Re Contract

BAE SYSTEMS PLC
29 October 2001

27 October 2001

                        JOINT STRIKE FIGHTER DECISION

Following the US Department of Defense announcement on the Joint Strike
Fighter (JSF) programme, BAE SYSTEMS has been selected to be part of the
winning Lockheed Martin team.

The team will now participate in the next phase of the programme, System
Development and Demonstration (SDD) to develop this next generation strike
aircraft.

Twenty-two aircraft will be produced as part of the SDD.

The Joint Strike Fighter programme will produce aircraft in three variants for
the US Air Force, US Navy, US Marine Corps, and the UK Royal Navy and Royal
Air Forces.

Ends