in <U>Section&#160;3.01(g)(1)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;FTC&#148;</I> has the meaning assigned in
    <U>Section&#160;4.04(b)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;GAAP&#148;</I> means generally accepted accounting
    principles in the United States.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Government Contract&#148;</I> has the meaning assigned
    in <U>Section&#160;3.01(k)(3)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Governmental Authority&#148;</I> means any court,
    administrative agency, bureau, board, department, official,
    political subdivision, tribunal or commission or other
    governmental authority or instrumentality, whether domestic or
    foreign.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Grant Date&#148;</I> has the meaning assigned in
    <U>Section&#160;3.01(e)(4)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Guarantor&#148;</I> means General Dynamics Corporation,
    a Delaware corporation.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Hazardous Materials&#148;</I> means any hazardous or
    toxic substances, materials, wastes, pollutants or contaminants,
    including those defined or regulated as such under any
    Environmental Law, and any other substance the presence of which
    may give rise to liability under any Environmental Law.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    A-3
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;HSR Act&#148;</I> means the
    <FONT style="white-space: nowrap">U.S.&#160;Hart-Scott-Rodino</FONT>
    Antitrust Improvements Act of 1976 and the rules and regulations
    promulgated thereunder.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;HSR Filing&#148;</I> has the meaning assigned in
    <U>Section&#160;4.04(b)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Import and Export Control Laws&#148;</I> has the
    meaning assigned in <U>Section&#160;3.01(j)(4)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Indemnified Party&#148;</I> has the meaning assigned in
    <U>Section&#160;5.01(b)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Insurance Policy&#148;</I> has the meaning assigned in
    <U>Section&#160;3.01(r)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Intellectual Property&#148;</I> means all of the
    following in any jurisdiction throughout the world:
    (a)&#160;patents, patent applications, patent disclosures and
    inventions; (b)&#160;trademarks, service marks, trade dress,
    trade names, corporate names and Internet domain names;
    (c)&#160;copyrights; (d)&#160;registrations for and applications
    to register any of the foregoing; (e)&#160;computer software
    (other than commercial
    <FONT style="white-space: nowrap">off-the-shelf</FONT>
    software); (f)&#160;trade secrets, confidential information and
    know-how; and (g)&#160;any other intellectual property rights.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Intervening Event&#148;</I> has the meaning assigned in
    <U>Section&#160;4.09(f)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;IP Assets&#148;</I> has the meaning assigned in
    <U>Section&#160;3.01(p)(1)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;IP Licenses&#148;</I> has the meaning assigned in
    <U>Section&#160;3.01(p)(4)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Knowledge&#148;</I> means or has reference to,
    respectively, the actual knowledge of the executive officers of
    the Company or Parent, as the case may be, after reasonable
    inquiry and investigation with respect to the matter(s)
    referenced.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Laws&#148;</I> means all federal, state, local and
    foreign laws, statutes, rules, regulations, ordinances, codes,
    licenses, permits, Orders or requirements issued, enacted,
    adopted, promulgated or otherwise implemented or put into effect
    by any Governmental Authority (including common law or the
    interpretation thereof).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Leased Property&#148;</I> has the meaning assigned in
    <U>Section&#160;3.01(q)(2)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Leases&#148;</I> has the meaning assigned in
    <U>Section&#160;3.01(q)(2)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Lien&#148;</I> means any mortgage, pledge, security
    interest, lien or similar encumbrance.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Matching Agreement&#148;</I> has the meaning assigned
    in <U>Section&#160;4.09(g)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Material Adverse Effect&#148;</I> means:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 8%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;with respect to the Company, any change, effect, event,
    occurrence, state of facts, development or circumstance that,
    individually or in the aggregate, has had, or would reasonably
    be expected to have, a material adverse effect on, (i)&#160;the
    condition (financial or otherwise), assets, liabilities, results
    of operations or business of the Company and its Subsidiaries,
    taken as a whole, or (ii)&#160;the ability of the Company to
    perform its obligations under this Agreement or to consummate
    the Transactions by the Termination Date, excluding in each case
    solely for purposes of clause&#160;(i) the impact of
    (1)&#160;changes after the date of this Agreement in GAAP or
    regulatory accounting requirements applicable to
    U.S.&#160;publicly owned business organizations generally or
    changes after the date of this Agreement in Laws,
    (2)&#160;changes or developments in general economic or
    political conditions, including acts of war (whether or not
    declared), sabotage, insurrection, terrorism and armed
    hostilities, (3)&#160;changes in any financial, banking, credit
    or securities markets (including any disruption thereof),
    (4)&#160;changes in the stock price or trading volume of the
    Shares (it being understood that the facts or circumstances
    giving rise to or contributing to such change in stock price or
    trading volume, if not otherwise excluded under this clause (a),
    may be taken into account in determining whether there has been,
    or would reasonably be expected to be, a Material Adverse Effect
    with respect to the Company), (5)&#160;general changes in
    industries in which the Company operates, (6)&#160;natural
    disasters, (7)&#160;any failure of the Company to meet revenue,
    backlog or earnings projections or forecasts (whether internal
    or published by the Company or third parties) or any decline in
    the Company&#146;s credit rating (it being understood that the
    facts or circumstances giving rise to or contributing to such
    failure to meet revenue, backlog or earnings projections or
    forecasts or decline in the Company&#146;s credit rating, if not
    otherwise excluded under this clause (a), may be taken into
    account in
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    A-4
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 8%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    determining whether there has been, or would reasonably be
    expected to be, a Material Adverse Effect with respect to the
    Company), (8)&#160;changes resulting from the announcement of
    this Agreement or the consummation of the Transactions or
    (9)&#160;any effect arising out of any action taken or omitted
    to be taken by the Company with the prior written consent of
    Parent or Merger Sub, except to the extent in the case of
    clauses (1), (2), (3), (5)&#160;or (6)&#160;that such change,
    effect, event, occurrence, state of facts, development or
    circumstance materially and disproportionately has had, or would
    reasonably be expected to have, a greater adverse impact on the
    Company and its Subsidiaries, taken as a whole, as compared to
    the adverse impact on the competitors of the Company and its
    Subsidiaries, but taking into account in determining whether
    there has been, or would reasonably be expected to be, a
    Material Adverse Effect with respect to the Company only such
    materially disproportionate greater adverse impact;&#160;and
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 8%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;with respect to Parent or Merger Sub, any change,
    effect, occurrence, state of facts, development or circumstance
    that, individually or in the aggregate, has had, or would
    reasonably be expected to have, a material and adverse effect on
    the ability of Parent or Merger Sub to perform their respective
    obligations under this Agreement or to consummate the
    Transactions by the Termination Date.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 8%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Material Contract&#148;</I> has the meaning assigned in
    <U>Section&#160;3.01(k)(1)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Material Customers&#148;</I> has the meaning assigned
    in <U>Section&#160;3.01(v)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Material Suppliers&#148;</I> has the meaning assigned
    in <U>Section&#160;3.01(v)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Merger&#148;</I> has the meaning assigned in the
    Recitals.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Merger Consideration&#148;</I> has the meaning assigned
    in <U>Section&#160;2.07(a)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Merger Sub&#148;</I> has the meaning assigned in the
    Preamble.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Merger Sub Common Stock&#148;</I> means the common
    stock, par value $.01 per share, of Merger Sub.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Modified Superior Proposal&#148;</I> has the meaning
    assigned in <U>Section&#160;4.09(g)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Nasdaq&#148;</I> means The Nasdaq Stock Market, Inc.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Notice of Superior Proposal&#148;</I> has the meaning
    assigned in <U>Section&#160;4.09(g)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Order&#148;</I> means, with respect to any Person, any
    order, writ, judgment, injunction, decree, ruling, stipulation
    or award by, or subject to, any Governmental Authority or
    arbitrator that is binding upon or applicable to such Person or
    its property.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Ordinary Course of Business&#148;</I> means an action
    taken or not taken with respect to the business of the Company
    and its Subsidiaries that is consistent with the reasonably
    recent past practices of the Company and its Subsidiaries
    (including with respect to quantity, nature, magnitude and
    frequency) and is taken in the ordinary course of the normal and
    recurring operations of the Company and its Subsidiaries.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Parent&#148;</I> has the meaning assigned in the
    Preamble.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Parent Approval&#148;</I> has the meaning assigned in
    <U>Section&#160;3.02(b)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Party&#148;</I> means Parent, Merger Sub or the
    Company, as the context requires.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Permitted Lien&#148;</I> means any Lien
    (a)&#160;disclosed in the consolidated financial statements of
    the Company and its Subsidiaries or the notes thereto set forth
    in the most recent Company Regulatory Filing publicly available
    at least one Business Day prior to the date of this Agreement or
    securing liabilities reflected on such financial statements,
    (b)&#160;incurred in the Ordinary Course of Business since the
    date of such financial statements and which is not material in
    amount or nature, (c)&#160;for Taxes not yet due and payable or
    that are being contested in good faith and reserved for on such
    financial statements in accordance with GAAP, or (d)&#160;that
    is a carrier&#146;s, warehousemen&#146;s, mechanic&#146;s,
    materialmen&#146;s, repairmen&#146;s, landlord&#146;s or other
    similar lien arising in the Ordinary Course of Business and
    which is not material in amount or nature.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Person&#148;</I> means any individual, corporation,
    limited liability company, partnership, association, joint-stock
    company, business trust or unincorporated organization and is
    intended to be interpreted broadly.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    A-5
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Previously Disclosed&#148;</I> means
    (a)&#160;information set forth by the Company in the applicable
    paragraph of the Disclosure Schedule, or any other paragraph of
    the Disclosure Schedule (so long as it is reasonably clear from
    the context that the disclosure in such other paragraph of the
    Disclosure Schedule is also applicable to the Section of this
    Agreement in question) or (b)&#160;except with respect to
    <U>Sections&#160;3.01(a)</U> through <U>3.01(f)</U> and
    <U>Section&#160;3.01(s)</U>, information set forth in those
    Company Regulatory Filings (including any schedules and exhibits
    thereto) filed with the SEC and publicly available during the
    period beginning on December&#160;31, 2007 and ending on the
    Business Day prior to the date of this Agreement, so long as it
    is reasonably clear from the context that the disclosure in
    those Company Regulatory Filings is applicable to the Section of
    this Agreement in question (but not including any disclosures
    set forth in any section of any such Company Regulatory Filing
    entitled &#147;Risk Factors&#148;, &#147;Cautionary Factors That
    May Affect Future Results&#148;, &#147;Forward-Looking
    Statements&#148; or &#147;Qualitative and Quantitative
    Disclosures About Market Risk&#148; or any other disclosures
    included in any such Company Regulatory Filing that are general
    cautionary, predictive or forward-looking in nature), without
    giving effect to any amendment to any such Company Regulatory
    Filing filed on or after the date of this Agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Proxy Statement&#148;</I> means the proxy statement,
    including the form of proxy, the letter to stockholders and the
    notice of meeting, as the case may be, to be provided to the
    Company Stockholders for the purpose of obtaining the Company
    Stockholder Approval in connection with the Merger (including
    any amendments or supplements thereto) and any schedules
    required to be filed with the SEC in connection therewith.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Representatives&#148;</I> means, with respect to any
    Person, such Person&#146;s directors, officers, employees, legal
    or financial advisors, accountants, representatives and agents.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Rights&#148;</I> means subscriptions, options,
    warrants, calls, convertible securities, rights of first
    refusal, preemptive rights, or other similar rights, agreements
    or commitments relating to the issuance of capital stock
    obligating the Company or any of its Subsidiaries to
    (a)&#160;issue, transfer or sell any shares of capital stock or
    other equity interests of the Company or any of its Subsidiaries
    or securities convertible into or exchangeable for such shares
    or equity interests, (b)&#160;grant, extend or enter into any
    such subscription, option, warrant, call, convertible securities
    or other similar right, agreement, arrangement or commitment to
    repurchase, (c)&#160;redeem or otherwise acquire any such shares
    of capital stock or other equity interests or (d)&#160;provide
    an amount of funds to, or make any investment (in the form of a
    loan, capital contribution or otherwise) in, the Company or any
    of its Subsidiaries.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Sarbanes-Oxley Act&#148;</I> means the Sarbanes-Oxley
    Act of 2002 and the rules and regulations promulgated thereunder.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;SEC&#148;</I> means the U.S.&#160;Securities and
    Exchange Commission.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Securities Act&#148;</I> means the U.S.&#160;Securities
    Act of 1933 and the rules and regulations promulgated thereunder.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Shares&#148;</I> has the meaning assigned in the
    Recitals.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Stockholders&#146; Meeting&#148;</I> has the meaning
    assigned in <U>Section&#160;4.05(a)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Subsidiary&#148;</I> and <I>&#147;Significant
    Subsidiary&#148;</I> have the respective meanings ascribed to
    those terms in
    <FONT style="white-space: nowrap">Rule&#160;1-02</FONT>
    of
    <FONT style="white-space: nowrap">Regulation&#160;S-X</FONT>
    promulgated by the SEC.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Superior Proposal&#148;</I> means a bona fide written
    Acquisition Proposal (with all references to &#147;fifteen
    percent (15%)&#148; in the definition thereof deemed to be
    &#147;a majority&#148; for the purposes of this definition) made
    by any Person that (a)&#160;is not received in violation of
    <U>Section&#160;4.09</U>, (b)&#160;is fully financed,
    (c)&#160;is on terms that the Company Board determines in good
    faith, after consultation with the Company&#146;s financial and
    legal advisors, and in light of all relevant circumstances as
    the Company Board in good faith considers to be appropriate
    (including the conditionality, regulatory aspects, time likely
    to be required to consummate such Acquisition Proposal and the
    likelihood of success of such Acquisition Proposal), are more
    favorable to the Company and its stockholders from a financial
    point of view than the Transactions, and (d)&#160;is reasonably
    likely to be consummated according to its terms.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    A-6
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Surviving Corporation&#148;</I> has the meaning
    assigned in <U>Section&#160;2.01</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Takeover Laws&#148;</I> has the meaning assigned in
    <U>Section&#160;3.01(s)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Takeover Provisions&#148;</I> has the meaning assigned
    in <U>Section&#160;3.01(s)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Tax&#148; and &#147;Taxes&#148;</I> means all federal,
    state, local or foreign taxes, levies or other assessments,
    however denominated, including all net income, gross income,
    gains, gross receipts, sales, use, ad valorem, goods and
    services, capital, production, transfer, franchise, windfall
    profits, license, withholding, payroll, employment, disability,
    excise, estimated, severance, stamp, occupation, property,
    unemployment or other taxes, custom duties, fees, assessments or
    similar charges, together with any interest, penalties and
    additions to tax imposed by any Governmental Authority,
    including any transferee, successor or secondary liability for
    any such tax and any liability assumed by contract or arising as
    a result of being or ceasing to be a member of any affiliated
    group, or similar group under state, provincial, local or
    foreign Law, or being included or required to be included in any
    income Tax Return relating thereto.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Tax Returns&#148;</I> means a report, return or other
    information required to be filed with a taxing authority with
    respect to Taxes (including any amendments and schedules
    thereto).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Termination Date&#148;</I> has the meaning assigned in
    <U>Section&#160;7.01(f)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Termination Fee&#148;</I> has the meaning assigned in
    <U>Section&#160;7.03(a)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Transactions&#148;</I> has the meaning assigned in
    <U>Section&#160;3.01(c)(2)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <I>&#147;Voting Agreement&#148;</I> has the meaning assigned in
    the Recitals.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    1.02&#160;<I>Interpretation</I>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;In this Agreement, except as the context may otherwise
    require, references:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (1)&#160;to the Preamble, Recitals, Sections, Exhibits or
    Schedules are to the Preamble to, a Recital or Section of, or
    Exhibit or Schedule to, this Agreement, as applicable;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (2)&#160;to this Agreement are to this Agreement and the
    Exhibits and Schedules to it taken as a whole;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (3)&#160;to any agreement (including this Agreement), contract
    or Law are to the agreement, contract or Law as amended,
    modified, supplemented, restated or replaced from time to time
    (in the case of an agreement or contract, to the extent
    permitted by the terms thereof);
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (4)&#160;to any section of any Law include any successor to that
    section;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (5)&#160;to any Governmental Authority include any successor to
    that Governmental Authority;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (6)&#160;to the date of this Agreement are to the date set forth
    in the Preamble;&#160;and
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (7)&#160;to &#147;$&#148; are to United States Dollars.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;The table of contents and Article and Section headings
    contained in this Agreement are for reference purposes only and
    do not limit or otherwise affect any of the substance of this
    Agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (c)&#160;The words &#147;include,&#148; &#147;includes&#148; or
    &#147;including&#148; and any other variations thereof as used
    in this Agreement are to be deemed followed by the words
    &#147;without limitation.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (d)&#160;The words &#147;herein,&#148; &#147;hereof,&#148;
    &#147;hereunder&#148; and similar terms as used in this
    Agreement are to be deemed to refer to this Agreement as a whole
    and not to any specific Section.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (e)&#160;This Agreement is the product of negotiation by the
    Parties, which have had the assistance of counsel and other
    advisors. The Parties intend that this Agreement not be
    construed more strictly with regard to one Party than with
    regard to any other Party.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (f)&#160;No provision of this Agreement is to be construed to
    require, directly or indirectly, any Person to take any action,
    or omit to take any action, to the extent such action or
    omission would violate applicable Law.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    A-7
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (g)&#160;Whenever the context requires, terms defined in this
    Agreement in the singular will be deemed to include the plural
    and vice versa.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (h)&#160;The word &#147;extent&#148; in the phrase &#147;to the
    extent&#148; as used in this Agreement means the degree to which
    a subject or other thing extends and such phrase does not simply
    mean &#147;if.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (i)&#160;With respect to this Agreement and the Voting
    Agreement, when calculating the period of time before which,
    within which or following which any act is to be done or step
    taken, the date that is the reference date in beginning the
    calculation of such period will be excluded (for example, if an
    action is to be taken within two (2)&#160;days of a triggering
    event and such event occurs on a Tuesday, then the action must
    be taken by the end of the day on Thursday). If the last day of
    such period is not a Business Day, the period in question will
    end on the next succeeding Business Day.
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <FONT style="font-family: 'Times New Roman', Times">ARTICLE&#160;II<BR>
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <FONT style="font-family: 'Times New Roman', Times; font-variant: SMALL-CAPS">The
    Merger
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    2.01&#160;<I>The Merger.</I>&#160;&#160;At the Effective Time,
    the Company and Merger Sub shall consummate the Merger, pursuant
    to which (a)&#160;the separate corporate existence of Merger Sub
    will terminate, (b)&#160;the Company will be the surviving
    corporation (the <I>&#147;Surviving Corporation&#148;</I>) and
    will continue its corporate existence under the Laws of the
    State of Delaware and will become an indirect, wholly-owned
    Subsidiary of Guarantor and (c)&#160;the separate corporate
    existence of the Company with all its rights, privileges,
    immunities, powers and franchises will continue unaffected by
    the Merger.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    2.02&#160;<I>Closing.</I>&#160;&#160;The closing of the Merger
    (the <I>&#147;Closing&#148;</I>) will take place at the offices
    of Jones Day, 901 Lakeside Avenue, Cleveland, Ohio, at
    10:00&#160;a.m. prevailing Eastern time, on the second Business
    Day (unless the Parties agree to another time or date) after
    satisfaction or waiver of the conditions set forth in
    <U>Article&#160;VI</U>, other than those conditions that by
    their nature are to be satisfied at the Closing but subject to
    the fulfillment or waiver of those conditions (the
    <I>&#147;Closing Date&#148;</I>).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    2.03&#160;<I>Effective Time.</I>&#160;&#160;On the Closing Date,
    the Parties shall cause the Merger to be consummated by
    executing and delivering a certificate of merger (the
    <I>&#147;Certificate of Merger&#148;</I>) to the Secretary of
    State of the State of Delaware for filing in accordance with
    Section&#160;103 of the DGCL. The Parties will make any and all
    other filings or recordings required under the DGCL, and the
    Merger will become effective when the Certificate of Merger is
    filed in the office of the Secretary of State of the State of
    Delaware, or at such later date or time as Parent and the
    Company mutually agree and specify in the Certificate of Merger
    in accordance with the DGCL (the time the Merger becomes
    effective being referred to herein as the <I>&#147;Effective
    Time&#148;</I>).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    2.04&#160;<I>Effects of the Merger.</I>&#160;&#160;At the
    Effective Time, the Merger will have the effects set forth in
    this Agreement and prescribed by the DGCL and any other
    applicable Law. Without limiting the generality of the
    foregoing, as of the Effective Time, the Surviving Corporation
    will succeed to all of the properties, rights, privileges,
    powers, franchises and assets of the Company and Merger Sub, and
    all debts, liabilities and duties of the Company and Merger Sub
    will become debts, liabilities and duties of the Surviving
    Corporation.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    2.05&#160;<I>Certificate of Incorporation and Bylaws.</I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;At the Effective Time, the certificate of incorporation
    of the Company as in effect immediately prior to the Effective
    Time shall be amended in the Merger to read in its entirety as
    set forth on <U>Exhibit&#160;B</U>, and as so amended, will be
    the certificate of incorporation of the Surviving Corporation
    until thereafter changed or amended as provided therein or by
    applicable Law (subject to the requirements of
    <U>Section&#160;5.01</U>).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;At the Effective Time, the bylaws of Merger Sub, as in
    effect immediately prior to the Effective Time, will be the
    bylaws of the Surviving Corporation until thereafter amended as
    provided therein, by the certificate of incorporation of the
    Surviving Corporation or by applicable Law (subject to the
    requirements of <U>Section&#160;5.01</U>).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    2.06&#160;<I>Directors and Officers.</I>&#160;&#160;The
    directors and officers of Merger Sub immediately prior to the
    Effective Time will be the directors and officers of the
    Surviving Corporation as of the Effective Time.
</DIV>

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    <BR>
    A-8
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    2.07&#160;<I>Conversion or Cancellation of
    Shares.</I>&#160;&#160;At the Effective Time, by virtue of the
    Merger and without any action on the part of the Company,
    Parent, Merger Sub or the holders of any of the following
    securities:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;Each Share issued and outstanding immediately prior to
    the Effective Time, other than Exception Shares (which will be
    canceled and cease to exist with no payment or distribution
    being made with respect thereto), Company Restricted Shares
    (which will be treated in accordance with
    <U>Section&#160;2.09(a)(2)</U>) and Dissenting Shares (which
    will be treated in accordance with <U>Section&#160;2.10</U>),
    will be converted into and constitute the right to receive cash
    in an amount equal to $54.00, without interest (the
    <I>&#147;Merger Consideration&#148;</I>), payable to the holder
    thereof in the manner provided in <U>Section&#160;2.08.</U> At
    the Effective Time, all Shares that have been converted into the
    right to receive the Merger Consideration as provided in this
    <U>Section&#160;2.07(a)</U> will no longer be outstanding and
    will be canceled and will cease to exist, and each holder of a
    Certificate that immediately prior to the Effective Time
    represented such Shares will cease to have any rights with
    respect thereto, except the right to receive the Merger
    Consideration in exchange therefor in accordance with
    <U>Section&#160;2.08</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;Each issued and outstanding share of Merger Sub Common
    Stock will be converted into one fully paid and nonassessable
    share of common stock, par value $.01 per share, of the
    Surviving Corporation, and will constitute the only outstanding
    shares of capital stock of the Surviving Corporation.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    2.08&#160;<I>Exchange of Certificates; Payment of the Merger
    Consideration</I>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;<I>Appointment of Disbursing
    Agent.</I>&#160;&#160;Prior to the Effective Time, Parent shall
    deposit, or cause to be deposited, with a disbursing agent
    agreed upon by Parent and the Company (the <I>&#147;Disbursing
    Agent&#148;</I>) cash in an amount sufficient to allow the
    Disbursing Agent to pay the aggregate Merger Consideration
    payable pursuant to <U>Section&#160;2.07(a)</U> in exchange for
    outstanding Shares. Any income from investment of such funds,
    which investment will be in accordance with the instructions of
    Parent, will be payable solely to Parent (or its designee).
    Parent shall be obligated to, from time to time, deposit any
    additional funds necessary to make all payments that may be
    required pursuant to <U>Section&#160;2.07(a).</U> Any such cash
    remaining in the possession of the Disbursing Agent six
    (6)&#160;months after the Effective Time (together with any
    earnings in respect thereof) will be delivered by the Disbursing
    Agent to Parent (or its designee), and any holder of
    Certificates immediately prior to the Effective Time who has not
    theretofore exchanged such Certificates pursuant to this
    <U>Article&#160;II</U> will thereafter be entitled to look
    exclusively to Parent
    <FONT style="white-space: nowrap">and/or</FONT> the
    Surviving Corporation, and only as a general creditor thereof,
    for the consideration to which such holder may be entitled upon
    exchange of such Certificates pursuant to
    <U>Section&#160;2.07(a).</U> Notwithstanding the foregoing,
    neither the Disbursing Agent nor any Party will be liable to any
    holder of Certificates for any amount properly delivered to a
    public official pursuant to applicable abandoned property,
    escheat or similar Laws. After any remaining cash has been
    delivered by the Disbursing Agent to Parent pursuant to this
    <U>Section&#160;2.08(a)</U>, in the event any Certificate has
    not been surrendered for the consideration to which such holder
    may be entitled prior to the date that such Certificate, or the
    consideration payable upon the surrender thereof, would
    otherwise escheat to or become the property of any Governmental
    Authority, then the consideration otherwise payable upon the
    surrender of such Certificate will, to the extent permitted by
    applicable Law, become the property of Parent, free and clear of
    all Liens, rights, interests and adverse claims of any Person.
    The consideration paid in accordance with the terms of this
    <U>Article&#160;II</U> in respect of Certificates that have been
    surrendered in accordance with the terms of this Agreement will
    be deemed to have been paid in full satisfaction of all rights
    pertaining to the Shares formerly represented thereby.
    Notwithstanding anything herein to the contrary, the exchange
    procedures described in this <U>Section&#160;2.08</U> will not
    apply to Company Restricted Shares and the Company Restricted
    Share Consideration, and the Disbursing Agent will not act as
    disbursing agent for the Company Restricted Shares.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;<I>Exchange Procedures.</I>&#160;&#160;As contemplated
    by <U>Section&#160;2.08(a)</U> above, promptly after the
    Effective Time, but in no event more than two (2)&#160;Business
    Days thereafter, Parent shall cause the Disbursing Agent to mail
    or deliver to each Person who was, immediately prior to the
    Effective Time, a holder of record of Company Common Stock, a
    form of letter of transmittal (which will specify that delivery
    will be effected, and risk of loss and title to Certificates
    will pass, only upon proper delivery of such Certificates to the
    Disbursing Agent and will be in such form and have such other
    customary provisions as Parent reasonably specifies) containing
    instructions for use in effecting the surrender of Certificates
    in exchange for the consideration to which such Person is
    entitled pursuant to <U>Section&#160;2.07(a).</U> Upon surrender
    to the Disbursing Agent of a Certificate for cancellation
    together with such letter of
</DIV>

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    <BR>
    A-9
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    transmittal, duly executed and completed in accordance with the
    instructions thereto, and all other documents required by the
    Disbursing Agent, the holder of such Certificate will promptly
    be provided in exchange therefor cash in the amount to which
    such holder is entitled pursuant to <U>Section&#160;2.07(a)</U>,
    and the Certificate so surrendered will forthwith be canceled.
    No interest will accrue or be paid with respect to any
    consideration to be delivered upon surrender of Certificates.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (c)&#160;<I>Transfer to Holder other than Existing
    Holder.</I>&#160;&#160;If any cash payment is to be made
    pursuant to <U>Section&#160;2.07(a)</U> in a name other than
    that in which the Certificate surrendered in exchange therefor
    is registered, it will be a condition of such payment that
    (1)&#160;the Person requesting such payment shall pay any
    transfer or other similar Taxes required by reason of the making
    of such payment in a name other than that of the registered
    holder of the Certificate surrendered, or required for any other
    reason relating to such holder or requesting Person, or shall
    establish to the reasonable satisfaction of the Disbursing Agent
    that any such Tax has been paid or is inapplicable, and
    (2)&#160;the Certificate so surrendered will be properly
    endorsed or will be otherwise in proper form for transfer.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (d)&#160;<I>Transfers.</I>&#160;&#160;At the Effective Time, the
    stock transfer books of the Company will be closed, and there
    will be no further registration of transfers of Company Common
    Stock or Certificates that were outstanding immediately prior to
    the Effective Time on the stock transfer books of the Company.
    If after the Effective Time Certificates are presented to the
    Surviving Corporation for any reason, they will be canceled and
    exchanged as provided in this <U>Article&#160;II</U>, subject to
    applicable Laws in the case of Dissenting Shares.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (e)&#160;<I>Lost, Stolen or Destroyed
    Certificates.</I>&#160;&#160;If any Certificate shall have been
    lost, stolen or destroyed, upon the making of an affidavit (in
    form and substance reasonably acceptable to Parent) of that fact
    by the Person claiming such Certificate to be lost, stolen or
    destroyed and, if required by Parent or the Disbursing Agent,
    the posting by such Person of a bond in such reasonable amount
    as Parent or the Disbursing Agent may direct as indemnity
    against any claim that may be made against it with respect to
    such Certificate, Parent or the Disbursing Agent shall, in
    exchange for such lost, stolen or destroyed Certificate, pay or
    cause to be paid the consideration deliverable in respect of
    Company Common Stock formerly represented by such Certificate
    pursuant to <U>Section&#160;2.07(a)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (f)&#160;<I>Return of Merger Consideration for Dissenting
    Shares.</I>&#160;&#160;Any portion of the Merger Consideration
    deposited by Parent with the Disbursing Agent pursuant to
    <U>Section&#160;2.08(a)</U> in respect of any Dissenting Shares
    will be returned to Parent (or its designee) upon demand.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (g)&#160;<I>Cessation of Rights.</I>&#160;&#160;From and after
    the Effective Time, the holders of Certificates will cease to
    have any rights as stockholders of the Surviving Corporation,
    except as otherwise expressly provided in this Agreement or by
    applicable Law, and Parent will be entitled to treat each
    Certificate that has not yet been surrendered for exchange
    solely as evidence of the right to receive the consideration
    into which the Company Common Stock formerly evidenced by such
    Certificate has been converted pursuant to the Merger.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    2.09&#160;<I>Stock Incentives</I>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;<I>Company Stock Options; Company Restricted Shares;
    Company Stock-Based Awards</I>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (1)&#160;Each option to purchase Company Common Stock granted
    under the Company Stock Plan (each, a <I>&#147;Company Stock
    Option&#148;</I>) outstanding and unexercised immediately prior
    to the Effective Time (whether vested or unvested), by virtue of
    the Merger and without any action on the part of any holder of
    any Company Stock Option, will become fully vested and
    exercisable immediately prior to, and then will be canceled
    automatically at, the Effective Time and will thereafter
    represent, and will be converted into, only the right to receive
    an amount of cash, if any (and without interest), equal to the
    product of (A)&#160;the excess, if any, of (i)&#160;the Merger
    Consideration over (ii)&#160;the exercise price per share of the
    Company Common Stock subject to such Company Stock Option and
    (B)&#160;the number of shares of Company Common Stock subject to
    such Company Stock Option immediately prior to its cancellation,
    regardless of the vested status of such Company Stock Option
    (the <I>&#147;Company Stock Option Consideration&#148;</I>).
    Parent will, or will cause the Surviving Corporation to, pay to
    holders of Company Stock Options the Company Stock Option
    Consideration, if any, as soon as practicable after the
    Effective Time and in any case within five (5)&#160;Business
    Days thereafter. For the avoidance of doubt, no Company Stock
    Option Consideration will be payable in respect of Company Stock
    Options with an exercise price per share in excess of the Merger
</DIV>

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    <BR>
    A-10
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Consideration as of immediately prior to the Effective Time, and
    all such Company Stock Options will be canceled automatically at
    the Effective Time without any payment therefor.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (2)&#160;Each restricted share of Company Common Stock granted
    under the Company Stock Plan (each a <I>&#147;Company Restricted
    Share&#148;</I>) outstanding and subject to restrictions
    immediately prior to the Effective Time (whether vested or
    unvested), by virtue of the Merger and without any action on the
    part of the holder of any Company Restricted Share, will become
    fully vested and no longer subject to any restrictions
    immediately prior to, and then will be canceled automatically at
    the Effective Time and will thereafter represent, and will be
    converted into, only the right to receive an amount of cash,
    without interest, equal to the Merger Consideration (the
    <I>&#147;Company Restricted Share Consideration&#148;</I>).
    Parent will, or will cause the Surviving Corporation to, pay to
    holders of Company Restricted Shares the Company Restricted
    Share Consideration as soon as practicable after the Effective
    Time and in any case within five (5)&#160;Business Days
    thereafter.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (3)&#160;Each Company Stock-Based Award outstanding immediately
    prior to the Effective Time will, by virtue of the Merger and
    without any action on the part of the holder thereof, become
    fully vested and no longer subject to any restrictions
    immediately prior to, and then will be cancelled automatically
    at the Effective Time and will thereafter represent, and will be
    converted into, only the right to receive an amount of cash,
    without interest, equal to the product of (1)&#160;the Merger
    Consideration (or, if the Company Stock-Based Award provides for
    payments to the extent the value of the Shares exceeds a
    specified reference price, the amount, if any, by which the
    Merger Consideration exceeds such reference price) and
    (2)&#160;the number of Shares subject to such Company
    Stock-Based Award (the <I>&#147;Company Stock-Based Award
    Consideration&#148;</I>). Parent will, or will cause the
    Surviving Corporation to, pay to holders of Company Stock-Based
    Awards the Company Stock-Based Award Consideration as soon as
    practicable after the Effective Time and in any case within five
    (5)&#160;Business Days thereafter.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;As of the Effective Time, the Company Stock Plan will
    terminate and all rights under any provision of any other plan,
    program or arrangement providing for the issuance or grant of
    any other interest in respect of the capital stock of the
    Company will be canceled. At and after the Effective Time, no
    Person will have any right under the Company Stock Options, the
    Company Restricted Shares, the Company Stock-Based Awards, the
    Company Stock Plan or any other plan, program or arrangement
    with respect to equity securities of the Surviving Corporation
    or any Subsidiary thereof, except the right to receive the
    amounts payable under this <U>Section&#160;2.09</U>, if any.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (c)&#160;As soon as practicable following the date of this
    Agreement, the Company Board or any committee administering the
    Company Stock Plan will adopt such resolutions or take such
    other actions as may be required or appropriate to effect the
    provisions of this <U>Section&#160;2.09.</U> The Company will
    provide notice (in a form reasonably satisfactory to Parent) to
    each holder of an outstanding Company Stock Option, a Company
    Restricted Share or a Company Stock-Based Award describing the
    treatment of such Company Stock Option, Company Restricted Share
    or Company Stock-Based Award, as applicable, in accordance with
    this <U>Section&#160;2.09</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (d)&#160;Except to the extent permitted by
    <U>Section&#160;4.01(b)</U>, unless this Agreement is terminated
    in accordance with its terms, no additional Company Stock
    Options, Company Restricted Shares, Company Stock-Based Awards
    or any other equity-based awards or other Rights will be granted
    pursuant to the Company Stock Plan or otherwise by the Company
    or its Subsidiaries after the date of this Agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    2.10&#160;<I>Appraisal Rights</I>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;Notwithstanding any provision of this Agreement to the
    contrary, Shares that are outstanding immediately prior to the
    Effective Time (other than the Exception Shares) and that are
    held by Company Stockholders who shall have neither voted in
    favor of the Merger nor consented thereto in writing and who
    shall have demanded properly in writing appraisal for such
    Shares in accordance with Section&#160;262 of the DGCL (the
    <I>&#147;Dissenting Stockholders&#148;</I>) shall not be
    converted into, or represent the right to receive, the Merger
    Consideration (collectively, the <I>&#147;Dissenting
    Shares&#148;</I>). Dissenting Stockholders shall be entitled to
    receive payment of the fair value of the Dissenting Shares as
    determined in accordance with the provisions of Section&#160;262
    of the DGCL, except that all Dissenting Shares held by Company
    Stockholders who shall have failed to perfect or who effectively
    shall have withdrawn or lost their rights to appraisal of such
    Shares under Section&#160;262 of the DGCL will thereupon be
    deemed to have been converted into, and to have become
    exchangeable for, as of the Effective Time, the right to receive
    the Merger Consideration in
</DIV>

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    <BR>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    accordance with <U>Section&#160;2.07</U>, without any interest
    thereon, upon surrender, in the manner provided in
    <U>Section&#160;2.08</U>, of the Certificate or Certificates
    that formerly evidenced such Shares.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;The Company shall give Parent notice as promptly as
    reasonably practicable upon receipt by the Company of any demand
    for appraisal pursuant to Section&#160;262 of the DGCL and of
    withdrawals of any such demand, and any other communications
    delivered to the Company pursuant to or in connection with
    Section&#160;262 of the DGCL with respect to the Transactions,
    and the Company will give Parent the opportunity to participate
    in all negotiations and proceedings with respect to any such
    demands (including any settlement offers). Except with the prior
    written consent of Parent, the Company will not voluntarily make
    any payment with respect to any demand for appraisal and will
    not settle or offer to settle any such demand.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    2.11&#160;<I>Withholdings.</I>&#160;&#160;All amounts payable
    pursuant to this Agreement will be subject to any required
    withholding of Taxes and will be paid at or as soon as
    practicable following the Effective Time, but in any event
    within five (5)&#160;Business Days following the Effective Time,
    without interest. To the extent that amounts are so withheld and
    paid over to the appropriate Governmental Authority by Parent,
    Merger Sub, the Surviving Corporation or the Disbursing Agent,
    such withheld amounts will be treated for all purposes of this
    Agreement as having been paid to the holder of Certificates,
    Company Restricted Shares, Company Stock Options or Company
    Stock-Based Awards as the case may be, in respect of which such
    deduction and withholding was made by Parent, Merger Sub, the
    Surviving Corporation or the Disbursing Agent.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    2.12&#160;<I>Section&#160;16 Matters.</I>&#160;&#160;Prior to
    the Effective Time, the Company Board or an appropriate
    committee of non-employee directors will adopt a resolution and
    take all other necessary action consistent with the
    interpretative guidance of the SEC so that the disposition of
    Shares, Company Stock Options, Company Restricted Shares or
    Company Stock-Based Awards pursuant to this Agreement and the
    Merger by any officer or director of the Company who is a
    covered person of the Company for purposes of Section&#160;16 of
    the Exchange Act will be an exempt transaction for purposes of
    Section&#160;16 of the Exchange Act.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    2.13&#160;<I>Further Action.</I>&#160;&#160;If at any time after
    the Effective Time the Surviving Corporation shall determine, in
    its sole discretion, that any actions are necessary or desirable
    to vest, perfect or confirm of record or otherwise in the
    Surviving Corporation its right, title or interest in, to or
    under any of the rights, properties or assets of either of the
    Company or Merger Sub vested in the Surviving Corporation as a
    result of, or in connection with, the Merger or otherwise to
    carry out this Agreement, then the officers and directors of the
    Surviving Corporation will be authorized to take all such
    actions as may be necessary or desirable to vest all right,
    title or interest in, to and under such rights, properties or
    assets in the Surviving Corporation or otherwise to carry out
    this Agreement.
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <FONT style="font-family: 'Times New Roman', Times">ARTICLE&#160;III<BR>
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <FONT style="font-family: 'Times New Roman', Times; font-variant: SMALL-CAPS">Representations
    and Warranties
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    3.01&#160;<I>Representations and Warranties about the
    Company.</I>&#160;&#160;Except as Previously Disclosed, the
    Company hereby represents and warrants to Parent and Merger Sub
    as follows:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;<I>Organization and Standing.</I>&#160;&#160;The
    Company is a corporation duly organized, validly existing and in
    good standing under the Laws of the State of Delaware. The
    Company is duly qualified and licensed to do business and is in
    good standing in all jurisdictions where its ownership, leasing
    or operation of property or assets or its conduct of business
    requires it to be so qualified or licensed, except where the
    failure to be in good standing or be so qualified or licensed
    has not had, and would not reasonably be expected to have, a
    Material Adverse Effect with respect to the Company. The Company
    has made available to Parent or its counsel, true, correct and
    complete copies of the Constituent Documents of the Company and
    each of its Subsidiaries, in each case as amended and in effect.
    Neither the Company nor any of its Subsidiaries is in material
    violation of any of the provisions of its Constituent Documents.
    The Company has made available to Parent or its counsel true,
    correct and complete copies of the minute books containing
    records of all consents, actions and meetings of (1)&#160;the
    Company Board, committees of the Company Board and stockholders
    of the Company, and (2)&#160;the boards of directors, managers
    or equivalent governing bodies of each of the Company&#146;s
    Subsidiaries and all stockholders and equity holders thereof, in
    each case, since January&#160;1, 2007.
</DIV>

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    <BR>
    A-12
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;<I>Power.</I>&#160;&#160;The Company has the corporate
    power and authority to execute, deliver and perform its
    obligations under this Agreement and to consummate the
    Transactions, subject to the receipt of the affirmative vote of
    the holders of a majority of the outstanding Shares entitled to
    vote thereon to adopt this Agreement (the <I>&#147;Company
    Stockholder Approval&#148;</I>). The Company and each of its
    Subsidiaries has the corporate (or comparable) power and
    authority to carry on its business as it is now being conducted
    and to own, lease and operate all its properties and assets,
    except where the failure to have such power and authority has
    not had, and would not reasonably be expected to have, a
    Material Adverse Effect with respect to the Company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (c)&#160;<I>Authority</I>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (1)&#160;The Company has duly authorized, executed and delivered
    this Agreement. Subject to receipt of the Company Stockholder
    Approval, this Agreement (and the execution, delivery and
    performance hereof by the Company) and the Transactions have
    been duly authorized by all necessary corporate action of the
    Company and no other corporate proceedings on the part of the
    Company are necessary to authorize the execution, delivery and
    performance of this Agreement or to consummate the Transactions,
    other than obtaining the Company Stockholder Approval. The
    Company Stockholder Approval is the only vote of the holders of
    any class or series of the Company&#146;s capital stock
    necessary to adopt this Agreement and authorize and approve the
    Transactions. This Agreement is the Company&#146;s valid and
    legally binding obligation, enforceable against the Company in
    accordance with its terms (except as enforcement may be limited
    by applicable bankruptcy, insolvency, reorganization,
    moratorium, fraudulent transfer and similar Laws of general
    applicability relating to or affecting creditors&#146; rights or
    by general equity principles).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (2)&#160;The Company Board, by resolutions duly adopted prior to
    the execution of this Agreement, has unanimously
    (A)&#160;determined that the Merger is in the best interests of
    the Company and the stockholders of the Company (the
    <I>&#147;Company Stockholders&#148;</I>) and declared advisable
    this Agreement and the transactions contemplated by this
    Agreement, including the Merger (collectively, the
    <I>&#147;Transactions&#148;</I>), (B)&#160;approved and adopted
    this Agreement and the Transactions in all respects in
    accordance with the DGCL (including such approval for purposes
    of rendering the restrictions on business combinations set forth
    in the Business Combination Law inapplicable to Guarantor,
    Parent, Merger Sub, the Transactions, this Agreement and the
    Voting Agreement), and (C)&#160;subject to
    <U>Section&#160;4.09</U>, resolved to (i)&#160;submit this
    Agreement for adoption by a vote of the Company Stockholders at
    the Stockholders&#146; Meeting and (ii)&#160;recommend that the
    Company Stockholders adopt and approve this Agreement and the
    Transactions (the <I>&#147;Company Board
    Recommendation&#148;</I>). A copy of such resolutions of the
    Company Board has been made available to Parent and, other than
    as permitted by and in accordance with
    <U>Section&#160;4.09(f)</U>, such resolutions have not been
    modified, supplemented or rescinded and remain in full force and
    effect.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (d)&#160;<I>Consents and Regulatory Approvals; No Defaults</I>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (1)&#160;No consents, authorizations or approvals of, or filings
    or registrations with, or notifications to, any Governmental
    Authority or with any third party are required to be made or
    obtained by the Company or any of its Subsidiaries in connection
    with the execution, delivery or performance by the Company of
    this Agreement or for the Company to consummate the
    Transactions, except for (A)&#160;filings of applications and
    notices with, receipt of approvals or non-objections from, and
    expiration of related waiting periods required by, the FTC and
    the Antitrust Division under the HSR Act, (B)&#160;filings as
    may be required by the Securities Act or the Exchange Act or any
    applicable national securities exchange or Nasdaq, (C)&#160;the
    approvals and filings required by the DGCL, including receipt of
    the Company Stockholder Approval, and (D)&#160;such consents,
    authorizations, approvals, filings, registrations or
    notifications the failure of which to make or obtain has not
    had, and would not reasonably be expected to have, a Material
    Adverse Effect with respect to the Company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (2)&#160;Subject to receipt of the consents, authorizations and
    approvals referred to in <U>Section&#160;3.01(d)(1)</U>, the
    expiration of related waiting periods, and the making of
    required filings with applicable Governmental Authorities, the
    execution, delivery and performance of this Agreement and the
    consummation of the Transactions do not and will not
    (A)&#160;result in, conflict with, or constitute or create (with
    or without due notice or lapse of time or both) a breach or
    violation of, or a default under, or give rise to any Lien
    (other than Permitted Liens) on any property or asset of the
    Company or its Subsidiaries or any acceleration of remedies or
    right of termination or cancellation under any Law or under any
    of the terms, conditions or provisions of any
</DIV>

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    <BR>
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<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Material Contract or IP License, except for any such conflict,
    breach, violation, default, Lien, acceleration of remedies,
    right of termination or cancellation that has not had, and would
    not reasonably be expected to have, a Material Adverse Effect
    with respect to the Company, or (B)&#160;constitute a breach or
    violation of, or a default under, or conflict with, the
    Constituent Documents of the Company or any of its Subsidiaries.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (e)&#160;<I>Company Stock</I>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (1)&#160;The authorized capital stock of the Company consists of
    4,000,000&#160;shares of Company Preferred Stock and
    30,000,000&#160;shares of Company Common Stock. As of the close
    of business on June&#160;2, 2009,
    (A)&#160;11,622,629&#160;shares of Company Common Stock
    (including 254,641 Company Restricted Shares) were issued and
    outstanding and (B)&#160;294,322&#160;shares of Company Common
    Stock were issuable upon exercise of Company Stock Options under
    the Company Stock Plan. There are (i)&#160;no shares of Company
    Preferred Stock issued or outstanding, (ii)&#160;no shares of
    Company Common Stock issuable upon exercise of any Rights under
    the Company Stock Plan (except as described in clause&#160;(B)
    above), and (iii)&#160;no Company Stock-Based Awards outstanding.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (2)&#160;The outstanding Shares are, and all Shares which may be
    issued pursuant to the Company Stock Plan or the exercise of
    Company Stock Options or Company Stock-Based Awards will be,
    when issued in accordance with the respective terms thereof,
    (A)&#160;duly authorized and validly issued and outstanding,
    fully paid and nonassessable, and not subject to or issued in
    violation of any preemptive rights, any purchase option, call
    option, right of first refusal, subscription right or any
    similar right under any provision of the DGCL, the
    Company&#146;s Constituent Documents or any contract or
    commitment to which the Company is a party or otherwise bound
    and (B)&#160;issued in material compliance with all applicable
    Laws, including federal and state securities laws, and all
    requirements set forth in applicable contracts governing the
    issuance of such Company Stock Options or Company Stock-Based
    Awards. Except as set forth in <U>Section&#160;3.01(e)(1)</U>,
    there are no shares of Company Common Stock or Company Preferred
    Stock reserved for issuance, the Company does not have any
    Rights outstanding with respect to Company Common Stock or
    Company Preferred Stock and the Company does not have any
    commitment to authorize, issue, sell or otherwise cause to
    become outstanding any Company Common Stock, Company Preferred
    Stock or Rights, except pursuant to Company Stock Options and
    Company Restricted Shares outstanding as of the date of this
    Agreement and set forth on <U>Section&#160;3.01(e)(4)</U> of the
    Disclosure Schedule. There are no outstanding stock
    appreciation, phantom stock, profit participation or similar
    rights with respect to the Company or any of its Subsidiaries or
    other equity interests in the Company or any of its Subsidiaries
    or securities convertible into or exchangeable for such shares
    or equity interests. There are no stockholder agreements, voting
    trusts or other arrangements or understandings to which the
    Company is a party, or of which the Company has Knowledge, with
    respect to the voting of stock or other equity interests of the
    Company or any of its Subsidiaries. The Company does not have,
    and there is not in effect, a stockholder rights, &#147;poison
    pill&#148; or similar plan with respect to the Company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (3)&#160;No bonds, debentures, notes or other indebtedness of
    the Company or any of its Subsidiaries having the right to vote
    are issued or outstanding, and there are no outstanding
    contractual obligations of the Company or any of its
    Subsidiaries to repurchase, redeem or otherwise acquire any
    shares of capital stock of the Company or any of its
    Subsidiaries.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (4)&#160;<U>Section&#160;3.01(e)(4)</U> of the Disclosure
    Schedule sets forth a complete and accurate list, as of
    June&#160;2, 2009, of (A)&#160;all outstanding Company Stock
    Options under the Company Stock Plan (or otherwise), the number
    of Shares subject thereto, the exercise or grant prices (if
    applicable) and the names of the holders thereof and
    (B)&#160;all Company Restricted Shares under the Company Stock
    Plan (or otherwise) and the names of the holders thereof. All
    (i)&#160;Company Stock Options and (ii)&#160;Company Restricted
    Shares are evidenced by stock option agreements, restricted
    stock purchase agreements or other award agreements, in each
    case in the forms set forth in <U>Section&#160;3.01(e)(4)</U> of
    the Disclosure Schedule or filed as an exhibit to a Company
    Regulatory Filing prior to the date of this Agreement, and no
    stock option agreement, restricted stock purchase agreement or
    other award agreement contains any terms that are materially
    inconsistent with or in addition to such forms. Each grant of a
    Company Stock Option was duly authorized no later than the date
    on which the grant of such Company Stock Option was by its terms
    to be effective (the <I>&#147;Grant Date&#148;</I>) by all
    necessary corporate action, including, as applicable, approval
    by the Company Board (or a duly constituted and authorized
    committee
</DIV>

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<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    thereof), and the award agreement governing such grant (if any)
    was duly executed and delivered by each party thereto, each such
    grant was made in accordance with the terms of the Company Stock
    Plan, the Exchange Act and all other applicable Laws, the per
    share exercise price of each Company Stock Option was equal to
    or greater than the fair market value of a share of Company
    Common Stock on the applicable Grant Date and each such grant
    was properly accounted for in accordance with GAAP in the
    Financial Statements and disclosed in the Company Regulatory
    Filings in accordance with the Exchange Act and all other
    applicable Laws. To the Company&#146;s Knowledge, the Company
    has not granted, and there is no and has been no Company policy
    or practice to grant, Company Stock Options prior to, or
    otherwise coordinate the grant of Company Stock Options with,
    the release or other public announcement of material information
    regarding the Company or its Subsidiaries or their financial
    results or prospects. Each Company Stock Option, each Company
    Restricted Share and each Company Stock-Based Award may, by its
    terms, be treated at the Effective Time as set forth in
    <U>Section&#160;2.09.</U>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (5)&#160;The Company Board has not declared any dividend or
    distribution with respect to the Company Common Stock, the
    record or payment date for which is on or after the date of this
    Agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (f)&#160;<I>Company Subsidiaries</I>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (1)&#160;(A)&#160;The Company owns, directly or indirectly, all
    the outstanding capital stock and equity of each of its
    Subsidiaries free and clear of any Liens (other than Permitted
    Liens); (B)&#160;no capital stock or equity of any of the
    Company&#146;s Subsidiaries are or may become required to be
    issued (other than to the Company or its wholly owned
    Subsidiaries) by reason of any Right or otherwise;
    (C)&#160;there are no contracts, commitments, understandings or
    arrangements by which any of the Company&#146;s Subsidiaries is
    bound to sell or otherwise transfer any capital stock or equity
    of any such Subsidiaries (other than to the Company or its
    wholly owned Subsidiaries); (D)&#160;there are no contracts,
    commitments, understandings or arrangements relating to the
    Company&#146;s rights to vote or to dispose of the capital stock
    or equity of any of its Subsidiaries; and (E)&#160;all the
    capital stock and equity interests of each Subsidiary held by
    the Company or its Subsidiaries (i)&#160;have been duly
    authorized and are validly issued and outstanding, fully paid
    and nonassessable and not subject to or issued in violation of
    any preemptive right, purchase option, call option, right of
    first refusal, subscription right or any similar right under any
    provision of the DGCL, such Subsidiary&#146;s Constituent
    Documents or any contract or commitment to which such Subsidiary
    is a party or otherwise bound, and (ii)&#160;were issued in
    material compliance with all applicable Laws, including federal
    and state securities laws.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (2)&#160;Each of the Company&#146;s Subsidiaries has been duly
    organized and is validly existing and in good standing under the
    Laws of the jurisdiction of its organization and is duly
    qualified and licensed to do business and is in good standing in
    all jurisdictions where its ownership, leasing or operation of
    property or assets or its conduct of business requires it to be
    so qualified or licensed, except where the failure to be in good
    standing or to be so qualified or licensed has not had, and
    would not reasonably be expected to have, a Material Adverse
    Effect with respect to the Company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (3)&#160;Other than with respect to the Subsidiaries listed on
    <U>Section&#160;3.01(f)(3)</U> of the Disclosure Schedule, the
    Company does not directly or indirectly own any securities or
    beneficial ownership interests in any other Person (including
    through joint ventures or partnership arrangements) or have any
    investment in any other Person.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (g)&#160;<I>Company Regulatory Filings; Ordinary Course.</I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (1)&#160;Since January&#160;1, 2006, the Company has filed on a
    timely basis with the SEC all forms, statements, reports,
    certifications, schedules and other documents (including all
    exhibits and amendments thereto) required to be filed or
    furnished by it under the Exchange Act or the Securities Act
    (collectively, together with the information incorporated by
    reference therein, the <I>&#147;Company Regulatory
    Filings&#148;</I>). Each of the Company Regulatory Filings,
    including each of the Company Regulatory Filings filed or
    furnished after the date hereof, as of the date filed or
    furnished (or if amended prior to the date of this Agreement,
    then as of the date of the last such amendment)
    (A)&#160;complied in all material respects as to form with the
    applicable requirements under the Securities Act or the Exchange
    Act, as the case may be, and (B)&#160;did not contain any untrue
    statement of a material fact or omit to state a material fact
    required to be stated therein or necessary to
</DIV>

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    <BR>
    A-15
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    make the statements made therein, in the light of the
    circumstances under which they were made, not misleading; and
    each of the consolidated financial statements contained in or
    incorporated by reference into any such Company Regulatory
    Filing (including the related notes and schedules)
    (collectively, the <I>&#147;Financial Statements&#148;</I>)
    (i)&#160;complied in all material respects as to form with the
    published rules and regulations of the SEC with respect thereto,
    (ii)&#160;was prepared in accordance with GAAP applied on a
    consistent basis throughout the periods involved, and
    (iii)&#160;fairly presented in all material respects the
    financial position of the Company and its Subsidiaries on a
    consolidated basis as of the date of such statement and the
    consolidated results of the Company&#146;s and its
    Subsidiaries&#146; operations and cash flows for the periods
    indicated in such statement, except in each case subject to
    normal year-end audit adjustments and as permitted by SEC
    <FONT style="white-space: nowrap">Form&#160;10-Q</FONT>
    promulgated under the Exchange Act in the case of unaudited
    statements. The Company has not had any material dispute with
    any of its auditors regarding accounting matters or policies
    during any of its past three (3)&#160;full fiscal years or
    during the current fiscal year that is currently outstanding or
    that resulted in an adjustment to, or any restatement of, the
    Financial Statements.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (2)&#160;Without limiting the generality of the foregoing,
    Ernst&#160;&#038; Young LLP has not resigned nor been dismissed
    as independent public accountant of the Company as a result of
    or in connection with any disagreement with the Company on a
    matter of accounting practices which impacts or would require
    the restatement of any previously issued financial statements,
    covering one or more years or interim periods for which the
    Company is required to provide financial statements, such that
    they should no longer be relied on.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (3)&#160;Since January&#160;1, 2007, the Company has not
    conducted any material internal investigations regarding
    accounting or revenue recognition discussed with, reviewed by or
    initiated at the direction of the chief executive officer, chief
    financial officer, the Company Board or any committee thereof.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (4)&#160;Except for liabilities and obligations
    (A)&#160;incurred in the Ordinary Course of Business since
    December&#160;31, 2008, (B)&#160;that have been discharged or
    paid in full in the Ordinary Course of Business since
    December&#160;31, 2008, (C)&#160;reflected in or reserved
    against on the most recent balance sheet of the Company prepared
    in accordance with GAAP and included in the Company Regulatory
    Filings filed with the SEC at least one Business Day prior to
    the date of this Agreement, (D)&#160;that arise under this
    Agreement or (E)&#160;that have not had, and would not
    reasonably be expected to have, a Material Adverse Effect with
    respect to the Company, the Company has not incurred any
    liabilities or obligations of any nature, whether or not
    accrued, contingent, absolute or otherwise that would be
    required to be reflected in or reserved against on a balance
    sheet prepared in accordance with GAAP.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (5)&#160;Since December&#160;31, 2008 through the date of this
    Agreement, (A)&#160;the Company and its Subsidiaries have
    conducted their respective businesses in the Ordinary Course of
    Business (excluding conduct in connection with and the
    incurrence of expenses related to this Agreement and the
    Transactions and the general process of soliciting and
    evaluating proposals to acquire the Company), (B)&#160;there has
    not been a Material Adverse Effect with respect to the Company,
    and (C)&#160;neither the Company nor any of its Subsidiaries has
    taken or authorized the taking of any action that if taken after
    the date of this Agreement would constitute a breach of
    <U>Section&#160;4.01</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (6)&#160;The Company is in compliance in all material respects
    with the applicable provisions of the applicable listing and
    governance rules and regulations of Nasdaq.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (7)&#160;The Company has made available to Parent complete and
    correct copies of all comment letters from the SEC staff since
    January&#160;1, 2006 with respect to any of the Company
    Regulatory Filings. There are no outstanding or unresolved
    comments in comment letters received from the SEC staff with
    respect to any of the Company Regulatory Filings.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (h)&#160;<I>Sarbanes-Oxley Act.</I>&#160;&#160;(1)&#160;The
    management of the Company has designed, implemented and
    maintains disclosure controls and procedures (as defined in
    <FONT style="white-space: nowrap">Rule&#160;13a-15(e)</FONT>
    of the Exchange Act) to reasonably ensure that all material
    information relating to the Company, including its consolidated
    Subsidiaries, required to be disclosed by the Company in the
    reports it files or submits under the Exchange Act is recorded,
    processed, summarized and reported within the time periods
    specified in the rules and forms of the SEC, and that all such
    information is accumulated and made known to the chief executive
    officer and the chief financial officer of the
</DIV>

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    <BR>
    A-16
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Company by other employees within the Company as appropriate to
    allow timely decisions regarding required disclosure;
    (2)&#160;the Company maintains a system of internal control over
    financial reporting (as defined in
    <FONT style="white-space: nowrap">Rules&#160;13a-15(f)</FONT>
    of the Exchange Act) that is reasonably designed to provide
    reasonable assurance (A)&#160;that the Company maintains records
    that in reasonable detail accurately and fairly reflect its
    transactions and dispositions of assets, (B)&#160;that
    transactions are recorded as necessary to permit preparation of
    financial statements in conformity with GAAP, (C)&#160;that
    receipts and expenditures are being made only in accordance with
    authorizations of management and the Company Board and
    (D)&#160;of the prevention or timely detection of the
    unauthorized acquisition, use or disposition of the
    Company&#146;s assets that could have a material effect on the
    Company&#146;s consolidated financial statements; (3)&#160;the
    Company has evaluated the effectiveness of the Company&#146;s
    internal control over financial reporting and, to the extent
    required by applicable Law, presented in any applicable Company
    Regulatory Filing that is a report on
    <FONT style="white-space: nowrap">Form&#160;10-K</FONT>
    or
    <FONT style="white-space: nowrap">Form&#160;10-Q</FONT>
    (or any amendment thereto) its conclusions about the
    effectiveness of the internal control over financial reporting
    as of the end of the period covered by such report (or
    amendment) based on such evaluations; (4)&#160;the
    Company&#146;s chief executive officer and chief financial
    officer have disclosed, based on their most recent evaluation of
    internal control over financial reporting, to the Company&#146;s
    auditors and the audit committee of the Company Board (or
    persons performing the equivalent functions), (A)&#160;all
    significant deficiencies and material weaknesses within their
    knowledge in the design or operation of internal control over
    financial reporting that are reasonably likely to adversely
    affect the Company&#146;s ability to record, process, summarize
    and report financial information and (B)&#160;any fraud that
    involves management or other employees who have a significant
    role in the Company&#146;s internal control over financial
    reporting; (5)&#160;the certifications provided pursuant to
    Sections&#160;302 and 906 of the Sarbanes-Oxley Act with each
    Company Regulatory Filing, as applicable, at the time of filing
    or submission of such certification, were true and correct; and
    (6)&#160;as of the date of this Agreement, the Company has not
    identified any material weaknesses in the design or operation of
    its internal control over financial reporting except as
    disclosed in the Company Regulatory Filings filed with the SEC
    prior to the date of this Agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (i)&#160;<I>Litigation.</I>&#160;&#160;There is no suit, claim,
    action, charge or proceeding (including arbitration proceeding
    or dispute resolution proceeding) pending or, to the
    Company&#146;s Knowledge, threatened against or affecting it or
    any of its Subsidiaries, businesses, assets or properties, or
    its officers or directors in their capacities as such, that has
    had, or would reasonably be expected to have, a Material Adverse
    Effect with respect to the Company, and to the Company&#146;s
    Knowledge, there is no valid basis for any such suit, claim,
    action, charge or proceeding. No Order is outstanding against
    the Company or any of its Subsidiaries, businesses, assets or
    properties, or its officers or directors in their capacities as
    such, that has had, or would reasonably be expected to have, a
    Material Adverse Effect with respect to the Company. To the
    Company&#146;s Knowledge, there is no investigation, indictment
    or audit pending or threatened by or against the Company or any
    of its Subsidiaries, businesses, assets or properties, or its
    officers or directors in their capacities as such, that has had,
    or would reasonably be expected to have, a Material Adverse
    Effect with respect to the Company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (j)&#160;<I>Compliance with Laws.</I>&#160;&#160;Since
    January&#160;1, 2007, the Company and each of its Subsidiaries:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 8%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (1)&#160;have been and are in compliance with all Laws
    applicable to their respective businesses or to the employees
    conducting such businesses, except for instances of
    noncompliance that have not had, and would not reasonably be
    expected to have, a Material Adverse Effect with respect to the
    Company;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 8%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (2)&#160;have obtained and hold all permits, licenses,
    authorizations, Orders and approvals of, and have made all
    filings, applications and registrations with, all Governmental
    Authorities that are required in order to permit them to own or
    lease their properties and assets and to conduct their
    businesses as presently conducted, except for those the failure
    of which to obtain or to be in compliance with have not had, and
    would not reasonably be expected to have, a Material Adverse
    Effect with respect to the Company; all such permits, licenses,
    authorizations, Orders and approvals are in full force and
    effect; and, to the Company&#146;s Knowledge, no suspension or
    cancellation of any of them has been threatened as of the date
    of this Agreement, except for those suspensions or cancellations
    that have not had, and would not reasonably be expected to have,
    a Material Adverse Effect with respect to the Company;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 8%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (3)&#160;have not received written notification from any
    Governmental Authority (A)&#160;asserting that the Company or
    any of its Subsidiaries is not in material compliance with any
    of the Laws that such
</DIV>

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    <BR>
    A-17
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 8%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Governmental Authority enforces or (B)&#160;threatening to
    revoke any material license, franchise, permit, approval or
    governmental authorization;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 8%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (4)&#160;(A)&#160;have been and are in material compliance with
    all statutory and regulatory requirements under the Arms Export
    Control Act (22&#160;U.S.C. 2778), the International Traffic in
    Arms Regulations (22&#160;C.F.R. &#167;&#160;120 et seq.), the
    Export Administration Regulations (15&#160;C.F.R.
    &#167;&#160;730 et seq.) and associated executive orders, the
    Laws implemented by the Office of Foreign Assets Control, United
    States Department of the Treasury, antidumping and
    countervailing duty orders issued by the United States
    International Trade Commission
    <FONT style="white-space: nowrap">and/or</FONT> the
    International Trade Administration, United States Department of
    Commerce, and the Laws implemented by the United States Customs
    and Border Protection, United States Department of Homeland
    Security (collectively, the <I>&#147;Import and Export Controls
    Laws&#148;</I>); and (B)&#160;have not received any written
    communication that alleges that the Company or any of its
    Subsidiaries is not, or may not be, in material compliance with,
    or has, or may have, any material liability under, the Import
    and Export Control Laws;&#160;and
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 8%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (5)&#160;(A) (i)&#160;have been and are in material compliance
    with all legal requirements under the Foreign Corrupt Practices
    Act (15&#160;U.S.C.
    <FONT style="white-space: nowrap">&#167;&#167;&#160;78dd-1,</FONT>
    et seq.) and the Organization for Economic Cooperation and
    Development Convention Against Bribery of Foreign Public
    Officials in International Business Transactions and legislation
    implementing such Convention and (ii)&#160;have been and are in
    compliance with all international anti-bribery conventions
    (other than the convention described in clause (i)) and local
    anti-corruption and bribery Laws, in each case, in jurisdictions
    in which the Company and its Subsidiaries are operating
    (collectively, the <I>&#147;Anti-Bribery Laws&#148;</I>), except
    with respect to clause&#160;(ii) only any failure to be in
    compliance that has not had, and would not reasonably be
    expected to have, a Material Adverse Effect with respect to the
    Company; and (B)&#160;have not received any written
    communication that alleges that the Company, its Subsidiaries or
    any agent thereof is, or may be, in material violation of, or
    has, or may have, any material liability under, the Anti-Bribery
    Laws, except any written communication received more than
    twenty-four (24)&#160;months prior to the date of this Agreement
    that did not result in an inquiry or investigation that to the
    Company&#146;s Knowledge is currently pending.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (k)&#160;<I>Material Contracts; Defaults</I>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (1)&#160;Neither the Company nor any of its Subsidiaries is a
    party to, bound by or subject to any currently effective
    agreement, contract, arrangement, commitment or understanding
    (A)&#160;that is a &#147;material contract&#148; within the
    meaning of Item&#160;601(b)(10) of the SEC&#146;s
    <FONT style="white-space: nowrap">Regulation&#160;S-K;</FONT>
    (B)&#160;that is a credit agreement, note, bond, guarantee,
    mortgage, indenture, lease, or other instrument or obligation
    pursuant to which any &#147;indebtedness&#148; (as defined
    below) of the Company or any of its Subsidiaries is outstanding
    or may be incurred; (C)&#160;that is a collective bargaining
    agreement; (D)&#160;that is an employment or consulting
    agreement, contract or binding commitment providing for annual
    compensation or annual payments in excess of $250,000 in the
    current or any future year; (E)&#160;that is an agreement,
    contract or commitment of indemnification or guaranty not
    entered into in the Ordinary Course of Business providing for
    indemnification which would reasonably be expected to exceed
    $250,000, as well as any agreement, contract or commitment of
    indemnification or guaranty between the Company or any of its
    Subsidiaries and any of their respective officers or directors,
    irrespective of the amount; (F)&#160;that is an agreement,
    contract or binding commitment containing any covenant directly
    or indirectly limiting the freedom of the Company or any of its
    Subsidiaries to engage in any line of business, compete with any
    Person, or sell any product or service (including any &#147;most
    favored nation&#148; clauses), or which, following the
    consummation of the Merger, could so limit Parent or any of its
    affiliates (including the Surviving Corporation), including any
    contract clause, mitigation plan, or other limitation with
    respect to &#147;Organizational Conflicts of Interest,&#148; as
    that term is used in Federal Acquisition Regulation&#160;Subpart
    9.5; (G)&#160;that is a material partnership, joint venture,
    teaming or similar agreement or arrangement; (H)&#160;that is a
    contract or agreement involving a standstill or similar
    obligation of the Company or any of its Subsidiaries to a third
    party; (I)&#160;the termination or cancellation of which by any
    other party thereto, or under which the acceleration of any
    obligation or the loss of any benefit, has had, or would
    reasonably be expected to have, a Material Adverse Effect with
    respect to the Company; or (J)&#160;that contemplates or
    provides for actual or potential payments to or from the Company
    <FONT style="white-space: nowrap">and/or</FONT> any
    of its Subsidiaries in excess of $2,500,000 in the aggregate
    during the term thereof (each, other than to the extent it would
    include a Benefit Arrangement, a
</DIV>

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    <I>&#147;Material Contract&#148;</I>).
    <U>Section&#160;3.01(k)</U> of the Disclosure Schedule lists
    each of the Material Contracts that as of the date of this
    Agreement is in effect or otherwise binding on the Company or
    any of its Subsidiaries or their respective properties or
    assets, other than those contracts or agreements that have been
    filed as exhibits to the Company Regulatory Filings prior to the
    date of this Agreement. For purposes of this
    <U>Section&#160;3.01(k)</U>, &#147;indebtedness&#148; will mean,
    with respect to any Person, without duplication, (i)&#160;all
    obligations of such Person for borrowed money, (ii)&#160;all
    obligations of others secured by any Lien on property or assets
    owned or acquired by such Person, whether or not the obligations
    secured thereby have been assumed, (iii)&#160;all letters of
    credit issued for the account of such Person (excluding letters
    of credit issued for the benefit of suppliers to support
    accounts payable to suppliers incurred in the Ordinary Course of
    Business) and (iv)&#160;all obligations, the principal component
    of which are obligations under leases that are, or should be
    pursuant to GAAP, classified as capital leases. A complete copy
    of each Material Contract has previously been made available to
    Parent.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (2)&#160;Neither the Company nor any of its Subsidiaries is in
    default under any Material Contract or IP License, and, to the
    Company&#146;s Knowledge, (A)&#160;no other party thereto is in
    default, and (B)&#160;there has not occurred any event that,
    with the lapse of time or the giving of notice or both, would
    constitute such a default, in each case, except those defaults
    that have not had, and would not reasonably be expected to have,
    a Material Adverse Effect with respect to the Company. Each
    Material Contract and each Government Contract (as defined
    below) is valid, binding and enforceable upon the Company or the
    Subsidiary that is a party thereto, and to the Company&#146;s
    Knowledge each other party thereto, and is, and immediately
    following consummation of the Transactions will remain, in full
    force and effect (except as such enforcement may be limited by
    applicable bankruptcy, insolvency, reorganization, moratorium,
    fraudulent transfer and similar Laws of general applicability
    relating to or affecting creditors&#146; rights or by general
    equity principles), except where any failure to be valid,
    binding and enforceable and in full force and effect has not
    had, and would not reasonably be expected to have, a Material
    Adverse Effect with respect to the Company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (3)&#160;To the Company&#146;s Knowledge, with respect to each
    contract, agreement, purchase order, modification, bid,
    quotation or proposal between the Company or any of its
    Subsidiaries and any (A)&#160;Governmental Authority or
    (B)&#160;third party relating to a contract, agreement, purchase
    order, modification, bid, quotation or proposal where the
    ultimate contracting party is any domestic or foreign government
    or Governmental Authority (each a <I>&#147;Government
    Contract&#148;</I>), (i)&#160;the Company and each of its
    Subsidiaries have complied in all material respects with all
    terms and conditions of such Government Contract; (ii)&#160;such
    Government Contract was legally awarded and the Company and each
    of its Subsidiaries have complied in all material respects with
    all applicable requirements of all applicable Laws pertaining to
    such Government Contract, including where applicable the
    &#147;Cost Accounting Standards&#148;; (iii)&#160;all
    representations and certifications executed, acknowledged or set
    forth in or pertaining to such Government Contract were complete
    and accurate in all material respects as of their respective
    effective dates and the Company and its Subsidiaries have
    complied in all material respects with all such representations
    and certifications; (iv)&#160;all &#147;cost or pricing
    data&#148; required to be provided in connection with a
    Government Contract was provided and was current, accurate and
    complete in all material respects as of the date of agreement on
    price; (v)&#160;neither the United States government nor any
    prime contractor, subcontractor or other Person has notified the
    Company or any of its Subsidiaries, in writing or, to the
    Company&#146;s Knowledge, orally, that the Company or any of its
    Subsidiaries has breached or violated any Laws, certification,
    representation, clause, provision or requirement pertaining to
    such Government Contract; (vi)&#160;neither the Company nor any
    of its Subsidiaries has received any notice of termination for
    convenience, notice of termination for default, cure notice or
    show cause notice pertaining to such Government Contract;
    (vii)&#160;other than in the Ordinary Course of Business, no
    cost incurred by the Company or any of its Subsidiaries
    pertaining to such Government Contract has been disallowed by
    any Governmental Authority, or to the Company&#146;s Knowledge,
    is the subject of any audit or investigation by any Governmental
    Authority; and (viii)&#160;other than in the Ordinary Course of
    Business, no payments due to the Company or any of its
    Subsidiaries pertaining to such Government Contract have been
    withheld or set off, nor has any claim been made to withhold or
    set off money, and the Company and its Subsidiaries are entitled
    to all progress or other payments received with respect thereto.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (4)&#160;To the Company&#146;s Knowledge, there exist no
    material disputes or claims between the Company or any of its
    Subsidiaries and the United States government under the Contract
    Disputes Act, as amended, or any
</DIV>

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<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    other applicable federal Law, or between the Company or any of
    its Subsidiaries and any prime contractor, subcontractor or
    vendor arising under or relating to any Government Contract
    that, if adversely determined against the Company has had, or
    would reasonably be expected to have, a Material Adverse Effect
    with respect to the Company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (5)&#160;To the Company&#146;s Knowledge, since January&#160;1,
    2006, neither the Company nor any of its Subsidiaries has been
    debarred or suspended from participation in the award of
    contracts with the United States government or any other
    Governmental Authority (excluding for this purpose ineligibility
    to bid on certain contracts due to generally applicable bidding
    requirements). To the Company&#146;s Knowledge, there exist no
    facts or circumstances that would warrant mandatory disclosure
    to a Governmental Authority, the institution of suspension or
    debarment proceedings or the finding of nonresponsibility or
    ineligibility on the part of the Company, any of its
    Subsidiaries or any of their respective directors, officers or
    employees.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (l)&#160;<I>Taxes.</I>&#160;&#160;(1)&#160;All material Tax
    Returns that are required to be filed (taking into account any
    extensions of time within which to file) by or with respect to
    the Company and its Subsidiaries have been duly and timely filed
    and all such Tax Returns are true, correct and accurate in all
    material respects; (2)&#160;all material Taxes have been paid in
    full or are adequately reserved in the Company&#146;s deferred
    Tax accounts; (3)&#160;all material Taxes that the Company or
    any of its Subsidiaries is obligated to withhold from amounts
    owing to any employee, creditor or third party have been
    withheld, properly reported and paid over to the proper
    Governmental Authority, to the extent due and payable;
    (4)&#160;no extensions or waivers of statutes of limitation have
    been granted or requested with respect to any of the
    Company&#146;s U.S.&#160;federal income taxes or those of its
    Subsidiaries; (5)&#160;neither the Company nor any of its
    Subsidiaries has received notice of any dispute or claim
    concerning any Tax and no such dispute or claim is pending or,
    to the Company&#146;s Knowledge, threatened in writing; and
    (6)&#160;there have been no claims in writing by any
    jurisdiction where the Company or its Subsidiaries do not file
    Tax Returns that the Company or any of its Subsidiaries is or
    may be subject to taxation by such jurisdiction. Except for
    Permitted Liens, to the Company&#146;s Knowledge, no Liens for
    material Taxes exist with respect to any of its assets or
    properties or those of its Subsidiaries.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (m)&#160;<I>Benefit Arrangements</I>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (1)&#160;True and complete copies of all material Benefit
    Arrangements, including any summary plan description,
    determination letter, trust instruments, insurance contracts and
    other funding agreements, each forming a part of any Benefit
    Arrangements, and the most recent governmental filings, most
    recent actual reports, most recent audited financial statements
    and all amendments thereto, have been made available to Parent.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (2)&#160;All of the Benefit Arrangements have been administered
    in a manner consistent in all respects with their written terms
    and are in substantial compliance in form and operation with
    ERISA and the Code and other applicable Laws, except for
    failures of administration or compliance that have not had, and
    would not reasonably be expected to have, a Material Adverse
    Effect with respect to the Company. Each of the Benefit
    Arrangements that is an &#147;employee pension benefit
    plan&#148; within the meaning of Section&#160;3(2) of ERISA, and
    that is intended to be qualified under Section&#160;401(a) of
    the Code, has received a favorable determination letter or is
    subject to an opinion letter from the U.S.&#160;Internal Revenue
    Service, and no event has occurred which would reasonably be
    expected to cause the loss, revocation or denial of any such
    favorable determination letter or opinion letter.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (3)&#160;Neither the Company nor any entity that is considered
    one employer with the Company under Section&#160;4001 of ERISA
    or Section&#160;414 of the Code (an <I>&#147;ERISA
    Affiliate&#148;</I>) has contributed to a &#147;multiemployer
    plan&#148; within the meaning of Section&#160;3(37) of ERISA, a
    &#147;multiple employer plan&#148; within the meaning of
    Section&#160;210(a) of ERISA, or a pension plan subject to
    Title&#160;IV of ERISA or Section&#160;412 of the Code, in each
    case, at any time within the last six (6)&#160;years.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (4)&#160;Except as provided in <U>Section&#160;2.09</U>, neither
    the Company&#146;s execution and delivery of this Agreement, the
    consummation of the Transactions nor the Company Stockholder
    Approval will, either alone or in conjunction with another event
    (such as termination of employment), (A)&#160;entitle any of its
    employees or any employees of its Subsidiaries to the payment of
    any severance, termination, &#147;golden parachute,&#148; or
    other
</DIV>

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<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    similar payments, (B)&#160;accelerate the time of payment or
    vesting or trigger any payment or funding of compensation or
    benefits under, increase the amount payable or trigger any other
    material obligation pursuant to, any of the Benefit Arrangements
    or (C)&#160;result in payments under any of the Benefit
    Arrangements which would not be fully deductible under
    Section&#160;280G of the Code. No Person is entitled to any
    additional payment from the Company or any of its Subsidiaries
    by reason of the excise tax required by Section&#160;4999(a) of
    the Code being imposed on such Person by reason of the
    Transactions.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (5)&#160;The Company is not a party to any agreement, contract,
    arrangement or plan (A)&#160;that constitutes a
    &#147;nonqualified deferred compensation plan&#148; within the
    meaning of Code Section&#160;409A(d)(1) but that fails to meet
    the requirements of Code Sections&#160;409A(a)(2), (3)&#160;or
    (4), or (B)&#160;that has resulted or would result in any amount
    that would not be fully deductible as a result of Code
    Section&#160;162(m).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (6)&#160;With respect to each Benefit Arrangement, as
    applicable, there have been no non-exempt prohibited
    transactions (as defined in Section&#160;406 of ERISA and Code
    Section&#160;4975)&#160;with respect to such Benefit
    Arrangement, no fiduciary has any liability for breach of
    fiduciary duty or any other failure to act or comply in
    connection with the administration or investment of the assets
    of such Benefit Arrangement (including the actions contemplated
    by this Agreement), and no action, suit, proceeding, hearing or,
    to the Company&#146;s Knowledge, investigation with respect to
    the administration or the investment of the assets of such plan
    (other than routine claims for benefits) is pending or, to the
    Company&#146;s Knowledge, threatened, but excluding from each of
    the foregoing, events or circumstances that have not had, and
    would not reasonably be expected to have, a Material Adverse
    Effect with respect to the Company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (7)&#160;Other than as required under Section&#160;601 et seq.
    of ERISA or any similar Law, no Benefit Arrangement provides
    health and welfare benefits or coverage following retirement or
    other termination of employment.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (8)&#160;All contributions, premiums or other payments
    (including all employer contributions and employee salary
    reduction contributions) that are required to be made under the
    terms of any Benefit Arrangement have been timely made and
    properly provided for in the Financial Statements, as
    applicable, except for failures that have not had, and would not
    reasonably be expected to have, a Material Adverse Effect with
    respect to the Company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (9)&#160;All Benefit Arrangements are by their terms able to be
    amended or terminated by the Company without material penalty,
    consent or incremental cost.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (10)&#160;The Company has never been a party to or otherwise
    bound by an advance agreement pursuant to 48&#160;C.F.R. sec.
    31.109 with the U.S.&#160;government relating to the
    allowability, allocation or reimbursement of benefit costs or
    other matters in connection with any Benefit Arrangement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (11)&#160;All required reports and descriptions (including
    Form&#160;5500 Annual Reports, Summary Annual Reports,
    PBGC-1&#146;s and Summary Plan Descriptions) have been filed or
    distributed appropriately with respect to each Benefit
    Arrangement, except for failures of filing or distribution that
    have not had, and would not reasonably be expected to have, a
    Material Adverse Effect with respect to the Company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (12)&#160;The requirements of Part&#160;6 of Subtitle B of
    Title&#160;I of ERISA and Section&#160;4980B of the Code have
    been met with respect to each Benefit Arrangement, as
    applicable, except for failures that have not had, and would not
    reasonably be expected to have, a Material Adverse Effect with
    respect to the Company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (n)&#160;<I>Labor Matters.</I>&#160;&#160;Neither the Company
    nor any of its Subsidiaries is a party to, or is bound by, any
    collective bargaining agreement, contract or other agreement or
    understanding with a labor union or labor organization. As of
    the date of this Agreement, neither the Company nor any of its
    Subsidiaries is the subject of a proceeding before any
    Governmental Authority asserting that the Company or any such
    Subsidiary has committed an unfair labor practice (within the
    meaning of the National Labor Relations Act) or seeking to
    compel the Company or such Subsidiary to bargain with any labor
    organization as to wages and conditions of employment. To the
    Company&#146;s Knowledge, no executive officer of the Company or
    any of their respective direct reports has any plan to terminate
    employment with the Company or its Subsidiaries. As of the date
    of this Agreement, (1)&#160;there is no strike or other material
    labor dispute involving the Company or any of its
</DIV>

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<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Subsidiaries pending or, to the Company&#146;s Knowledge,
    threatened, and (2)&#160;to the Company&#146;s Knowledge, none
    of the Company&#146;s or any of its Subsidiaries&#146; employees
    is seeking to certify a collective bargaining unit or engaging
    in any other similar labor organization activity. To the
    Company&#146;s Knowledge, there are no material liabilities or
    obligations relating to any individual&#146;s current or former
    employment with the Company or any of its Subsidiaries or
    related entities arising in connection with any violation of any
    Laws.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (o)&#160;<I>Environmental Matters.</I>&#160;&#160;There are no
    material proceedings, claims, actions or investigations pending
    or, to the Company&#146;s Knowledge, threatened before any
    Governmental Authority arising under any Environmental Law
    against the Company or any of its Subsidiaries. The Company and
    its Subsidiaries currently hold all material permits required
    under all applicable Environmental Laws for the operations of
    their businesses, and such permits are in full force and effect.
    Except with respect to matters that have not had, and would not
    reasonably be expected to have, a Material Adverse Effect with
    respect to the Company: (1)&#160;since January&#160;1, 2006, the
    Company and its Subsidiaries have conducted their operations in
    compliance with all permits required under applicable
    Environmental Laws and the limitations, restrictions,
    conditions, standards, prohibitions, requirements and
    obligations of all applicable Environmental Laws, and
    (2)&#160;there have been no releases of Hazardous Materials at
    any property that the Company or its Subsidiaries owns or
    operates, or has owned or operated, and that currently requires
    remediation by the Company or its Subsidiaries under
    Environmental Laws.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (p)&#160;<I>Intellectual Property Assets</I>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (1)&#160;<U>Section&#160;3.01(p)(1)</U> of the Disclosure
    Schedule lists each patent, registered trademark, registered
    service mark, trade name or Internet domain name and registered
    copyright or mask work, and applications for registration of any
    of the foregoing, owned by the Company or any of its
    Subsidiaries as of the date of this Agreement (collectively, and
    together with any of the foregoing obtained by the Company or
    any of its Subsidiaries after the date of this Agreement, the
    <I>&#147;Company IP Assets&#148;</I>). The term <I>&#147;IP
    Assets&#148;</I> means all of the following in any jurisdiction
    throughout the world: (A)&#160;the Intellectual Property listed
    on <U>Section&#160;3.01(p)(1)</U> of the Disclosure Schedule and
    (B)&#160;all other Intellectual Property used in the operation
    of the business of the Company and its Subsidiaries, as
    presently conducted, including Intellectual Property
    incorporated or used in products sold by the Company or its
    Subsidiaries.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (2)&#160;Each of the Company IP Assets is owned exclusively by
    either the Company or one of its Subsidiaries, free and clear of
    all Liens, and free and clear of any restrictions or limitations
    regarding ownership, use, license or disclosure (including any
    &#147;rights in data&#148; claims of any Governmental
    Authority), in each case, except for Liens or any such
    restrictions or limitations that have not had, and would not
    reasonably be expected to have, a Material Adverse Effect with
    respect to the Company. The Company and its Subsidiaries own or
    have a valid and enforceable license or other right to use all
    IP Assets that are material to their businesses or operations as
    presently conducted.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (3)&#160;With respect to all patent applications, trademark
    applications and copyright applications included in the Company
    IP Assets pending with any Governmental Authority, the Company
    and its Subsidiaries have conducted the prosecution of all such
    pending applications in a manner consistent with their
    reasonable ongoing business goals and objectives. With respect
    to all patents, trademarks and copyrights included in the
    Company IP Assets issued or registered by any Governmental
    Authority, to the extent consistent with the reasonable ongoing
    business goals and objectives of the Company and its
    Subsidiaries, all registration fees, maintenance fees, renewal
    fees and annuity fees necessary to maintain such Company IP
    Assets as active and due prior to the Closing have been paid or
    will be paid through the Closing, and all necessary documents
    and certificates in connection with such Company IP Assets have
    been filed or will be filed with the relevant patent, trademark
    and copyright offices, registrars or other authorities in the
    United States or foreign jurisdictions, as the case may be, for
    the purposes of maintaining the registration of such Company IP
    Assets through the Closing Date. With regard to all applications
    for domain name registration and all registered domain names
    included in the Company IP Assets, all necessary registration
    and renewal fees due in connection with such Company IP Assets
    have been paid or will be paid through the Closing.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (4)&#160;<U>Section&#160;3.01(p)(4)</U> of the Disclosure
    Schedule contains a true and complete list of all material
    agreements, contracts, arrangements, commitments or
    understandings regarding the development, ownership
</DIV>

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    <BR>
    A-22
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    or use of IP Assets (including material licenses to or from
    other Persons) to which either the Company or one of its
    Subsidiaries is a party or by which the Company or any of its
    Subsidiaries or any of the IP Assets is bound (collectively, the
    <I>&#147;IP Licenses&#148;</I>) (true and complete copies of
    which, or, if none exist, written descriptions of which,
    together with all amendments and supplements thereto and all
    waivers of any terms thereof, have been made available to
    Parent), except licenses and license agreements entered into in
    the Ordinary Course of Business for commercially-available
    off-the-shelf software (as that term is commonly understood) and
    those that arise as a matter of Law by implication as a result
    of sales of products and services in the Ordinary Course of
    Business by the Company or any of its Subsidiaries or any of
    their respective sales representatives, distributors or
    resellers.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (5)&#160;To the Company&#146;s Knowledge, none of the IP Assets
    owned by the Company or any of its Subsidiaries is being
    infringed by any other Person.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (6)&#160;To the Company&#146;s Knowledge, none of the Company IP
    Assets infringes any Intellectual Property of any other Person.
    Neither the Company nor any of its Subsidiaries is infringing
    any Person&#146;s Intellectual Property, and no claims regarding
    the foregoing are pending or, to the Company&#146;s Knowledge,
    threatened.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (7)&#160;No Governmental Authority is currently, nor since
    January&#160;1, 2006 has been, entitled to claim any rights
    (including license rights) in: (A)&#160;any &#147;Technical
    Data&#148; (as defined below) included in or related to any
    Company IP Assets, other than &#147;Limited Rights&#148; (as
    defined below); (B)&#160;any &#147;Computer Software&#148; (as
    defined below) included in the Company IP Assets, other than
    &#147;Restricted Rights&#148; (as defined below); (C)&#160;any
    patents or patentable invention included in the Company IP
    Assets; or (D)&#160;any copyright included in the Company IP
    Assets. The terms &#147;Technical Data&#148; and &#147;Limited
    Rights&#148; have the meanings set forth at 48&#160;C.F.R.
    252.227-7013, and the terms &#147;Restricted Rights&#148; and
    &#147;Computer Software&#148; have the meanings set forth at
    48&#160;C.F.R. 252.227-7014.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (q)&#160;<I>Real and Personal Property</I>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (1)&#160;The Company does not own any real property.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (2)&#160;<U>Section&#160;3.01(q)(2)</U> of the Disclosure
    Schedule contains a true and complete list of all material real
    property leases, subleases and other occupancy agreements to
    which the Company or any of its Subsidiaries is a party
    (together with all amendments, modifications, supplements,
    renewals and extensions related thereto, the
    <I>&#147;Leases</I>,&#148; and the space and real property
    subject to the Leases, the <I>&#147;Leased Property&#148;</I>),
    and the Company has made available to Parent a true and complete
    copy of each such Lease. The Company or one of its Subsidiaries
    has good and valid title to the leasehold estate in all Leased
    Property, free and clear of all Liens (except for Permitted
    Liens). Each Lease is valid, binding and enforceable upon the
    Company or the Subsidiary that is a party thereto, and, to the
    Company&#146;s Knowledge, each other party thereto, and is in
    full force and effect (except as such enforcement may be limited
    by applicable bankruptcy, insolvency, reorganization,
    moratorium, fraudulent transfer and similar Laws of general
    applicability relating to or affecting creditors&#146; rights or
    by general equity principles), except where any failure to be
    valid, binding and enforceable and in full force and effect has
    not had, and would not reasonably be expected to have, a
    Material Adverse Effect with respect to the Company. There is
    neither any existing default or violation by the Company or any
    of its Subsidiaries under any Lease nor, to the Company&#146;s
    Knowledge, any existing default or violation by any counterparty
    to any Lease, except those defaults or violations that have not
    had, and would not reasonably be expected to have, a Material
    Adverse Effect with respect to the Company. As of the date of
    this Agreement, neither the Company nor any of its Subsidiaries
    has received any written notice of any default or event that
    with notice or lapse of time, or both, would constitute a
    default by the Company or any of its Subsidiaries under any
    Lease, except those defaults that have not had, and would not
    reasonably be expected to have, a Material Adverse Effect with
    respect to the Company. Neither the Company nor any of its
    Subsidiaries has assigned, sublet, transferred or otherwise
    conveyed any interest in any Lease.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (3)&#160;Other than scheduled maintenance, repairs and
    replacements conducted or required in the Ordinary Course of
    Business, the Leased Property and all material improvements
    located thereon are in good operating condition and repair and
    do not require material repair or material replacement in order
    to serve their intended purposes in the Ordinary Course of
    Business.
</DIV>

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    <BR>
    A-23
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (4)&#160;The Company or one of its Subsidiaries has good and
    valid title to, or a valid leasehold estate in, all personal
    property and assets reflected in the December&#160;31, 2008
    balance sheet contained in the Company&#146;s Annual Report on
    <FONT style="white-space: nowrap">Form&#160;10-K</FONT>
    for the fiscal year ended December&#160;31, 2008, except
    (A)&#160;for properties or assets subsequently sold, and leases
    subsequently terminated, in the Ordinary Course of Business or
    otherwise as expressly permitted by this Agreement or
    (B)&#160;as has not had, and would not reasonably be expected to
    have, a Material Adverse Effect with respect to the Company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (r)&#160;<I>Insurance.</I>&#160;&#160;(1)&#160;The Company and
    its Subsidiaries maintain, or are entitled to the benefits of,
    insurance covering their material properties, operations,
    personnel and businesses (each, an <I>&#147;Insurance
    Policy&#148;</I>); (2) <U>Section&#160;3.01(r)</U> of the
    Disclosure Schedule contains a true and complete list of all of
    the Insurance Policies as of the date of this Agreement;
    (3)&#160;except as has not had, and would not reasonably be
    expected to have, a Material Adverse Effect with respect to the
    Company, all premiums payable under any Insurance Policy have
    been paid when due, the Company and each of its Subsidiaries are
    in compliance with the terms of each Insurance Policy and each
    Insurance Policy is in full force and effect; and (4)&#160;there
    are no self-insurance arrangements in effect with respect to the
    Company or any of its Subsidiaries.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (s)&#160;<I>Takeover Laws and Provisions Applicable to the
    Company.</I>&#160;&#160;The Company has taken all action
    required to be taken by it in order to: (1)&#160;exempt this
    Agreement, the Voting Agreement and the Transactions from the
    requirements of any &#147;moratorium,&#148; &#147;control
    share,&#148; &#147;fair price,&#148; &#147;affiliate
    transaction,&#148; &#147;business combination&#148; or other
    anti-takeover Laws of any State, including the Business
    Combination Law (collectively, <I>&#147;Takeover
    Laws&#148;</I>); and (2)&#160;make this Agreement, the Voting
    Agreement and the Transactions comply with the requirements of
    any provisions of its Constituent Documents concerning
    &#147;business combination,&#148; &#147;fair price,&#148;
    &#147;voting requirement,&#148; &#147;constituency
    requirement&#148; or other related provisions (collectively,
    <I>&#147;Takeover Provisions&#148;</I>).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (t)&#160;<I>Financial Advisors.</I>&#160;&#160;Neither the
    Company nor any of its Subsidiaries has engaged any broker or
    finder or incurred any liability for any brokerage fees,
    commissions or finder&#146;s fees in connection with the
    Transactions, except that, in connection with the Transactions,
    the Company has retained Jefferies&#160;&#038; Company, Inc., as
    its financial advisor (the <I>&#147;Financial
    Advisor&#148;</I>), pursuant to the letter agreement dated
    January&#160;26, 2009, a complete copy of which has been made
    available to Parent prior to the date of this Agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (u)&#160;<I>Opinion of Financial Advisor.</I>&#160;&#160;Prior
    to the execution and delivery of this Agreement, the Company has
    received a written opinion of the Financial Advisor to the
    effect that as of the date of this Agreement and based upon and
    subject to the matters set forth therein, the Merger
    Consideration to be received by the Company Stockholders
    pursuant to the Merger is fair from a financial point of view to
    such Company Stockholders, and such opinion has not been
    withdrawn or revoked or otherwise modified in any material
    respect. The Company has been authorized by the Financial
    Advisor to permit the inclusion of such written opinion in its
    entirety and a description of the Financial Advisor&#146;s
    analysis in preparing such opinion in the Proxy Statement so
    long as the Financial Advisor approves in advance such
    description and any accompanying disclosure.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (v)&#160;<I>Material Suppliers and
    Customers.</I>&#160;&#160;<U>Section&#160;3.01(v)</U> of the
    Disclosure Schedule sets forth a true, correct and complete list
    of the ten (10)&#160;largest suppliers to (the <I>&#147;Material
    Suppliers&#148;</I>) and customers of (the <I>&#147;Material
    Customers&#148;</I>) the Company for the fiscal year ended
    December&#160;31, 2008 (determined on the basis of the total
    dollar amount of purchases or sales, as the case may be) showing
    the total dollar number of purchases from or sales to, as the
    case may be, each such Material Supplier or Material Customer,
    as the case may be, during such period. Since January&#160;1,
    2009, there has been no termination, cancellation or material
    curtailment of the business relationship of the Company with any
    Material Customer or Material Supplier nor, to the
    Company&#146;s Knowledge, has any Material Customer or Material
    Supplier notified the Company in writing that it intends to
    terminate, cancel or materially curtail its business
    relationship with the Company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (w)&#160;<I>No Additional Representations.</I>&#160;&#160;Except
    for the representations and warranties of the Company expressly
    set forth in this <U>Section&#160;3.01</U> (as modified by the
    Disclosure Schedule), neither the Company nor any other Person
    makes any other express or implied representation or warranty on
    behalf of the Company with respect to the Company, any of its
    Subsidiaries, any of their respective businesses or the
    Transactions.
</DIV>

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    <BR>
    A-24
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    3.02 <I>Representations and Warranties about Parent and Merger
    Sub.</I>&#160;&#160;Parent and Merger Sub hereby jointly and
    severally represent and warrant to the Company as follows:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;<I>Organization and Standing.</I>&#160;&#160;Each of
    Parent and Merger Sub is a corporation duly organized, validly
    existing and in good standing under the Laws of the State of
    Delaware. Each of Parent and Merger Sub is duly qualified and
    licensed to do business and is in good standing in all
    jurisdictions where its ownership, leasing or operation of
    property or assets or its conduct of business requires it to be
    so qualified or licensed, except where the failure to be in good
    standing or to be so qualified or licensed has not had, and
    would not reasonably be expected to have, a Material Adverse
    Effect with respect to Parent and Merger Sub.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;<I>Power.</I>&#160;&#160;Each of Parent and Merger Sub
    has the corporate power and authority to execute, deliver and
    perform its obligations under this Agreement and to consummate
    the Transactions, subject to the adoption of this Agreement by
    General Dynamics Government Systems Corporation, a Delaware
    corporation as the sole stockholder of Merger Sub (which will
    occur promptly after the execution and delivery of this
    Agreement) (the <I>&#147;Parent Approval&#148;</I>). Each of
    Parent and Merger Sub has the corporate power and authority to
    carry on its business as it is now being conducted and to own,
    lease and operate all its properties and assets, except where
    the failure to have such power and authority has not had, and
    would not reasonably be expected to have, a Material Adverse
    Effect with respect to Parent and Merger Sub.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (c)&#160;<I>Authority.</I>&#160;&#160;Each of Parent and Merger
    Sub has duly authorized, executed and delivered this Agreement
    and the Voting Agreement. This Agreement, the Voting Agreement
    (and the execution, delivery and performance thereof by Parent
    and Merger Sub) and the Transactions have been duly authorized
    by all necessary corporate action of each of Parent and Merger
    Sub and no other corporate proceedings on the part of Parent or
    Merger Sub are necessary to authorize the execution, delivery
    and performance of this Agreement, the Voting Agreement or to
    consummate the Transactions, subject to obtaining the Parent
    Approval. The Parent Approval is the only vote of the holders of
    any class or series of Merger Sub&#146;s capital stock necessary
    to adopt this Agreement and authorize and approve the
    Transactions. This Agreement and the Voting Agreement are each
    Parent&#146;s and Merger Sub&#146;s valid and legally binding
    obligation, enforceable against each of them in accordance with
    its terms (except as enforcement may be limited by applicable
    bankruptcy, insolvency, reorganization, moratorium, fraudulent
    transfer and similar Laws of general applicability relating to
    or affecting creditors&#146; rights or by general equity
    principles).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (d)&#160;<I>Consents and Regulatory Approvals; No Defaults</I>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (1)&#160;No consents, authorizations or approvals of, or filings
    or registrations with, or notifications to, any Governmental
    Authority or with any third party are required to be made or
    obtained by Parent or Merger Sub in connection with the
    execution, delivery or performance by it of this Agreement or
    the Voting Agreement or to consummate the Transactions, except
    for (A)&#160;filings of applications and notices with, receipt
    of approvals or non-objections from, and expiration of related
    waiting periods required by, the FTC and the Antitrust Division
    under the HSR Act, (B)&#160;filings as may be required by the
    Securities Act or the Exchange Act or any applicable national
    securities exchange or Nasdaq, (C)&#160;the approvals and
    filings required by the DGCL, including receipt of the Parent
    Approval, and (D)&#160;such consents, authorizations, approvals,
    filings, registrations or notifications the failure of which to
    make or obtain has not had, and would not reasonably be expected
    to have, a Material Adverse Effect with respect to Parent and
    Merger Sub.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (2)&#160;Subject to receipt of the consents and approvals
    referred to in <U>Section&#160;3.02(d)(1)</U>, the expiration of
    related waiting periods, and the making of required filings with
    applicable Governmental Authorities, the execution, delivery and
    performance of this Agreement, the Voting Agreement and the
    consummation of the Transactions do not and will not
    (A)&#160;result in, conflict with, or constitute or create (with
    or without due notice or lapse of time or both) a breach or
    violation of, or a default under, or give rise to any Lien
    (other than Permitted Liens) on any property or asset of Parent
    or Merger Sub or any acceleration of remedies or right of
    termination or cancellation under any Law or any indenture or
    instrument of Parent or Merger Sub or to which Parent or Merger
    Sub or any of their properties is subject or bound, except for
    any such conflict, breach, violation, default, Lien,
    acceleration of remedies, right of termination or cancellation
    that, has not had, and would not reasonably be expected to have,
    a Material Adverse Effect with respect to Parent and Merger Sub,
    or
</DIV>

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    <BR>
    A-25
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (B)&#160;constitute a breach or violation of, or a default
    under, or conflict with, the Constituent Documents of Parent or
    Merger Sub.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (e)&#160;<I>Merger Sub Stock.</I>&#160;&#160;The authorized
    capital stock of Merger Sub consists of 1,000&#160;shares of
    Merger Sub Common Stock. All of the issued and outstanding
    capital stock of Merger Sub is owned by General Dynamics
    Government Systems Corporation, a Delaware corporation, as
    Merger Sub&#146;s sole stockholder. The outstanding shares of
    Merger Sub Common Stock are duly authorized and validly issued
    and outstanding, fully paid and nonassessable, and not subject
    to or issued in violation of any preemptive rights, any purchase
    option, call option, right of first refusal, subscription right
    or any similar right under any provision of the DGCL, Merger
    Sub&#146;s Constituent Documents or any contract or commitment
    to which Merger Sub is a party or otherwise bound.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (f)&#160;<I>No Prior Activities.</I>&#160;&#160;Merger Sub was
    formed solely for the purpose of engaging in the Transactions,
    has engaged in no other business activities and has conducted
    and will conduct its operations prior to the Effective Time only
    as contemplated by this Agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (g)&#160;<I>Ownership of Company Common Stock.</I>&#160;&#160;As
    of the date of this Agreement, neither Parent nor any of its
    Subsidiaries (including Merger Sub) is, and at no time during
    the last three (3)&#160;years has Parent or any of its
    Subsidiaries (including Merger Sub) been, an &#147;interested
    stockholder&#148; of the Company as defined in the Business
    Combination Law. As of the date of this Agreement, neither
    Parent nor any of its Subsidiaries (including Merger Sub) owns
    (beneficially or of record), or is a party to any agreement,
    arrangement or understanding for the purpose of acquiring,
    holding, voting or disposing of, any shares of capital stock of
    the Company (other than as contemplated by this Agreement and
    the Voting Agreement) in excess of five percent (5%) of the
    outstanding Shares.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (h)&#160;<I>Proxy Statement</I>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (1)&#160;The information regarding Guarantor, Parent and Merger
    Sub furnished in writing by Parent or Merger Sub expressly for
    inclusion in the Proxy Statement will not at the time
    (A)&#160;the Proxy Statement (or any amendment or supplement
    thereto) is filed with the SEC, (B)&#160;the Proxy Statement is
    first disseminated to the Company Stockholders, or (C)&#160;of
    the Stockholders&#146; Meeting, contain any untrue statement of
    a material fact or omit to state any material fact required to
    be stated therein or necessary in order to make the statements
    therein, in light of the circumstances under which they were
    made, not misleading.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (2)&#160;Notwithstanding the foregoing, Parent and Merger Sub
    make no representation or warranty with respect to any other
    information contained or incorporated by reference in the Proxy
    Statement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (i)&#160;<I>Funds.</I>&#160;&#160;As of the date of this
    Agreement, Merger Sub has access to, and will at the Effective
    Time have, sufficient funds available to satisfy the obligation
    to pay the Merger Consideration in the Merger.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (j)&#160;<I>Full Access.</I>&#160;&#160;Parent acknowledges that
    it and its Representatives have received access to such books
    and records, facilities, equipment, contracts and other assets
    of the Company and its Subsidiaries that it and its
    Representatives have desired or requested to review, and that it
    and its Representatives have had full opportunity to meet with
    the management of the Company to discuss the businesses and
    assets of the Company and its Subsidiaries. Parent acknowledges
    that neither the Company nor any other Person has made any
    representation or warranty, expressed or implied, as to the
    accuracy or completeness of any information regarding the
    Company furnished or made available to Parent and its
    Representatives in connection with the Transactions and that
    neither the Company, its Subsidiaries nor any of their
    respective Representatives has made any representation or
    warranty regarding the Company, its Subsidiaries or their
    respective businesses, except as and to the extent expressly set
    forth in <U>Section&#160;3.01</U> (as modified by the Disclosure
    Schedule).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (k)&#160;<I>No Additional Representations.</I>&#160;&#160;Except
    for the representations and warranties of Parent and Merger Sub
    expressly set forth in this <U>Section&#160;3.02</U>, neither
    Parent, Merger Sub nor any other Person makes any other express
    or implied representation or warranty on behalf of Parent or
    Merger Sub with respect to Parent, Merger Sub or any of their
    respective Subsidiaries or the Transactions.
</DIV>

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    <BR>
    A-26
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <FONT style="font-family: 'Times New Roman', Times">ARTICLE&#160;IV<BR>
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <FONT style="font-family: 'Times New Roman', Times; font-variant: SMALL-CAPS">Covenants
    and Agreements to be Performed Prior to the Closing
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    4.01&#160;<I>Conduct of Business of the
    Company.</I>&#160;&#160;From the date of this Agreement until
    the Effective Time or the earlier termination of this Agreement
    in accordance with its terms, except as otherwise expressly
    required by this Agreement or as specifically permitted pursuant
    to (a)&#160;through (v)&#160;below, the Company shall conduct
    its business and cause to be conducted the businesses of its
    Subsidiaries in the Ordinary Course of Business and shall use
    reasonable best efforts to preserve intact their respective
    business organizations, keep available the services of their
    respective current officers and employees, preserve the goodwill
    of those having material business relationships with the Company
    and its Subsidiaries, preserve their respective material
    relationships with customers, creditors and suppliers, maintain
    their respective books, accounts and records and comply in all
    material respects with applicable Laws. Without limiting the
    generality of the foregoing, except as expressly required by
    this Agreement, as set forth on <U>Section&#160;4.01</U> of the
    Disclosure Schedule or as required by applicable Law, without
    the prior written consent of Parent, from the date of this
    Agreement until the Effective Time or the earlier termination of
    this Agreement in accordance with its terms, the Company shall
    not, and shall cause each of its Subsidiaries not to:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;<I>Operations.</I>&#160;&#160;Enter into any new
    material line of business or change its material operating
    policies.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;<I>Capital Stock and Other
    Securities.</I>&#160;&#160;Other than with respect to Company
    Stock Options or Company Restricted Shares set forth on
    <U>Section&#160;3.01(e)(4)</U> of the Disclosure Schedule,
    (1)&#160;issue, sell, grant or otherwise permit to become
    outstanding or dispose of or encumber or pledge, or authorize or
    propose the creation of, any additional shares of its capital
    stock or any other securities (including long-term debt) or any
    Rights with respect to shares of its capital stock or any other
    securities, or (2)&#160;permit any additional shares of its
    capital stock to become subject to new grants under the Company
    Stock Plan or otherwise.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (c)&#160;<I>Dividends, Distributions,
    Repurchases.</I>&#160;&#160;(1)&#160;Make, declare, pay or set
    aside for payment any dividend on or in respect of, or declare
    or make any actual, constructive or deemed distribution on, any
    shares of its capital stock, other than dividends from its
    wholly owned Subsidiaries to it or another of its wholly owned
    Subsidiaries or (2)&#160;authorize or effect, directly or
    indirectly, any adjustment, split, combination, redemption or
    reclassification, or purchase of or otherwise acquire, any
    shares of its capital stock or any other securities exercisable
    or exchangeable for or convertible into shares of its capital
    stock, or amend any terms of any outstanding security of the
    Company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (d)&#160;<I>Dispositions.</I>&#160;&#160;Sell, transfer,
    mortgage, encumber, lease, license or otherwise dispose of any
    of its assets, businesses or properties, including any shares of
    capital stock of its Subsidiaries, except for sales, transfers,
    mortgages, encumbrances, leases, licenses or other dispositions
    in the Ordinary Course of Business pursuant to a transaction
    that, together with any other such transactions, is not material
    to it and its Subsidiaries, taken as a whole.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (e)&#160;<I>Acquisitions.</I>&#160;&#160;Other than in the
    Ordinary Course of Business, acquire (whether by purchase of
    assets, purchase of stock, merger or otherwise) (1)&#160;all or
    any portion of the assets, business, properties or shares of
    stock or other securities of any other Person or (2)&#160;any
    equity interest of any Person or any business or division of any
    business, or enter into any joint venture, partnership
    agreement, joint development agreement, strategic alliance
    agreement or other similar agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (f)&#160;<I>Constituent Documents.</I>&#160;&#160;Amend or
    propose to amend its Constituent Documents.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (g)&#160;<I>Accounting Methods.</I>&#160;&#160;Implement or
    adopt any change in its financial accounting principles,
    practices or methods, other than as may be required as a result
    of changes after the date of this Agreement in GAAP or
    regulatory accounting requirements applicable to
    U.S.&#160;publicly owned business organizations generally.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (h)&#160;<I>Compensation; Employment Agreements;
    Etc.</I>&#160;&#160;Except as expressly required by the terms of
    a Benefit Arrangement set forth on <U>Section&#160;4.01(h)</U>
    of the Disclosure Schedule: (1)&#160;enter into, amend, modify
    or renew any employment, consulting, change in control or
    similar contract, agreement or arrangement with any director,
    officer or employee; (2)&#160;increase the compensation payable
    or to become payable to any director, officer or employee
    (excluding increases in cash compensation in the Ordinary Course
    of Business);
</DIV>

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    <BR>
    A-27
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (3)&#160;increase any bonus, insurance, pension or other benefit
    plan, payment or arrangement made to, for or with any such
    directors, officers or employees; (4)&#160;grant any severance
    or termination pay to any executive officer or director, or to
    any other employee (excluding payments made in connection with
    the termination of employees who are not executive officers in
    amounts consistent with its policies and past practice or
    pursuant to written agreements set forth on
    <U>Section&#160;3.01(m)(4)</U> of the Disclosure Schedule); or
    (5)&#160;issue or grant any Company Stock-Based Awards.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (i)&#160;<I>Benefit Arrangements.</I>&#160;&#160;Enter into,
    establish, adopt, amend, modify or renew any pension,
    retirement, stock option, stock purchase, savings, profit
    sharing, deferred compensation, bonus, group insurance or other
    employee benefit, incentive or welfare contract, plan or
    arrangement or any trust agreement in respect of any director,
    officer or employee or take any action to accelerate the vesting
    or exercisability of stock options (including Company Stock
    Options), restricted stock units (including Company Restricted
    Shares) or other compensation or benefits payable thereunder,
    except (1)&#160;as may be required by applicable Law or by the
    terms of a Benefit Arrangement set forth on
    <U>Section&#160;4.01(h)</U> of the Disclosure Schedule or
    (2)&#160;amendments that do not increase benefits or result in
    increased administrative costs.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (j)&#160;<I>Indebtedness.</I>&#160;&#160;(1)&#160;Create, incur,
    endorse, assume or otherwise become liable for or suffer to
    exist any indebtedness for borrowed money or guarantee any such
    indebtedness other than borrowings in the Ordinary Course of
    Business pursuant to the Company&#146;s and its
    Subsidiaries&#146; revolving credit arrangements or under
    capital leases, in each case, in effect on the date of this
    Agreement, (2)&#160;issue, sell or amend any debt securities or
    other rights to acquire any debt securities of the Company or
    any of its Subsidiaries, (3)&#160;guarantee any debt securities
    of others, (4)&#160;enter into any &#147;keep well&#148; or
    other covenants to maintain any financial condition or enter
    into any arrangement having the economic effect of the
    foregoing, (5)&#160;other than to wholly-owned Subsidiaries of
    the Company, make any loans, advances or capital contributions
    to, or material investment in, any Person, (6)&#160;pledge or
    otherwise encumber shares of capital stock of the Company or any
    of its Subsidiaries (other than Permitted Liens), or
    (7)&#160;mortgage, pledge or otherwise encumber any of its
    material assets (other than Permitted Liens).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (k)&#160;<I>Taxes.</I>&#160;&#160;Make or change any material
    Tax election, settle or compromise any material Tax liability,
    change in any material respect any accounting method in respect
    of Taxes, file any amendment to a material Tax Return, enter
    into any closing agreement, settle any material claim or
    material assessment of Taxes, enter into any agreement or waiver
    extending the period for assessment or collection of any
    material Taxes of the Company or any of its Subsidiaries, or
    fail to pay or withhold, or otherwise properly reserve for, any
    material Taxes of the Company or any of its Subsidiaries.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (l)&#160;<I>Material Contracts.</I>&#160;&#160;Enter into any
    contract, agreement or commitment (excluding Government
    Contracts) of a character that would constitute a Material
    Contract or be required to be disclosed in
    <U>Section&#160;3.01(k)</U> of the Disclosure Schedule if such
    contract, agreement or commitment had been entered into prior to
    the date of this Agreement, or terminate, renew or amend in any
    material respect any Material Contract, in each case, other than
    in the Ordinary Course of Business (it being understood that if
    any such entry into, or termination, renewal or amendment of,
    any such contract, agreement or commitment is permitted pursuant
    to this <U>Section&#160;4.01(l)</U> as a result of the Ordinary
    Course of Business exception set forth above, but such action
    would otherwise be prohibited by any other provision of this
    <U>Section&#160;4.01</U>, then this <U>Section&#160;4.01(l)</U>
    shall not be interpreted to permit such action without the prior
    written consent of Parent as contemplated hereby).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (m)&#160;<I>Non-Competes.</I>&#160;&#160;Enter into any
    agreement, contract or binding commitment containing any
    covenant directly or indirectly limiting the freedom of the
    Company or any of its Subsidiaries to engage in any line of
    business, compete with any Person, or sell any product or
    service (including any &#147;most favored nation&#148; clauses),
    or which, following the consummation of the Merger, could so
    limit Guarantor, Parent or any of their affiliates (including
    the Surviving Corporation), including any contract clause,
    mitigation plan, or other limitation with respect to
    &#147;Organizational Conflicts of Interest,&#148; as that term
    is used in Federal Acquisition Regulation&#160;Subpart 9.5.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (n)&#160;<I>Government Contracts.</I>&#160;&#160;Enter into any
    Government Contract or submit any bid for a Government Contract
    that (1)&#160;would reasonably be expected to result in a
    financial loss of greater than $100,000,
</DIV>

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    <BR>
    A-28
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (2)&#160;involves unusual risk in performance or compliance with
    schedule requirements or contains non-customary terms and
    conditions or (3)&#160;would, under the federal rules covering
    Organizational Conflicts of Interest, as that term is used in
    Federal Acquisition Regulation&#160;Subpart 9.5, limit Parent,
    the Surviving Corporation or any of their respective
    Subsidiaries from engaging in any line of business, competing
    with any Person or selling any product or service.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (o)&#160;<I>Adverse Actions.</I>&#160;&#160;Take, or omit to
    take, any action that would reasonably be expected to result in
    any of the conditions to the Merger set forth in
    <U>Article&#160;VI</U> not being satisfied in a timely manner.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (p)&#160;<I>Waivers; Etc.</I>&#160;&#160;Waive, release or
    assign any material rights, claims or benefits of the Company or
    any of its Subsidiaries under any Material Contract, other than
    in the Ordinary Course of Business.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (q)&#160;<I>Capital Expenditures; Demonstration
    Equipment.</I>&#160;&#160;Make any capital expenditures, capital
    additions or capital improvements in amounts exceeding
    $5,000,000 in the aggregate, or manufacture any demonstration
    equipment with a cost exceeding $2,000,000 in the aggregate.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (r)&#160;<I>Reportable Transactions.</I>&#160;&#160;Engage in
    any &#147;reportable transaction,&#148; including any
    &#147;listed transaction,&#148; within the meaning of Code
    Section&#160;6011 or any other applicable federal Law including
    any Internal Revenue Service ruling, procedure, notice or other
    pronouncement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (s)&#160;<I>Satisfaction of Liabilities.</I>&#160;&#160;Other
    than in the Ordinary Course of Business, pay, discharge or
    satisfy any material claim, liability or obligation, or settle
    or compromise any material pending or threatened suit, action or
    proceeding requiring payments by the Company in excess of
    $250,000 in the aggregate.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (t)&#160;<I>Insurance.</I>&#160;&#160;Materially change the
    amount or nature of any insurance coverage, other than in the
    Ordinary Course of Business.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (u)&#160;<I>Related-Party Transactions.</I>&#160;&#160;Enter
    into, amend, modify, terminate or engage in any contract,
    agreement, commitment or transaction with any executive officer
    or director of the Company, or any Person owning five percent
    (5%) or more of the Company Common Stock, or any relative of any
    such Person directly or indirectly controlled by such Person.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (v)&#160;<I>Commitments.</I>&#160;&#160;Enter into any contract
    or binding commitment with respect to any of the foregoing, or
    otherwise resolve or commit to do any of the foregoing.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    4.02&#160;<I>[Reserved]</I>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    4.03&#160;<I>Additional Reports.</I>&#160;&#160;From the date of
    this Agreement to the Effective Time, the Company will timely
    file with, or furnish to, the SEC all forms, statements,
    reports, certifications, schedules and other documents
    (including all exhibits and amendments thereto) required to be
    filed or furnished by it under the Exchange Act
    <FONT style="white-space: nowrap">and/or</FONT> the
    Securities Act. The Company will furnish to Parent drafts of all
    such forms, statements, reports, certifications, schedules and
    other documents a reasonable time prior to filing with, or
    furnishing to, the SEC, and copies of any such forms,
    statements, reports, certifications, schedules and other
    documents that it files with, or furnishes to, the SEC on or
    after the date of this Agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    4.04&#160;<I>Reasonable Best Efforts; Antitrust Filings;
    Cooperation</I>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;<I>Reasonable Best Efforts.</I>&#160;&#160;Subject to
    <U>Section&#160;4.04(b)</U>, from the date of this Agreement
    until the Effective Time or the earlier termination of this
    Agreement in accordance with its terms, each of the Parties
    shall use its reasonable best efforts to take, or cause to be
    taken, all actions, and to do, or cause to be done, and to
    assist and cooperate with the other Parties in doing, all
    things, necessary, proper or advisable to consummate and make
    effective, as promptly as practicable prior to the Termination
    Date, the Transactions in accordance with the terms of this
    Agreement and the Voting Agreement, including: (1)&#160;the
    taking of all acts necessary to cause the conditions to the
    Merger to each be satisfied as promptly as practicable; and
    (2)&#160;the obtaining of all actions or nonactions, waivers,
    consents and approvals from Governmental Authorities and the
    making of all registrations, notices and filings (including
    filings with Governmental Authorities), in each case, that are
    required in connection with this Agreement and the Merger and
    the taking of all steps as may be necessary to obtain an
    approval or waiver from, or to avoid an action or proceeding by,
    any Governmental Authority.
</DIV>

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    <BR>
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;<I>Antitrust Filings.</I>&#160;&#160;In connection with
    and without limiting the foregoing clause (a), the Company
    shall, and Parent shall cause Guarantor to, file (1)&#160;duly
    file with the United States Federal Trade Commission (the
    <I>&#147;FTC&#148;</I>) and the Antitrust Division of the United
    States Department of Justice (the <I>&#147;Antitrust
    Division&#148;</I>) the notification and report form (the
    <I>&#147;HSR Filing&#148;</I>) required under the HSR Act and
    (2)&#160;duly make all notifications and other filings required
    under any other applicable Antitrust Law (together with the HSR
    Filing, the <I>&#147;Antitrust Filings&#148;</I>) that the
    Company and Parent deem advisable or appropriate or that may be
    required by the applicable Antitrust Authority, in each case
    with respect to the Transactions and as promptly as practicable,
    but in the case of the HSR Filing, no later than five
    (5)&#160;Business Days following the execution and delivery of
    this Agreement unless the Parties otherwise agree. The Antitrust
    Filings shall be prepared and made in substantial compliance
    with the requirements of the HSR Act or other Antitrust Laws, as
    applicable. Each Party will use its respective reasonable best
    efforts to obtain early termination of the applicable waiting
    period, if any, under all Antitrust Laws. Notwithstanding
    anything to the contrary contained in this Agreement (whether in
    clause&#160;(a) or elsewhere), nothing contained in this
    Agreement will be deemed to require Parent or Guarantor to enter
    into any agreement, consent decree or other commitment requiring
    Parent, Guarantor or any of their Subsidiaries to
    (A)&#160;divest, hold separate or otherwise limit the use of any
    assets of the Company or its Subsidiaries, or Parent, Guarantor
    or their Subsidiaries, (B)&#160;litigate, pursue or defend any
    action or proceeding challenging any of the Transactions as
    violative of any Antitrust Laws, (C)&#160;other than filing fees
    required by the HSR Act, make any out of pocket expenditures of
    more than a de minimis amount or incur any obligations or
    liabilities, in each case, in order to comply with the
    provisions of this <U>Section&#160;4.04</U> or (D)&#160;take any
    other action that would, or would reasonably be expected to,
    materially and adversely affect Parent, Guarantor or any of
    their Subsidiaries (including after the Effective Time, the
    Surviving Corporation).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (c)&#160;<I>Cooperation.</I>&#160;&#160;From the date of this
    Agreement until the Closing or the earlier termination of this
    Agreement in accordance with its terms, each Party shall,
    subject to applicable Law and except as prohibited by any
    applicable representative of any applicable Governmental
    Authority: (1)&#160;furnish to the other Parties upon reasonable
    request all information concerning itself, its Subsidiaries,
    directors, officers and stockholders and such other matters as
    may be reasonably necessary or advisable in connection with any
    filing, notice or application made by or on behalf of such other
    Party or any of its Subsidiaries with or to any third party or
    Governmental Authority in connection with the Transactions;
    (2)&#160;promptly notify the other Parties of any written
    communication to the first Party from any Antitrust Authority,
    any State Attorney General or any other Governmental Authority
    relating to this Agreement or the Transactions, and permit the
    other Parties a reasonable opportunity to review in advance any
    proposed written communication to any of the foregoing with
    respect to the Transactions; (3)&#160;not participate or agree
    to participate in any substantive meeting or discussion with any
    Governmental Authority in respect of any filings, investigation
    or inquiry concerning this Agreement or the Transactions unless
    it consults with the other Parties in advance and, to the extent
    permitted by such Governmental Authority, gives the other
    Parties the opportunity to attend and participate thereat; and
    (4)&#160;furnish the other Parties with copies of all
    correspondence, filings and written communications (and
    memoranda setting forth the substance thereof) between such
    Party and its Subsidiaries and their respective Representatives,
    on the one hand, and any Governmental Authority or members or
    their respective staffs, on the other hand, with respect to this
    Agreement and the Transactions. Each Party shall
    (A)&#160;respond as promptly as reasonably practicable under the
    circumstances to any inquiries received from any Antitrust
    Authority for additional information or documentation and to all
    inquiries and requests received from any State Attorney General
    or other Governmental Authority in connection with antitrust
    matters relating to this Agreement or the Transactions,
    including the Antitrust Filings, and (B)&#160;not extend any
    waiting period under the HSR Act or enter into any agreement
    with any Antitrust Authority not to consummate the Transactions
    without the prior written consent of the other Parties.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (d)&#160;Parent shall cause Merger Sub to comply with all of
    Merger Sub&#146;s obligations under or related to this Agreement
    and the Transactions.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    4.05&#160;<I>Stockholder Approvals</I>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;As soon as possible after the date of this Agreement,
    the Company, acting through the Company Board, shall, in
    accordance with applicable Law (including the DGCL) and the
    Company&#146;s Certificate of Incorporation and Bylaws,
    establish a record date for, duly call, give notice of, convene
    and hold a special meeting of its stockholders for the purpose
    of considering and taking action on this Agreement and the
    Merger, and the Company shall submit this Agreement for adoption
    by the Company Stockholders at such meeting (the
    <I>&#147;Stockholders&#146; Meeting&#148;</I>). At the
</DIV>

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    A-30
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Stockholders&#146; Meeting, Parent and Merger Sub shall cause
    all Shares then owned by them and their respective Subsidiaries
    to be voted in favor of the approval and adoption of this
    Agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;Subject to <U>Section&#160;4.09</U>, the Company shall
    use its reasonable best efforts to solicit from the Company
    Stockholders proxies in favor of the adoption of this Agreement
    and take all actions reasonably necessary or advisable to secure
    the Company Stockholder Approval.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (c)&#160;The Company&#146;s obligations pursuant to this
    <U>Section&#160;4.05</U> will not be affected by the
    commencement, public proposal, public disclosure or
    communication to the Company of any Acquisition Proposal or
    Superior Proposal or any withdrawal of the Company Board
    Recommendation. Subject to the Company withholding, withdrawing,
    qualifying or modifying its recommendation pursuant to and in
    accordance with <U>Section&#160;4.09</U>, the Company, acting
    through the Company Board, will make the Company Board
    Recommendation at the Stockholders&#146; Meeting.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    4.06&#160;<I>Proxy Statement</I>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;As soon as possible after the date of this Agreement,
    the Company shall prepare and file, in no event later than three
    (3)&#160;Business Days after the date of this Agreement, a
    preliminary Proxy Statement with the SEC under the Exchange Act
    and shall use its reasonable best efforts to have such
    preliminary Proxy Statement cleared by the SEC promptly. The
    Company agrees to use its reasonable best efforts, after
    consultation with Parent, to respond promptly to all comments of
    and requests by the SEC with respect to such preliminary Proxy
    Statement and to cause a definitive Proxy Statement and all
    required amendments and supplements thereto to be disseminated
    to the Company Stockholders entitled to vote at the
    Stockholders&#146; Meeting at the earliest practicable time. The
    Company will notify Parent promptly of the receipt of and will
    respond promptly to any (1)&#160;comments from the SEC or its
    staff and (2)&#160;request by the SEC or its staff for
    amendments or supplements to the Proxy Statement or for
    additional information and will supply Parent with copies of all
    correspondence between the Company or any of its
    Representatives, on the one hand, and the SEC or its staff, on
    the other hand, with respect to the Proxy Statement or the
    Merger. Parent and its counsel will be given a reasonable
    opportunity to be involved in the drafting of and review and
    comment upon the Proxy Statement and any amendment or supplement
    thereto and any such correspondence prior to its filing with the
    SEC or dissemination to the Company Stockholders.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;No amendment or supplement to the Proxy Statement will
    be made by the Company without the prior approval of Parent,
    which approval will not be unreasonably withheld, conditioned or
    delayed. If at any time prior to the Stockholders&#146; Meeting,
    any information relating to the Company, Parent, Merger Sub or
    any of their respective affiliates, directors or officers or the
    Transactions should be discovered by the Company or Parent,
    which such Party believes should be set forth in an amendment or
    supplement to the Proxy Statement so that the Proxy Statement
    shall not contain any untrue statement of a material fact or
    omit to state any material fact required to be stated therein or
    necessary in order to make the statements made therein, in light
    of the circumstances under which they were made, not misleading,
    the Party that discovers such information (or the Party whose
    Subsidiary discovers such information) shall promptly notify the
    other Party, and an appropriate amendment, supplement or other
    filing, if any, incorporated by reference into the Proxy
    Statement describing such information shall be filed by the
    Company with the SEC upon mutual agreement of Parent and the
    Company and, to the extent required by applicable Law,
    (1)&#160;disseminated to the Company Stockholders, and
    (2)&#160;proxies in connection therewith will be resolicited, in
    each case, as promptly as reasonably practicable.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (c)&#160;The Company shall cause (1)&#160;the Proxy Statement to
    include all information required under applicable Law to be
    furnished to the Company Stockholders in connection with the
    Merger and the Transactions and, subject to
    <U>Section&#160;4.09</U>, to include the Company Board
    Recommendation and (2)&#160;all documents filed by the Company
    with the SEC in connection with the Merger to comply as to form
    and substance with all applicable requirements of the Exchange
    Act. The information included or incorporated by reference in
    the Proxy Statement will not at the time (A)&#160;the Proxy
    Statement (or any amendment or supplement thereto) is filed with
    the SEC, (B)&#160;the Proxy Statement is disseminated to the
    Company Stockholders, or (C)&#160;of the Stockholders&#146;
    Meeting, contain any untrue statement of a material fact or omit
    to state any material fact required to be stated therein or
    necessary in order to make the statements made therein, in light
    of the circumstances under which they were made, not misleading.
    Notwithstanding the foregoing, the Company makes no
    representation or warranty with respect to statements made in
    the Proxy Statement regarding Guarantor, Parent or Merger Sub
    and furnished in writing by Guarantor, Parent or
</DIV>

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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Merger Sub expressly for inclusion in the Proxy Statement. It is
    understood and agreed that all other information in the Proxy
    Statement will be deemed to have been furnished by the Company.
    Parent and Merger Sub shall supply all information regarding
    Guarantor, Parent and Merger Sub reasonably requested by the
    Company in connection with the preparation of the Proxy
    Statement as promptly as practicable.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    4.07&#160;<I>Press Releases.</I>&#160;&#160;The initial press
    releases issued by each Party announcing the Merger and the
    Transactions will be in a form that is mutually acceptable to
    Parent and the Company. Thereafter, Parent and Merger Sub, on
    the one hand, and the Company, on the other hand, will consult
    with each other before issuing any press release with respect to
    the Transactions or this Agreement and will not issue any such
    press release without the prior written consent of the other
    Party, which will not be unreasonably withheld, conditioned or
    delayed; provided, however, that a Party may, without the prior
    consent of the other Party (but after prior consultation, to the
    extent practicable in the circumstances), issue any such press
    release as may be required by applicable Law, securities
    exchange or Nasdaq rules. Parent and Merger Sub, on the one
    hand, and the Company, on the other hand, will cooperate to
    develop all public communications and make appropriate members
    of management available at presentations related to the
    Transactions as reasonably requested by the other Party.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    4.08&#160;<I>Access; Information</I>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;From the date of this Agreement until the Effective
    Time or the earlier termination of this Agreement in accordance
    with its terms, upon reasonable notice, the Company will (and
    will cause its Subsidiaries to) afford Parent and Parent&#146;s
    Representatives such access during normal business hours to the
    officers, employees, agents, books, records (including Tax
    Returns and work papers of independent auditors) and properties
    of the Company and its Subsidiaries as Parent may reasonably
    request; provided, however, that such access shall not
    unreasonably disrupt the operations of the Company or any of its
    Subsidiaries. All requests for such access shall be made to such
    agents of the Company as the Company may designate, who will be
    solely responsible for coordinating all such requests and all
    access permitted hereunder. Notwithstanding the foregoing,
    neither the Company nor any of its Subsidiaries will be required
    to afford access to or disclose information that would
    (1)&#160;jeopardize the attorney client privilege, provided that
    the Company will nonetheless provide Parent and its
    Representatives with appropriate information regarding the
    factual basis underlying any circumstances that resulted in the
    preparation of such privileged analyses, (2)&#160;violate any of
    its contractual obligations with respect to confidentiality if
    the Company will have used reasonable best efforts to obtain the
    consent of such third party to such inspection or disclosure
    without requiring the Company to pay any amount or waive any
    rights to obtain such consent or (3)&#160;violate any Law. The
    Parties will make reasonable appropriate substitute arrangements
    in circumstances where the previous sentence applies.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;Each Party will hold any information provided in
    connection with this Agreement or the Transactions confidential
    and any such information provided by the Company, its
    Subsidiaries or their respective Representatives to Parent,
    Merger Sub or any of their respective Representatives, will be
    deemed to be &#147;Information&#148; under the Confidentiality
    Agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (c)&#160;The Company will provide to Parent a copy of the
    opinion referenced in <U>Section&#160;3.01(u)</U> promptly after
    the date of this Agreement solely for information purposes.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    4.09&#160;<I>No Solicitation</I>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;From the date of this Agreement until the Effective
    Time or the earlier termination of this Agreement in accordance
    with its terms, the Company shall not, and shall cause its
    Representatives and its Subsidiaries (and its Subsidiaries&#146;
    Representatives) not to, directly or indirectly,
    (1)&#160;initiate, facilitate, solicit or knowingly encourage
    inquiries or proposals that constitute, or might reasonably be
    expected to lead to, any Acquisition Proposal, (2)&#160;initiate
    or engage with any third party in any discussions or
    negotiations concerning, or furnish any information to any third
    party in connection with, any Acquisition Proposal (except to
    notify such third party of the existence of the provisions of
    this <U>Section&#160;4.09</U>), or otherwise knowingly
    facilitate other inquiries or the making of any proposal that
    constitutes, or that might reasonably be expected to lead to,
    any Acquisition Proposal, or (3)&#160;except as permitted
    pursuant to <U>Section&#160;4.09(g)</U> below, enter into any
    letter of intent, agreement, arrangement or undertaking (other
    than a confidentiality agreement permitted by
    <U>Section&#160;4.09(b)</U> below) with respect to any
    Acquisition Proposal or approve or resolve to approve any
    Acquisition Proposal, or enter into any agreement, arrangement
    or understanding
</DIV>

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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    that would require the Company to abandon, terminate or fail to
    consummate the Merger or any of the other Transactions. Without
    limiting the foregoing, it is agreed that any violation of the
    foregoing restrictions by any Representative, whether or not
    such Person is purporting to act on behalf of the Company or any
    of its Subsidiaries, or otherwise, will be deemed to be a breach
    of this <U>Section&#160;4.09</U> by the Company, and the Company
    will cause its Representatives to comply with the terms of this
    <U>Section&#160;4.09.</U>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;Notwithstanding the restrictions set forth in
    <U>Section&#160;4.09(a)</U>, any time prior to obtaining the
    Company Stockholder Approval, the Company may in response to an
    unsolicited Acquisition Proposal received by the Company which
    did not result from a breach of this <U>Section&#160;4.09</U>,
    furnish information to, or enter into discussions or
    negotiations with, any Person that has made such unsolicited
    Acquisition Proposal if, and only to the extent that:
    (1)&#160;such Acquisition Proposal constitutes a Superior
    Proposal or the Company Board, after consulting with the
    Company&#146;s outside legal counsel and financial advisors,
    determines in good faith that such Acquisition Proposal, after
    furnishing such information and entering into such discussions
    or negotiations, would reasonably be expected to result in a
    Superior Proposal; (2)&#160;after consultation with its outside
    legal counsel, the Company Board determines in good faith that
    the failure to take such action would violate its fiduciary
    duties under applicable Law; (3)&#160;the Company and its
    Subsidiaries are otherwise in compliance with this
    <U>Section&#160;4.09</U> (including, at least two
    (2)&#160;Business Days prior to furnishing such information to,
    or entering into discussions or negotiations with, such Person,
    by giving Parent notice to the effect that the Company is
    furnishing information to, or entering into discussions or
    negotiations with, such Person); (4)&#160;prior to furnishing
    such information, the Company receives from such Person an
    executed confidentiality agreement on customary terms similar to
    and no less favorable to the Company than those contained in the
    Confidentiality Agreement (provided such agreement shall allow
    the Company to comply with its obligations under this Agreement,
    including <U>Section&#160;4.09(c)</U>); and (5)&#160;the Company
    keeps Parent informed, on a reasonably current basis, of the
    status of any discussions or negotiations as provided herein.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (c)&#160;The Company shall as promptly as reasonably practicable
    (and in any event within two (2)&#160;Business Days after
    receipt) notify Parent of the existence of any proposal,
    discussion, negotiation or inquiry received by the Company that
    has led to, or might reasonably be expected to lead to, any
    Acquisition Proposal, including a copy of (or if oral, a written
    statement setting forth in reasonable detail the material terms
    and conditions of) any such proposal, discussion, negotiation,
    inquiry or Acquisition Proposal, and the identity of the third
    party from which it was received. The Company will (1)&#160;keep
    Parent reasonably apprised of any material developments,
    discussions and negotiations with respect to any such proposal,
    discussion, negotiation, inquiry or Acquisition Proposal, as
    well as any material modification of or amendment thereto,
    (2)&#160;promptly upon receipt or delivery thereof, provide
    Parent with copies of all drafts and versions of agreements
    (including schedules and exhibits) relating thereto exchanged
    between the Company and such third party or their respective
    Representatives, and (3)&#160;promptly make available to Parent
    any non-public information concerning the Company or any of its
    Subsidiaries furnished to any third party in connection
    therewith that has not previously been provided to Parent. The
    Company will give Parent prompt notice after any determination
    by the Company Board that an Acquisition Proposal is, or would
    reasonably be likely to result in, a Superior Proposal.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (d)&#160;The Company shall immediately cease and cause to be
    terminated any existing discussions or negotiations with any
    Persons (other than the Transactions) conducted heretofore with
    respect to any Acquisition Proposal and use its commercially
    reasonable efforts to effect the prompt return or destruction of
    all confidential information furnished to any Person in
    connection with a possible Acquisition Proposal during the
    twelve (12)&#160;month period ending on the date of this
    Agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (e)&#160;Nothing contained in this <U>Section&#160;4.09</U>
    prohibits or will be construed as prohibiting the Company or the
    Company Board from (1)&#160;taking and disclosing to the Company
    Stockholders a position contemplated by
    <FONT style="white-space: nowrap">Rule&#160;14e-2(a)</FONT>
    promulgated under the Exchange Act or (2)&#160;making any
    disclosure to the Company Stockholders if, in the good faith
    judgment of the Company Board, after consultation with outside
    legal counsel, failure to make such disclosure would be
    inconsistent with applicable Law; provided however, that a
    Company Board Change of Recommendation (as defined below) shall
    be made only in accordance with <U>Section&#160;4.09(f)</U> or
    <U>4.09(g).</U>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (f)&#160;Except as otherwise permitted by this
    <U>Section&#160;4.09(f)</U> and <U>Section&#160;4.09(g)</U>,
    from the date of this Agreement until the Effective Time or the
    earlier termination of this Agreement in accordance with its
    terms, neither the
</DIV>

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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Company Board nor any committee thereof shall (1)&#160;approve
    or recommend, or propose to approve or recommend, any
    Acquisition Proposal, (2)&#160;cause or permit the Company to
    enter into any letter of intent, agreement in principle,
    acquisition agreement or similar agreement with respect to any
    Acquisition Proposal, or (3)&#160;withdraw, amend or modify in a
    manner adverse to Parent or Merger Sub, or publicly propose to
    withdraw, amend or modify in a manner adverse to Parent or
    Merger Sub, the Company Board Recommendation (a <I>&#147;Company
    Board Change of Recommendation&#148;</I>). Notwithstanding the
    foregoing, at any time prior to obtaining the Company
    Stockholder Approval, the Company Board may, in response to a
    material development or change in circumstances occurring or
    arising after the date of this Agreement that was neither known
    to the Company Board nor reasonably foreseeable as of or prior
    to the date hereof (and not relating to any Acquisition
    Proposal) (such material development or change in circumstances,
    an <I>&#147;Intervening Event&#148;</I>), make a Company Board
    Change of Recommendation if the Company Board has concluded in
    good faith, after consultation with, and taking into account the
    advice of, its outside legal counsel, that, in light of such
    Intervening Event, the failure of the Company Board to effect
    such a Company Board Change of Recommendation would result in a
    breach of its fiduciary duties under applicable Law; provided,
    however, that the Company shall not be entitled to exercise its
    right to make a Company Board Change of Recommendation pursuant
    to this sentence unless the Company has (A)&#160;given Parent at
    least three (3)&#160;Business Days&#146; prior notice (unless
    the Intervening Event arises fewer than three (3)&#160;Business
    Days prior to the Stockholders&#146; Meeting) advising Parent
    that the Company Board intends to take such action and
    specifying the reasons therefor in reasonable detail and
    (B)&#160;during such three (3)&#160;Business Day period, or such
    shorter period as may remain prior to the Stockholders&#146;
    Meeting, if requested by Parent, engaged in good faith
    negotiations with Parent to amend this Agreement in such a
    manner that obviates the need for a Company Board Change of
    Recommendation as a result of the Intervening Event. No Company
    Board Change of Recommendation will modify the previous approval
    of the Company Board which caused all state takeover statutes or
    other state Laws, including the Takeover Laws, to be
    inapplicable to the Transactions.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (g)&#160;Notwithstanding anything in this
    <U>Section&#160;4.09</U> to the contrary, at any time prior to
    obtaining the Company Stockholder Approval, the Company Board
    (or any duly constituted committee of the Company Board) may, in
    response to a Superior Proposal, cause the Company to terminate
    this Agreement pursuant to <U>Section&#160;7.01(g)</U> and
    concurrently with such termination enter into a definitive
    agreement providing for the transactions contemplated by such
    Superior Proposal; provided, however, that the Company shall not
    terminate this Agreement pursuant to
    <U>Section&#160;7.01(g)</U>, and any purported termination
    pursuant to <U>Section&#160;7.01(g)</U> shall be void and of no
    force or effect, unless, (1)&#160;the Company shall have
    complied with all the provisions of this
    <U>Section&#160;4.09</U>, including the notification provisions
    in this <U>Section&#160;4.09(g)</U>, and with all applicable
    requirements of <U>Sections&#160;7.01(g)</U> and <U>7.03</U>
    (including the payment of the Termination Fee and Expense
    Reimbursement prior to or concurrently with such termination) in
    connection with such Superior Proposal and (2)&#160;after
    consultation with its outside legal counsel, the Company Board
    determines in good faith that the failure to take such action
    would violate its fiduciary duties under applicable Law; and
    provided further, however, that the Company shall not exercise
    its right to terminate this Agreement pursuant to
    <U>Section&#160;7.01(g)</U>: (A)&#160;until after the second
    Business Day following actual receipt by Parent of notice from
    the Company advising Parent that the Company has received a
    Superior Proposal, specifying the material terms and conditions
    of the Superior Proposal and attaching the most current versions
    of the definitive agreement, all exhibits and other attachments
    thereto and agreements (such as stockholder agreements)
    ancillary thereto to effect such Superior Proposal, and
    identifying the Person making such Superior Proposal (a
    <I>&#147;Notice of Superior Proposal&#148;</I>) and stating that
    the Company Board intends to cause the Company to exercise its
    right to terminate this Agreement pursuant to
    <U>Section&#160;7.01(g)</U> (it being understood and agreed
    that, prior to any termination pursuant to
    <U>Section&#160;7.01(g)</U> taking effect, any amendment to the
    price or any other material term of a Superior Proposal (such
    amended Superior Proposal, a <I>&#147;Modified Superior
    Proposal&#148;</I>) shall require a new Notice of Superior
    Proposal and a new two (2)&#160;Business Day period with respect
    to such Modified Superior Proposal), during which two
    (2)&#160;Business Day period the Company will and will cause its
    Representatives to negotiate in good faith with Parent so that
    Parent may propose an adjustment to this Agreement for the
    purpose of causing the Acquisition Proposal to no longer be a
    Superior Proposal, and (B)&#160;unless either (i)&#160;on or
    before the expiration of the two (2)&#160;Business Day period
    following the actual receipt by Parent of any Notice of Superior
    Proposal, Parent does not make such adjustments in the terms and
    conditions of this Agreement so that such Acquisition Proposal
    ceases to constitute a Superior Proposal (a <I>&#147;Matching
    Agreement&#148;</I>) in response to such Superior Proposal or
    (ii)&#160;following receipt of a Matching Agreement within the
    two (2)&#160;Business Day period, the Company Board (or any duly
    constituted committee thereof) concludes
</DIV>

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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    in good faith, after consultation with the Company&#146;s
    outside legal counsel and after taking into consideration the
    Matching Agreement, that the Superior Proposal to which the
    Notice of Superior Proposal relates continues to be a Superior
    Proposal.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    4.10&#160;<I>Takeover Laws and Provisions.</I>&#160;&#160;Each
    of the Company and the Company Board will take all actions to
    cause the Transactions (a)&#160;not to be subject to
    requirements imposed by any Takeover Law and will take all
    necessary steps within its control to exempt (or ensure the
    continued exemption of) the Transactions from, or if necessary
    challenge the validity or applicability of, any applicable
    Takeover Law, as now or hereafter in effect and (b)&#160;to
    comply with any Takeover Provisions and will take all necessary
    steps within its control to make the Transactions comply with
    (or continue to comply with) any Takeover Provisions. If any
    Takeover Law or Takeover Provision becomes applicable to the
    Transactions, each of the Company and the Company Board will,
    upon the request of Parent or Merger Sub, use its best efforts
    to ensure that the Transactions may be consummated as promptly
    as practicable on the terms contemplated by this Agreement and
    otherwise to minimize the effect of such Takeover Law or
    Takeover Provision on the Transactions.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    4.11&#160;<I>Control of
    Operations.</I>&#160;&#160;Notwithstanding anything to the
    contrary contained herein, nothing contained in this Agreement
    will give to Guarantor, Parent or Merger Sub, directly or
    indirectly, rights to control or direct the operations of the
    Company or any of its Subsidiaries prior to the Effective Time.
    Prior to the Effective Time, the Company will exercise,
    consistent with the terms and conditions of this Agreement,
    complete control and supervision of its and its
    Subsidiaries&#146; operations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    4.12&#160;<I>Stockholder Litigation.</I>&#160;&#160;The Company
    will give Parent the opportunity to participate in the defense
    or settlement of any stockholder litigation against the Company
    <FONT style="white-space: nowrap">and/or</FONT> its
    directors or executive officers relating to the Transactions,
    whether commenced prior to or after the execution and delivery
    of this Agreement. The Company agrees that it will not settle or
    offer to settle in exchange for the payment of funds any
    litigation commenced prior to or after the date of this
    Agreement against the Company or any of its directors or
    executive officers by any stockholder of the Company relating to
    this Agreement, the Merger or any other Transaction (unless such
    payment of funds will be made under the Company&#146;s
    applicable Insurance Policy), without the prior written consent
    of Parent (which consent will not be unreasonably withheld,
    conditioned or delayed).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    4.13&#160;<I>Notification of Certain
    Matters.</I>&#160;&#160;Each of the Company, on the one hand,
    and Parent and Merger Sub, on the other hand, will give prompt
    notice to each other of, and will use its reasonable best
    efforts to prevent or promptly remedy, (a)&#160;the occurrence
    or failure to occur or the impending or threatened occurrence or
    failure to occur, of any event which occurrence or failure to
    occur would be likely to cause any of its representations or
    warranties in this Agreement to be untrue or inaccurate in any
    material respect at any time from the date of this Agreement to
    the Effective Time and (b)&#160;any material failure on its part
    to comply with or satisfy any covenant, condition or agreement
    to be complied with or satisfied by it hereunder. The delivery
    of any notice pursuant to this <U>Section&#160;4.13</U> will not
    limit or otherwise affect the remedies available hereunder to
    the Party receiving such notice nor be deemed to have amended
    any of the disclosures set forth in the Disclosure Schedule, to
    have qualified the representations and warranties contained
    herein or to have cured any misrepresentation or breach of a
    representation or warranty that otherwise might have existed
    hereunder by reason of such material development.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    4.14&#160;<I>Voting Agreement.</I>&#160;&#160;The Company will
    take actions as may be necessary or appropriate to give effect
    to and implement the transfer restrictions and other provisions
    set forth in the Voting Agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    4.15&#160;<I>Release of Confidentiality and Standstill
    Obligations.</I>&#160;&#160;The Company shall not release nor
    permit the release of any Person from, or waive or permit the
    waiver of any provision of, and the Company shall use its
    reasonable efforts to enforce or cause to be enforced, any
    confidentiality, &#147;standstill&#148; or similar agreement to
    which the Company or any of its Subsidiaries is a party, unless
    the Company Board determines in good faith (after consultation
    with outside legal counsel) that the failure to take such action
    would be a breach of its fiduciary duties to the Company
    Stockholders under applicable Law; provided, however, that the
    Company shall give Parent at least two (2)&#160;Business Days
    prior notice of such upcoming release
    <FONT style="white-space: nowrap">and/or</FONT>
    waiver and specifying the reasons therefor in reasonable detail,
    including the identities of the parties to such confidentiality,
    &#147;standstill&#148; or similar agreements; provided further,
    however, that the Company shall not release or permit the
    release from, or waive or permit the waiver of, any provision of
    any standstill or similar agreement the effect of which would be
    to permit such Person to effect a transaction without the
    approval of the Company Board.
</DIV>

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<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <FONT style="font-family: 'Times New Roman', Times">ARTICLE&#160;V<BR>
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <FONT style="font-family: 'Times New Roman', Times; font-variant: SMALL-CAPS">Covenants
    and Agreements to be Performed Following the Closing
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    5.01&#160;<I>Indemnification</I>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;The indemnification provisions of the Constituent
    Documents of the Surviving Corporation as in effect at the
    Effective Time will not be amended, repealed or otherwise
    modified for a period of six (6)&#160;years from the Effective
    Time in any manner that would adversely affect the rights
    thereunder of individuals who immediately prior to the Effective
    Time were directors, officers or employees of the Company unless
    such modification shall be required by Law.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;Without limiting <U>Section&#160;5.01(a)</U>, following
    the Effective Time, Parent and the Surviving Corporation will
    indemnify and hold harmless the present and former directors,
    officers and employees of the Company and its Subsidiaries
    (each, an <I>&#147;Indemnified Party&#148;</I>) from and against
    any and all costs or expenses (including reasonable
    attorneys&#146; fees and costs of investigation), judgments,
    fines, losses, claims, damages or liabilities incurred in
    connection with any claim, action, suit, proceeding or
    investigation, whether civil, criminal, administrative or
    investigative, arising out of actions or omissions before, at or
    after the Effective Time (including as to, or arising out of or
    pertaining to, the Transactions), to the fullest extent
    permitted by applicable Law. At and as of the Effective Time,
    Parent shall cause the Constituent Documents of the Surviving
    Corporation to be amended as necessary to provide for the rights
    and protections contained in the indemnification and advancement
    of expense provisions set forth in the Constituent Documents of
    the Company in effect on the date hereof and with Parent&#146;s
    obligations under this <U>Section&#160;5.01.</U> Parent shall
    cause the Surviving Corporation to advance expenses in
    connection with any of the foregoing as incurred by directors
    and officers to the fullest extent permitted under applicable
    Laws; provided that any Person to whom expenses are advanced
    shall have provided an undertaking to repay such advances if it
    is finally determined that it is not entitled to indemnification
    by a court of competent jurisdiction.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (c)&#160;Effective as of the Effective Time, Parent will cause
    to be purchased a directors&#146; and officers&#146; liability
    &#147;tail&#148; insurance policy that serves to reimburse the
    present and former officers and directors (determined as of the
    Effective Time) of the Company and its Subsidiaries (as opposed
    to reimbursing the Company or such Subsidiaries) with respect to
    claims against such directors and officers arising from facts or
    events occurring before, at or after the Effective Time
    (including as to, or arising out of or pertaining to, the
    Transactions), which insurance will contain substantially
    equivalent scope and amount of coverage as provided in the
    directors&#146; and officers&#146; liability insurance currently
    provided as of the date of this Agreement by the Company and its
    Subsidiaries; provided, however, that Parent will not be
    obligated to pay a premium for such insurance policy in excess
    of two hundred percent (200%) of the aggregate premium paid by
    the Company for its directors&#146; and officers&#146; insurance
    coverage in effect for the year that includes the date of this
    Agreement, which aggregate premium is set forth on
    <U>Section&#160;5.01(c)</U> of the Disclosure Schedule. If the
    aggregate premium necessary to purchase such insurance coverage
    exceeds two hundred percent (200%) of the aggregate premium set
    forth on <U>Section&#160;5.01(c)</U> of the Disclosure Schedule,
    Parent will use its reasonable best efforts to obtain the most
    advantageous &#147;tail&#148; policy of directors&#146; and
    officers&#146; liability insurance and fiduciary liability
    insurance reasonably obtainable for an aggregate premium not
    exceeding two hundred percent (200%) of the aggregate premium
    set forth on <U>Section&#160;5.01(c)</U> of the Disclosure
    Schedule, provided that Indemnified Parties may be required to
    make application and provide customary representations and
    warranties to the insurance carrier for the purpose of obtaining
    such insurance.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (d)&#160;Any Indemnified Party wishing to claim indemnification
    under <U>Section&#160;5.01(b)</U>, upon learning of any claim,
    action, suit, proceeding or investigation described above, will
    promptly notify Parent; provided, however, that failure to so
    notify Parent will not affect the obligations of Parent under
    <U>Section&#160;5.01(b)</U> unless and to the extent that Parent
    is actually and materially prejudiced thereby.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (e)&#160;If Parent or any of its successors or assigns
    (1)&#160;consolidates with or merges into any other entity and
    is not the continuing or surviving entity of such consolidation
    or merger or (2)&#160;transfers all or substantially all of its
    assets to any other entity, then and in each such case, Parent
    will use its reasonable best efforts to cause proper provision
    to be made so that the successors and assigns of Parent will
    expressly assume the obligations set forth in this
    <U>Section&#160;5.01.</U>
</DIV>

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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (f)&#160;The provisions of this <U>Section&#160;5.01</U> will
    survive the Effective Time and are intended to be for the
    benefit of, and will be enforceable by, each Indemnified Party
    and his or her heirs and legal representatives.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (g)&#160;Parent shall pay all reasonable expenses, including
    reasonable attorneys&#146; fees and costs of investigation, that
    may be incurred by any Indemnified Party in enforcing
    Parent&#146;s obligations set forth in this
    <U>Section&#160;5.01.</U>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    5.02&#160;<I>Employee Matters</I>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;From the Effective Time until the date that is twelve
    (12)&#160;months following the Effective Time, Parent shall
    provide, or cause to be provided, the employees and former
    employees of the Company and its Subsidiaries as of the
    Effective Time (the <I>&#147;Covered Employees&#148;</I>) with
    employee benefits and compensation plans (including with respect
    to salary and bonus, but not equity awards), programs and
    arrangements no less favorable, in the aggregate, than those
    provided by the Company or its Subsidiaries, as the case may be,
    to the Covered Employees immediately prior to the Effective Time.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;From and after the Effective Time, Parent shall:
    (1)&#160;provide, or cause to be provided, all Covered Employees
    with service credit for purposes of eligibility to participate,
    vesting and benefit accruals (other than benefit accruals under
    a defined benefit plan) under any employee benefit or
    compensation plan, program or arrangement adopted, maintained or
    contributed to by Parent or any of its Subsidiaries in which
    Covered Employees are eligible to participate, for all periods
    of employment with the Company or any of its Subsidiaries (or
    their predecessor entities) prior to the Effective Time to the
    extent credited by the Company for purposes of a comparable plan
    (provided that there will be no duplication of benefits); and
    (2)&#160;with respect to any self-insured welfare benefit plans
    of Parent or any of its Subsidiaries, cause, and with respect to
    all other welfare benefit plans, use reasonable best efforts to
    cause, any pre-existing conditions limitations, eligibility
    waiting periods or required physical examinations to be waived
    with respect to the Covered Employees and their eligible
    dependents to the extent waived under the corresponding plan
    (for a comparable level of coverage) in which the applicable
    Covered Employee participated immediately prior to the Effective
    Time. If the Company&#146;s or any of its Subsidiaries&#146;
    medical, vision
    <FONT style="white-space: nowrap">and/or</FONT>
    dental benefit plans for Covered Employees are terminated prior
    to the end of a plan year, Covered Employees and their
    dependents who are then participating in a deductible-based
    medical, vision
    <FONT style="white-space: nowrap">and/or</FONT>
    dental benefit plan sponsored by the Company or any of its
    Subsidiaries will be given credit for deductibles, co-payments
    and eligible
    <FONT style="white-space: nowrap">out-of-pocket</FONT>
    expenses incurred toward deductibles, co-payments and
    <FONT style="white-space: nowrap">out-of-pocket</FONT>
    maximums during the portion of the plan year preceding the
    termination date (or transfer date) in a comparable
    deductible-based medical, vision
    <FONT style="white-space: nowrap">and/or</FONT>
    dental benefit plan of Parent or any of its Subsidiaries for the
    corresponding Parent benefit plan year.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (c)&#160;Parent and the Surviving Corporation shall honor, or
    cause to be honored, in accordance with their respective terms,
    all vested or accrued benefit obligations to, and contractual
    rights of, Covered Employees, including any benefits or rights
    arising as a result of the Transactions (either alone or in
    combination with any other event), in each case, as set forth on
    <U>Section&#160;5.02(c)</U> of the Disclosure Schedule.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (d)&#160;No provision in this <U>Section&#160;5.02</U> will
    (1)&#160;create or be deemed to create any third-party
    beneficiary or other rights in any employee or former employee
    (including any beneficiary or dependent thereof) of the Company,
    its Subsidiaries or any other Person other than the Parties and
    their respective successors and permitted assigns,
    (2)&#160;constitute or create or be deemed to constitute or
    create an employment agreement, (3)&#160;constitute or be deemed
    to constitute an amendment to any employee benefit plan
    sponsored or maintained by Guarantor, Parent, the Company or any
    of their respective Subsidiaries, or (4)&#160;limit the
    Surviving Corporation&#146;s discretion and authority to
    interpret the respective employee benefit and compensation
    plans, agreements, arrangements, and programs, in accordance
    with their terms and applicable Law.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (e)&#160;Provided that Parent complies with its obligations
    pursuant to <U>Sections&#160;5.02(a)</U> and <U>5.02(b)</U>, no
    provision in this <U>Section&#160;5.02</U> will
    (1)&#160;prohibit Parent from adding, deleting or changing
    providers of benefits, changing, increasing or decreasing
    co-payments, deductibles or other requirements for coverage or
    benefits (e.g., utilization review or pre-certification
    requirements),
    <FONT style="white-space: nowrap">and/or</FONT>
    making other changes in the administration or in the design,
    coverage and benefits provided to such Covered Employees, or
    (2)&#160;limit the right of the Surviving Corporation to amend
    or terminate any plan.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    A-37
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <FONT style="font-family: 'Times New Roman', Times">ARTICLE&#160;VI<BR>
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <FONT style="font-family: 'Times New Roman', Times; font-variant: SMALL-CAPS">Conditions
    to the Merger
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    6.01&#160;<I>Conditions to Each Party&#146;s Obligation to
    Effect the Merger.</I>&#160;&#160;The respective obligation of
    each Party to consummate the Merger and the other Transactions
    is subject to the fulfillment or written waiver by the Parties
    (to the extent permitted by applicable Law) before the Effective
    Time of each of the following conditions:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;<I>Stockholder Approval.</I>&#160;&#160;The Company
    will have obtained the Company Stockholder Approval;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;<I>No Order.</I>&#160;&#160;No Governmental Authority
    of competent jurisdiction shall have enacted, issued,
    promulgated, enforced or entered any Order (whether temporary,
    preliminary or permanent) that is then in effect and has the
    effect of making consummation of the Merger illegal or otherwise
    preventing or prohibiting consummation of the Merger and no Law
    shall have been adopted that makes consummation of the Merger
    illegal or otherwise prevented or prohibited;&#160;and
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (c)&#160;<I>HSR Act.</I>&#160;&#160;Any applicable waiting
    period under the HSR Act shall have expired or been terminated.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    6.02&#160;<I>Conditions to the Obligation of the
    Company.</I>&#160;&#160;The obligation of the Company to
    consummate the Merger and the other Transactions is subject to
    the fulfillment or written waiver by the Company (to the extent
    permitted by applicable Law) before the Effective Time of each
    of the following conditions:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;<I>Representations and Warranties.</I>&#160;&#160;Each
    of the representations and warranties of Parent and Merger Sub
    set forth in this Agreement (which for purposes of this
    subsection will be read as though none of them contained any
    Material Adverse Effect or materiality qualification) will be
    true and correct in all respects at and as of the Closing Date
    as though made at and as of the Closing Date (except to the
    extent expressly made as of an earlier date, in which case
    solely as of such date), in each instance, except as has not
    had, and would not reasonably be expected to have, a Material
    Adverse Effect with respect to Parent and Merger Sub;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;<I>Performance of Obligations.</I>&#160;&#160;Each of
    Parent and Merger Sub will have performed or complied in all
    material respects with all of its agreements, obligations and
    covenants under this Agreement;&#160;and
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (c)&#160;<I>Closing Certificate.</I>&#160;&#160;Parent will have
    delivered to the Company a certificate, dated as of the Closing
    Date and signed by an executive officer of Parent, certifying in
    his or her capacity as an executive officer of Parent and not in
    his or her capacity as an individual the satisfaction of the
    conditions set forth in <U>Sections&#160;6.02(a)</U> and
    <U>6.02(b).</U>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    6.03&#160;<I>Conditions to the Obligation of Parent and Merger
    Sub.</I>&#160;&#160;The obligation of Parent and Merger Sub to
    consummate the Merger and the other Transactions is subject to
    the fulfillment or written waiver by Parent or Merger Sub (to
    the extent permitted by applicable Law) before the Effective
    Time of each of the following conditions:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;<I>Representations and
    Warranties.</I>&#160;&#160;(1)&#160;Each of the representations
    and warranties of the Company contained in
    <U>Section&#160;3.01(e)(1)</U> through <U>(3)</U> and <U>(5)</U>
    shall be true and correct other than in de minimis respects as
    of the date of this Agreement and as of the Closing Date, as if
    made as of such date (except to the extent expressly made as of
    an earlier date, in which case solely as of such date),
    (2)&#160;each of the representations and warranties of the
    Company contained in <U>Sections&#160;3.01(a)</U>,
    <U>3.01(b)</U>, <U>3.01(c)</U>, <U>3.01(e)(4)</U>,
    <U>3.01(f)</U>, <U>3.01(g)(1)</U>, <U>3.01(g)(2)</U> and
    <U>3.01(s)</U> that is qualified as to materiality or Material
    Adverse Effect shall be true and correct in all respects, or any
    such representation or warranty that is not so qualified shall
    be true and correct in all material respects, in each case as of
    the date of this Agreement and as of the Closing Date, as if
    made as of such date (except to the extent expressly made as of
    an earlier date, in which case solely as of such date) and
    (3)&#160;each of the other representations and warranties of the
    Company set forth in this Agreement (without regard to
    materiality or Material Adverse Effect) shall be true and
    correct in all respects, in each case, at and as of the date of
    this Agreement and as of the Closing Date, as if made as of such
    date (except to the extent expressly made as of an earlier date,
    in which case solely as of such date), except where the failure
    to be so true and correct has not had, and would not reasonably
    be expected to have, a Material Adverse Effect with respect to
    the Company;
</DIV>

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    <BR>
    A-38
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;<I>Performance of Obligations.</I>&#160;&#160;The
    Company will have performed or complied with in all material
    respects all of its agreements, obligations and covenants under
    this Agreement;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (c)&#160;<I>No Material Adverse Effect.</I>&#160;&#160;Since the
    date of this Agreement, there will not have been any event,
    change, circumstance, condition, development or effect that has
    had, or would reasonably be expected to have, a Material Adverse
    Effect with respect to the Company;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (d)&#160;<I>Dissenting Shares.</I>&#160;&#160;Dissenting Shares
    will constitute no more than twelve percent (12%) of the
    outstanding Shares;&#160;and
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (e)&#160;<I>Closing Certificate.</I>&#160;&#160;The Company will
    have delivered to Parent a certificate, dated as of the Closing
    Date and signed by an executive officer of the Company,
    certifying in his or her capacity as an executive officer and
    not in his or her individual capacity the satisfaction of the
    conditions set forth in <U>Sections&#160;6.03(a)</U> and
    <U>6.03(b).</U>
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <FONT style="font-family: 'Times New Roman', Times">ARTICLE&#160;VII<BR>
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <FONT style="font-family: 'Times New Roman', Times; font-variant: SMALL-CAPS">Termination
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    7.01&#160;<I>Termination.</I>&#160;&#160;This Agreement may be
    terminated at any time prior to the Effective Time and the
    Transactions may be abandoned (whether before or, subject to the
    terms hereof, after the Company Stockholder Approval has been
    obtained) for any reason provided in paragraphs (a)&#160;through
    (j)&#160;below.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;By mutual written consent of each of Parent and the
    Company.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;By either Parent or the Company if any Governmental
    Authority of competent jurisdiction shall have enacted, issued,
    promulgated, enforced or entered any Order (whether temporary,
    preliminary or permanent) that has become final and
    nonappealable and has the effect of making consummation of the
    Merger illegal or otherwise preventing or prohibiting
    consummation of the Merger; provided, however, that the
    provisions of this <U>Section&#160;7.01(b)</U> shall not be
    available to any Party if such Party&#146;s material breach of
    this Agreement has been a principal cause of such Order.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (c)&#160;By either Parent or the Company if any Law shall have
    been adopted, enacted or promulgated that makes consummation of
    the Merger illegal or otherwise prohibited.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (d)&#160;By Parent if there shall have been a breach of any of
    the covenants or agreements set forth in this Agreement on the
    part of the Company (other than <U>Section&#160;4.09</U>), or
    any representation or warranty of the Company set forth in this
    Agreement shall have become untrue or inaccurate, in each case,
    such that (1)&#160;the conditions set forth in
    <U>Section&#160;6.03(a)</U> or <U>6.03(b)</U> would not be
    satisfied and (2)&#160;such breach, untruth or inaccuracy shall
    not have been cured or is incapable of being cured within
    fifteen (15)&#160;days after Parent shall have given the Company
    notice thereof.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (e)&#160;By either Parent or the Company if the adoption of this
    Agreement by the Company Stockholders shall not have been
    obtained at the Stockholders&#146; Meeting or at any adjournment
    or postponement of the Stockholders&#146; Meeting.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (f)&#160;By Parent or the Company if the Merger shall not have
    been consummated on or before November&#160;30, 2009 (the
    <I>&#147;Termination Date&#148;</I>); provided, however, that
    the right to terminate this Agreement under this
    <U>Section&#160;7.01(f)</U> shall not be available to any Party
    to the extent that such Party&#146;s failure to comply in all
    respects with any provision of this Agreement has resulted in
    the failure of a condition to the consummation of the Merger
    prior to the Termination Date.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (g)&#160;By the Company, at any time prior to obtaining the
    Company Stockholder Approval, to enter into a definitive
    agreement with respect to a Superior Proposal in accordance with
    <U>Section&#160;4.09</U>; provided that prior thereto and as a
    condition precedent thereof, the Company pays the Termination
    Fee and Expense Reimbursement in accordance with
    <U>Section&#160;7.03.</U>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (h)&#160;By Parent if: (1)&#160;a Company Board Change of
    Recommendation shall have occurred or the Company shall have
    failed to include the Company Board Recommendation in the Proxy
    Statement disseminated to the Company
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    A-39
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Stockholders; (2)&#160;the Company Board fails to reconfirm the
    Company Board Recommendation within five (5)&#160;Business Days
    after receipt of a request by Parent, provided that any such
    request may be made only after notice of any of the following
    events (as any of the following events may occur from time to
    time): (A)&#160;receipt by the Company of an Acquisition
    Proposal, (B)&#160;any material change to an Acquisition
    Proposal and (C)&#160;a public announcement of any transaction
    to acquire a material portion of the Company Common Stock by a
    Person other than Merger Sub, Parent or any of their affiliates;
    (3)&#160;the Company Board shall have resolved to do either of
    the foregoing; or (4)&#160;the Company violates or breaches in
    any material respect any of its obligations under
    <U>Section&#160;4.09.</U>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (i)&#160;By the Company if there shall have been a breach of any
    of the covenants or agreements set forth in this Agreement on
    the part of Merger Sub or Parent, or any representation or
    warranty of Parent or Merger Sub set forth in this Agreement
    shall have become untrue or inaccurate, in each case, such that
    (1)&#160;the conditions set forth in <U>Section&#160;6.02(a)</U>
    or <U>Section&#160;6.02(b)</U> would not be satisfied and
    (2)&#160;such breach, untruth or inaccuracy shall not have been
    cured or is incapable of being cured within fifteen
    (15)&#160;days after the Company shall have given Parent notice
    thereof.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (j)&#160;By Parent, if for five (5)&#160;or more days, the
    Dissenting Shares constitute more than twelve percent (12%) of
    the outstanding Shares.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    7.02&#160;<I>Effect of Termination.</I>&#160;&#160;In the event
    of the termination of this Agreement pursuant to
    <U>Section&#160;7.01</U>, this Agreement will forthwith become
    void and there will be no liability on the part of any Party or
    any of its affiliates, directors, officers or stockholders
    except that (a)&#160;the Company may have liability or
    obligations as set forth in <U>Section&#160;7.03</U>,
    (b)&#160;nothing herein relieves the Company, on the one hand,
    or Parent and Merger Sub, on the other hand, from liability for
    fraud or any willful or intentional breach hereof or willful or
    intentional misrepresentation herein, and (c)&#160;the
    provisions contained in <U>Article&#160;I</U> (Definitions;
    Interpretation), <U>Section&#160;4.07</U> (Press Releases), this
    <U>Section&#160;7.02</U> (Effect of Termination),
    <U>Section&#160;7.03</U> (Termination Fee),
    <U>Article&#160;VIII</U> (Miscellaneous) (as applicable) and the
    provisions of the Confidentiality Agreement will each survive
    any such termination. For purposes of this Agreement,
    &#147;willful or intentional breach&#148; will include a breach
    that is a consequence of an act undertaken by a breaching party
    with the knowledge that the taking of such act would, or would
    reasonably be expected to, cause a breach of this Agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    7.03&#160;<I>Termination Fee</I>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;If (1)&#160;the Company terminates this Agreement
    pursuant to <U>Section&#160;7.01(g)</U> or (2)&#160;Parent
    terminates this Agreement pursuant to
    <U>Section&#160;7.01(h)</U>, then the Company shall (A)&#160;pay
    to Parent $23,600,000 in cash (the <I>&#147;Termination
    Fee&#148;</I>) and (B)&#160;reimburse up to an aggregate of
    $2,000,000 for Parent&#146;s and Guarantor&#146;s documented
    <FONT style="white-space: nowrap">out-of-pocket</FONT>
    expenses in connection with the Transactions (the
    <I>&#147;Expense Reimbursement&#148;</I>).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;If Parent terminates this Agreement pursuant to
    <U>Section&#160;7.01(d)</U>, then (1)&#160;the Company will pay
    to Parent the Expense Reimbursement and (2)&#160;if
    (A)&#160;prior to such termination there exists an Acquisition
    Proposal (whether or not such offer or proposal has been
    rejected or has been withdrawn prior to the time of such
    termination) and (B)&#160;within twelve (12)&#160;months after
    such termination, the Company or any of its Subsidiaries accepts
    a written offer for, or otherwise enters into an agreement to
    consummate or consummates, an Acquisition Proposal, then upon
    the signing of a definitive agreement relating to such
    Acquisition Proposal, or, if no such agreement is signed, then
    upon consummation of any such Acquisition Proposal, the Company
    will pay to Parent the Termination Fee.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (c)&#160;If this Agreement is terminated pursuant to
    <U>Section&#160;7.01(f)</U> or <U>Section&#160;7.01(j)</U>, then
    if (1)&#160;prior to such termination there exists an
    Acquisition Proposal (whether or not such offer or proposal has
    been rejected or has been withdrawn prior to the time of such
    termination) and (2)&#160;within twelve (12)&#160;months after
    such termination, the Company or any of its Subsidiaries accepts
    a written offer for, or otherwise enters into an agreement to
    consummate or consummates, an Acquisition Proposal, then upon
    the signing of a definitive agreement relating to such
    Acquisition Proposal, or, if no such agreement is signed, then
    upon consummation of any such Acquisition Proposal, the Company
    will pay to Parent the Expense Reimbursement and the Termination
    Fee.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (d)&#160;In the event that Parent terminates this Agreement
    pursuant to <U>Section&#160;7.01(e)</U>, then the Company will
    pay to Parent the Expense Reimbursement.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    A-40
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (e)&#160;The Company will make any payments required by this
    <U>Section&#160;7.03</U> by wire transfer of immediately
    available funds to an account designated by Parent. Assuming
    reasonable documentation has been provided therefor, all Expense
    Reimbursements payable pursuant to <U>Sections&#160;7.03(a)</U>,
    <U>(b)</U> or <U>(d)</U> will be paid concurrently with the
    termination of this Agreement, and any Expense Reimbursement
    payable pursuant to <U>Section&#160;7.03(c)</U> will be payable
    concurrently with the payment of any Termination Fee payable
    pursuant to such <U>Section&#160;7.03(c)</U>, as set forth in
    the next sentence. All Termination Fees will be paid (1)&#160;no
    later than two (2)&#160;Business Days after the date of such
    termination if terminated by Parent pursuant to
    <U>Section&#160;7.01(h)</U>, (2)&#160;prior to or concurrently
    with such termination if terminated by the Company pursuant to
    <U>Section&#160;7.01(g)</U>, and (3)&#160;the earlier of the
    date of the Company&#146;s entry into an agreement providing
    for, or consummating, an Acquisition Proposal if terminated
    pursuant to <U>Section&#160;7.01(d)</U>,
    <U>Section&#160;7.01(f)</U> or <U>Section&#160;7.01(j).</U>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (f)&#160;The Parties acknowledge that (1)&#160;the provisions of
    this <U>Section&#160;7.03</U> are an integral part of the
    Transactions, (2)&#160;the amount of, and basis for payment of,
    the Termination Fee and Expense Reimbursement are reasonable and
    appropriate in all respects, and (3)&#160;without those
    provisions, the Parties would not enter into this Agreement.
    Accordingly, if the Company fails to pay in a timely manner the
    Termination Fee
    <FONT style="white-space: nowrap">and/or</FONT> the
    Expense Reimbursement, and in order to obtain such payment,
    Parent or Merger Sub makes a claim that results in a judgment
    for the amounts set forth in this <U>Section&#160;7.03</U>, the
    Company will pay to Parent and the Merger Sub their reasonable
    costs and expenses (including reasonable attorneys&#146; fees
    and expenses) in connection with such suit, together with
    interest on the amount set forth in this
    <U>Section&#160;7.03</U> at the rate announced by Bank of
    America, N.A. as its prime rate in effect on the date such
    payment was required to be made hereunder. Payment of the
    amounts described in this <U>Section&#160;7.03</U> will not be
    in lieu of damages incurred in the event of breach of this
    Agreement.
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <FONT style="font-family: 'Times New Roman', Times">ARTICLE&#160;VIII<BR>
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <FONT style="font-family: 'Times New Roman', Times; font-variant: SMALL-CAPS">Miscellaneous
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    8.01&#160;<I>Survival.</I>&#160;&#160;None of the
    representations or warranties contained in this Agreement will
    survive the Effective Time. This <U>Section&#160;8.01</U> will
    not limit any covenant or agreement of the Parties which by its
    terms contemplates performance after the Effective Time and this
    <U>Article&#160;VIII</U> will survive the Effective Time.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    8.02&#160;<I>Waiver; Amendment; Extension of
    Time.</I>&#160;&#160;At any time prior to the Effective Time,
    whether before or after obtaining the Company Stockholder
    Approval, any provision of this Agreement may be (a)&#160;waived
    by the Party benefited by the provision, but only in writing
    (provided that no such waiver will be applicable except in the
    specific instance for which it is given), or (b)&#160;amended or
    modified at any time, but only by a written agreement executed
    in the same manner as this Agreement, except to the extent that
    any such amendment would violate applicable Law; provided that
    after receipt of the Company Stockholder Approval, no amendment
    shall be made or given that requires further approval of the
    Company Stockholders under the DGCL unless the required approval
    is obtained. Except as set forth elsewhere in this Agreement, at
    any time prior to the Effective Time, the Parties may extend the
    time for performance of any of the covenants, agreements or
    conditions of the other Parties to this Agreement, but only in a
    written agreement executed and delivered by or on behalf of the
    Party against which it is sought to be enforced. Neither the
    failure nor any delay by any Party in exercising any right,
    power or privilege under this Agreement will operate as a waiver
    of such right, power or privilege, and no single or partial
    exercise of any such right, power or privilege will preclude any
    other or further exercise of such right, power or privilege or
    the exercise of any other right, power or privilege.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    8.03&#160;<I>Counterparts; Electronic
    Transmission.</I>&#160;&#160;This Agreement may be executed in
    one or more counterparts (whether by facsimile, electronic
    transmission or otherwise), each of which will be deemed to
    constitute an original, and transmission of a duly executed
    counterpart hereof by electronic means will be deemed to
    constitute delivery of an executed original manual counterpart
    hereof.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    8.04&#160;<I>Governing Law; Jurisdiction; Venue; Service of
    Process; Waiver of Jury Trial.</I>&#160;&#160;This Agreement and
    the agreements, instruments and documents contemplated hereby
    and all disputes between the Parties under or relating to this
    Agreement or the facts and circumstances leading to its
    execution and delivery, whether in contract, tort or otherwise,
    will be governed by and construed in accordance with the Laws of
    the State of Delaware, without giving effect to conflicts of
    laws principles that would result in the application of the Law
    of any other State. The Delaware
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    A-41
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Court of Chancery sitting in Wilmington, Delaware (and if the
    Delaware Court of Chancery shall be unavailable, any Delaware
    state court and the Federal court of the United States of
    America sitting in the State of Delaware) will have exclusive
    jurisdiction over any and all disputes among the Parties,
    whether at law or in equity, based upon, arising out of or
    relating to this Agreement and the agreements, instruments and
    documents contemplated hereby or the facts and circumstances
    leading to its execution and delivery, whether in contract, tort
    or otherwise. Each of the Parties irrevocably consents to and
    agrees to submit to the exclusive jurisdiction of such courts,
    agrees that process may be served upon them in any manner
    authorized by the Laws of the State of Delaware, and hereby
    waives, and agrees not to assert in any such dispute, to the
    fullest extent permitted by applicable Law, any claim that
    (a)&#160;such Party is not personally subject to the
    jurisdiction of such courts, (b)&#160;such Party and such
    Party&#146;s property is immune from any legal process issued by
    such courts or (c)&#160;any litigation commenced in such courts
    is brought in an inconvenient forum. EACH OF THE PARTIES HERETO
    IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUTSIDE THE
    TERRITORIAL JURISDICTION OF THE COURTS REFERRED TO IN THIS
    <U>SECTION&#160;8.04</U> IN ANY ACTION OR PROCEEDING UNDER OR
    RELATING TO THIS AGREEMENT OR THE FACTS AND CIRCUMSTANCES
    LEADING TO ITS EXECUTION AND DELIVERY BY MAILING COPIES THEREOF
    BY REGISTERED UNITED STATES MAIL, POSTAGE PREPAID, RETURN
    RECEIPT REQUESTED, TO ITS ADDRESS AS SPECIFIED IN OR PURSUANT TO
    <U>SECTION&#160;8.07.</U> HOWEVER, THE FOREGOING SHALL NOT LIMIT
    THE RIGHT OF A PARTY TO EFFECT SERVICE OF PROCESS ON ANY OTHER
    PARTY BY ANY OTHER LEGALLY AVAILABLE METHOD. EACH OF THE PARTIES
    HERETO IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN
    ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS
    AGREEMENT OR THE TRANSACTIONS (AS DEFINED HEREIN). For purposes
    of this <U>Section&#160;8.04</U> only, the term
    &#147;Party&#148; shall include Guarantor.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    8.05&#160;<I>Specific Performance.</I>&#160;&#160;The Parties
    agree that irreparable damage would occur in the event that any
    of the provisions of this Agreement were not performed in
    accordance with its specific terms or were otherwise breached.
    Each Party agrees that, in the event of any breach or threatened
    breach by any other Party of any covenant or obligation
    contained in this Agreement, the non-breaching Party shall be
    entitled (in addition to any other remedy that may be available
    to it whether in law or equity, including monetary damages) to
    seek and obtain (a)&#160;a decree or order of specific
    performance to enforce the observance and performance of such
    covenant or obligation and (b)&#160;an injunction restraining
    such breach or threatened breach. Each Party further agrees that
    no other Party or any other Person shall be required to obtain,
    furnish or post any bond or similar instrument in connection
    with or as a condition to obtaining any remedy referred to in
    this <U>Section&#160;8.05</U>, and each Party irrevocably waives
    any right it may have to require the obtaining, furnishing or
    posting of any such bond or similar instrument.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    8.06&#160;<I>Disclosure Schedule.</I>&#160;&#160;Before entry
    into this Agreement, the Company delivered to Parent and Merger
    Sub a schedule (the <I>&#147;Disclosure Schedule&#148;</I>)
    setting forth, among other things, items the disclosure of which
    is necessary or appropriate either (a)&#160;in response to an
    express disclosure requirement contained in a provision hereof
    or (b)&#160;as an exception to one or more representations or
    warranties contained in <U>Section&#160;3.01</U> or to one or
    more of the Company&#146;s covenants contained in
    <U>Article&#160;IV.</U> The Disclosure Schedule constitutes an
    integral part of this Agreement and is attached hereto as
    <U>Schedule&#160;A</U> and is hereby incorporated herein. There
    may be included in the Disclosure Schedule and elsewhere in this
    Agreement items and information that are not
    &#147;material,&#148; and such inclusion will not be deemed to
    be an acknowledgment or agreement that any such item or
    information (or any non-disclosed item or information of
    comparable or greater significance) is &#147;material&#148; and
    will not be used as a basis for interpreting the terms
    &#147;material,&#148; &#147;materially,&#148;
    &#147;materiality&#148; or any word or phrase of similar import
    used herein. Matters reflected in the Disclosure Schedule are
    not necessarily limited to matters required by this Agreement to
    be disclosed in the Disclosure Schedule. No disclosure in the
    Disclosure Schedule relating to a possible breach or violation
    of any contract or Law will be construed as an admission or
    indication that such breach or violation exists or has occurred.
    Any disclosures in the Disclosure Schedule that refer to a
    document are qualified in their entirety by reference to the
    text of such document, including all amendments, exhibits,
    schedules and other attachments thereto. Any capitalized term
    used in the Disclosure Schedule and not otherwise defined
    therein has the meaning given to such term in this Agreement.
    Any headings set forth in the Disclosure Schedule are for
    convenience of reference only and do not affect the meaning or
    interpretation of any of the disclosures set forth in the
    Disclosure Schedule.
</DIV>

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    <BR>
    A-42
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    8.07&#160;<I>Notices.</I>&#160;&#160;All notices, requests and
    other communications given or made under this Agreement must be
    in writing and will be deemed given when personally delivered,
    transmitted by facsimile (with confirmation of successful
    transmission) or mailed by registered or certified mail (return
    receipt requested) to the persons, addresses
    <FONT style="white-space: nowrap">and/or</FONT>
    facsimile numbers set forth below or such other place as such
    Party may specify by notice given in accordance with this
    <U>Section&#160;8.07.</U>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If to the Company, to:
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Axsys Technologies, Inc.
</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    175 Capital Boulevard, Suite&#160;103
</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Rocky Hill, CT 06067
</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Attention: Scott Conner
</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Facsimile:
    <FONT style="white-space: nowrap">(860)&#160;257-0200</FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    with a copy to:
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Jones Day
</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    901 Lakeside Avenue
</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Cleveland, Ohio 44114
</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Attention: Christopher J. Hewitt
</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Facsimile:
    <FONT style="white-space: nowrap">(216)&#160;579-0212</FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If to Parent or Merger Sub, to:
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    General Dynamics Advanced Information Systems, Inc.
</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    2941 Fairview Park Drive
</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Suite&#160;100
</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Falls Church, VA
    <FONT style="white-space: nowrap">22042-4513</FONT>
</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Attention: David A. Savner
</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Facsimile:
    <FONT style="white-space: nowrap">(703)&#160;876-3554</FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    with a copy to:
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Jenner&#160;&#038; Block LLP
</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    330 North Wabash Avenue
</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Chicago, IL
    <FONT style="white-space: nowrap">60611-7603</FONT>
</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Attention: Thaddeus J. Malik
</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Facsimile:
    <FONT style="white-space: nowrap">(312)&#160;840-7313</FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    8.08&#160;<I>Entire Understanding; No Third Party
    Beneficiaries.</I>&#160;&#160;This Agreement represents the
    entire understanding of the Parties regarding the Transactions
    and supersedes any and all other oral or written agreements and
    understandings previously made or purported to be made with
    respect thereto, other than the Confidentiality Agreement and
    the Voting Agreement. Other than those set forth in the Voting
    Agreement, no representation, warranty, inducement, promise,
    understanding or condition not set forth in this Agreement has
    been made or relied on by any Party in entering into this
    Agreement. Except for (i)&#160;the enforcement by the
    Indemnified Parties after the Effective Time of
    <U>Section&#160;5.01</U>, and (ii)&#160;Guarantor to the extent
    it is required to perform its obligations as set forth in
    <U>Section&#160;8.13</U>, nothing expressed or implied in this
    Agreement is intended to confer any rights, remedies,
    obligations or liabilities upon any Person other than the
    Parties.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    8.09&#160;<I>Severability.</I>&#160;&#160;The provisions of this
    Agreement shall be deemed severable and the invalidity or
    unenforceability of any provision shall not affect the validity
    or enforceability of the other provisions hereof. If any
    provision of this Agreement or the application thereof to any
    Person or circumstance is determined by a court of competent
    jurisdiction to be invalid, void or unenforceable, the remaining
    provisions, or the application of such provision to Persons or
    circumstances other than those as to which it has been held
    invalid or unenforceable, will remain in full force and effect
    and will in no way be affected, impaired or invalidated thereby,
    so long as the economic or legal substance of the Transactions
    is not affected in any manner materially adverse to any Party.
    Upon any such determination, the Parties will negotiate in good
    faith in an effort to agree upon a suitable and equitable
    substitute provision to effect the original intent of the
    Parties.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    A-43
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    8.10&#160;<I>Assignment; Successors.</I>&#160;&#160;No Party nor
    Guarantor may assign either this Agreement or any of its rights
    or interests, or delegate any of its duties, hereunder, in whole
    or in part, without the prior written consent of the other
    Parties; provided that Merger Sub may assign any of its rights,
    interests and obligations hereunder, in whole or from time to
    time in part, to any direct or indirect Subsidiary of Guarantor
    without the consent of any other party, but no such assignment
    shall relieve Parent of its obligations hereunder. Any attempt
    to make any assignment in violation of this
    <U>Section&#160;8.10</U> will be null and void. Subject to the
    preceding sentences of this <U>Section&#160;8.10</U>, this
    Agreement will be binding upon, inure to the benefit of and be
    enforceable by, the Parties and Guarantor and their respective
    successors and permitted assigns.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    8.11&#160;<I>Expenses.</I>&#160;&#160;Except as otherwise
    specifically provided herein, all costs and expenses incurred in
    connection with this Agreement and the Transactions will be paid
    by the Party incurring such expenses, whether or not the Merger
    is consummated.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    8.12&#160;<I>Disclaimer.</I>&#160;&#160;The representations and
    warranties in this Agreement are the product of negotiations
    among the Parties and are for the sole benefit of the Parties.
    Any inaccuracies in such representations and warranties are
    subject to waiver by the Parties in accordance with
    <U>Section&#160;8.02</U> without notice or liability to any
    other Person. In some instances, the representations and
    warranties in this Agreement may represent an allocation among
    the Parties of risks associated with particular matters
    regardless of the knowledge of any of the Parties. Consequently,
    Persons other than the Parties may not rely upon the
    representations and warranties in this Agreement as
    characterizations of actual facts or circumstances as of the
    date of this Agreement or as of any other date.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    8.13&#160;<I>Guaranty.</I>&#160;&#160;Guarantor hereby
    irrevocably guarantees each and every obligation of Parent and
    Merger Sub under this Agreement. This is a guarantee of payment
    and performance, and not of collection, and Guarantor
    acknowledges and agrees that this guarantee is full and
    unconditional, and no release or extinguishment of Parent&#146;s
    or Merger Sub&#146;s obligations (other than in accordance with
    the terms hereof), whether by decree in any bankruptcy
    proceeding or otherwise, shall affect the continuing validity or
    enforceability of this guarantee or any provision requiring or
    contemplating performance by Guarantor. Guarantor hereby waives,
    for the benefit of the Company, (i)&#160;any right to require
    the Company to, as a condition of payment or performance by
    Guarantor, proceed against Parent or Merger Sub or pursue any
    other remedy whatsoever and (ii)&#160;to the fullest extent
    permitted by Law, any defense or benefits that may be derived
    from or afforded by applicable Law that limit the liability of
    or exonerate guarantors or sureties. Guarantor understands that
    the Company is relying on this guarantee in entering into this
    Agreement.
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">[Signature
    Page&#160;Follows]</FONT></B>
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    A-44
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    IN WITNESS WHEREOF, the Parties have caused this Agreement to be
    executed by their duly authorized officers as of the day and
    year first above written.
</DIV>

<DIV style="margin-top: 24pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    GENERAL DYNAMICS ADVANCED INFORMATION SYSTEMS, INC.
</DIV>

<DIV style="margin-top: 48pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="49%"></TD>
    <TD width="4%"></TD>
    <TD width="47%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    By:&#160;
</TD>
    <TD align="left">
    <DIV style="display:inline; text-align:left;">/s/&#160;&#160;David
    A. Savner</DIV>
</TD>
</TR>

</TABLE>

<DIV style="font-size: 2pt; margin-left: 53%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=0 -->

<DIV align="left" style="margin-left: 53%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Name:&#160;&#160;&#160;&#160;&#160;David A. Savner
</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="53%"></TD>
    <TD width="8%"></TD>
    <TD width="39%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    Title:&#160;
</TD>
    <TD align="left">
    Vice President
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 24pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    VISION MERGER SUB, INC.
</DIV>

<DIV style="margin-top: 48pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="49%"></TD>
    <TD width="4%"></TD>
    <TD width="47%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    By:&#160;
</TD>
    <TD align="left">
    <DIV style="display:inline; text-align:left;">/s/&#160;&#160;David
    A. Savner</DIV>
</TD>
</TR>

</TABLE>

<DIV style="font-size: 2pt; margin-left: 53%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=0 -->

<DIV align="left" style="margin-left: 53%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Name:&#160;&#160;&#160;&#160;&#160;David A. Savner
</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="53%"></TD>
    <TD width="8%"></TD>
    <TD width="39%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    Title:&#160;
</TD>
    <TD align="left">
    Vice President
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 24pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    AXSYS TECHNOLOGIES, INC.
</DIV>

<DIV style="margin-top: 48pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="49%"></TD>
    <TD width="4%"></TD>
    <TD width="47%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    By:&#160;
</TD>
    <TD align="left">
    <DIV style="display:inline; text-align:left;">/s/&#160;&#160;Stephen
    W. Bershad</DIV>
</TD>
</TR>

</TABLE>

<DIV style="font-size: 2pt; margin-left: 53%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=0 -->

<DIV align="left" style="margin-left: 53%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Name:&#160;&#160;&#160;&#160;&#160;Stephen W. Bershad
</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="53%"></TD>
    <TD width="8%"></TD>
    <TD width="39%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    Title:&#160;
</TD>
    <TD align="left">
    Chief Executive Officer
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 24pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    AS GUARANTOR SOLELY FOR THE PURPOSES OF <U>SECTION&#160;8.13</U>:
</DIV>

<DIV style="margin-top: 24pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    GENERAL DYNAMICS CORPORATION
</DIV>

<DIV style="margin-top: 48pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="49%"></TD>
    <TD width="4%"></TD>
    <TD width="47%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    By:&#160;
</TD>
    <TD align="left">
    <DIV style="display:inline; text-align:left;">/s/&#160;&#160;David
    A. Savner</DIV>
</TD>
</TR>

</TABLE>

<DIV style="font-size: 2pt; margin-left: 53%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=0 -->

<DIV align="left" style="margin-left: 53%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Name:&#160;&#160;&#160;&#160;&#160;David A. Savner
</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="53%"></TD>
    <TD width="8%"></TD>
    <TD width="39%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    Title:&#160;
</TD>
    <TD align="left">
    Senior Vice President
</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    A-45
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="right" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">ANNEX&#160;B</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="right" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Execution
    Version</FONT></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">VOTING
    AGREEMENT<BR>
    by and among<BR>
    STEPHEN W. BERSHAD,<BR>
    SWB HOLDING CORPORATION,<BR>
    GENERAL DYNAMICS ADVANCED INFORMATION SYSTEMS, INC.<BR>
    and<BR>
    VISION MERGER SUB, INC.<BR>
    dated as of<BR>
    June&#160;4, 2009</FONT></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<P align="left" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">TABLE OF
    CONTENTS</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>
<DIV align="left">
<!-- TOC -->
</DIV>

<DIV align="left">
<A name="tocpage"></A>
</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="8%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="86%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=quadleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=03 type=quadright -->
</TR>
<!-- Table Width Row END -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Page</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="7" align="center" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    ARTICLE&#160;1
</DIV>
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-variant: SMALL-CAPS">1.01
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    Certain Definitions
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    B-1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-variant: SMALL-CAPS">1.02
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    Representations and Warranties of the Stockholders
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    B-1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-variant: SMALL-CAPS">1.03
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    Representations and Warranties of Parent and Merger Sub
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    B-2
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="line-height: 9pt">
<TD colspan="7">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="7" align="center" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    ARTICLE&#160;2
</DIV>
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-variant: SMALL-CAPS">2.01
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    Transfer of the Shares
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    B-3
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-variant: SMALL-CAPS">2.02
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    Adjustments
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    B-3
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="line-height: 6pt">
<TD colspan="7">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="7" align="center" valign="top">
    ARTICLE&#160;3
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-variant: SMALL-CAPS">3.01
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    Voting Agreement
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    B-3
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-variant: SMALL-CAPS">3.02
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    Proxy
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    B-4
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-variant: SMALL-CAPS">3.03
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    Dissenting Shares
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    B-4
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-variant: SMALL-CAPS">3.04
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    Succession to Shares
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    B-5
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-variant: SMALL-CAPS">3.05
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    No Solicitation
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    B-5
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-variant: SMALL-CAPS">3.06
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    Disclosure
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    B-5
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom" style="line-height: 9pt">
<TD colspan="7">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="7" align="center" valign="top">
    ARTICLE&#160;4
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-variant: SMALL-CAPS">4.01
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    Termination
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    B-5
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-variant: SMALL-CAPS">4.02
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    Expenses
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    B-5
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-variant: SMALL-CAPS">4.03
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    Further Assurances
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    B-5
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-variant: SMALL-CAPS">4.04
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    Press Releases
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    B-5
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-variant: SMALL-CAPS">4.05
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    Specific Performance
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    B-5
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="top">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <FONT style="font-variant: SMALL-CAPS">4.06
    </FONT>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    Miscellaneous
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    B-6
</TD>
<TD>&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<DIV align="left">
<!-- /TOC -->
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    B-i
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='205'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">VOTING
    AGREEMENT</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    This VOTING AGREEMENT, dated as of June&#160;4, 2009 (this
    <I>&#147;Agreement&#148;</I>), is by and among General Dynamics
    Advanced Information Systems, Inc., a Delaware corporation
    <I>(&#147;Parent&#148;)</I>, Vision Merger Sub, Inc., a Delaware
    corporation <I>(&#147;Merger Sub&#148;)</I>, and the undersigned
    stockholders (each a <I>&#147;Stockholder&#148;</I> and
    collectively, the <I>&#147;Stockholders&#148;</I>) of Axsys
    Technologies, Inc., a Delaware corporation (the
    <I>&#147;Company&#148;</I>).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    WHEREAS, Parent, Merger Sub and the Company have entered into an
    Agreement and Plan of Merger, dated as of the date hereof (as
    amended from time to time, the <I>&#147;Merger
    Agreement&#148;</I>), which provides, among other things, that,
    upon the terms and subject to the conditions therein, Merger Sub
    will merge with and into the Company (the
    <I>&#147;Merger&#148;</I>), and as a result of the Merger, the
    Company will become an indirect, wholly-owned subsidiary of
    Guarantor;&#160;and
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    WHEREAS, each Stockholder acknowledges that, as a condition to
    the willingness of Parent and Merger Sub to enter into the
    Merger Agreement (and for Guarantor to perform its obligations
    thereunder), Guarantor, Parent and Merger Sub have requested
    that each Stockholder agree, and in order to induce Guarantor,
    Parent and Merger Sub to enter into the Merger Agreement, each
    Stockholder has agreed, to enter into this Agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    NOW, THEREFORE, in consideration of the foregoing premises and
    the representations, warranties, covenants and agreements set
    forth herein, and other good and valuable consideration, the
    receipt and sufficiency of which are hereby acknowledged, and
    subject to the terms and conditions set forth herein, the
    parties hereto hereby agree as follows:
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <FONT style="font-family: 'Times New Roman', Times">ARTICLE&#160;1
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    1.01&#160;<I><U>Certain Definitions</U>.</I>&#160;&#160;
    Capitalized terms used but not otherwise defined herein have the
    meanings ascribed to such terms in the Merger Agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    1.02&#160;<I><U>Representations and Warranties of the
    Stockholders</U>.</I>&#160;&#160; Each Stockholder represents
    and warrants to Parent and Merger Sub as follows:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;The Stockholder (i)&#160;is the sole record or
    beneficial owner, except for the Shares held of record by HoldCo
    (as defined below), which are also beneficially owned by Bershad
    (as defined below) (the term &#147;beneficial owner&#148; shall
    be as defined in
    <FONT style="white-space: nowrap">Rule&#160;13d-3</FONT>
    under the Securities Exchange Act of 1934, as amended (the
    <I>&#147;Exchange Act&#148;</I>), which meaning will apply to
    all uses of the term &#147;beneficial owner&#148; (or any
    variation thereof) contained in this Agreement), of, and has
    good title to, the shares of Company Common Stock identified as
    being held by such Stockholder on <U>Annex&#160;A</U> hereto
    (all such shares of Company Common Stock, including any
    restricted shares of Company Common Stock owned by such
    Stockholder, being hereinafter referred to as the
    <I>&#147;Shares&#148;</I> of such Stockholder), free and clear
    of any Liens or voting agreements and commitments of every kind
    (including any restriction on the right to vote, sell or
    otherwise dispose of its Shares), except as set forth in this
    Agreement and (ii)&#160;holds stock options identified as being
    held by such Stockholder (the <I>&#147;Options&#148;</I>) to
    acquire the number of shares of Company Common Stock as set
    forth on <U>Annex&#160;A</U> hereto.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;Other than its Options (if applicable), its Shares
    constitute all of the securities (as defined in
    Section&#160;3(10) of the Exchange Act, which definition will
    apply to all uses of the term &#147;securities&#148; contained
    in this Agreement) of the Company owned beneficially or
    otherwise, directly or indirectly, by the Stockholder (excluding
    (i)&#160;any securities beneficially owned by any of its
    affiliates or associates (as such terms are defined in
    <FONT style="white-space: nowrap">Rule&#160;12b-2</FONT>
    under the Exchange Act, which definitions will apply to all uses
    of the terms &#147;affiliates&#148; and &#147;associates,&#148;
    respectively, contained in this Agreement) as to which it does
    not have voting or investment power and (ii)&#160;the Shares and
    Options (if applicable) owned by the other Stockholder).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (c)&#160;Except for its Shares, its Options (if applicable) and
    the Shares and Options (if applicable) owned by the other
    Stockholder, the Stockholder does not, directly or indirectly,
    beneficially own or have any option, warrant, or other Rights to
    acquire any securities of the Company that are or may by their
    terms become entitled to vote or any securities that are
    convertible or exchangeable into or exercisable for any
    securities of the Company that are or may by their terms become
    entitled to vote, nor is the Stockholder subject to any
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    B-1
</DIV><!-- END PAGE WIDTH -->
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    contract, commitment, arrangement, understanding or relationship
    (whether or not legally enforceable), other than this Agreement,
    that obligates it to vote or acquire any securities of the
    Company. The Stockholder holds sole and exclusive power to vote
    the Shares and has not granted any proxy to any other Person to
    vote the Shares, subject to the limitations set forth in this
    Agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (d)&#160;(i)&#160;Stephen W. Bershad
    <I>(&#147;Bershad&#148;)</I> owns, directly or indirectly, all
    the outstanding capital stock and equity of SWB Holding
    Corporation, a Delaware corporation <I>(&#147;HoldCo&#148;)</I>;
    (ii)&#160;no capital stock or equity of HoldCo is or may become
    required to be issued (other than to Bershad) by reason of any
    security or otherwise; (iii)&#160;there are no contracts,
    commitments, understandings or arrangements by which HoldCo is
    bound to sell or otherwise transfer any capital stock or equity
    of HoldCo (other than to Bershad); (iv)&#160;there are no
    contracts, commitments, understandings or arrangements relating
    to Bershad&#146;s right to vote or to dispose of the capital
    stock or equity of HoldCo; (v)&#160;all the capital stock and
    equity interests of HoldCo (A)&#160;have been duly authorized
    and are validly issued and outstanding, fully paid and
    nonassessable and not subject to or issued in violation of any
    preemptive right, purchase option, call option, right of first
    refusal, subscription right or any similar right under any
    provision of the DGCL, HoldCo&#146;s Constituent Documents or
    any contract or commitment to which HoldCo is a party or
    otherwise bound, and (B)&#160;were issued in material compliance
    with all applicable Laws, including federal and state securities
    laws; (vi)&#160;Bershad is the sole director and officer of
    HoldCo; and (vii)&#160;Bershad exclusively controls HoldCo.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (e)&#160;The Stockholder has the legal capacity or power and
    authority, as the case may be, to execute, deliver and perform
    its obligations under, and has duly executed and delivered, this
    Agreement. This Agreement is the Stockholder&#146;s valid and
    legally binding obligation, enforceable against the Stockholder
    in accordance with its terms (except as enforcement may be
    limited by applicable bankruptcy, insolvency, reorganization,
    moratorium, fraudulent transfer and similar Laws of general
    applicability relating to or affecting creditors&#146; rights or
    by general equity principles). If the Stockholder is married and
    the Shares constitute community property, then this Agreement
    (including the granting of the irrevocable proxy as provided for
    in <U>Section&#160;3.02</U>) has been duly authorized, executed
    and delivered by, and constitutes a valid and binding agreement
    of, such Stockholder&#146;s spouse, enforceable against such
    person in accordance with its terms.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (f)&#160;No consents, authorizations or approvals of, or filings
    or registrations with, or notifications to, any Governmental
    Authority or with any third party are required to be made or
    obtained by the Stockholder in connection with the execution,
    delivery or performance by the Stockholder of this Agreement or
    the transactions contemplated hereby.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (g)&#160;The execution, delivery and performance of this
    Agreement by the Stockholder does not and will not constitute
    (i)&#160;a violation of any Law to which the Stockholder or any
    of the Stockholder&#146;s properties (including the Shares) is
    subject or bound or (ii)&#160;a breach or violation of, or a
    default under, or conflict with, (A)&#160;the Constituent
    Documents of the Company or any of its Subsidiaries or
    (B)&#160;the Constituent Documents of such Stockholder, if
    applicable.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (h)&#160;There is no suit, claim, action, charge or proceeding
    (including any arbitration proceeding or dispute resolution
    proceeding) pending or, to the knowledge of the Stockholder
    (after reasonably inquiry), threatened that, individually or in
    the aggregate, has impaired, or would reasonably be expected to
    impair, the ability of the Stockholder to perform its
    obligations under this Agreement or consummate the transactions
    contemplated hereby.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    1.03&#160;<I><U>Representations and Warranties of Parent and
    Merger Sub</U>.</I>&#160;&#160; Parent and Merger Sub represent
    and warrant to each Stockholder as follows:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;Each of Parent and Merger Sub is a corporation duly
    organized, validly existing and in good standing under the Laws
    of the State of Delaware.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;Each of Parent and Merger Sub has the corporate power
    and authority to execute, deliver and perform its obligations
    under this Agreement. Each of Parent and Merger Sub has duly
    authorized, executed and delivered this Agreement. This
    Agreement has been duly authorized by all necessary corporate
    action of each of Parent and Merger Sub. This Agreement is each
    of Parent&#146;s and Merger Sub&#146;s valid and legally binding
    obligation, enforceable against each of them in accordance with
    its terms (except as enforcement may be
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    B-2
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    limited by applicable bankruptcy, insolvency, reorganization,
    moratorium, fraudulent transfer and similar Laws of general
    applicability relating to or affecting creditors&#146; rights or
    by general equity principles).
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <FONT style="font-family: 'Times New Roman', Times">ARTICLE&#160;2
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    2.01&#160;<I><U>Transfer of the Shares</U>.</I>&#160;&#160;
    During the term of this Agreement, except as otherwise provided
    herein, each Stockholder will not, directly or indirectly,
    (a)&#160;tender into any tender or exchange offer or otherwise
    sell, transfer (including transfer by merger, testamentary or
    intestate succession, interspousal disposition pursuant to a
    domestic relations proceeding or otherwise by operation of Law),
    pledge, hypothecate, assign, gift, constructively sell or
    otherwise dispose of, or encumber with any Lien, or permit or
    suffer the encumbrance of any Lien on, any of its Shares (or any
    economic, voting or other direct or indirect right, title or
    interest therein), including, in each case, by operation of Law,
    (b)&#160;deposit its Shares into a voting trust, enter into any
    other voting agreement or arrangement with respect to its Shares
    or grant any proxy, power of attorney or other authorization or
    consent in or with respect to its Shares (other than to the
    other Stockholder), (c)&#160;enter into any contract, option or
    other arrangement or undertaking with respect to the direct or
    indirect acquisition or sale, transfer, pledge, hypothecation,
    assignment, gift, constructive sale, or other disposition of, or
    encumbrance with any Lien on, any interest in or the voting of
    any shares of Company Common Stock or any other securities of
    the Company (or any economic, voting or other direct or indirect
    right, title or interest therein), or any Rights with respect
    thereto, (d)&#160;take any other action which would, or could
    reasonably be expected to, result in a diminution of the voting
    power represented by its Shares or in any way restrict, limit or
    interfere in any material respect with the performance of such
    Stockholder&#146;s obligations hereunder or (e)&#160;offer,
    commit or agree to take any of the foregoing actions. Any
    purported action by a Stockholder in violation of this
    <U>Section&#160;2.01</U> shall be null and void.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    2.02&#160;<I><U>Adjustments</U>.</I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;In the event (i)&#160;of any stock dividend, stock
    split, recapitalization, reclassification, combination or
    exchange of shares of capital stock or other securities of the
    Company on, of or affecting the Shares or the like or any other
    action that would have the effect of changing a
    Stockholder&#146;s ownership of Company Common Stock or other
    securities of the Company or (ii)&#160;a Stockholder becomes the
    beneficial owner of any additional shares of Company Common
    Stock or other securities of the Company that entitle such
    Stockholder to vote on the matters contemplated herein
    (including pursuant to any exercise or conversion of any Rights,
    including any Company Stock Options or Company Stock-Based
    Awards), then the terms of this Agreement will apply to the
    shares of capital stock held by such Stockholder immediately
    following the effectiveness of the events described in
    clause&#160;(i) or such Stockholder becoming the beneficial
    owner thereof as described in clause (ii), and shall be deemed
    to be &#147;Shares&#148; with respect to such Stockholder for
    all purposes hereunder.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;Each Stockholder hereby agrees, while this Agreement is
    in effect, to promptly notify Parent in writing of the number of
    any new shares of Company Common Stock or other securities of
    the Company acquired by such Stockholder, if any, after the date
    hereof.
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <FONT style="font-family: 'Times New Roman', Times">ARTICLE&#160;3
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    3.01&#160;<I><U>Voting Agreement</U>.</I>&#160;&#160; Unless
    otherwise directed in writing by Parent, at every meeting of the
    Company Stockholders, however called, and at every postponement
    or adjournment thereof, and on every action or approval of
    Company Stockholders (including by written consent), each
    Stockholder irrevocably agrees to, or to cause the holder of
    record on the applicable record date to, vote (or cause to be
    voted) (or consent or cause to be consented) its Shares
    (a)&#160;in favor of (i)&#160;the Company Stockholder Approval,
    including the approval and adoption of the Merger Agreement and
    the approval of the Merger and the other Transactions and
    (ii)&#160;any other matter that is required by applicable Law or
    a Governmental Authority to be approved by the Company
    Stockholders to facilitate the approval and consummation of the
    Merger and the other Transactions and (b)&#160;against
    (i)&#160;any Acquisition Proposal, (ii)&#160;any action or
    agreement that would, or would reasonably be expected to, result
    in a breach in any respect of any covenant, agreement,
    representation or warranty of the Company under the Merger
    Agreement, and (iii)&#160;the following actions (other than the
    Merger and the other Transactions): (A)&#160;any extraordinary
    corporate transaction, such as a merger, consolidation or other
    business combination involving the Company or any of its
    Subsidiaries;
</DIV>

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    <BR>
    B-3
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (B)&#160;any sale, lease or transfer of a material amount of
    assets of the Company or any of its Subsidiaries, or a
    reorganization, recapitalization, dissolution or liquidation of
    the Company or its Subsidiaries; (C) (1)&#160;any change in the
    board of directors of the Company as of the date hereof;
    (2)&#160;any change in the present capitalization of the Company
    or any amendment of the Company&#146;s certificate of
    incorporation or bylaws, as amended prior to the date of this
    Agreement; (3)&#160;any other material change in the
    Company&#146;s corporate structure or business; or (4)&#160;any
    other action that, in the case of each of the matters referred
    to in clauses (C)(1), (2)&#160;and (3), would, or would
    reasonably be expected to, prevent, impede, frustrate, interfere
    with, delay, postpone or adversely affect the Merger or the
    other Transactions or that could facilitate an Acquisition
    Proposal or Superior Proposal. Each Stockholder shall, or shall
    cause the holder of record on the applicable record date, to
    cast votes (or cause votes to be cast), or give consents (or
    cause consents to be given), with respect to all of its Shares
    in accordance with such procedures relating thereto so as to
    ensure that all of its Shares are duly counted, including for
    purposes of determining that a quorum is present and for
    purposes of recording the results of such vote (or consent).
    Unless and until this Agreement shall be terminated pursuant to
    <U>Section&#160;4.01</U>, the obligations of the Stockholders
    specified herein will apply whether or not (I)&#160;the Company
    Board (or any committee thereof) shall make any Company Board
    Change of Recommendation or (II)&#160;the Company breaches any
    of its representations, warranties, agreements or covenants set
    forth in the Merger Agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    3.02&#160;<I><U>Proxy</U>.</I>&#160;&#160; Each Stockholder, by
    this Agreement, does hereby constitute and appoint Parent and
    Merger Sub, or any nominee thereof, with full power of
    substitution and re-substitution, during and for the term of
    this Agreement, as its true and lawful attorney-in-fact and
    proxy for and in its name, place and stead, to vote, express
    consent or dissent, or otherwise utilize such voting power with
    respect to its Shares in the manner and to the extent
    contemplated by <U>Section&#160;3.01</U> as such proxy or its
    substitute or re-substitute shall, in its sole discretion, deem
    proper with respect to its Shares. The proxy and power of
    attorney granted by each Stockholder pursuant to this
    <U>Section&#160;3.02</U> is a proxy and power coupled with an
    interest (in accordance with Section&#160;212 of the DGCL), is
    irrevocable during and for the term of this Agreement, and is
    granted in order to secure each Stockholder&#146;s performance
    under this Agreement and also in consideration of Parent and
    Merger Sub entering into this Agreement and the Merger
    Agreement. The power of attorney granted hereunder is a durable
    power of attorney and shall survive the bankruptcy, death or
    incapacity of a Stockholder, as applicable. Each Stockholder
    hereby ratifies and confirms all that such irrevocable proxy may
    lawfully do or cause to be done by virtue hereof. Each
    Stockholder shall execute and deliver to Parent any proxy cards
    that such Stockholder receives to vote in favor of the approval
    and adoption of the Merger Agreement and the approval of the
    Merger and the other Transactions. Each Stockholder represents
    and warrants that any proxies heretofore made or granted in
    respect of its Shares are not irrevocable, and hereby revokes
    any and all other proxies with respect to its Shares that it may
    have heretofore made or granted. If a Stockholder fails for any
    reason to be counted as present, consent or vote its Shares in
    accordance with the requirements of <U>Section&#160;3.01</U> (or
    anticipatorily breaches <U>Section&#160;3.01</U>), then Parent
    shall have the right to cause to be present, consent or vote
    such Stockholder&#146;s Shares in accordance with
    <U>Section&#160;3.01</U>. For Shares as to which a Stockholder
    is the beneficial but not the record owner, such Stockholder
    shall cause the record owner of any such Shares to grant to
    Parent and Merger Sub a proxy to the same effect as that
    contained herein. Notwithstanding anything to the contrary
    contained herein, the irrevocable proxy granted hereby shall
    automatically terminate and be of no further force or effect
    upon termination of this Agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    3.03&#160;<I><U>Dissenting Shares</U>.</I>&#160;&#160; Each
    Stockholder hereby irrevocably and unconditionally
    (a)&#160;waives, and agrees to prevent the exercise of, any
    rights of appraisal, any dissenters&#146; rights and any similar
    rights relating to the Merger or the other Transactions that it
    may directly or indirectly have by virtue of the ownership of
    its Shares, and (b)&#160;agrees not to commence or participate
    in, and to take all actions necessary to opt out of any class in
    any class action with respect to, any claim, derivative or
    otherwise, against Guarantor, Parent, Merger Sub, the Company or
    any of their respective successors relating to the negotiation,
    execution or delivery of this Agreement or the Merger Agreement
    or the consummation of the Merger, including any claim
    (i)&#160;challenging the validity of, or seeking to enjoin the
    operation of, any provision of this Agreement or
    (ii)&#160;alleging a breach of any fiduciary duty of the Company
    Board in connection with the Merger Agreement, the Merger or the
    other Transactions. Notwithstanding the foregoing, nothing in
    this <U>Section&#160;3.03</U> shall constitute, or be deemed to
    constitute, a waiver or release by either Stockholder of any
    claim or cause of action against Parent or Merger Sub to the
    extent arising out of a breach of this Agreement by Parent or
    Merger Sub.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    B-4
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    3.04&#160;<I><U>Succession to Shares</U>.</I>&#160;&#160;Each
    Stockholder agrees that this Agreement and the obligations
    hereunder shall attach to its Shares and shall be binding upon
    any Person to which legal or beneficial ownership of its Shares
    shall pass, whether by operation of Law or otherwise, including
    such Stockholder&#146;s heirs, guardians, administrators or
    successors, as applicable. Prior to, directly or indirectly,
    transferring any rights (including voting rights) or ownership
    in or to any of its Shares, each Stockholder agrees to cause the
    potential transferee of such Shares to enter into an agreement
    with Parent and Merger Sub on substantially the same terms as
    the terms hereof. Each Stockholder agrees that it shall
    authorize and request the Company to notify its transfer agent
    that there is a stop order with respect to all of the Shares and
    that this Agreement places limits on the voting of its Shares.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    3.05&#160;<I><U>No Solicitation</U>.</I>&#160;&#160; Each
    Stockholder agrees that Section&#160;4.09 of the Merger
    Agreement shall apply to each Stockholder <I>mutatis
    mutandis.</I> Notwithstanding anything to the contrary in this
    <U>Section&#160;3.05</U>, any action which is permitted by the
    Merger Agreement to be taken by a Stockholder in its individual
    capacity as an officer or director of the Company shall not be
    prohibited by this <U>Section&#160;3.05</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    3.06&#160;<I><U>Disclosure</U>. </I>&#160;&#160;Each Stockholder
    (a)&#160;hereby authorizes Guarantor, Parent and the Company to
    publish and disclose in any announcement or disclosure in
    connection with the Merger or the other Transactions, including
    the Proxy Statement, such Stockholder&#146;s identity and
    ownership of its Shares and the nature of such
    Stockholder&#146;s obligations under this Agreement and
    (b)&#160;agrees to promptly furnish to Parent any information it
    may reasonably request for the preparation of any such
    announcement or disclosure. Each Stockholder agrees to promptly
    notify Parent and the Company of any required corrections with
    respect to any information supplied by it for use in any such
    announcement or disclosure, if and to the extent that any such
    information shall have become false or misleading in any
    material respect.
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <FONT style="font-family: 'Times New Roman', Times">ARTICLE&#160;4
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    4.01&#160;<I><U>Termination</U>.</I>&#160;&#160; This Agreement
    will terminate upon the earliest to occur of (a)&#160;the
    Effective Time, (b)&#160;the date the Merger Agreement is
    terminated in accordance with its terms, and (c)&#160;the mutual
    written agreement of the Stockholders and Parent (such date of
    termination, the <I>&#147;Termination Date&#148;</I>); provided,
    however, that (i)&#160;this <U>Section&#160;4.01</U> and
    <U>Sections&#160;1.01</U>, <U>4.02</U>, <U>4.04</U>, <U>4.05</U>
    and <U>4.06</U> (as applicable) shall survive any such
    termination and (ii)&#160;such termination shall not relieve any
    party for any breach of this Agreement occurring prior to such
    termination.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    4.02&#160;<I><U>Expenses</U>. </I>&#160;&#160;Except as may
    otherwise be specifically provided herein, all costs and
    expenses incurred in connection with this Agreement and the
    transactions contemplated hereby will be paid by the party
    incurring such expenses, whether or not the Merger is
    consummated.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    4.03&#160;<I><U>Further Assurances</U>.</I>&#160;&#160; Each
    Stockholder agrees that prior to the Termination Date in
    accordance with its terms, such Stockholder shall not take any
    action that would make any representation or warranty of such
    Stockholder contained herein untrue or incorrect or have the
    effect of preventing, impeding, interfering with or adversely
    affecting the performance by such Stockholder of its obligations
    under this Agreement. Each party hereto will execute and deliver
    all such further documents and instruments and take all such
    further action as any other party may reasonably request in
    order to consummate the transactions contemplated hereby.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    4.04&#160;<I><U>Press Releases</U>.</I>&#160;&#160; Parent and
    Merger Sub, on the one hand, and the Stockholders, on the other
    hand, will consult with each other before issuing any press
    release with respect to the transactions contemplated by this
    Agreement, the Merger Agreement or the Transactions and will not
    issue any such press release without the prior written consent
    of the other parties, which will not be unreasonably withheld,
    conditioned or delayed; provided, however, that a party may,
    without the prior consent of the other party (but after prior
    consultation, to the extent practicable in the circumstances),
    issue any such press release as may be required by applicable
    Law or securities exchange rules.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    4.05&#160;<I><U>Specific Performance</U>.</I>&#160;&#160; The
    parties agree that irreparable damage would occur in the event
    that any of the provisions of this Agreement were not performed
    in accordance with its specific terms or were otherwise
    breached. Each party agrees that, in the event of any breach or
    threatened breach by any other party of any covenant or
    obligation contained in this Agreement, the non-breaching party
    shall be entitled (in addition to any other remedy that may be
    available to it whether in law or equity, including monetary
    damages) to seek and obtain (a)&#160;a decree or
</DIV>

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    <BR>
    B-5
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    order of specific performance to enforce the observance and
    performance of such covenant or obligation and (b)&#160;an
    injunction restraining such breach or threatened breach. Each
    party further agrees that no other party or any other Person
    shall be required to obtain, furnish or post any bond or similar
    instrument in connection with or as a condition to obtaining any
    remedy referred to in this <U>Section&#160;4.05</U>, and each
    party irrevocably waives any right it may have to require the
    obtaining, furnishing or posting of any such bond or similar
    instrument.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    4.06&#160;<I><U>Miscellaneous</U>.</I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;All representations and warranties contained herein are
    made as of the date hereof and will not survive the consummation
    of the Merger or any termination of this Agreement. The
    covenants and agreements made herein will survive in accordance
    with their respective terms.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;At any time prior to the Termination Date, any
    provision of this Agreement may be (i)&#160;waived by the party
    benefited by the provision, but only in writing (provided that
    no such waiver will be applicable except in the specific
    instance for which it is given), or (ii)&#160;amended or
    modified, but only by a written agreement executed in the same
    manner as this Agreement, except to the extent that any such
    amendment would violate applicable Law. Except as set forth
    elsewhere in this Agreement, at any time prior to the
    Termination Date, the parties may extend the time for
    performance of any of the covenants, agreements or conditions of
    the other parties to this Agreement, but only in a written
    agreement executed and delivered by or on behalf of the party
    against which it is sought to be enforced. Neither the failure
    nor any delay by any party in exercising any right, power or
    privilege under this Agreement will operate as a waiver of such
    right, power or privilege, and no single or partial exercise of
    any such right, power or privilege will preclude any other or
    further exercise of such right, power or privilege or the
    exercise of any other right, power or privilege.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (c)&#160;This Agreement represents the entire understanding of
    the parties regarding the transactions contemplated hereby and
    supersedes any and all other oral or written agreements,
    representations and understandings previously made or purported
    to be made with respect thereto. Other than those set forth in
    the Merger Agreement, no representation, warranty, inducement,
    promise, understanding or condition not set forth in this
    Agreement has been made or relied on by any party in entering
    into this Agreement. Nothing expressed or implied in this
    Agreement is intended to confer any rights, remedies,
    obligations or liabilities upon any Person other than the
    parties hereto.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (d)&#160;This Agreement and the agreements, instruments and
    documents contemplated hereby and all disputes between the
    parties under or relating to this Agreement or the facts and
    circumstances leading to its execution and delivery, whether in
    contract, tort or otherwise, will be governed by and construed
    in accordance with the Laws of the State of Delaware, without
    giving effect to conflicts of laws principles that would result
    in the application of the Law of any other State. The Delaware
    Court of Chancery sitting in Wilmington, Delaware (and if the
    Delaware Court of Chancery shall be unavailable, any Delaware
    state court and the Federal court of the United States of
    America sitting in the State of Delaware) will have exclusive
    jurisdiction over any and all disputes among the parties,
    whether at law or in equity, based upon, arising out of or
    relating to this Agreement and the agreements, instruments and
    documents contemplated hereby or the facts and circumstances
    leading to its execution and delivery, whether in contract, tort
    or otherwise. Each of the parties irrevocably consents to and
    agrees to submit to the exclusive jurisdiction of such courts,
    agrees that process may be served upon them in any manner
    authorized by the Laws of the State of Delaware, and hereby
    waives, and agrees not to assert in any such dispute, to the
    fullest extent permitted by applicable Law, any claim that
    (i)&#160;such party is not personally subject to the
    jurisdiction of such courts, (ii)&#160;such party and such
    party&#146;s property is immune from any legal process issued by
    such courts or (iii)&#160;any litigation commenced in such
    courts is brought in an inconvenient forum. EACH OF THE PARTIES
    HERETO IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUTSIDE
    THE TERRITORIAL JURISDICTION OF THE COURTS REFERRED TO IN THIS
    <U>SECTION&#160;4.06(d)</U> IN ANY ACTION OR PROCEEDING UNDER OR
    RELATING TO THIS AGREEMENT OR THE FACTS AND CIRCUMSTANCES
    LEADING TO ITS EXECUTION AND DELIVERY BY MAILING COPIES THEREOF
    BY REGISTERED UNITED STATES MAIL, POSTAGE PREPAID, RETURN
    RECEIPT REQUESTED, TO ITS ADDRESS AS SPECIFIED IN OR PURSUANT TO
    <U>SECTION&#160;4.06(f)</U>. HOWEVER, THE FOREGOING SHALL NOT
    LIMIT THE RIGHT OF A PARTY TO EFFECT SERVICE OF PROCESS ON ANY
    OTHER PARTY BY ANY OTHER LEGALLY AVAILABLE METHOD. EACH OF THE
    PARTIES HERETO IRREVOCABLY WAIVES ANY AND ALL
</DIV>

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    <BR>
    B-6
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR
    RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
    HEREBY.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (e)&#160;The table of contents and Section headings contained in
    this Agreement are for reference purposes only and do not limit
    or otherwise affect any of the substance of this Agreement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (f)&#160;All notices, requests and other communications given or
    made under this Agreement must be in writing and will be deemed
    given when personally delivered, transmitted by facsimile (with
    confirmation of successful transmission) or mailed by registered
    or certified mail (return receipt requested) to the persons,
    addresses
    <FONT style="white-space: nowrap">and/or</FONT>
    facsimile numbers set forth below or such other person, address
    <FONT style="white-space: nowrap">and/or</FONT>
    facsimile number as such party may specify by notice given in
    accordance with this <U>Section&#160;4.06(f)</U>.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If to either of the Stockholders:
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Axsys Technologies, Inc.<BR>
    175 Capital Boulevard, Suite&#160;103<BR>
    Rocky Hill, CT 06067<BR>
    Attention: Stephen W. Bershad<BR>
    Facsimile:
    <FONT style="white-space: nowrap">(860)&#160;257-0200</FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    If to Parent or Merger Sub, to:
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    General Dynamics Advanced Information Systems, Inc.<BR>
    2941 Fairview Park Drive<BR>
    Suite&#160;100<BR>
    Falls Church, VA
    <FONT style="white-space: nowrap">22042-4513</FONT><BR>
    Attention: David A. Savner<BR>
    Facsimile:
    <FONT style="white-space: nowrap">(703)&#160;876-3554</FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    With a copy to:
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Jenner&#160;&#038; Block LLP<BR>
    330 North Wabash Avenue<BR>
    Chicago, IL
    <FONT style="white-space: nowrap">60611-7603</FONT><BR>
    Attention: Thaddeus J. Malik<BR>
    Facsimile:
    <FONT style="white-space: nowrap">(312)&#160;840-7313</FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (g)&#160;This Agreement may be executed in one or more
    counterparts (whether by facsimile, electronic transmission or
    otherwise), each of which will be deemed to constitute an
    original, and transmission of a duly executed counterpart hereof
    by electronic means will be deemed to constitute delivery of an
    executed original manual counterpart hereof.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (h)&#160;No party may assign either this Agreement or any of its
    rights or interests, or delegate any of its duties, hereunder,
    in whole or in part, without the prior written consent of the
    other parties; provided that Merger Sub may assign any of its
    rights, interests and obligations hereunder, in whole or from
    time to time in part, to any direct or indirect Subsidiary of
    Guarantor without the consent of any other party, but no such
    assignment shall relieve Parent of its obligations hereunder.
    Any attempt to make any assignment in violation of this
    <U>Section&#160;4.06(h)</U> will be null and void. Subject to
    the preceding sentences of this <U>Section&#160;4.06(h)</U>,
    this Agreement will be binding upon, inure to the benefit of and
    be enforceable by, the parties and their respective successors
    and permitted assigns.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (i)&#160;The provisions of this Agreement shall be deemed
    severable and the invalidity or unenforceability of any
    provision shall not affect the validity or enforceability of the
    other provisions hereof. If any provision of this Agreement or
    the application thereof to any Person or circumstance is
    determined by a court of competent jurisdiction to be invalid,
    void or unenforceable, the remaining provisions, or the
    application of such provision to Persons or circumstances other
    than those as to which it has been held invalid, void or
    unenforceable, will remain in full force and effect and will in
    no way be affected, impaired or invalidated thereby, so long as
    the economic or legal substance of the transactions contemplated
    hereby is not affected in any manner materially adverse to any
    party. Upon any such determination, the parties will negotiate
    in good faith in an effort to agree upon a suitable and
    equitable substitute provision to effect the original intent of
    the parties.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    B-7
</DIV><!-- END PAGE WIDTH -->
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (j)&#160;All rights, powers and remedies provided under this
    Agreement or otherwise available in respect hereof at law or in
    equity will be cumulative and not alternative, and the exercise
    of any thereof by any party will not preclude the simultaneous
    or later exercise of any other such right, power or remedy by
    such party. Without limiting the generality of the foregoing,
    the rights and remedies of the parties under this Agreement, and
    the obligations and liabilities of the parties under this
    Agreement, are in addition to their respective rights, remedies,
    obligations and liabilities under all applicable Laws.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (k)&#160;This Agreement is the product of negotiation by the
    parties, which have had the assistance of counsel and other
    advisors. The parties intend that this Agreement not be
    construed more strictly with regard to one party than with
    regard to any other party.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (l)&#160;The words &#147;include,&#148; &#147;includes&#148; or
    &#147;including&#148; as used in this Agreement are to be deemed
    followed by the words &#147;without limitation.&#148; The words
    &#147;herein,&#148; &#147;hereof,&#148; &#147;hereunder&#148;
    and similar terms as used in this Agreement are to be deemed to
    refer to this Agreement as a whole and not to any specific
    Section or Article. Whenever the context requires, terms defined
    in this Agreement in the singular will be deemed to include the
    plural and vice versa. The word &#147;extent&#148; in the phrase
    &#147;to the extent&#148; as used in this Agreement means the
    degree to which a subject or other thing extends and such phrase
    does not simply mean &#147;if.&#148; No provision of this
    Agreement is to be construed to require, directly or indirectly,
    any Person to take any action, or omit to take any action, to
    the extent such action or omission would violate applicable Law.
    In this Agreement, except as the context may otherwise require,
    references: (i)&#160;to Sections or Articles are to the Sections
    or Articles of this Agreement; (ii)&#160;to any agreement
    (including this Agreement), contract, statute or regulation are
    to the agreement, contract, statute or regulation as amended,
    modified, supplemented, restated or replaced from time to time
    (in the case of an agreement or contract, to the extent
    permitted by the terms thereof); (iii)&#160;to any section of
    any statute or regulation include any successor to that section;
    and (iv)&#160;to the date of this Agreement is to the date set
    forth in the Preamble.
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">[Signatures
    on following page]</FONT></B>
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    B-8
</DIV><!-- END PAGE WIDTH -->
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    IN WITNESS WHEREOF, the parties hereto have duly executed this
    Agreement on the date first above written.
</DIV>

<DIV style="margin-top: 24pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    GENERAL DYNAMICS ADVANCED<BR>
    INFORMATION SYSTEMS, INC.
</DIV>

<DIV style="margin-top: 48pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="49%"></TD>
    <TD width="4%"></TD>
    <TD width="47%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    By:&#160;
</TD>
    <TD align="left">
    <DIV style="display:inline; text-align:left;">/s/&#160;&#160;David
    A. Savner</DIV>
</TD>
</TR>

</TABLE>

<DIV style="font-size: 2pt; margin-left: 53%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=0 -->

<DIV align="left" style="margin-left: 53%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Name:&#160;&#160;&#160;&#160;&#160;David A. Savner
</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="53%"></TD>
    <TD width="8%"></TD>
    <TD width="39%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    Title:&#160;
</TD>
    <TD align="left">
    Vice President
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 24pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    VISION MERGER SUB, INC.
</DIV>

<DIV style="margin-top: 48pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="49%"></TD>
    <TD width="4%"></TD>
    <TD width="47%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    By:&#160;
</TD>
    <TD align="left">
    <DIV style="display:inline; text-align:left;">/s/&#160;&#160;David
    A. Savner</DIV>
</TD>
</TR>

</TABLE>

<DIV style="font-size: 2pt; margin-left: 53%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=0 -->

<DIV align="left" style="margin-left: 53%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Name:&#160;&#160;&#160;&#160;&#160;David A. Savner
</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="53%"></TD>
    <TD width="8%"></TD>
    <TD width="39%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    Title:&#160;
</TD>
    <TD align="left">
    Vice President
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 24pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    STOCKHOLDERS:
</DIV>

<DIV style="margin-top: 48pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <DIV style="display:inline; text-align:left;">/s/&#160;&#160;Stephen
    W. Bershad</DIV>
</DIV>

<DIV style="font-size: 2pt; margin-left: 49%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=0 -->

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Stephen W. Bershad
</DIV>

<DIV style="margin-top: 24pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    SWB HOLDING CORPORATION
</DIV>

<DIV style="margin-top: 48pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">

</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="49%"></TD>
    <TD width="4%"></TD>
    <TD width="47%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    By:&#160;
</TD>
    <TD align="left">
    <DIV style="display:inline; text-align:left;">/s/&#160;&#160;Stephen
    W. Bershad</DIV>
</TD>
</TR>

</TABLE>

<DIV style="font-size: 2pt; margin-left: 53%; width: 100%;  align: left; border-bottom: 1pt solid #000000"></DIV><!-- callerid=999 iwidth=456 length=0 -->

<DIV align="left" style="margin-left: 53%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Name:&#160;&#160;&#160;&#160;&#160;Stephen W. Bershad
</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="53%"></TD>
    <TD width="8%"></TD>
    <TD width="39%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    Title:&#160;
</TD>
    <TD align="left">
    President
</TD>
</TR>

</TABLE>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    B-9
</DIV><!-- END PAGE WIDTH -->
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<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='206'>
<DIV style="margin-top: 4pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="right" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">ANNEX&#160;C</FONT></B>
</DIV>
</A>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="right" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <IMG src="l36705dl3670507.gif" alt="(JEFFERIES LOGO)"><B> </B>
</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    June&#160;3, 2009
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    The Board of Directors
</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Axsys Technologies, Inc.
</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    175 Capital Boulevard
</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Suite&#160;103
</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Rocky Hill, CT 06067
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Members of the Board:
</DIV>

<DIV style="margin-top: 2pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We understand that Axsys Technologies, Inc. (the
    &#147;Company&#148;), General Dynamics Advanced Information
    Systems, Inc. (&#147;Parent&#148;), and Vision Merger Sub, Inc.
    (&#147;Merger Sub&#148;), an indirect wholly-owned subsidiary of
    General Dynamics Corporation (&#147;Guarantor&#148;), propose to
    enter into an Agreement and Plan of Merger (the &#147;Merger
    Agreement&#148;), pursuant to which Merger Sub will merge with
    and into the Company (the &#147;Merger&#148;) in a transaction
    in which each outstanding share of common stock, par value $0.01
    per share, of the Company (the &#147;Common Stock&#148;), other
    than shares of Common Stock held by the Company, Parent, Merger
    Sub, Guarantor or any of their respective subsidiaries, all of
    which shares will be canceled, or as to which dissenters rights
    have been properly exercised, will be converted into the right
    to receive $54.00 in cash (the &#147;Consideration&#148;). The
    terms and conditions of the Merger are more fully set forth in
    the Merger Agreement.
</DIV>

<DIV style="margin-top: 2pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    You have asked for our opinion as to whether the Consideration
    to be received by the holders of shares of Common Stock pursuant
    to the Merger Agreement is fair, from a financial point of view,
    to such holders.
</DIV>

<DIV style="margin-top: 2pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In arriving at our opinion, we have, among other things:
</DIV>

<DIV style="margin-top: 2pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="8%"></TD>
    <TD width="5%"></TD>
    <TD width="87%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    (i)&#160;
</TD>
    <TD align="left">
    reviewed (a)&#160;a draft dated June&#160;3, 2009 of the Merger
    Agreement and (b)&#160;a draft dated June&#160;3, 2009 of the
    Voting Agreement (as defined in the Merger Agreement);
</TD>
</TR>


<TR style="line-height: 2pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    (ii)&#160;
</TD>
    <TD align="left">
    reviewed certain publicly available financial and other
    information about the Company;
</TD>
</TR>


<TR style="line-height: 2pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    (iii)&#160;
</TD>
    <TD align="left">
    reviewed certain information furnished to us by the
    Company&#146;s management, including financial forecasts and
    analyses, relating to the business, operations and prospects of
    the Company;
</TD>
</TR>


<TR style="line-height: 2pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    (iv)&#160;
</TD>
    <TD align="left">
    held discussions with members of senior management of the
    Company concerning the matters described in clauses&#160;(ii)
    and (iii)&#160;above;
</TD>
</TR>


<TR style="line-height: 2pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    (v)&#160;
</TD>
    <TD align="left">
    reviewed the share trading price history and valuation multiples
    for the Common Stock and compared them with those of certain
    publicly traded companies that we deemed relevant;
</TD>
</TR>


<TR style="line-height: 2pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    (vi)&#160;
</TD>
    <TD align="left">
    compared the proposed financial terms of the Merger with the
    financial terms of certain other transactions that we deemed
    relevant;&#160;and
</TD>
</TR>


<TR style="line-height: 2pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <TD>&nbsp;</TD>
    <TD>    (vii)&#160;
</TD>
    <TD align="left">
    conducted such other financial studies, analyses and
    investigations as we deemed appropriate.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 2pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    In our review and analysis and in rendering this opinion, we
    have assumed and relied upon, but have not assumed any
    responsibility to independently investigate or verify, the
    accuracy and completeness of all financial and other information
    that was supplied or otherwise made available by the Company to
    us or that was publicly available (including, without
    limitation, the information described above), or that was
    otherwise reviewed by us. We have relied on assurances of the
    management of the Company that it is not aware of any facts or
    circumstances that would make such information inaccurate or
    misleading. In our review, we did not obtain any independent
    evaluation or appraisal of any of the assets or liabilities of,
    nor did we conduct a physical inspection of any of the
    properties or facilities of, the Company, nor have we been
    furnished with any such evaluations or appraisals of such
    physical inspections, nor do we assume any responsibility to
    obtain any such evaluations or appraisals.
</DIV>

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    <BR>
    C-1
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    With respect to the financial forecasts provided to and examined
    by us, we note that projecting future results of any company is
    inherently subject to uncertainty. The Company has informed us,
    however, and we have assumed, that such financial forecasts were
    reasonably prepared on bases reflecting the best currently
    available estimates and good faith judgments of the management
    of the Company as to the future financial performance of the
    Company. We express no opinion as to the Company&#146;s
    financial forecasts or the assumptions on which they are made.
</DIV>

<DIV style="margin-top: 2pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Our opinion is based on economic, monetary, regulatory, market
    and other conditions existing and which can be evaluated as of
    the date hereof. We expressly disclaim any undertaking or
    obligation to advise any person of any change in any fact or
    matter affecting our opinion of which we become aware after the
    date hereof.
</DIV>

<DIV style="margin-top: 2pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have made no independent investigation of any legal or
    accounting matters affecting the Company, and we have assumed
    the correctness in all respects material to our analysis of all
    legal and accounting advice given to the Company and its Board
    of Directors, including, without limitation, advice as to the
    legal, accounting and tax consequences of the terms of, and
    transactions contemplated by, the Merger Agreement to the
    Company and its stockholders. In addition, in preparing this
    opinion, we have not taken into account any tax consequences of
    the transaction to any holder of Common Stock. We have assumed
    that the final forms of the Merger Agreement and the Voting
    Agreement will be substantially similar to the last drafts
    reviewed by us. We have also assumed that in the course of
    obtaining the necessary regulatory or third party approvals,
    consents and releases for the Merger, no delay, limitation,
    restriction or condition will be imposed that would have an
    adverse effect on the Company or the contemplated benefits of
    the Merger in any way meaningful to our analysis.
</DIV>

<DIV style="margin-top: 2pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    It is understood that our opinion is for the use and benefit of
    the Board of Directors of the Company in its consideration of
    the Merger, and our opinion does not address the relative merits
    of the transactions contemplated by the Merger Agreement as
    compared to any alternative transaction or opportunity that
    might be available to the Company, nor does it address the
    underlying business decision by the Company to engage in the
    Merger or the terms of the Merger Agreement or the documents
    referred to therein. Our opinion does not constitute a
    recommendation as to how any holder of shares of Common Stock
    should vote on the Merger or any matter related thereto. In
    addition, you have not asked us to address, and this opinion
    does not address, the fairness to, or any other consideration
    of, the holders of any class of securities, creditors or other
    constituencies of the Company, other than the holders of shares
    of Common Stock. We express no opinion as to the price at which
    shares of Common Stock will trade at any time. Furthermore, we
    do not express any view or opinion as to the fairness, financial
    or otherwise, of the amount or nature of any compensation
    payable to or to be received by any of the Company&#146;s
    officers, directors or employees, or any class of such persons,
    in connection with the Merger relative to the Consideration to
    be received by holders of shares of Common Stock. Our opinion
    has been authorized by the Fairness Committee of
    Jefferies&#160;&#038; Company, Inc.
</DIV>

<DIV style="margin-top: 2pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    We have been engaged by the Company to act as financial advisor
    to the Company in connection with the Merger and will receive a
    fee for our services, a portion of which is payable upon
    delivery of this opinion and a significant portion of which is
    payable contingent upon consummation of the Merger. We also will
    be reimbursed for expenses incurred. The Company has agreed to
    indemnify us against liabilities arising out of or in connection
    with the services rendered and to be rendered by us under such
    engagement. In the ordinary course of our business, we and our
    affiliates may trade or hold securities of the Company or Parent
    <FONT style="white-space: nowrap">and/or</FONT> their
    respective affiliates for our own account and for the accounts
    of our customers and, accordingly, may at any time hold long or
    short positions in those securities. In addition, we may seek
    to, in the future, provide financial advisory and financing
    services to the Company, Parent or entities that are affiliated
    with the Company or Parent, for which we would expect to receive
    compensation. Except as otherwise expressly provided in our
    engagement letter with the Company, our opinion may not be used
    or referred to by the Company, or quoted or disclosed to any
    person in any matter, without our prior written consent.
</DIV>

<DIV style="margin-top: 2pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Based upon and subject to the foregoing, we are of the opinion
    that, as of the date hereof, the Consideration to be received by
    the holders of shares of Common Stock pursuant to the Merger
    Agreement is fair, from a financial point of view, to such
    holders.
</DIV>

<DIV style="margin-top: 24pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Very truly yours,
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 49%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    JEFFERIES&#160;&#038; COMPANY, INC.
</DIV>

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    <BR>
    C-2
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<A name='207'>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="right" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">ANNEX&#160;D</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: #FFFFFF">

    <B><FONT style="font-family: 'Times New Roman', Times">Section&#160;262
    of the General Corporation Law of the State of Delaware<BR>
    Appraisal Rights</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (a)&#160;Any stockholder of a corporation of this State who
    holds shares of stock on the date of the making of a demand
    pursuant to subsection&#160;(d) of this section with respect to
    such shares, who continuously holds such shares through the
    effective date of the merger or consolidation, who has otherwise
    complied with subsection&#160;(d) of this section and who has
    neither voted in favor of the merger or consolidation nor
    consented thereto in writing pursuant to &#167;&#160;228 of this
    title shall be entitled to an appraisal by the Court of Chancery
    of the fair value of the stockholder&#146;s shares of stock
    under the circumstances described in subsections&#160;(b) and
    (c)&#160;of this section. As used in this section, the word
    &#147;stockholder&#148; means a holder of record of stock in a
    stock corporation and also a member of record of a nonstock
    corporation; the words &#147;stock&#148; and &#147;share&#148;
    mean and include what is ordinarily meant by those words and
    also membership or membership interest of a member of a nonstock
    corporation; and the words &#147;depository receipt&#148; mean a
    receipt or other instrument issued by a depository representing
    an interest in one or more shares, or fractions thereof, solely
    of stock of a corporation, which stock is deposited with the
    depository.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (b)&#160;Appraisal rights shall be available for the shares of
    any class or series of stock of a constituent corporation in a
    merger or consolidation to be effected pursuant to
    &#167;&#160;251 (other than a merger effected pursuant to
    &#167;&#160;251(g) of this title), &#167;&#160;252,
    &#167;&#160;254, &#167;&#160;257, &#167;&#160;258,
    &#167;&#160;263 or &#167;&#160;264 of this title:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (1)&#160;Provided, however, that no appraisal rights under this
    section shall be available for the shares of any class or series
    of stock, which stock, or depository receipts in respect
    thereof, at the record date fixed to determine the stockholders
    entitled to receive notice of the meeting of stockholders to act
    upon the agreement of merger or consolidation, were either
    (i)&#160;listed on a national securities exchange or
    (ii)&#160;held of record by more than 2,000 holders; and further
    provided that no appraisal rights shall be available for any
    shares of stock of the constituent corporation surviving a
    merger if the merger did not require for its approval the vote
    of the stockholders of the surviving corporation as provided in
    subsection&#160;(f) of &#167;&#160;251 of this title.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (2)&#160;Notwithstanding paragraph (1)&#160;of this subsection,
    appraisal rights under this section shall be available for the
    shares of any class or series of stock of a constituent
    corporation if the holders thereof are required by the terms of
    an agreement of merger or consolidation pursuant to
    &#167;&#167;&#160;251, 252, 254, 257, 258, 263 and 264 of this
    title to accept for such stock anything except:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 8%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    a.&#160;Shares of stock of the corporation surviving or
    resulting from such merger or consolidation, or depository
    receipts in respect thereof;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 8%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    b.&#160;Shares of stock of any other corporation, or depository
    receipts in respect thereof, which shares of stock (or
    depository receipts in respect thereof) or depository receipts
    at the effective date of the merger or consolidation will be
    either listed on a national securities exchange or held of
    record by more than 2,000 holders;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 8%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    c.&#160;Cash in lieu of fractional shares or fractional
    depository receipts described in the foregoing subparagraphs a.
    and b. of this paragraph;&#160;or
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 8%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    d.&#160;Any combination of the shares of stock, depository
    receipts and cash in lieu of fractional shares or fractional
    depository receipts described in the foregoing subparagraphs a.,
    b. and c. of this paragraph.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (3)&#160;In the event all of the stock of a subsidiary Delaware
    corporation party to a merger effected under &#167;&#160;253 of
    this title is not owned by the parent corporation immediately
    prior to the merger, appraisal rights shall be available for the
    shares of the subsidiary Delaware corporation.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (c)&#160;Any corporation may provide in its certificate of
    incorporation that appraisal rights under this section shall be
    available for the shares of any class or series of its stock as
    a result of an amendment to its certificate of incorporation,
    any merger or consolidation in which the corporation is a
    constituent corporation or the sale of all or substantially all
    of the assets of the corporation. If the certificate of
    incorporation contains such a provision, the
</DIV>

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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    procedures of this section, including those set forth in
    subsections&#160;(d) and (e)&#160;of this section, shall apply
    as nearly as is practicable.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (d)&#160;Appraisal rights shall be perfected as follows:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (1)&#160;If a proposed merger or consolidation for which
    appraisal rights are provided under this section is to be
    submitted for approval at a meeting of stockholders, the
    corporation, not less than 20&#160;days prior to the meeting,
    shall notify each of its stockholders who was such on the record
    date for notice of such meeting with respect to shares for which
    appraisal rights are available pursuant to subsection&#160;(b)
    or (c)&#160;hereof that appraisal rights are available for any
    or all of the shares of the constituent corporations, and shall
    include in such notice a copy of this section. Each stockholder
    electing to demand the appraisal of such stockholder&#146;s
    shares shall deliver to the corporation, before the taking of
    the vote on the merger or consolidation, a written demand for
    appraisal of such stockholder&#146;s shares. Such demand will be
    sufficient if it reasonably informs the corporation of the
    identity of the stockholder and that the stockholder intends
    thereby to demand the appraisal of such stockholder&#146;s
    shares. A proxy or vote against the merger or consolidation
    shall not constitute such a demand. A stockholder electing to
    take such action must do so by a separate written demand as
    herein provided. Within 10&#160;days after the effective date of
    such merger or consolidation, the surviving or resulting
    corporation shall notify each stockholder of each constituent
    corporation who has complied with this subsection and has not
    voted in favor of or consented to the merger or consolidation of
    the date that the merger or consolidation has become
    effective;&#160;or
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (2)&#160;If the merger or consolidation was approved pursuant to
    &#167;&#160;228 or &#167;&#160;253 of this title, then either a
    constituent corporation before the effective date of the merger
    or consolidation or the surviving or resulting corporation
    within 10&#160;days thereafter shall notify each of the holders
    of any class or series of stock of such constituent corporation
    who are entitled to appraisal rights of the approval of the
    merger or consolidation and that appraisal rights are available
    for any or all shares of such class or series of stock of such
    constituent corporation, and shall include in such notice a copy
    of this section. Such notice may, and, if given on or after the
    effective date of the merger or consolidation, shall, also
    notify such stockholders of the effective date of the merger or
    consolidation. Any stockholder entitled to appraisal rights may,
    within 20&#160;days after the date of mailing of such notice,
    demand in writing from the surviving or resulting corporation
    the appraisal of such holder&#146;s shares. Such demand will be
    sufficient if it reasonably informs the corporation of the
    identity of the stockholder and that the stockholder intends
    thereby to demand the appraisal of such holder&#146;s shares. If
    such notice did not notify stockholders of the effective date of
    the merger or consolidation, either (i)&#160;each such
    constituent corporation shall send a second notice before the
    effective date of the merger or consolidation notifying each of
    the holders of any class or series of stock of such constituent
    corporation that are entitled to appraisal rights of the
    effective date of the merger or consolidation or (ii)&#160;the
    surviving or resulting corporation shall send such a second
    notice to all such holders on or within 10&#160;days after such
    effective date; provided, however, that if such second notice is
    sent more than 20&#160;days following the sending of the first
    notice, such second notice need only be sent to each stockholder
    who is entitled to appraisal rights and who has demanded
    appraisal of such holder&#146;s shares in accordance with this
    subsection. An affidavit of the secretary or assistant secretary
    or of the transfer agent of the corporation that is required to
    give either notice that such notice has been given shall, in the
    absence of fraud, be prima facie evidence of the facts stated
    therein. For purposes of determining the stockholders entitled
    to receive either notice, each constituent corporation may fix,
    in advance, a record date that shall be not more than
    10&#160;days prior to the date the notice is given, provided,
    that if the notice is given on or after the effective date of
    the merger or consolidation, the record date shall be such
    effective date. If no record date is fixed and the notice is
    given prior to the effective date, the record date shall be the
    close of business on the day next preceding the day on which the
    notice is given.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (e)&#160;Within 120&#160;days after the effective date of the
    merger or consolidation, the surviving or resulting corporation
    or any stockholder who has complied with subsections&#160;(a)
    and (d)&#160;of this section hereof and who is otherwise
    entitled to appraisal rights, may commence an appraisal
    proceeding by filing a petition in the Court of Chancery
    demanding a determination of the value of the stock of all such
    stockholders. Notwithstanding the foregoing, at any time within
    60&#160;days after the effective date of the merger or
    consolidation, any stockholder who has not commenced an
    appraisal proceeding or joined that proceeding as a named party
    shall have the right to withdraw such stockholder&#146;s demand
    for appraisal and to accept the terms offered upon the merger or
    consolidation.
</DIV>

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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    Within 120&#160;days after the effective date of the merger or
    consolidation, any stockholder who has complied with the
    requirements of subsections&#160;(a) and (d)&#160;of this
    section hereof, upon written request, shall be entitled to
    receive from the corporation surviving the merger or resulting
    from the consolidation a statement setting forth the aggregate
    number of shares not voted in favor of the merger or
    consolidation and with respect to which demands for appraisal
    have been received and the aggregate number of holders of such
    shares. Such written statement shall be mailed to the
    stockholder within 10&#160;days after such stockholder&#146;s
    written request for such a statement is received by the
    surviving or resulting corporation or within 10&#160;days after
    expiration of the period for delivery of demands for appraisal
    under subsection&#160;(d) of this section hereof, whichever is
    later. Notwithstanding subsection&#160;(a) of this section, a
    person who is the beneficial owner of shares of such stock held
    either in a voting trust or by a nominee on behalf of such
    person may, in such person&#146;s own name, file a petition or
    request from the corporation the statement described in this
    subsection.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (f)&#160;Upon the filing of any such petition by a stockholder,
    service of a copy thereof shall be made upon the surviving or
    resulting corporation, which shall within 20&#160;days after
    such service file in the office of the Register in Chancery in
    which the petition was filed a duly verified list containing the
    names and addresses of all stockholders who have demanded
    payment for their shares and with whom agreements as to the
    value of their shares have not been reached by the surviving or
    resulting corporation. If the petition shall be filed by the
    surviving or resulting corporation, the petition shall be
    accompanied by such a duly verified list. The Register in
    Chancery, if so ordered by the Court, shall give notice of the
    time and place fixed for the hearing of such petition by
    registered or certified mail to the surviving or resulting
    corporation and to the stockholders shown on the list at the
    addresses therein stated. Such notice shall also be given by 1
    or more publications at least 1&#160;week before the day of the
    hearing, in a newspaper of general circulation published in the
    City of Wilmington, Delaware or such publication as the Court
    deems advisable. The forms of the notices by mail and by
    publication shall be approved by the Court, and the costs
    thereof shall be borne by the surviving or resulting corporation.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (g)&#160;At the hearing on such petition, the Court shall
    determine the stockholders who have complied with this section
    and who have become entitled to appraisal rights. The Court may
    require the stockholders who have demanded an appraisal for
    their shares and who hold stock represented by certificates to
    submit their certificates of stock to the Register in Chancery
    for notation thereon of the pendency of the appraisal
    proceedings; and if any stockholder fails to comply with such
    direction, the Court may dismiss the proceedings as to such
    stockholder.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (h)&#160;After the Court determines the stockholders entitled to
    an appraisal, the appraisal proceeding shall be conducted in
    accordance with the rules of the Court of Chancery, including
    any rules specifically governing appraisal proceedings. Through
    such proceeding the Court shall determine the fair value of the
    shares exclusive of any element of value arising from the
    accomplishment or expectation of the merger or consolidation,
    together with interest, if any, to be paid upon the amount
    determined to be the fair value. In determining such fair value,
    the Court shall take into account all relevant factors. Unless
    the Court in its discretion determines otherwise for good cause
    shown, interest from the effective date of the merger through
    the date of payment of the judgment shall be compounded
    quarterly and shall accrue at 5% over the Federal Reserve
    discount rate (including any surcharge) as established from time
    to time during the period between the effective date of the
    merger and the date of payment of the judgment. Upon application
    by the surviving or resulting corporation or by any stockholder
    entitled to participate in the appraisal proceeding, the Court
    may, in its discretion, proceed to trial upon the appraisal
    prior to the final determination of the stockholders entitled to
    an appraisal. Any stockholder whose name appears on the list
    filed by the surviving or resulting corporation pursuant to
    subsection&#160;(f) of this section and who has submitted such
    stockholder&#146;s certificates of stock to the Register in
    Chancery, if such is required, may participate fully in all
    proceedings until it is finally determined that such stockholder
    is not entitled to appraisal rights under this section.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (i)&#160;The Court shall direct the payment of the fair value of
    the shares, together with interest, if any, by the surviving or
    resulting corporation to the stockholders entitled thereto.
    Payment shall be so made to each such stockholder, in the case
    of holders of uncertificated stock forthwith, and the case of
    holders of shares represented by certificates upon the surrender
    to the corporation of the certificates representing such stock.
    The Court&#146;s decree may be enforced as other decrees in the
    Court of Chancery may be enforced, whether such surviving or
    resulting corporation be a corporation of this State or of any
    state.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    D-3
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (j)&#160;The costs of the proceeding may be determined by the
    Court and taxed upon the parties as the Court deems equitable in
    the circumstances. Upon application of a stockholder, the Court
    may order all or a portion of the expenses incurred by any
    stockholder in connection with the appraisal proceeding,
    including, without limitation, reasonable attorney&#146;s fees
    and the fees and expenses of experts, to be charged pro rata
    against the value of all the shares entitled to an appraisal.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (k)&#160;From and after the effective date of the merger or
    consolidation, no stockholder who has demanded appraisal rights
    as provided in subsection&#160;(d) of this section shall be
    entitled to vote such stock for any purpose or to receive
    payment of dividends or other distributions on the stock (except
    dividends or other distributions payable to stockholders of
    record at a date which is prior to the effective date of the
    merger or consolidation); provided, however, that if no petition
    for an appraisal shall be filed within the time provided in
    subsection&#160;(e) of this section, or if such stockholder
    shall deliver to the surviving or resulting corporation a
    written withdrawal of such stockholder&#146;s demand for an
    appraisal and an acceptance of the merger or consolidation,
    either within 60&#160;days after the effective date of the
    merger or consolidation as provided in subsection&#160;(e) of
    this section or thereafter with the written approval of the
    corporation, then the right of such stockholder to an appraisal
    shall cease. Notwithstanding the foregoing, no appraisal
    proceeding in the Court of Chancery shall be dismissed as to any
    stockholder without the approval of the Court, and such approval
    may be conditioned upon such terms as the Court deems just;
    provided, however that this provision shall not affect the right
    of any stockholder who has not commenced an appraisal proceeding
    or joined that proceeding as a named party to withdraw such
    stockholder&#146;s demand for appraisal and to accept the terms
    offered upon the merger or consolidation within 60&#160;days
    after the effective date of the merger or consolidation, as set
    forth in subsection&#160;(e) of this section.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    (l)&#160;The shares of the surviving or resulting corporation to
    which the shares of such objecting stockholders would have been
    converted had they assented to the merger or consolidation shall
    have the status of authorized and unissued shares of the
    surviving or resulting corporation.
</DIV>

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: #FFFFFF">
    <BR>
    D-4
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>


<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>Preliminary Copy</b></div>
<DIV align="left" style="font-size: 10pt; margin-top: 3pt; MARGIN-LEFT: 3%"><B>THIS PROXY WILL BE VOTED AS DIRECTED, OR IF NO DIRECTION IS INDICATED, WILL BE VOTED &#147;FOR&#148; THE</B>
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 0pt; MARGIN-LEFT: 3%"><B>PROPOSALS.</B></DIV>
<DIV align="center">
<TABLE style="font-size: 8pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="75%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="10%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="12%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Please mark <br>
your votes as<br>
indicated in <br>
this example
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><br>
<FONT face="Wingdings" style="font-size: 20pt">&#120;</FONT>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="center" style="margin-left: 2%">
<TABLE style="font-size: 8pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="1%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="18%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="20%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD>&nbsp;</TD>
    <TD  align="center" valign="top">1.</TD>

    <TD colspan="13" valign="top" align="left">Adoption of the Agreement and Plan of Merger, dated as of June&nbsp;4, 2009, among Axsys
Technologies, Inc., General Dynamics
Advanced Information Systems, Inc. and Vision Merger Sub, Inc.</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><FONT face="Wingdings">&#111;</FONT>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><B>FOR</B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><FONT face="Wingdings">&#111;</FONT>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><B>AGAINST</B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><FONT face="Wingdings">&#111;</FONT>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><B>ABSTAIN</B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD>&nbsp;</TD>
    <TD valign="top" align="center">2.</TD>

    <TD colspan="13" valign="top" align="left">Approval of adjournment  of the Special Meeting, if necessary, to permit further solicitation of proxies.</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><FONT face="Wingdings">&#111;</FONT>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><B>FOR</B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><FONT face="Wingdings">&#111;</FONT>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><B>AGAINST</B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><FONT face="Wingdings">&#111;</FONT>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><B>ABSTAIN</B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD colspan="15" valign="top" align="center"><font  style="font-family: 'Times New Roman',Times,serif"> (continued and to be signed on the other side)</font><BR></TD>
</TR>
<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top" style="border-top: 2px solid black; border-right: 2px solid black">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD  style="border-right: 2px solid black">&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>

    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><font style="font-size: 8pt">Mark  Here for Address<br>
Change or Comments<br>
SEE REVERSE</font>

</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="middle">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="Wingdings">&#111;</FONT></TD>

</TR>

<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD style="border-left: 2px solid black">&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD  style="border-bottom: 2px solid black; border-left: 2px solid black">&nbsp;</TD>
    <TD align="left" valign="top"  style="border-bottom: 2px solid black">&nbsp;</TD>
    <TD  style="border-bottom: 2px solid black">&nbsp;</TD>
    <TD align="left" valign="top"  style="border-bottom: 2px solid black">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>
<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="center">
<TABLE style="font-size: 10pt; margin-left: 2%" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="25%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px"><font style="font-size: 10pt"><B>Signature</B></font>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><font style="font-size: 10pt"><B>Signature</B></font>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><font style="font-size: 8pt"><B>Date</B></font></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top" style="border-top: 1px solid #000000">&nbsp;
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top" style="border-top: 1px solid #000000">&nbsp;
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top" style="border-top: 1px solid #000000">&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV></DIV>



<DIV align="left" style="font-size: 8pt; margin-top: 6pt; margin-left: 2%"><B>Please sign exactly as name appears above. When shares are held by joint tenants,
both should sign. When signing as attorney, executor, administrator, trustee or guardian,
please give full title as such. If a corporation, please sign in full corporate name by
President or other authorized officer. If partnership, please sign in
partnership name by authorized person.</B>
</DIV>
<DIV align="center">
<TABLE style="font-size: 8pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="15%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="40%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><FONT face="Webdings">&#053;</FONT>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><B>FOLD AND DETACH HERE</B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><FONT face="Webdings">&#053;</FONT></TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>WE ENCOURAGE YOU TO TAKE ADVANTAGE OF INTERNET OR TELEPHONE VOTING,<BR>
BOTH ARE AVAILABLE 24 HOURS A DAY, 7 DAYS A WEEK.</B>
</DIV>


<DIV align="center" style="font-size: 8pt; margin-top: 18pt">Internet and telephone voting is available through 11:59 PM Eastern Time<BR>
the day prior to special meeting day.
</DIV>

<P><DIV style="position: relative; float: left; width: 45%">
<P>
<DIV style="width: 100%; border: 1px solid black; padding: 11px;">


<DIV align="center">
<TABLE style="font-size: 9pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="50%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="45%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD colspan="3" valign="top" align="center"><B>Axsys Technologies, Inc.</B></TD>
</TR>
<TR valign="bottom" style="font-size: 50pt"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size: 50pt"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size: 50pt"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size: 50pt"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom" style="font-size: 20pt"><!-- Blank Space -->
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<!-- End Table Body -->
</TABLE>
</DIV>
</DIV>



<DIV align="left" style="font-size: 8pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>You can review the Proxy statement on the Internet at</B><BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#091;<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>&#093;

</DIV>
</DIV>
<DIV style="position: relative; float: right; width: 45%">
<P>
<DIV style="width: 100%; border: 1px solid black; padding: 11px;">



<DIV align="center" style="font-size: 8pt; margin-top: 0pt"><B>INTERNET</B><BR>
&#091;<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>&#093;
</DIV>

<DIV align="left" style="font-size: 8pt; margin-top: 6pt">Use the Internet to vote your proxy. Have your proxy card in
hand when you access the web site.
</DIV>

</DIV>



<DIV align="center" style="font-size: 10pt; margin-top: 6pt"><b>OR</b>
</DIV>


<DIV style="width: 100%; border: 1px solid black; padding: 11px;">



<DIV align="center" style="font-size: 8pt; margin-top: 0pt"><b>TELEPHONE</b><BR>
&#091;<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>&#093;
</DIV>

<DIV align="left" style="font-size: 8pt; margin-top: 6pt">Use any touch-tone telephone to vote your proxy. Have your proxy card in hand when you call.
</DIV>

</DIV>


<DIV align="justify" style="font-size: 7pt; margin-top: 6pt; margin-left: 2%">If you vote your proxy by Internet or by telephone, you do NOT need to mail back your proxy
card.
</DIV>

<DIV align="justify" style="font-size: 7pt; margin-top: 6pt;  margin-left: 2%">To vote by mail, mark, sign and date your proxy card and return it in the enclosed postage-paid
envelope.
</DIV>

<DIV align="justify" style="font-size: 7pt; margin-top: 6pt;  margin-left: 2%"><B>Your Internet or telephone vote authorizes the named proxies to vote your shares in the same
manner as if you marked, signed and returned your proxy card.</B>
</DIV>

</DIV>
<BR clear="all"><BR>

<P align="center" style="font-size: 10pt"><!-- Folio --><!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>
<DIV style="font-family: Helvetica,Arial,sans-serif">


<DIV align="center" style="font-size: 12pt; margin-top: 18pt"><B>AXSYS TECHNOLOGIES, INC.<BR>
SPECIAL MEETING OF STOCKHOLDERS &#151; August &#091;</B>&#095;&#095;<B>&#093; , 2009<BR>
PROXY<BR>
This Proxy is Solicited by the Board of Directors</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 18pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The undersigned hereby appoints Stephen W. Bershad and David A. Almeida, and each of them, the
attorneys and proxies of the undersigned (each with power to act without the other and with power
of substitution) to vote, in accordance with the terms of this proxy, all shares of Common Stock of
Axsys Technologies, Inc., which the undersigned may be entitled to vote at the Special Meeting of
Stockholders to be held  at &#091;&#095;&#095;&#093;, on the &#091;&#095;&#095;&#093; day of August&nbsp;2009, at &#091;10:00&nbsp;a.m.,&#093; and any adjournment or postponement
thereof,
upon all matters which may properly come before said meeting.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 12pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>This proxy when properly executed will be voted in the manner directed herein by the undersigned
stockholder. If no direction is made, this proxy will be voted &#147;FOR&#148; THE ADOPTION OF THE AGREEMENT
PLAN OF MERGER AND APPROVAL OF ADJOURNMENT OF THE SPECIAL MEETING and in the
discretion of the proxies on any other matter that may properly come before the meeting or any
adjournment or postponement thereof.</B>
</DIV>
<DIV align="Center" style="font-size: 10pt; margin-top: 3pt"><B>(Continued, and to be dated and signed, on reverse side)</B>
</DIV>


<DIV align="right">
<TABLE style="font-size: 7pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom" style="font-size: 7pt">
    <TD width="1%">&nbsp;</TD>
    <TD width="19%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD><!-- VRule -->
    <TD width="2%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>

    <TD width="1%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">

    <TD width="1%" style="border-left: 0px solid #000000; border-top: 0px solid #000000">&nbsp;</TD>
              <TD valign="top" style="border-top: 0px solid #000000"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD style="border-right: 0px solid #000000; border-top: 0px solid #000000">&nbsp;</TD>
    <TD style="border-top: 0px solid #000000">&nbsp;</TD>
    <TD align="left" valign="top" style="border-top: 0px solid #000000"><DIV style="margin-left:25px; text-indent:-0px">BNY MELLON SHAREOWNER SERVICES</div></TD>
    <TD width="1%" style="border-right: 0px solid #000000; border-top: 0px solid #000000">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD width="1%" style="border-left: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="center" style="border-top: 1px solid #000000"><DIV style="margin-left:0px; text-indent:-0px"><B>Address Change/Comments</B>
</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 0px solid #000000">&nbsp;</TD>
    <TD align="left" valign="top" style="border-top: 0px solid #000000"><DIV style="margin-left:25px; text-indent:-0px">P.O. BOX 3550</div></TD>
    <TD width="1%" style="border-right: 0px solid #000000; border-top: 0px solid #000000">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD width="1%" style="border-left: 1px solid #000000; border-top: 0px solid #000000">&nbsp;</TD>

    <TD align="center" style="border-top: 0px solid #000000" nowrap><DIV style="margin-left:0px; text-indent:-0px"><B>(Mark the corresponding box on the reverse side)</B>
</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 0px solid #000000">&nbsp;</TD>
    <TD style="border-top: 0px solid #000000">&nbsp;</TD>
    <TD align="left" valign="top" style="border-top: 0px solid #000000"><DIV style="margin-left:25px; text-indent:-0px">SOUTH HACKENSACK, NJ 07606-9250</div></TD>
    <TD width="1%" style="border-right: 0px solid #000000; border-top: 0px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD width="1%" style="border-left: 1px solid #000000; border-top: 1px solid #000000"><br><br><br><br><br><br>&nbsp;</TD>
    <TD align="center" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 0px solid #000000">&nbsp;</TD>

    <TD align="left" valign="middle" style="border-top: 0px solid #000000">
</TD>
    <TD width="1%" style="border-right: 0px solid #000000; border-top: 0px solid #000000">&nbsp;</TD>
</TR>
<TR style="font-size: 1px" valign="bottom">
    <TD colspan="3" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD nowrap align="left" colspan="3" style="border-top: 0px solid #000000">&nbsp;</TD>
</TR>



<!-- End Table Body -->
</TABLE>
</DIV>

<p>
<DIV align="Center" style="font-size: 8pt; margin-top: 6pt">
<B>FOLD AND DETACH </B>
</DIV>
<DIV align="Center" style="font-size: 9pt; margin-top: 0pt; margin-bottom: 100"><font face="webdings">&#053;</font>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <b>HERE</b> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<font face=webdings>&#053;</font></div>


<P><DIV style="position: relative; float: left; width: 12%">
</DIV>
<DIV style="position: relative; float: left; margin-left: 0%; width: 100%">
<P>
<DIV style="width: 100%; border: 1px solid black; padding: 11px;">


<DIV align="left" style="font-size: 10pt; margin-top: 10pt">Choose <b>MLink</b><SUP><b>SM</b></SUP> for fast, easy and secure 24/7 online access to your future proxy
  materials, investment plan statements, tax documents and more. Simply log on to <b>Investor
  ServiceDirect</b><SUP style="font-size: 85%; vertical-align: text-top"><b>&#174;</b></SUP>  at <U>www.bnymellon.com/shareowner/isd</U> where step-by-step instructions will
  prompt you through enrollment.

</DIV>

</DIV>


</DIV>
<DIV style="position: relative; float: right; width: 12%">
</DIV>
<BR clear="all"><BR>








<P align="center" style="font-size: 10pt"><!-- Folio --><!-- /Folio -->
</DIV>



<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>
<DIV style="font-family: Helvetica,Arial,sans-serif">


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>Preliminary Copy</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-left: 2%"><B>THIS PROXY WILL BE VOTED AS DIRECTED, OR IF NO DIRECTION IS INDICATED, WILL BE VOTED
&#147;FOR&#148; THE PROPOSALS.</B></DIV>


<DIV align="center">
<TABLE style="font-size: 8pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="80%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Please mark</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">your votes as<br>indicated in<br>this example
</TD>
    <TD>&nbsp;</TD>

<TD align="left" valign="top">
<FONT face="Wingdings" style="font-size: 20pt">&#120;</FONT></TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="center">
<TABLE style="font-size: 8pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="8%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="30%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="30%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="3%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="20%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD align="center" valign="top">1.</TD>
    <TD>&nbsp;</TD>
    <TD colspan="15" valign="top" align="left">Adoption of
the Agreement and Plan of Merger, dated as of June&nbsp;4, 2009, among Axsys
Technologies, Inc., General Dynamics</TD>
</TR>
<TR valign="bottom">
    <TD valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="15" valign="top" align="left">Advanced Information Systems, Inc. and Vision Merger Sub, Inc.</TD>
</TR>
<tr>
<td>&nbsp;</td>
</tr>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><B><FONT face="Wingdings">&#111;</FONT></B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><B>FOR</B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><B><FONT face="Wingdings">&#111;</FONT></B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><B>AGAINST</B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><B><FONT face="Wingdings">&#111;</FONT></B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><B>ABSTAIN</B></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<tr>
<td>&nbsp;</td>
</tr>
<TR valign="bottom">
    <TD align="center" valign="top">2.</TD>
    <TD>&nbsp;</TD>
    <TD colspan="15" valign="top" align="left"><FONT style="white-space: nowrap">Approval of
adjournment of the Special Meeting, if necessary, to permit further solicitation of proxies.</FONT></TD>
</TR>
<tr>
<td>&nbsp;</td>
</tr>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><B><FONT face="Wingdings">&#111;</FONT></B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><B>FOR</B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><B><FONT face="Wingdings">&#111;</FONT></B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><B>AGAINST</B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><B><FONT face="Wingdings">&#111;</FONT></B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top"><B>ABSTAIN</B></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

 <DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="center" style="font-size: 10pt; margin-top: 6pt">(continued and to be signed on the other side)<br><br>
</DIV></DIV>

<DIV align="center">
<TABLE style="font-size: 8pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="15%"><DIV style="width: 100%; border-bottom: 0px solid #000000; font-size: 1px">&nbsp;</DIV></TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="10%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="15%" style="border-top: 3px solid #000000; border-right: 3px solid #000000; font-size: 1px">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="20%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
    <TD width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="5%"><DIV style="width: 100%; border-top: 0px solid #000000; font-size: 1px">&nbsp;</DIV></TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
<TD width="15%" style="border-top: 0px solid #000000; border-right: 3px solid #000000; font-size: 1px">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Mart Here for Address<br>Change or Comments<br>SEE REVERSE</TD>
    <TD valign=middle><FONT face="Wingdings" style="font-size: 10px">&#111;</FONT></TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top" style="border-bottom: 0px solid #000000; border-left: 3px solid #000000">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">
</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD valign="top" style="border-bottom: 3px solid #000000; border-left: 3px solid #000000">&nbsp;</TD>
    <TD >&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV style="font-family: 'Times New Roman',Times,serif">
<DIV align="left" style="font-size: 10pt; margin-top: 12pt; margin-left: 2%"><b>Signature&nbsp;
<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;</U> Signature&nbsp;<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U><U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>
Date&nbsp;<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</U>
</b></DIV></DIV>

<DIV align="left" style="font-size: 8pt; margin-top: 6pt; margin-left: 2%"><b>Please sign exactly as name appears
above. When shares are held by joint tenants, both should
sign. When signing as attorney, executor, administrator, trustee or guardian, please give full
title as such. If a corporation, please sign in full corporate name by President or other
authorized officer. If partnership, please sign in partnership name by authorized person.</b>
</DIV>


<DIV align="center">
<TABLE style="font-size: 8pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="15%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="60%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD>&nbsp;</TD>
    <TD valign="top" align="center"><DIV style="margin-left:0px; text-indent:-0px"><FONT face="Webdings">&#053;</FONT></DIV></TD>

    <TD align="center" valign="top"><b>FOLD AND DETACH HERE</b>
</TD>

    <TD align="center" valign="top"><FONT face="Webdings">&#053;</FONT></TD>
<TD>&nbsp;</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>




<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>WE ENCOURAGE YOU TO TAKE ADVANTAGE OF INTERNET OR TELEPHONE VOTING,<BR>
BOTH ARE AVAILABLE 24 HOURS A DAY, 7 DAYS A WEEK.</B>
</DIV>


<DIV align="Center" style="font-size: 8pt; margin-top: 6pt">Internet and telephone voting is available through 11:59 PM Eastern Time<BR>
the day prior to special meeting day.

</DIV>
<P><DIV style="position: relative; float: left; width: 45%">
<P>
<DIV style="width: 100%; border: 1px solid black; padding: 11px;">



<DIV align="center" style="font-size: 9pt; margin-top: 18pt"><B>Axsys Technologies, Inc.</B><br><BR>
<br><BR>
<br><BR>
<br><BR>
<br><BR>

<br><BR>
<br><BR>
<br><BR>
<br><BR>
<br><BR>
<br>
</DIV>

</DIV>


<DIV align="left" style="font-size: 8pt; margin-top: 6pt"><b>You can review the
Proxy Statement <BR>on the Internet at
&#091;<U>&nbsp;&nbsp;&nbsp;</U>&#093;</b>
</DIV>

</DIV>
<DIV style="position: relative; float: right; width: 50%">
<P>
<DIV style="width: 100%; border: 1px solid black; padding: 4px;">



<DIV align="Center" style="font-size: 8pt; margin-top: 6pt"><b>INTERNET</b><BR>
&#091;<u>&nbsp;&nbsp;&nbsp;</u>&#093;

</DIV>
<DIV align="left" style="font-size: 8pt; margin-top: 6pt">Use the Internet to vote your proxy. Have your proxy card in
hand when you access the web site.
</DIV>

</DIV>



<DIV align="Center" style="font-size: 10pt; margin-top: 6pt"><B>OR</B>

</DIV>
<DIV style="width: 100%; border: 1px solid black; padding: 11px;">


<DIV align="Center" style="font-size: 8pt; margin-top: 6pt"><b>TELEPHONE</b><BR>
&#091;<u>&nbsp;&nbsp;&nbsp;</u>&#093;

</DIV>
<DIV align="left" style="font-size: 8pt; margin-top: 6pt">Use any touch-tone telephone to vote your proxy. Have your proxy card in hand when you call.
</DIV>

</DIV>


<DIV align="justify" style="font-size: 7pt; margin-top: 6pt; margin-left: 3%">If you vote your proxy by
Internet or by telephone, you do NOT need to mail back your proxy card.
</DIV>

<DIV align="justify" style="font-size: 7pt; margin-top: 6pt; margin-left: 3%">To vote by mail, mark, sign
and date your proxy card and return it in the enclosed
postage-paid envelope.
</DIV>

<DIV align="justify" style="font-size: 7pt; margin-top: 6pt; margin-left: 3%"><b>Your Internet or telephone vote
authorizes the named proxies to vote your shares in the same manner
as if you marked, signed and returned your proxy
card.</b>
</DIV>

</DIV>
<BR clear="all"><BR>

<P align="center" style="font-size: 10pt"><!-- Folio -->- 3 -<!-- /Folio -->
</DIV>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#tocpage">Table of Contents</A></H5><P>

<DIV style="font-family: Helvetica,Arial,sans-serif">

<DIV align="center" style="font-size: 12pt; margin-top: 18pt"><B>AXSYS TECHNOLOGIES, INC.<BR>
SPECIAL MEETING OF STOCKHOLDERS &#151; August </B> &#091;&#095;&#095;&#093; <B>, 2009<BR>
PROXY<BR>
This Proxy is Solicited by the Board of Directors</B>
</DIV>


<DIV align="justify" style="font-size: 10pt; margin-top: 18pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The undersigned hereby authorizes and directs Fidelity Investments Institutional Services
Company, Inc., as trustee (the &#147;Trustee&#148;), of Axsys Technologies, Inc. Employees Retirement Savings
Plan to vote for the undersigned, in person or by proxy, as herein stated at the Special Meeting of
Stockholders of Axsys Technologies, Inc. (the &#147;Company&#148;) to be held at &#091;&#095;&#095;&#093; on the &#091;<u>&nbsp;&nbsp;&nbsp;</u>&#093; day of August&nbsp;2009, at
10:00&nbsp;a.m., and any adjournment thereof, all shares of Common Stock of the Company allocated to
the account of the undersigned under such plan, on the proposals set forth on the reverse side
hereof and in accordance with the Trustee&#146;s discretion on any other matters that may properly come
before the meeting or any adjournments or postponement thereof. The undersigned hereby
acknowledges receipt of the Notice and Proxy Statement.
</DIV>

<DIV align="justify" style="font-size: 10pt; margin-top: 12pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>This proxy when properly executed will be voted in the manner directed herein by the
undersigned stockholder. If no direction is made, this proxy will be voted &#147;FOR&#148; THE ADOPTION OF
THE AGREEMENT PLAN OF MERGER AND APPROVAL OF ADJOURNMENT OR POSTPONEMENT OF THE SPECIAL MEETING.</B>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 10pt"><B>(Continued, and to be dated and signed, on reverse side)</B>
</DIV>

<DIV align="right">
<TABLE style="font-size: 7pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom" style="font-size: 7pt">
    <TD width="1%">&nbsp;</TD>
    <TD width="19%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD><!-- VRule -->
    <TD width="2%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>

    <TD width="1%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">

    <TD width="1%" style="border-left: 0px solid #000000; border-top: 0px solid #000000">&nbsp;</TD>
              <TD valign="top" style="border-top: 0px solid #000000"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD style="border-right: 0px solid #000000; border-top: 0px solid #000000">&nbsp;</TD>
    <TD style="border-top: 0px solid #000000">&nbsp;</TD>
    <TD align="left" valign="top" style="border-top: 0px solid #000000"><DIV style="margin-left:25px; text-indent:-0px">BNY MELLON SHAREOWNER SERVICES</div></TD>
    <TD width="1%" style="border-right: 0px solid #000000; border-top: 0px solid #000000">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD width="1%" style="border-left: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD align="center" style="border-top: 1px solid #000000"><DIV style="margin-left:0px; text-indent:-0px"><B>Address Change/Comments</B>
</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 0px solid #000000">&nbsp;</TD>
    <TD align="left" valign="top" style="border-top: 0px solid #000000"><DIV style="margin-left:25px; text-indent:-0px">P.O. BOX 3550</div></TD>
    <TD width="1%" style="border-right: 0px solid #000000; border-top: 0px solid #000000">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD width="1%" style="border-left: 1px solid #000000; border-top: 0px solid #000000">&nbsp;</TD>

    <TD align="center" style="border-top: 0px solid #000000" nowrap><DIV style="margin-left:0px; text-indent:-0px"><B>(Mark the corresponding box on the reverse side)</B>
</DIV></TD>
    <TD style="border-right: 1px solid #000000; border-top: 0px solid #000000">&nbsp;</TD>
    <TD style="border-top: 0px solid #000000">&nbsp;</TD>
    <TD align="left" valign="top" style="border-top: 0px solid #000000"><DIV style="margin-left:25px; text-indent:-0px">SOUTH HACKENSACK, NJ 07606-9250</div></TD>
    <TD width="1%" style="border-right: 0px solid #000000; border-top: 0px solid #000000">&nbsp;</TD>
</TR>

<TR valign="bottom">
    <TD width="1%" style="border-left: 1px solid #000000; border-top: 1px solid #000000"><br><br><br><br><br><br>&nbsp;</TD>
    <TD align="center" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-right: 1px solid #000000; border-top: 1px solid #000000">&nbsp;</TD>
    <TD style="border-top: 0px solid #000000">&nbsp;</TD>

    <TD align="left" valign="middle" style="border-top: 0px solid #000000">
</TD>
    <TD width="1%" style="border-right: 0px solid #000000; border-top: 0px solid #000000">&nbsp;</TD>
</TR>
<TR style="font-size: 1px" valign="bottom">
    <TD colspan="3" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD nowrap align="left" colspan="3" style="border-top: 0px solid #000000">&nbsp;</TD>
</TR>



<!-- End Table Body -->
</TABLE>
</DIV>

<p>
<DIV align="Center" style="font-size: 8pt; margin-top: 6pt">
<B>FOLD AND DETACH </B>
</DIV>
<DIV align="Center" style="font-size: 9pt; margin-top: 0pt; margin-bottom: 100"><font face="webdings">&#053;</font>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <b>HERE</b> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<font face=webdings>&#053;</font></div>



<P>
<DIV style="width: 100%; border: 1px solid black; padding: 4px;">

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Choose <B>MLink</B><SUP style="font-size: 85%; vertical-align: text-top"><B>SM</B></SUP> for fast, easy and secure 24/7 online access to your future proxy
materials, investment plan statements, tax documents and more. Simply log on to <B>Investor Service
Direct</B><SUP style="font-size: 85%; vertical-align: text-top"><b>&#174;</b></SUP> at <U>www.bnymellon.com/shareowner/isd</U> where step-by-step instructions will prompt
you through enrollment.
</DIV>

</DIV>






<P align="center" style="font-size: 10pt"><!-- Folio -->- 4 -<!-- /Folio -->
</DIV>



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</SUBMISSION>
