S-4

As filed with the Securities and Exchange Commission on April 30, 2007

Registration No. 333-          

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM S-4

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

ALION SCIENCE AND TECHNOLOGY CORPORATION
(Exact Name of Registrant as Specified in its Charter)

(See table of additional registrants on following page)
Delaware	541330	54-2061691
(State or Other Jurisdiction of Incorporation or Organization)	(Primary Standard Industrial Classification Code Number)	(I.R.S. Employer Identification Number)

1750 Tysons Boulevard Suite 1300 McLean, VA 22102 (703) 918-4480	10 West 35th Street Chicago, IL 60616 (312) 567-4000
(Address, including Zip Code and Telephone Number, including Area Code of Registrant’s Principal Executive Offices)

James C. Fontana
Alion Science and Technology Corporation
1750 Tysons Boulevard
Suite 1300
McLean, VA 22102
(703) 918-4480

(Name, Address, including Zip Code and Telephone Number, including Area Code, of Agent for Service)

Copies to

Marc R. Paul

Baker & McKenzie LLP

815 Connecticut Avenue, N.W.

Washington, DC 20006

Approximate date of commencement of proposed sale to the public:  As soon as practicable following the effective date of this Registration Statement.

If the securities being registered on this Form are to be offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box.  o

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  o

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  o

CALCULATION OF REGISTRATION FEE

			Proposed maximum			Proposed maximum		Amount of
Title of each class of	Amount to be		offering price			aggregate offering		registration
securities to be registered	registered		per unit(1)			price(1)		fee(1)
101/4% Senior Notes due 2015	$	250,000,000		100	%	$	250,000,000	$	7,675
Guarantees of 101/4% Senior Notes due 2015(2)		—		—			—		—	(3)
Total	$	250,000,000		100	%	$	250,000,000	$	7,675

(1)	Estimated solely for the purpose of calculating the registration fee in accordance with Rule 457(f) under the Securities Act of 1933, as amended. The registration fee has been calculated pursuant to Rule 457(f)(2) under the Securities Act of 1933, as amended.
(2)	See the following page for a table of guarantor registrants.
(3)	Pursuant to Rule 457(n), no additional registration fee is payable with respect to the guarantees.

The registrants hereby amend this registration statement on such date or dates as may be necessary to delay its effective date until the registrants shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this registration statement shall become effective on such date as the Commission acting pursuant to said Section 8(a), may determine.

Table of Guarantor Registrants

Exact Name of	State or Other	Primary Standard
Additional Registrant	Jurisdiction of	Industrial	I.R.S. Employer
as Specified in the	Incorporation or	Classification Code	Identification
Charter	Organization	Number	Number
Alion — BMH Corporation	Virginia	541330	54-1384264
Alion — CATI Corporation	California	541511	77-0323371
Alion — JJMA Corporation	New York	541330	13-5679965
Alion — MA&D Corporation	Colorado	541511	84-1145568
Alion — METI Corporation	Virginia	541690	54-1554099
Human Factors Applications, Inc.	Pennsylvania	541330	23-2217191
Washington Consulting, Inc.	Virginia	541611	76-0725281

The address for each of the additional registrants is c/o Alion Science and Technology Corporation, 1750 Tysons Boulevard, Suite 1300, McLean, VA 22102, telephone: (703) 918-4480. The name and address, including zip code, of the agent for service of process for each additional registrant is James C. Fontana, Alion Science and Technology Corporation, 1750 Tysons Boulevard, Suite 1300, McLean, VA, 22102, telephone: (703) 918-4480.

The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

SUBJECT TO COMPLETION, DATED APRIL 30, 2007

PRELIMINARY PROSPECTUS

EXCHANGE OFFER

for

All Outstanding

101/4% Senior Notes Due 2015

of

Alion Science and Technology Corporation

and

Related Subsidiary Guarantees

This prospectus and accompanying letter of transmittal relate to our proposed exchange offer. We are offering to exchange up to $250,000,000 aggregate principal amount of registered 101/4% senior notes due 2015, which we refer to as the “exchange notes,” for any and all outstanding unregistered 101/4% senior notes due 2015, which we refer to as the “outstanding notes,” issued in a private offering on February 8, 2007, and which have certain transfer restrictions.

In this prospectus we sometimes refer to the outstanding notes and the exchange notes collectively as the “notes.”

•  The terms of the exchange notes are substantially identical to the terms of the outstanding notes, except that we have registered the exchange notes with the Securities and Exchange Commission, which we refer to as the “SEC.” Because we have registered the exchange notes, they will not be subject to transfer restrictions and will not be entitled to certain registration rights. The exchange notes will represent the same debt as the outstanding notes, and will be issued under the same indenture.

•  The outstanding notes are, and the exchange notes will be, guaranteed by certain of our current domestic subsidiaries and certain of our future subsidiaries.

•  We will exchange any and all outstanding notes that are validly tendered and not validly withdrawn for an equal principal amount of exchange notes which are registered under the Securities Act of 1933, which we refer to as the Securities Act.

•  The exchange offer expires at 5:00 p.m., New York City time, on          , 2007, unless extended.

•  We will not receive any proceeds from the exchange offer.

•  Outstanding notes not exchanged in the exchange offer will remain outstanding and be entitled to the benefits of the indenture, but, except under certain circumstances, will have no further exchange or registration obligations under the registration rights agreement discussed in this prospectus.

•  We do not intend to list the exchange notes on any securities exchange or seek approval through any automated quotation system and no active market for the exchange notes is anticipated.

Each broker-dealer that receives exchange notes for its own account pursuant to the exchange offer must acknowledge that it will deliver a prospectus in connection with any resale of such exchange notes. The letter of transmittal states that by so acknowledging and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an “underwriter” within the meaning of the Securities Act. This prospectus, as it may be amended or supplemented from time to time, may be used by a broker-dealer in connection with resales of exchange notes received in exchange for outstanding notes where such outstanding notes were acquired by such broker-dealer as a result of market-making activities or other trading activities. We have agreed that, for a period of 180 days after the expiration date (as defined herein), we will make this Prospectus available to any broker-dealer for use in connection with any such resale. See “Plan of Distribution.”

Please consider carefully the “Risk Factors” beginning on page 16 of this prospectus before deciding to participate in the exchange offer.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

The date of this prospectus is          , 2007

TABLE OF CONTENTS

	Page
About This Prospectus		i
Forward-Looking Statements		ii
Use of Non-Gaap Measures		iii
Industry and Market Data		iii
Trademarks		iii
Where You Can Find Additional Information		iv
Prospectus Summary		1
Risk Factors		16
Use of Proceeds		31
Ratio of Earnings to Fixed Charges		31
Capitalization		32
Unaudited Pro Forma Condensed Financial Information		33
Selected Consolidated Financial Data		36
Management’s Discussion and Analysis of Financial Condition and Results of Operations		40
Business		62
Employee Stock Ownership Plan		85
Management		86
Certain Relationships and Related Transactions		101
Security Ownership of Certain Beneficial Owners and Management and Related Stockholders Matters		102
Description of Other Indebtedness		103
The Exchange Offer		116
Description of the Notes		124
Material United States Federal Income Tax Considerations		168
Plan of Distribution		172
Legal Matters		173
Independent Registered Public Accounting Firms		173
Index to Financial Statements		F-1
EX-3.4
EX-3.5
EX-3.6
EX-3.7
EX-3.8
EX-3.9
EX-3.10
EX-3.11
EX-3.12
EX-3.13
EX-3.14
EX-3.15
EX-3.16
EX-3.17
EX-3.18
EX-3.19
EX-3.20
EX-3.21
EX-3.22
EX-3.23
EX-3.24
EX-4.19
EX-5.1
EX-10.85
EX-12.1
EX-23.1
EX-23.2
EX-25.1
EX-99.1
EX-99.2
EX-99.3
EX-99.4
EX-99.5

ABOUT THIS PROSPECTUS

This prospectus is part of a registration statement we have filed with the SEC. We are submitting this prospectus to holders of outstanding notes so that they can consider exchanging the outstanding notes for exchange notes.

You should rely only on the information contained in this prospectus or to which we have referred you. We have not authorized anyone to provide you with information that is different. This prospectus may only be used where it is legal to make the exchange offer and by a broker-dealer for resales of exchange notes acquired in the exchange offer where it is legal to do so. The information in this prospectus may only be accurate on the date of this prospectus.

i

FORWARD-LOOKING STATEMENTS

This prospectus includes and incorporates by reference forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact, included in this prospectus or incorporated by reference into this prospectus are forward-looking statements. These statements relate to our future plans, objectives, expectations and intentions and are for illustrative purposes only.

These forward-looking statements may be identified by the use of words such as “believe,” “expect,” “intend,” “plan,” “anticipate,” “likely,” “imply,” “forecast,” “projections,” “could,” “estimate,” “may,” “potential,” “should,” “would,” and similar expressions, and may also include references to assumptions. These statements are contained in the sections entitled “Offering Circular Summary,” “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Business” and other sections of this prospectus.

Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results to be materially different. The factors that could cause actual results to differ materially from those anticipated include, but are not limited to, the following:

•  additional costs associated with compliance provisions of the Sarbanes-Oxley Act of 2002, including any changes in the SEC’s rules, and other corporate governance requirements;

•  failure of government customers to exercise options under contracts;

•  funding decisions relating to U.S. government projects;

•  government contract procurement risks, such as protests of contract awards, and government contract terminations;

•  competitive factors such as pricing pressures and/or ability to hire and retain employees;

•  the results of current and/or future legal proceedings and government agency proceedings which may arise out of our operations (including our contracts with governmental agencies) and the attendant risks of fines, liabilities, penalties, suspension and/or debarment;

•  undertaking acquisitions that could increase our costs or liabilities or be disruptive;

•  taking on additional debt to fund acquisitions;

•  failure to adequately integrate acquired businesses;

•  changes to the ERISA laws related to the Alion Science and Technology Corporation Employee Ownership, Savings and Investment Plan;

•  changes to the tax laws relating to the treatment and deductibility of goodwill, our subchapter S status, or any change in our effective tax rate; and

•  material changes in other laws or regulations applicable to our business, as well as other risks discussed elsewhere in this prospectus, including all risk factors described in the section entitled “Risk Factors.”

You are cautioned not to place undue reliance on these forward-looking statements, which reflect our management’s view only as of the date of this prospectus. Except as may be required by applicable law, we undertake no obligation to update any of these factors or to publicly announce any change to our forward-looking statements made herein, whether as a result of new information, future events, changes in expectations or otherwise.

ii

USE OF NON-GAAP MEASURES

We have included certain non-GAAP financial measures in this prospectus, including earnings before interest, income taxes, depreciation and amortization (EBITDA) and Adjusted EBITDA. We believe that the presentation of EBITDA and Adjusted EBITDA enhances an investor’s understanding of our financial performance. We believe that EBITDA is a useful financial metric to assess our operating performance from period to period by adding back certain items, such as the effect on amortization of the substantial amount of intangible assets on our balance sheet, that we believe are not representative of our core business. In addition, we believe that Adjusted EBITDA is a useful financial metric to assess our operating performance from period to period by adding back certain items, such as certain non-cash items that have no effect on our cash available for operations and certain adjustments, that we believe are not representative of our core business. Adjusted EBITDA is the basis for the calculation of various covenants in the indenture governing the notes. EBITDA and Adjusted EBITDA are not measures under U.S. GAAP and our use of the terms EBITDA and Adjusted EBITDA varies from others in our industry. EBITDA and Adjusted EBITDA should not be considered as alternatives to net income (loss), operating income or any other performance measures derived in accordance with U.S. GAAP, as measures of operating performance or operating cash flows or as measures of liquidity.

EBITDA and Adjusted EBITDA have important limitations as analytical tools and you should not consider them in isolation or as substitutes for analysis of our results as reported under U.S. GAAP. For example, EBITDA and Adjusted EBITDA:

•  do not reflect any cash capital expenditure requirements for the assets being depreciated and amortized that may have to be replaced in the future;

•  do not reflect changes in, or cash requirements for, our working capital needs; and

•  do not reflect the significant interest expense, or the cash requirements necessary to service interest or principal payments, on our debt.

INDUSTRY AND MARKET DATA

We obtained the industry, market and competitive position data used throughout this prospectus from our own research, surveys or studies conducted by third parties and industry or general publications. Industry publications and surveys generally state that they have obtained information from sources believed to be reliable, but do not guarantee the accuracy and completeness of such information. While we believe that each of these studies and publications is reliable, we have not independently verified such data and we make no representations as to the accuracy of such information. Similarly, we believe our internal research is reliable but it has not been verified by any independent sources.

TRADEMARKS

The following terms used in this prospectus are our trademarks: Alion^®, Alion Science and Technology Corporation^tm, FACET^tm, ACAT^tm, SMART^tm, X-IG^tm, MobSim^tm, SimViewer^tm, Virtual Ocean^tm, Countermeasures^tm, CaveDog^tm, RTLS^tm, Isis-3D^tm, PRISM^® and Spectrum XXI^tm. All other trademarks appearing in this prospectus are the property of their holders.

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WHERE YOU CAN FIND ADDITIONAL INFORMATION

We have filed a registration statement on Form S-4 with the SEC with respect to the exchange notes and related guarantees offered by this prospectus. This prospectus, which is a part of the registration statement, does not contain all of the information included in that registration statement. For further information about us and the exchange notes and related guarantees offered in this prospectus, you should refer to the registration statement and its exhibits.

Immediately prior to the effectiveness of the registration statement relating to the exchange offer, we filed annual, quarterly and current reports and other information with the SEC on a voluntary basis. Following effectiveness of the registration statement relating to the exchange offer, we will become subject to the informational requirements of the Securities Exchange Act of 1934, as amended, and will be required to file annual, quarterly and current reports and other information with the SEC. These reports, the registration statement and its exhibits and other information are or will be available after filing with the SEC at the SEC’s public reference room located at 100 F. Street, N.E., Room 1580, Washington, D.C. 20459. You can request copies of these documents by writing to the SEC and paying a fee for the copying cost. Please call the SEC at 1-800-SEC-0330 for more information about the operation of the public reference rooms. Our SEC filings are also available at the SEC’s web site at http://www.sec.gov. However, these reports and other information are not part of this prospectus and should not be relied upon by investors in making their decision to exchange the outstanding notes for exchange notes.

This prospectus incorporates important business and financial information about us that is not included in or delivered with this prospectus. Such information is available without charge to the holders of our outstanding notes by contacting us at our address, which is Alion Science and Technology Corporation, 1750 Tysons Boulevard, Suite 1300, McLean, Virginia 22102, Attention: General Counsel, or by calling us at (703) 918-4480. To obtain timely delivery of this information, you must request this information no later than five business days before          , 2007.

iv

PROSPECTUS SUMMARY

This summary highlights selected information contained elsewhere or incorporated by reference in this prospectus, but is not complete and may not contain all of the information that is important to you or that you should consider in making a decision to exchange outstanding notes for exchange notes. To understand all of the terms of this exchange offer and the exchange notes and to attain a more complete understanding of our business and financial situation, you should read the entire prospectus carefully, including the “Risk Factors” section and the financial statements and related notes contained elsewhere in this prospectus.

In this prospectus, unless the context requires otherwise, “Alion,” “the Company,” “we,” “us” and “our” refer to Alion Science and Technology Corporation, a Delaware corporation, and its subsidiaries on a consolidated basis; provided however, references to the defined term the “Company” in the “Description of the Notes” section of this prospectus and in other places in this prospectus specifically addressing the notes, refer only to Alion Science and Technology Corporation. “Adjusted EBITDA” is defined in “Description of the Notes — Certain Definitions.” See “Unaudited Pro Forma Condensed Financial Information” for details on the calculation of EBITDA and Adjusted EBITDA. “Anteon Asset Acquisition” refers to our acquisition of certain contracts and related assets from Anteon Corporation (Anteon), which closed on June 30, 2006. “Pro forma” as applied to our results of operations for a particular period means the results after issuance of the outstanding notes and all Alion acquisitions (including the Anteon Asset Acquisition) that occurred on or after the first day of the relevant period, in each case, as though they occurred on the first day of the relevant period. “Organic growth” means the increase in our revenue or Adjusted EBITDA from one fiscal year to the next, excluding revenue from acquired companies.

The Company

With a 70-year legacy, we are a highly-experienced technology solutions company delivering scientific, research and development, and technology expertise and operational support primarily to the U.S. Department of Defense (DoD) and other U.S. government agencies, and commercial customers. Based in McLean, Virginia, we design, develop, integrate, deliver and maintain and upgrade technology solutions, products and tools for national defense, homeland security and other U.S. government programs. For example, we design and engineer complete naval vessels and components for naval vessels for the U.S. Navy; we manage and support the implementation of major U.S. Air Force programs by providing financial, procurement and logistics services; we develop and conduct battle simulations for the U.S. Army to prepare soldiers for combat environments; and we assist the DoD in managing the use of the wireless communications spectrum to optimize the efficient transmission of sensitive data.

We have grown revenue from $156.1 million from operations of our predecessor in fiscal year 2000 to $508.6 million in fiscal year 2006, representing a compounded annual growth rate of 21.8%. Over the same period, our Adjusted EBITDA grew at a compounded annual growth rate of 31.6% from $9.8 million to $50.8 million. This growth has been accomplished through organic growth from new and existing contracts, and through acquisitions. Our compounded organic revenue and Adjusted EBITDA growth rates from fiscal year 2000 to fiscal year 2006 were 9.2% and 18.9%, respectively. Since January 1, 2003, we have completed 11 stock and asset acquisitions. Our largest acquisition is the Anteon Asset Acquisition, which occurred on June 30, 2006 for consideration of approximately $221.4 million.

On a pro forma basis, for the fiscal year ended September 30, 2006, we generated approximately $726.9 million in revenue and approximately $72.4 million in Adjusted EBITDA. As of September 30, 2006, our backlog was approximately $4.2 billion or roughly 5.8 times our pro forma revenue for the fiscal year ended September 30, 2006.

We have a broad customer and contract base. As of September 30, 2006 we served approximately 350 customers including all branches of the U.S. military, a number of Cabinet-level U.S. government agencies, as well as state and foreign governments to a lesser degree. We recorded approximately 95.2% of our pro forma revenue for the fiscal year ended September 30, 2006 from U.S. government contracts, and approximately 91.0% of our pro forma revenue came from approximately 200 different DoD customers. The following branches of the DoD contributed to our pro forma revenue for the fiscal year ended September 30,

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2006: the Navy (45.8%), the Army (18.1%), the Air Force (15.1%) and all other branches of the DoD (11.9%). As of September 30, 2006, we had a portfolio of over 800 active contracts and task orders with a large portion of our contracts and task orders (based on contract revenue) having cost-reimbursement and time-and-materials pricing structures and a smaller portion (based on contract revenue) having fixed-price pricing structures.

We deliver solutions in the following seven core business areas:

•  defense operations;

•  wireless communications;

•  industrial technology solutions;

•  naval architecture and marine engineering;

•  modeling and simulation;

•  chemical, biological, nuclear and environmental sciences; and

•  information technology.

The following charts show our pro forma revenue by core business area and contract type for the fiscal year ended September 30, 2006:

Pro Forma Revenue by Core Business Area	Pro Forma Revenue by Contract Type
($ in millions)	($ in millions)

Total Pro Forma Revenue for the Fiscal Year Ended September 30, 2006: $726.9 million

Our sophisticated technology solutions in all of our core business areas are supported by our skilled employee base, which includes engineers, scientists and former military personnel. Approximately 72% of our employees have security clearances, with approximately 22% of our employees holding clearances at the Top Secret level or above, allowing us access to highly classified DoD information systems and networks. To enhance our technology solutions, we have approximately 120,000 square feet of laboratory facilities, which we use to conduct customer-funded research and development activities, and to a lesser degree, internally-funded research and development activities.

Alion has a long operating history in providing a broad range of technology solutions. We have supported the Information Analysis Centers (IACs) and the Extremely Low Frequency (ELF) Submarine Communications program for over 20 years, and we have supported the DoD for over 40 years in ensuring

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that military communications equipment and networks can operate as intended without causing or suffering from interference. Examples of our technology solutions include:

•  For the U.S. Intelligence Security Command (INSCOM) — Army Directed Studies Office (ADSO), we develop intelligence scenarios incorporating a suite of technologies, using modeling and simulation technologies, animation, video, and audio, to depict U.S., allied, hostile, and non-combatant forces, as well as the social, cultural, and physical attributes that exist in the supported command area of operations.

•  In support of the Defense Advanced Research Projects Agency (DARPA) Real-Time Adversarial Intelligence and Decision-Making (RAID) Program, we are providing simulation support and developing capabilities leveraging emerging technologies in adversarial and deception reasoning for anticipating enemy actions and deceptions, with particular focus on providing real-time support to tactical commanders in urban operations.

•  We are providing technology solutions to the Pacific Command (PACOM) and the Northern Command (NORTHCOM) of the U.S. Army in the development of a pandemic modeling decision support tool that will permit assessment of the impact of infectious diseases, like Bird Flu, on the readiness of a military organization.

•  In support of the U.S. Navy’s Office of Naval Research, we are developing a “transformable craft,” or T-Craft, to deliver payloads across open ocean and onto the shore. The vehicle is designed to operate as a surface effect ship for transit at sea, converting to a fully-skirted air-cushion vehicle for operation in very shallow water, across sand-bars or mud-flats, and for limited mobility on dry land. The concept vehicle is intended to operate over water at speeds in excess of 40 knots over a transit range of 2,500 nautical miles without payload; and 500-600 nautical miles with up to 750 tons, to enable transfer of cargo from sea to shore where no port facilities exist.

Our History

We were incorporated as a Delaware corporation in October 2001 as part of a planned employee buyout of IIT Research Institute (IITRI), a not-for-profit government contractor in the technology services sector controlled by the Illinois Institute of Technology, which was incorporated and began operations in 1936. On December 20, 2002, we purchased substantially all of the assets and certain liabilities of IITRI, which we refer to as the “Selected Operations of IITRI,” and a majority of the employees of IITRI acquired a 100% ownership interest in our common stock through our ESOP. We refer to this purchase as the “IITRI Acquisition.” Since the date we were established, we have always been a 100% ESOP-owned S corporation. We believe that our ESOP ownership structure helps create an organizational culture that promotes excellence because our employees are both professionally and personally invested in our success. In addition, as an S corporation, we are not subject to U.S. federal income tax or state income tax in many U.S. states. See “Employee Stock Ownership Plan.”

Industry Overview

We see the following trends that will continue to drive increased DoD and other U.S. government agencies’ spending and greater dependence on technology services contractors.

Continuing Growth in Overall DoD Budget/Spending.  In addition to projected increases in overall DoD spending on contracting out to the private sector, our government customers are also increasing their dependence and spending on the specific types of services and solutions we provide. Federal fiscal year 2005 DoD actual spending excluding supplemental funding relating to operations in Iraq and Afghanistan was $400.1 billion. Work contracted out to the private sector is expected to continue to grow, with the DoD forecasting its budget to grow to over $499.0 billion (excluding supplemental funding) by federal fiscal year 2011.

Growing Spending in the DoD Operations and Maintenance Accounts.  The Operations and Maintenance (O&M) portion of the DoD budget, which includes the majority of the services we provide to the

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U.S. military, such as engineering, information technology and logistics, is the largest and fastest growing segment of DoD military spending. For federal fiscal year 2006, the DoD budgeted O&M spending to be $147.0 billion, which represented 35.0% of the total DoD military budget, and is projected by the DoD to increase approximately 4.0% annually, on average, through federal fiscal year 2009 to $165.0 billion.

Projected Increases in Private Sector Information Technology Government Spending.  INPUT, an independent U.S. government market research firm, forecasts U.S. government spending on information technology to increase from $63.3 billion in federal fiscal year 2006 to $80.5 billion in federal fiscal year 2011, representing an annual growth rate of 5.0%.

Expected Growth in DoD Research and Development Expenditures.  The DoD research and development budget grew by 2.2% to $73.1 billion in federal fiscal year 2007. That budget includes increased funding for both the DARPA and the U.S. Air Force, both of which are our customers.

More Budget Dollars for Homeland Security.  There has been significant growth in the Department of Homeland Security (DHS) budget, which is $41.6 billion for federal fiscal year 2007, up from the $40.3 billion budget in federal fiscal year 2006. We are currently pursuing DHS procurements.

Increased Reliance on Technology Services Contractors.  The U.S. government is expected to continue its practice of contracting out for technical services to companies such as Alion as it downsizes and replaces government employees with more cost-effective commercial vendors.

Growing Opportunities for Sophisticated Technology Solution Providers.  In February 2006, the DoD completed its Quadrennial Defense Review (QDR), which details the DoD’s strategic plans and procurement trends. We believe many of these plans and trends, as noted in the QDR, will further increase demand for contracted-out services in our target markets.

Continuing Impact of U.S. Government Procurement Reform.  Recently increased alternative choices available to U.S. government agencies in contract vehicles (i.e., indefinite-delivery/indefinite quantity contracts (ID/IQs), government wide acquisition contracts (GWACs), GSA schedule contracts and blanket purchase agreements (BPAs)) have created a more market-based environment in U.S. government procurement, increased contracting flexibility and provided U.S. government agencies with multiple channels to access contractor services. Contractors’ successful past performance, as well as technical capabilities and management skills, remain critical elements of the award process.

Competitive Strengths

Our key competitive strengths include:

Sophisticated technology solutions.  We offer sophisticated technology solutions in all of our core business areas, which we have developed over our 70-year operating history. Our sophisticated technology solutions are supported by our skilled employee base, which includes engineers, scientists and former military personnel. This allows us to combine engineering capabilities, scientific skills and domain expertise to provide solutions that incorporate current technologies with real-world understanding of and experience with DoD programs, systems and networks. Approximately 72% of our employees have security clearances, with approximately 22% of our employees holding clearances at the Top Secret level or above, allowing us access to highly classified DoD systems and networks. To further enhance our technology solutions, we have approximately 120,000 square feet of laboratory facilities, which we use to conduct customer-funded research and development activities, and to a lesser degree, internally-funded research and development activities.

Strong reputation and long-term customer relationships.  As a result of our sophisticated technology solutions and long operating history, we have developed a strong reputation in our industry and with our customers for providing quality expertise in our core business areas. We have long-term relationships with many of our customers under various programs that are strategically important to the defense of the United States and the burgeoning homeland defense needs of federal and state governments. For example, our

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relationships with IACs and the ELF program span over 20 years and our support to the wireless spectrum management community spans over 40 years.

Diverse customer base with multiple contract vehicles.  As of September 30, 2006, we served approximately 350 customers, including all branches of the U.S. military, a number of Cabinet-level U.S. government agencies, and the White House. We earn revenue from our diversified customer base through a broad array of task orders that are issued under multiple contract vehicles awarded by U.S. government agencies and through other contracts we hold. Our multiple contract vehicles provide us with more flexibility to obtain tasking and associated funding from the U.S. government. As of September 30, 2006, we had a portfolio of over 800 active contracts and task orders. No active task order or single-award contract accounted for more than 13% of our revenue for the fiscal year ended September 30, 2006. In addition, on a pro forma basis, no active task order or single-award contract accounted for more than 9% of our revenue during the same period.

Large contract backlog and strong revenue visibility.  Management estimates that contract backlog has historically generated approximately 80% of our next twelve months’ revenue and will continue to do so in fiscal year 2007. As of September 30, 2006, our backlog was approximately $4.2 billion or roughly 5.8 times our pro forma revenue for the fiscal year ended September 30, 2006. Approximately $386 million of this backlog is funded. Our contracts with backlog as of September 30, 2006 had an expected weighted average life of approximately 5.1 years. We believe that the strength of our backlog provides us with longer-term visibility of our future revenue.

Attractive business model with strong free cash flow.  We have a business model that generates strong free cash flow as a result of our low capital expenditure requirements, moderate working capital needs and the fact that we pay negligible taxes. We also achieve stable cash flow due to the diversity of our revenue streams, long-term nature of our contracts and stable margins. As an S corporation, we do not pay U.S. federal income tax or income tax in most states because we are a pass-through tax entity. Our business model allows us to better service our debt, fund internal research and development and pursue strategic acquisitions.

Strong management and highly experienced board of directors.  The seven senior members of our management team have approximately 150 years of combined experience in the defense and related industry sectors, and have significant experience in government contracting. All members of senior management hold meaningful equity stakes through direct investment in our common stock through the ESOP and/or equity-based performance incentives. Our management team is supported by a board of directors with diverse experience in the U.S. government and the U.S. Armed Forces at senior policy levels, including Edward C. Aldridge, former Under Secretary of Defense for Acquisition, Technology and Logistics; Admiral Harold W. Gehman, Jr. USN (Ret.), former NATO Supreme Allied Commander, Atlantic; General George A. Joulwan USA (Ret.), former NATO Supreme Allied Commander, Europe; and General Michael E. Ryan, USAF (Ret.), former Chief of Staff of the U.S. Air Force.

Business Strategy

Our objective is to continue to grow both organically and through strategic acquisitions by capitalizing on our skilled work force and our sophisticated solutions competencies. The key strategies for meeting this objective are described below.

Broaden our existing core competencies.  We continually seek to develop new expertise and keep pace with developments in technology by hiring skilled employees, investing in research and development and acquiring new technologies that broaden the scope of our core business areas. In recent years through our acquisition program, we have enhanced several of our core business areas including defense operations, information technology, modeling and simulation and naval architecture and marine engineering. We also seek to broaden our technology skills by providing training to new and current employees. For example, we have established Alion University to provide our employees with financial, administrative and managerial training and education. In addition, we conduct customer-funded, and to a lesser degree, internally funded, research and development activities each year. These efforts are designed to position us to remain at the

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forefront of the U.S. federal and commercial technology solutions markets and enhance our ability to service the needs of our customers.

Leverage experience and reputation to expand market share.  We perform a variety of services for a broad base of customers, including Cabinet-level U.S. government agencies, as well as state and foreign governments to a lesser degree. We plan to leverage our sophisticated set of capabilities as well as our customer relationships in order to expand our market presence by delivering solutions to new customers. We also believe we can grow our revenue by offering the new capabilities we have obtained through our recent acquisitions or developed internally. We believe that our strong relationships with our customers and our sophisticated technology capabilities will allow us to continue to increase market share.

Continue to improve financial performance and increase scale.  We believe a key element of our success has been our continued focus on growing our business and achieving operating efficiencies attendant to increased size. Over the last five years, we have established a track record of consistent revenue and Adjusted EBITDA growth. From fiscal year 2000 to fiscal year 2006, our revenue grew at a compounded annual growth rate of 21.8% from $156.1 million to $508.6 million. Over the same period, our Adjusted EBITDA grew at a compounded annual growth rate of 31.6% from $9.8 million to $50.8 million. Through our focus on reducing operating costs and growing our business, we have increased our Adjusted EBITDA margin from 6.3% in fiscal year 2000 to 10.0% in fiscal year 2006. (Adjusted EBITDA margin is the ratio of Adjusted EBITDA to revenue.) We believe our cost structure will further benefit from operating cost synergies achieved through the Anteon Asset Acquisition. We intend to continue to strengthen our financial performance by growing our business, both organically and through strategic acquisitions, by achieving additional cost efficiencies and by continuing to reduce operating costs where possible. As we improve financial performance, we believe we will strengthen our position to win business as a result of a more competitive cost structure. We plan to leverage our increased scale and skill set to allow us to bid on larger government programs and broaden our customer base.

Pursue a disciplined acquisition strategy.  The U.S. government technology industry provides many opportunities to grow through acquisitions. We have maintained a disciplined acquisition strategy. We have evaluated a large number of opportunities, pursued a more limited number and completed 11 acquisitions since January 1, 2003. The success of our acquisition strategy stems from the quality of the assets we acquire, our pricing discipline and our proven ability to successfully integrate acquisitions. The Anteon Asset Acquisition occurred on June 30, 2006 and its integration is substantially complete. We have successfully integrated all of our other acquisitions into our operations and information systems with an average integration completion time of approximately 90 days. We intend to continue to pursue strategic acquisitions of companies with talents and technologies complementary to our current fields and to our future business goals in order to broaden our customer base and expand our core competencies.

The Anteon Asset Acquisition

On June 30, 2006, in connection with a divestiture required by the U.S. Justice Department as part of General Dynamics’s acquisition of Anteon, we acquired certain assets of Anteon including certain contracts and limited fixed assets for consideration of approximately $221.4 million. The Anteon Asset Acquisition included a portfolio of contracts that provide technical and operational support to the DoD, in particular the U.S. Navy and U.S. Air Force. The Anteon Asset Acquisition provided us with a broader customer base in supporting the U.S. Navy in the design, acquisition and lifetime support of surface ships and submarines. This acquisition expanded our design engineering and program management expertise to include acoustics, advanced materials and undersea warfare design expertise and enhanced our existing naval architecture and marine engineering skills. Additionally, the Anteon Asset Acquisition provided us with another relationship with the U.S. Air Force Acquisition Office and the opportunity to build on our U.S. Air Force business relationships. The Anteon Asset Acquisition also expanded our competencies and expertise through the addition of approximately 890 personnel. In October 2006, the ESOP received cash contributions totaling approximately $5.2 million in connection with rollovers into the ESOP by employees acquired as part of the Anteon Asset Acquisition.

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On December 18, 2006, we filed with the SEC on Form 8-K/A certain audited and unaudited financial results with respect to the contracts we acquired in the Anteon Asset Acquisition (the Anteon Contracts). The audited and unaudited financial results included audited revenues, direct expenses and gross profit with respect to the Anteon Contracts for the years ended December 31, 2005, 2004 and 2003 and unaudited revenues, direct expenses and gross profits with respect to the Anteon Contracts for the six months ended June 30, 2006 and 2005.

Anteon Contracts
Statements of Revenues and Direct Expenses

	For the Year December Ended 31,
	2003		2004		2005
			(In thousands)
Revenues	$	81,690	$	130,027	$	215,068
Direct expenses		58,289		94,872		160,840
Gross profit		23,401		35,155		54,228

Anteon Contracts
Statements of Revenues and Direct Expenses

	For the Six Months Ended
	June 30,
	2005		2006
	(In thousands)
Revenues	$	118,954	$	138,336
Direct expenses		89,214		100,656
Gross profit		29,740		37,680

In order to fund the purchase of the contracts and related assets from Anteon, we borrowed $50.0 million in incremental term loans under our Term B Senior Credit Facility and $170.0 million in Bridge Loans. See “Description of Other Indebtedness.”

The Anteon Asset Acquisition has been accounted for using the purchase method of accounting, and accordingly the purchase price was allocated to identifiable assets acquired and liabilities assumed based upon their estimated fair values. The estimated fair values included in the purchase price allocation are preliminary and based upon currently available information and are expected to be finalized in the third quarter of fiscal year 2007. We are still in the process of strategically assessing our combined business which may give rise to different allocations among the purchased assets. Accordingly, final adjustments to the purchase price allocations may be required. We believe that the integration of the Anteon Contracts into our business is substantially complete. We fully integrated the Anteon Contracts into our existing services, and therefore we do not manage the Anteon Contracts as a stand-alone business.

Recent Developments

On January 4, 2007, we borrowed a total of $15.0 million in additional term loans under our Term B Senior Credit Facility. The proceeds from such loans, less approximately $0.3 million in fees associated with the borrowing, were immediately used to pay down the outstanding balance on our senior revolving credit facility. Following that pay down, we had approximately $19.4 million in principal amount outstanding under our senior revolving credit facility. The balance on our senior revolving credit facility increased from $12.3 million at September 30, 2006 to approximately $34.1 million at January 4, 2007 (just prior to the pay down noted above). This increase was primarily caused by our increased working capital needs resulting from the fact that we did not receive any working capital as part of our acquisition of the Anteon Contracts and also from the cyclical decrease in accounts receivable collected from the U.S. government in the last few weeks of 2006 and the first week of 2007. During the second quarter of fiscal year 2007 we received a

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portion of such delayed accounts receivable from the U.S. government. See “Description of Other Indebtedness — Term B Senior Credit Facility.”

On February 6, 2007, we entered into an amendment to the Term B Senior Credit Facility, pursuant to which: (i) the maturity date of the senior term loans borrowed under the Term B Senior Credit Facility was extended to February 6, 2013, (ii) the fixed component of the interest rate payable by us on the outstanding amounts of senior term loans was reduced by 25 basis points, (iii) the principal repayment schedule was adjusted to require one balloon principal repayment at maturity, (iv) the amount of debt we were allowed to incur in connection with the re-financing of the Bridge Loan was increased from $200.0 million to $250.0 million; and (v) an incurrence test was added as an additional condition to our ability to incur permitted indebtedness. The extension of the maturity date and the adjustment to the amortization of principal resulted in a change in the timing and the amount of principal of senior term loans we must repay. As of February 8, 2007, through the quarter ending December 31, 2012, we are obligated to pay quarterly principal installments of approximately $0.6 million. On February 6, 2013, the senior term loan maturity date, we are obligated to pay a principal installment of approximately $209.6 million. See “Description of Other Indebtedness — Term B Senior Credit Facility.”

On February 8, 2007, we issued and sold $250.0 million of our 101/4% outstanding notes, which mature on February 1, 2015. The proceeds from the issuance of the outstanding notes were used to pay off all outstanding amounts under the Bridge Loan Agreement and approximately $72.0 million of the amounts outstanding under the Term B Senior Credit Facility and fees associated with the issuance. See “Description of Other Indebtedness — Bridge Loan Agreement.”

Additional Information

We are a Delaware corporation. Our executive offices are located at 1750 Tysons Boulevard, Suite 1300, McLean, VA 22102, and our telephone number is (703) 918-4480. Our corporate website address is www.alionscience.com. Our website and the information contained on our website are not part of, and are not incorporated into, this prospectus.

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Summary of the Terms of the Exchange Offer

The Exchange Offer	We are offering to exchange up to $250,000,000 principal amount of the outstanding notes for up to $250,000,000 principal amount of the exchange notes. As of the date of this prospectus, outstanding notes representing $250,000,000 aggregate principal amount are outstanding.
	The exchange notes will evidence the same debt as the outstanding notes, and the outstanding notes and the exchange notes will be governed by the same indenture. The exchange notes are described in detail under the heading “Description of the Notes.”
Purpose of the Exchange Offer	On February 8, 2007, we sold the outstanding notes to Credit Suisse Securities (USA) LLC, the initial purchaser, in a transaction that was exempt from the registration requirements of the Securities Act. In connection with the sale, we entered into a registration rights agreement with the initial purchaser which grants the holders of the outstanding notes specified exchange and registration rights. The exchange notes are being offered to satisfy our obligations under the registration rights agreement.
Expiration Date	The exchange offer will expire at 5:00 p.m., New York City time on          , 2007 or a later date and time if we extend it.
Conditions to the Exchange Offer	The exchange offer is not subject to material conditions other than that it does not violate applicable law or any applicable interpretation of the staff of the SEC and that no litigation has been instituted or threatened that would impair our ability to proceed with the exchange offer. We reserve the right to waive any defects, irregularities or conditions to exchange as to particular outstanding notes. See “The Exchange Offer — Conditions of the Exchange Offer.”
Withdrawal	You may withdraw the tender of any outstanding notes pursuant to the exchange offer at any time prior to the expiration date. We will return, as promptly as practicable after the expiration or termination of the exchange offer, any outstanding notes not accepted for exchange for any reason without expense to you.
Procedures for Tendering Outstanding Notes	If you wish to accept the exchange offer, you must complete, sign and date the accompanying letter of transmittal in accordance with the instructions in the letter of transmittal, and deliver the letter of transmittal, along with the outstanding notes and any other required documentation, to the exchange agent. By executing the letter of transmittal, you will represent to us that, among other things:
	• any exchange notes that you receive will be acquired in the ordinary course of your business,
	• you are not participating, and you have no arrangement or understanding with any person to participate, in the distribution of the exchange notes,
	• you are not our “affiliate,” as defined in Rule 405 of the Securities Act, or if you are an affiliate, you will comply with the

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	registration and prospectus delivery requirements of the Securities Act to the extent applicable, and
	• if you are not a broker-dealer, you will also be representing that you are not engaged in and do not intend to engage in a distribution of the exchange notes.
	Each broker-dealer that receives exchange notes for its own account in exchange for outstanding notes, where such outstanding notes were acquired by such broker-dealer as a result of market-making activities or other trading activities, must acknowledge that it will deliver a prospectus in connection with any resale of such exchange notes. See “Plan of Distribution.”
If You Fail to Exchange Your Outstanding Notes	If you do not exchange your outstanding notes for exchange notes in the exchange offer, you will continue to be subject to the restrictions on transfer provided in the outstanding notes and the indenture governing those notes. In general, you may not offer or sell your outstanding notes without registration under the federal securities laws or an exemption from the registration requirements of the federal securities laws and applicable state securities laws. You will not have dissenters’ rights or appraisal rights in connection with the exchange offer. See “The Exchange Offer — Appraisal Rights.”
U.S. Federal Income Tax Considerations	We believe the exchange of outstanding notes for exchange notes pursuant to the exchange offer will not constitute a sale or an exchange for federal income tax purposes. See “Material United States Federal Income Tax Consequences.”
Use of Proceeds	We will not receive any proceeds from the exchange of notes pursuant to the exchange offer.
Exchange Agent	We have appointed Wilmington Trust Company as the exchange agent for the exchange offer. Wilmington Trust Company also serves as the trustee (the “Trustee”) under the indenture for the notes. The mailing address and telephone number of the exchange agent are: Wilmington Trust Company, Rodney Square North, 1100 North Market Street, Wilmington, DE 19890-1626, Attention: Alisha Clendaniel, Telephone: 302-636-6470, Facsimile: 302-636-4139. See “The Exchange Offer — Exchange Agent.”
Resale	Under existing SEC interpretations, the exchange notes will be freely transferable by holders other than our affiliates after the exchange offer without further registration under the Securities Act if the holder of the exchange notes represents to us in the exchange offer that it is acquiring the exchange notes in the ordinary course of its business, that it has no arrangement or understanding with any person to participate in the distribution of the exchange notes and that it is not an affiliate of the Company, as such terms are interpreted by the SEC; provided, however, that broker-dealers receiving exchange notes in the exchange offer will have a prospectus delivery requirement with respect to resales of

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such exchange notes. The SEC has taken the position that broker-dealers may fulfill their prospectus delivery requirements with respect to exchange notes (other than a resale of an unsold allotment from the original sale of the notes) with the prospectus contained in the exchange offer registration statement.

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Summary of the Terms of the Exchange Notes

The exchange notes will be freely tradable and have only limited registration rights and otherwise will be substantially identical to the outstanding notes. The exchange notes will evidence the same debt as the outstanding notes, and the outstanding notes and the exchange notes will be governed by the same indenture. The outstanding notes and the exchange notes will vote together as a single class under the indenture.

Issuer	Alion Science and Technology Corporation, a Delaware corporation.
Notes Offered	$250,000,000 aggregate principal amount of 101/4% Senior Notes due 2015.
Maturity Date	February 1, 2015.
Interest	101/4% per annum, payable semi-annually in arrears on February 1 and August 1, commencing on August 1, 2007.
Guarantees	The exchange notes will be fully and unconditionally, and jointly and severally, guaranteed by certain of our current domestic subsidiaries and certain of our future subsidiaries.
Ranking	The exchange notes will:
	• be senior unsecured obligations of the Company,
	• rank pari passu in right of payment with all existing and future senior indebtedness of the Company including indebtedness under and which may in the future be borrowed pursuant to the Term B Senior Credit Facility, and
	• be senior in right of payment to existing and future subordinated indebtedness of the Company.
	All our secured debt and other obligations in effect from time to time will be effectively senior to the exchange notes to the extent of the value of the assets securing such debt or other obligations.
Optional Redemption	Prior to February 1, 2011, we may redeem all, but not less than all, of the exchange notes at a redemption price equal to 100% of the principal amount plus accrued and unpaid interest plus a “make-whole” premium as set forth under “Description of the Notes — Optional Redemption.” We may redeem some or all of the exchange notes at any time and from time to time on or after February 1, 2011, at the redemption prices set forth under “Description of the Notes — Optional Redemption,” plus accrued and unpaid interest to the date of redemption. In addition, at any time prior to February 1, 2010, we may redeem up to 35% of the notes (including exchange notes) with the proceeds of certain equity offerings.
Certain Covenants	The indenture governing the outstanding notes and that will govern the exchange notes contains covenants that, among other things, limit our ability and the ability of certain of our subsidiaries to:
	• incur or guarantee additional indebtedness or issue certain preferred stock;

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	• pay dividends on our capital stock or redeem, repurchase or retire our capital stock or subordinated indebtedness, except for junior subordinated notes and junior warrants;
	• transfer or sell assets outside the ordinary course of business;
	• make investments;
	• incur liens and enter into sale/leaseback transactions;
	• enter into certain transactions with our affiliates; and
	• merge or consolidate with other companies or transfer all or substantially all of our assets.
	These covenants are subject to a number of important limitations and exceptions as described under “Description of the Notes — Certain Covenants.”
Absence of Trading Market for Exchange Notes	We do not intend to apply for a listing of the exchange notes on any securities exchange. Accordingly, we cannot assure you that a liquid market for the exchange notes will develop or be maintained.

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Summary Historical Condensed Consolidated Financial Data

The following summary historical condensed consolidated financial data under the captions “Statement of Operations” and “Balance Sheet Data” has been derived from (1) our audited consolidated financial statements as of September 30, 2005 and for the years ended September 30, 2004 and 2005, which have been audited by KPMG LLP, independent registered public accounting firm, (2) our audited consolidated financial statements as of and for the year ended September 30, 2006, which have been audited by Deloitte & Touche LLP, independent registered public accounting firm and (3) our unaudited consolidated financial statements for the three months ended December 31, 2006 and 2005. The results of operations for each historical period presented below are not comparable to the prior period as a result of business acquisitions consummated in 2004, 2005 and 2006. Results for interim periods may not be indicative of results for full fiscal years. All of the acquisitions have been accounted for using the purchase method of accounting, and accordingly the purchase price for each acquisition was allocated to identifiable assets acquired and liabilities assumed based upon their estimated fair values. Results of operations of these acquired businesses are included in our consolidated financial statements for the periods subsequent to the respective dates of acquisition.

	For the Year Ended,									For the Three Months Ended,
	September 30,			September 30,			September 30,			December 31,			December 31,
	2004			2005			2006			2005			2006
	(In thousands)
Statement of Operations Data:
Contract revenue	$	269,940		$	369,231		$	508,628		$	101,289		$	181,139
Direct contract expense		196,388			267,241			381,467			76,305			140,101
Gross profit		73,552			101,990			127,161			24,984			41,038
Operating expenses		73,703			104,081			129,466			27,812			40,995
Operating income (loss)		(151	)		(2,091	)		(2,305	)		(2,828	)		43
Interest expense		(16,835	)		(38,696	)		(29,691	)		(5,445	)		(14,358	)
Other income		1,892			615			907			512			190
Loss before income taxes		(15,094	)		(40,172	)		(31,089	)		(7,761	)		(14,125	)
Income tax benefit (expense)		(17	)		(66	)		(26	)		(19	)		13
Net loss		(15,111	)		(40,238	)		(31,115	)		(7,780	)		(14,112	)

	At September 30,				At December 31,
	2005		2006		2005		2006
	(In thousands)
Balance Sheet Data (at period end):
Cash and cash equivalents	$	37,778	$	2,755	$	15,259	$	340
Working capital		59,775		53,811		47,596		66,622
Total assets		334,249		650,969		318,923		672,486

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Summary Pro Forma Condensed Consolidated Financial Data

The following summary of unaudited pro forma condensed consolidated financial data has been derived from the pro forma financial statements included under “Unaudited Pro Forma Condensed Financial Information.” The pro forma statements of operations and balance sheet data give effect to the offering of the outstanding notes and the following acquisitions, in each case as if they each occurred on October 1, 2005.

	Acquisition		Acquisition Date
•	BMH Associates, Inc. (BMH)	—	February 10, 2006
•	Washington Consulting, Inc. (WCI)	—	February 24, 2006
•	Micro Analysis and Design, Inc. (MA&D)	—	May 19, 2006
•	Certain assets of Anteon	—	June 30, 2006

This pro forma data has not been audited and is not necessarily indicative of our financial condition or actual results of operations that would have occurred had the offering of the outstanding notes and the acquisitions occurred on October 1, 2005, or of any expected future results. This unaudited information should be read in conjunction with “Unaudited Pro Forma Condensed Financial Information,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Business,” and our historical consolidated financial statements, together with the respective notes thereto, included elsewhere in this prospectus.

	For the Twelve
	Months Ended,
	September 30,
	2006
	(In thousands)
Statement of Operations Data:
Contract revenue	$	726,851
Direct contract expense		551,781
Gross profit		175,070
Operating expenses		168,541
Operating income		6,529
Interest expense		(49,517	)
Other income		118
Loss before income taxes	$	(42,870	)
Income tax expense		(26	)
Net loss	$	(42,896	)

	At
	December 31,
	2006(a)
	(In thousands)
Balance Sheet Data (at period end):
Cash and cash equivalents	$	340
Working capital		66,622
Total assets		672,486

(a) Alion’s December 31, 2006 unaudited balance sheet information includes the effects of the Anteon Asset Acquisition.

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RISK FACTORS

In considering whether to exchange your outstanding notes for exchange notes, you should carefully consider the following risk factors, in addition to the other information included or incorporated by reference in this prospectus. The risks described below are not the only risks we face. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may also materially and adversely affect our business, financial condition or results of operations. Any of the following risks could materially and adversely affect our business, financial condition, results of operations and our ability to meet our financial obligations. In such case, you could lose all or part of your investment.

Risks Related to the Notes and our Debt Structure

Our substantial leverage may impair our financial condition and prevent us from fulfilling our obligations under the notes.

We have a significant amount of indebtedness. As of February 28, 2007, we had, including the effect of the issuance of the outstanding notes and the repayment in full of the Bridge Loan and approximately $72.0 million of the amounts outstanding under the Term B Senior Credit Facility with proceeds from the outstanding notes issuance, approximately $557.8 million of total outstanding debt, including debt subordinated to our Term B Senior Credit Facility and the outstanding notes, and fiscal year 2007 debt service payment obligations of approximately $47.0 million.

Our substantial debt could have important consequences to you, including:

•  making it more difficult for us to satisfy our obligations with respect to our debt, including the notes, and any failure to comply with the obligations of any of our debt instruments, including restrictive and financial covenants, could result in an event of default under the indenture governing the notes and the agreements governing our other debt;

•  increasing our vulnerability to general adverse economic and industry conditions by making it more difficult for us to react to changing conditions;

•  limiting our ability to obtain additional financing to fund future working capital, capital expenditures, acquisitions and other business opportunities, introductions of new technologies and other general corporate requirements;

•  requiring a substantial portion of our cash flow from operations for the payments of interest on our debt and reducing our ability to use our cash flow to fund future working capital, capital expenditures, acquisitions and other business opportunities, introductions of new technologies and other general corporate requirements;

•  exposing us to risks inherent in interest rate fluctuations because some of our borrowings will be at variable rates of interest, which could result in higher interest expense in the event of increases in interest rates;

•  limiting our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate; and

•  placing us at a competitive disadvantage compared with our competitors that have less debt.

Despite current indebtedness levels, we and our subsidiaries may still be able to incur more debt. This could further exacerbate the risks associated with our substantial leverage.

We have the capacity to issue additional indebtedness, including the ability to raise up to $135.0 million of additional senior secured indebtedness under our Term B Senior Credit Facility, subject to limitations imposed by the covenants in our Term B Senior Credit Facility and the indenture governing the notes. Although our Term B Senior Credit Facility and the indenture governing the notes contain restrictive covenants, these restrictive covenants do not and will not fully prohibit us from incurring additional debt. The more we become leveraged, the more we, and in turn our security holders, become exposed to the risks

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described under “Our substantial leverage may impair our financial condition and prevent us from fulfilling our obligations under the notes.” See “Description of Other Indebtedness” and “Description of the Notes-Certain Covenants Limitation on Indebtedness” for additional information.

Our Term B Senior Credit Facility and the indenture governing the notes will restrict our operations.

Our Term B Senior Credit Facility and the indenture governing the notes will, and our future debt agreements may, contain covenants that may restrict our ability to engage in activities that may be in our long-term best interest, including financing future operations or capital needs or engaging in other business activities. Our Term B Senior Credit Facility and the indenture will restrict, among other things, our ability and the ability of our subsidiaries to:

•  incur additional debt other than permitted additional debt;

•  pay dividends or distributions on our capital stock or purchase, redeem or retire our capital stock other than distributions necessary for the ESOP to satisfy its repurchase obligations and certain payments required under our equity based compensation plans;

•  make acquisitions and investments other than permitted acquisitions and permitted investments;

•  issue or sell preferred stock of subsidiaries;

•  make acquisitions and investments;

•  create liens on our assets;

•  enter into certain transactions with affiliates;

•  merge or consolidate with another company; and

•  transfer and sell assets outside the ordinary course of business.

Our Term B Senior Credit Facility requires and our future debt agreements may require us to maintain specified financial ratios relating to, among other things, our interest coverage and leverage coverage levels. Our ability to satisfy these financial ratios can be affected by events beyond our control, and we cannot guaranty that we will meet these ratios. Default under our Term B Senior Credit Facility could allow lenders to declare all amounts outstanding under both our Term B Senior Credit Facility and the notes to be immediately due and payable. We have pledged substantially all of our assets to secure the debt under our Term B Senior Credit Facility. If the lenders declare amounts outstanding under the Term B Senior Credit Facility to be due, the lenders could proceed against those assets. Any event of default, therefore, could have a material adverse effect on our business, financial condition and results of operations if the creditors determine to exercise their rights.

If we default on our obligations to pay our other indebtedness, we may not be able to make payments on the notes.

The remedies from any default under the agreements governing our indebtedness that is not waived by the required lenders, including a default under our Term B Senior Credit Facility, could make us unable to pay principal, premium, if any, or interest on the notes and could substantially decrease the market value of the notes. In the event of such default, the holders of such indebtedness could elect to declare all the funds borrowed thereunder to be due and payable, together with accrued and unpaid interest, and institute foreclosure proceedings against our assets, and we could be forced into bankruptcy or liquidation. If our operating performance declines, we may in the future need to seek waivers from the required lenders under our Term B Senior Credit Facility to avoid being in default. If we breach our covenants under our Term B Senior Credit Facility and seek a waiver, we may not be able to obtain a waiver from the required lenders. If this occurs, we would be in default under our Term B Senior Credit Facility, the lenders could exercise their rights as described above, and we could be forced into bankruptcy or liquidation. See “Description of Other Indebtedness” and “Description of the Notes.”

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Your right to receive payments on the notes is effectively subordinated to the rights of our existing and future secured creditors.

The notes will not be secured by any of our assets.  However, our Term B Senior Credit Facility is secured by a pledge of substantially all of our assets and all of the assets of our guarantor subsidiaries, including all of the capital stock of certain of our existing and future subsidiaries. If we become insolvent or are liquidated, or if payment under any of the instruments governing our secured debt is accelerated, the lenders under those instruments will be entitled to exercise the remedies available to a secured lender under applicable law and pursuant to the instruments governing such debt. Accordingly, the lenders under our Term B Senior Credit Facility will have a prior claim on our assets and the assets of our guarantor subsidiaries securing the debt owed to them. In that event, because the notes will not be secured by any of our assets, our remaining assets might be insufficient to satisfy your claims.

As of December 31, 2006, the aggregate amount of our secured indebtedness was approximately $290.9 million and, on a pro forma basis, was approximately $218.9 million. As of December 31, 2006, we also had approximately $12.9 million available for additional borrowings under our senior revolving credit facility. On January 4, 2007, we borrowed an additional $15.0 million aggregate revolving principal amount of incremental term loans, the net proceeds of which we used to pay down outstanding revolving loans under our Term B Senior Credit Facility. We will be permitted to raise up to $135.0 million of additional senior secured indebtedness in the future under the terms of the Term B Senior Credit Facility, subject to limitations that will be imposed by the covenants in our Term B Senior Credit Facility and the indenture governing the notes. See “Description of the Notes — Certain Covenants — Limitation on Indebtedness” and “Description of the Notes — Certain Covenants — Limitation on Liens.”

Your right to receive payments on the notes is effectively subordinated to the rights of creditors of our current and future non-guarantor subsidiaries.

The notes will be structurally subordinated to indebtedness and other liabilities of our current and future non-guarantor subsidiaries. In the event of a bankruptcy, liquidation or reorganization of any of our non-guarantor subsidiaries, these non-guarantor subsidiaries will pay the holders of their debts, the holders of preferred equity interests and their trade creditors before they will be able to distribute any of their assets to us and as a result those assets may not be available to satisfy your claims.

We may not be able to repurchase the notes upon a change of control.

Upon a change of control as defined in the indenture governing the notes, we will be required to make an offer to repurchase all notes at 101% of their principal amount, plus accrued and unpaid interest, unless we give notice of our intention to exercise our right to redeem the notes. We may not have sufficient financial resources to purchase all of the notes that are tendered upon a change of control offer or to redeem the notes. A failure to make the applicable change of control offer or to pay the applicable change of control purchase price when due would result in a default under the indenture governing the notes. The occurrence of a change of control would also constitute an event of default under our Term B Senior Credit Facility and may constitute an event of default under the terms of our other indebtedness. The terms of the Term B Senior Credit Facility limit our right to purchase or redeem certain indebtedness. In the event any purchase or redemption is prohibited, we may seek to obtain waivers from the required lenders under our Term B Senior Credit Facility to permit the required repurchase or redemption, but we may not be able to do so. See “Description of the Notes — Change of Control.”

The guarantees provided by our subsidiary guarantors are subject to certain defenses which may limit your right to receive payment on the notes and are subordinated to the rights of other creditors of such guarantors.

Although the guarantees from our subsidiaries will provide the holders of the notes with a direct claim against the assets of those guarantors, enforcement of the guarantees against any guarantor would be subject to certain “suretyship” defenses available to guarantors generally as well as other limits to the maximum

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amount that the guarantors are permitted to guarantee under applicable law. Enforcement could also be subject to other defenses available to the guarantors in certain circumstances, including defenses relating to fraudulent conveyances. Even if the guarantees are enforceable, the guarantees would be effectively subordinated to any other indebtedness of the guarantors that is secured by any of their assets (including our Term B Senior Credit Facility), and may be effectively subordinated to all other liabilities of the guarantors, including trade payables of such guarantors, whether or not such liabilities are secured. In addition, you will lose the benefit of a particular guarantee if it is released under certain circumstances described under “Description of the Notes — Guarantees.”

The indebtedness represented by the notes and the guarantees may be unenforceable due to fraudulent conveyance statutes.

Under U.S. federal law or state fraudulent conveyance laws, an unpaid creditor or representative of creditors, such as a trustee in bankruptcy or Alion as a debtor-in-possession in a bankruptcy proceeding, could file a lawsuit claiming that the issuance of the notes constituted a “fraudulent conveyance.” Generally, to make such a determination, a court would have to find that we did not receive fair consideration or reasonably equivalent value for the notes, and that, at the time the notes were issued, we:

•  were insolvent;

•  were rendered insolvent by the issuance of the notes;

•  were engaged in a business or transaction for which our remaining assets after the notes issuance constituted unreasonably small capital; or

•  intended to incur, or believed or reasonably should have believed that we would incur, debts beyond our ability to pay such debts as they matured.

If a court were to make such a finding, it could void our obligations under the notes, subordinate the notes to our other indebtedness or take other actions detrimental to you as a holder of the notes.

The measure of insolvency for these purposes will vary depending upon the law of the jurisdiction being applied. Generally, however, a company will be considered insolvent for these purposes if the sum of that company’s debts is greater than the fair value of all of the company’s assets, or if the present fair saleable value of that company’s assets is less than the amount that will be required to pay its probable liability on its existing debts as they mature, or if the company cannot pay its debts as they become due. Moreover, regardless of solvency, a court could void an incurrence of indebtedness, including the notes, if it determined that the transaction was made with the intent to hinder, delay or defraud creditors, or a court could subordinate the indebtedness, including the notes, to the claims of all existing and future creditors on similar grounds. We cannot determine in advance what standard a court would apply to determine whether we were “insolvent” in connection with the sale of the notes.

The making of guarantees might also be subject to similar review under relevant fraudulent conveyance laws if a bankruptcy, reorganization or rehabilitation case or a lawsuit (including circumstances in which bankruptcy is not involved) were commenced by, or on behalf of, unpaid creditors of the guarantors at some future date. Such creditors could claim that, because the guarantees were incurred for Alion’s direct benefit and only indirectly for the benefit of the subsidiary guarantors, the obligations of the subsidiary guarantors were incurred for less than fair consideration. A court could impose legal and equitable remedies, including voiding the obligations under the subsidiary guarantees, subordinating the obligations under the guarantees to the guarantors’ other debts, directing the repayment of any amounts paid from the proceeds of the guarantees to a fund for the benefit of other creditors or taking other actions detrimental to you as a holder of the notes.

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Risk Factors Relating to the Exchange Offer

If you fail to exchange your outstanding notes, the existing transfer restrictions will remain in effect and the market value of your outstanding notes may be adversely affected because they may be more difficult to sell.

If you do not exchange your outstanding notes for exchange notes under the exchange offer, then you will continue to be subject to the existing transfer restrictions on the outstanding notes. In general, the outstanding notes may not be offered or sold unless they are registered or exempt from registration under the Securities Act and applicable state securities laws. Except as required by the registration rights agreement, we do not intend to register resales of the outstanding notes.

The tender of outstanding notes under the exchange offer will reduce the aggregate principal amount of the outstanding notes. This may have an adverse effect upon, and increase the volatility of, the market price of any outstanding notes that you continue to hold due to a reduction in liquidity.

There is no established trading market for the exchange notes.

Although the issuance of the exchange notes will be registered under the Securities Act, the exchange notes will be new securities for which there is no established trading market. We will not list the exchange notes for trading on any established securities exchange, and we can not assure you that an active trading market will develop for the exchange notes. If no active trading market develops, you may not be able to resell your exchange notes at their fair market value or at all. Consequently, your lenders may be reluctant to accept the exchange notes as collateral for loans. Future trading prices of the exchange notes will depend on many factors, including among other things, our ability to effectuate the exchange offer, prevailing interest rates, our operating results and the market for similar securities. Historically, the market for non-investment grade debt has been subject to disruptions that have caused substantial volatility in the prices of securities similar to the exchange notes. There can be no assurances that the market for the exchange notes, if any, will not be subject to similar disruptions. Any such disruptions may have an adverse effect on the holders of the exchange notes.

Some persons who participate in the exchange offer must deliver a prospectus in connection with resales of the exchange notes.

Based on interpretation of the staff of the SEC, we believe that you may offer for resale, resell or otherwise transfer the exchange notes without compliance with the registration and prospectus delivery requirements of the Securities Act. However, in some instances described in this prospectus under “Plan of Distribution,” you will remain obligated to comply with the registration and prospectus delivery requirements of the Securities Act to transfer your exchange notes. In these cases, if you transfer any exchange note without delivering a prospectus meeting the requirements of the Securities Act or without an exemption from registration of your exchange notes under the Securities Act, you may incur liability under this act. We do not and will not assume, or indemnify you against, this liability.

Risks Related to Our Business and Operations

We expect to experience net losses in at least our next five years of operation.

We have incurred a net loss in each year of operation since our inception in late 2002, and we expect to incur a net loss in at least our next five years of operation, fiscal years 2007 through 2011. Contributing factors to our net losses include the significant amounts of interest expense associated with the debt financing for the acquisitions that we have completed, expense related to our repurchase obligations for outstanding warrants, compensation expense associated with stock appreciation rights and phantom stock plans, and amortization expense related to intangible assets acquired. The amount of net losses and our ability to achieve future profitability are subject to our ability to achieve and sustain a significant level of revenue growth coupled with our ability to manage our operating expenses. If revenue grows slower than we

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anticipate, or if operating expenses exceed our expectations, we may not become profitable. Even if we become profitable we may not be able to sustain our profitability.

Our ability to meet our financial and other future obligations is dependent on our future operating results and we cannot be sure that we will be able to meet these obligations as they come due.

Our ability to make payments on our debt, including the notes, and to fund working capital needs and planned capital expenditures depends on our ability to generate cash flow in the future. We cannot assure you that our business strategy will succeed or that we will achieve our anticipated financial results. Our financial and operational performance depends upon a number of factors, many of which are beyond our control. These factors include:

•  funding of our contract backlog;

•  the time within which our customers pay our accounts receivable;

•  new contract awards and our performance under those contracts;

•  continued increase in revenue on an annual basis;

•  increase in operating income on an annual basis;

•  the amount of our common stock purchased by our employees via payroll deferrals and rollovers to our ESOP;

•  the amount of our common stock repurchased from our former employees;

•  interest rate levels;

•  our status as an S corporation for U.S. federal income tax purposes;

•  the current economic condition and conditions in the defense contracting industry;

•  U.S. government spending levels, both generally and by our particular customers;

•  the failure by the Congress to approve budgets timely for the U.S. federal agencies we support;

•  any operating difficulties, operating costs or pricing pressures we may experience;

•  the passage of legislation or other regulatory developments that affects us adversely; and

•  any delays in implementing any strategic projects we may have.

These factors will also affect our ability in the future to meet our repurchase obligations under the KSOP. We also are required to re-pay all principal and accrued interest outstanding under our senior term loan by February 6, 2013 and our revolving credit facility by August 2, 2009 and are required to pay 50% of the principal amount outstanding, under our subordinated note and 50% of the principal amount outstanding under our payment-in-kind notes in each of 2009 and 2010. We further may be required to redeem 50% of our subordinated warrant in each of 2009 and 2010 in accordance with the put rights included in our subordinated warrant.

We may not generate sufficient cash flows to comply with our financial covenants and to meet our payment obligations when they become due. If we are unable to comply with our financial covenants, or if we are unable to generate sufficient cash flow or otherwise obtain funds necessary to make the required payments on our indebtedness, then we may be required to refinance our indebtedness. We cannot be certain that our indebtedness could be refinanced on terms that are favorable to us, if at all. In the absence of a refinancing, our lenders would be able to accelerate the maturity of our indebtedness, which could cause us to default under our other indebtedness, dispose of assets or declare bankruptcy. See “Description of Other Indebtedness” and “Description of the Notes — Certain Covenants.”

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We face intense competition from many competitors that have greater resources than we do, which could result in price reductions, reduced profitability, and loss of market share.

We operate in highly competitive markets and generally encounter intense competition to win contracts. If we are unable to successfully compete for new business, our revenue growth and operating margins may decline. Many of our competitors are larger and have greater financial, technical, marketing, and public relations resources, larger client bases, and greater brand or name recognition than we do. Larger competitors include U.S. federal systems integrators such as Booz Allen Hamilton, CACI International, Inc., Science Applications International Corporation, Battelle Memorial Institute, SRA International, Inc., and the services divisions of large defense contractors such as Lockheed Martin Corporation, General Dynamics Corporation and Northrop Grumman Corporation. Our larger competitors may be able to compete more effectively for very large-scale government contracts. Our larger competitors also may be able to provide clients with different or greater capabilities or benefits than we can provide in areas such as technical qualifications, past performance on large-scale contracts, geographic presence, price, and the availability of key professional personnel. Our competitors also have established or may establish relationships among themselves or with third parties, including through mergers and acquisitions, to increase their ability to address client needs. Accordingly, it is possible that new competitors or alliances among competitors may emerge.

Our ability to compete for desirable contracts will depend on:

•  the effectiveness of our research and development programs;

•  our ability to offer better performance than our competitors at a lower or comparable cost;

•  the readiness of our facilities, equipment and personnel to perform the programs for which we compete; and

•  our ability to attract and retain key personnel.

If we do not continue to compete effectively and win contracts, our future business, financial condition, results of operations and our ability to meet our financial obligations may be materially compromised.

Historically, a few contracts have provided us with most of our revenue, and if we do not retain or replace these contracts our operations will suffer.

The following five federal government contracts accounted for approximately 37% of our revenues for the fiscal year ended September 30, 2006:

1. Modeling and Simulation Information Analysis Center for the DoD — Defense Modeling and Simulation Office (13%);

2. Engineering, Financial and Program Management Services to the Virtual SYSCOM for the U.S. Navy (9%);

3. Joint Spectrum Center (JSC) Engineering Support Services for the DoD Joint Spectrum Center (7%);

4. Night Vision HighTech Omnibus Contract for the U.S. Army (4%); and

5. Information Technology Services for the General Services Administration (4%).

During our fiscal year ended September 30, 2005, the support services contract to the JSC underwent a full and open competition for the follow-on support contract that was to commence beginning October 2005. Following rounds of protest filings in 2005 and 2006, it was finally determined in October 2006 that we would not receive the follow-on contract.

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The following five federal government contracts accounted for approximately 46% of our revenues for the fiscal year ended September 30, 2006, on a pro forma basis:

1. Seaport Multiple Award Contract (Seaport MAC) for the U.S. Navy (22%) (consisting of the NAVSEA Seaport Multiple Award Contract and the Virtual SYSCOM Multiple Award Contract), under which we perform more than 25 task orders for a number of customers, including the following five largest task orders by pro forma fiscal year 2006 revenue:

		(percentage of
		total pro forma
		fiscal year 2006
		revenue)
a.	PEO Ships F		4.5	%
b.	PEO IWS 1.0		2.1	%
c.	LPD-17		2.1	%
d.	PMS 404 (PEO SUBS)		1.7	%
e.	Ship Design Support to NAVSEA 05D		1.5	%

2. Modeling and Simulation Information Analysis Center for the DoD-Defense Modeling and Simulation Office (9%);

3. Secretary of the Air Force Technical and Analytical Support for the U.S. Air Force (7%);

4. Joint Spectrum Center Engineering Support Services for the DoD Joint Spectrum Center (5%); and

5. Information Technology Services for the General Services Administration (3%).

The termination of these contracts or our inability to renew or replace them when they expire could cause our revenue to decrease and could have a material adverse effect on our business, financial condition, results of operations and our ability to meet our financial obligations.

If we are unable to manage our growth, our business could be adversely affected.

Sustaining our growth has placed significant demands on our management, as well as on our administrative, operational and financial resources. To continue to manage our growth, we must continue to improve our operational, financial and management information systems and expand, motivate and manage our workforce. If we are unable to successfully manage our growth without compromising our quality of service and our profit margins, or if new systems we implement to assist in managing our growth do not produce the expected benefits, our business, financial condition, results of operations and our ability to meet our financial obligations could be materially and adversely affected.

Our acquisitions could increase our costs or liabilities or be disruptive.

One of our key operating strategies has been and continues to be to selectively pursue and implement acquisitions. We have made a number of acquisitions in the past, are currently pursuing a number of potential acquisition opportunities, and will consider other acquisitions in the future. We may not be able to successfully implement our past or future acquisitions. We may not be able to consummate the acquisitions we are currently pursuing on favorable terms, or at all. We may not be able to locate other suitable acquisition candidates at prices we consider appropriate or to finance acquisitions on terms that are satisfactory to us. If we do identify an appropriate acquisition candidate, we may not be able to successfully negotiate the terms of an acquisition, finance the acquisition or, if the acquisition occurs, integrate the acquired business into our existing business. Negotiations of potential acquisitions and the integration of acquired business operations could disrupt our business by diverting management away from day-to-day operations. Acquisitions of businesses or other material operations may require additional debt financing, resulting in additional debt servicing obligations. The difficulties of integration may be increased by the necessity of coordinating geographically dispersed organizations, integrating personnel with disparate business backgrounds and combining different corporate cultures. We also may not realize cost efficiencies

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or synergies that we anticipated when selecting our acquisition candidates. In addition, we may need to record write-downs from future impairments of intangible assets, which could reduce our future reported earnings. At times, acquisition candidates may have liabilities or adverse operating issues that we fail to discover through due diligence prior to the acquisition, but which we generally assume as part of an acquisition. Such liabilities could have a material adverse effect on our business, financial condition, results of operations and our ability to meet our financial obligations.

Due to the inherent danger involved in some of the businesses that we conduct, there are risks of claims by clients and third parties that could have a substantial adverse economic impact upon us.

Some of the businesses that we conduct, such as those that involve unexploded ordnance through a wholly-owned subsidiary of ours, inherently involve dangerous materials or other risks that could expose us to substantial liability, if, for example, our services are involved in situations involving substantial loss of life, personal injury, property damage or consequential damages. There can be no assurance that our efforts to protect against such risks, including the purchase of liability insurance, will be sufficient to avoid the adverse economic impact upon us, should claims by clients and third parties arise in the future.

We depend on key management and may not be able to retain those employees due to competition for their services.

We believe that our future success will be due, in part, to the continued services of our senior management team. The loss of any one of these individuals could cause our operations to suffer. We do not maintain key man life insurance policies on any members of management.

Our business could suffer if we fail to attract, train and retain skilled employees.

The availability of highly trained and skilled professional, administrative and technical personnel is critical to our future growth and profitability. Competition for scientists, engineers, technicians, management and professional personnel is intense and competitors aggressively recruit key employees. Due to our growth and this competition for experienced personnel, particularly in highly specialized areas, it has become more difficult to meet all of our needs for these employees in a timely manner. We cannot be certain that we will be able to attract and retain such employees on acceptable terms. Any failure to do so could have a material adverse effect on our business, financial condition, results of operations and our ability to meet our financial obligations. If we are unable to recruit and retain a sufficient number of these employees, our ability to maintain and grow our business could be negatively impacted. In addition, some of our contracts contain provisions requiring us to commit to staff a program with certain personnel the customer considers key to our successful performance under the contract. In the event we are unable to provide these key personnel or acceptable substitutions, the customer may terminate the contract, and we may not be able to recover our costs.

If we do not, or the Alion Science and Technology Corporation Employee Ownership, Savings and Investment Trust (the ESOP Trust) does not, continue to be exempt from U.S. federal income tax and any unrelated business income tax, our cash flow available to meet our debt and other financial obligations and to reinvest in our operations will decrease.

We have made an election to be taxed as an S corporation for U.S. federal income tax purposes. As an S corporation, we generally are not subject to U.S. federal income taxation or state income taxation in most U.S. states. Rather, our income, gains, losses, deductions and credits should flow through to the ESOP Trust. Under current provisions of the U.S. Internal Revenue Code (Code), the ESOP Trust is exempt from U.S. federal income taxation and any unrelated business income tax. Unrelated business income tax is a special U.S. federal income tax imposed on an otherwise tax-exempt entity (such as a tax-exempt charity or qualified pension plan, including an employee stock ownership plan) to the extent it earns income from a trade or business unrelated to its exempt purpose. The Code specifically exempts ESOPs that invest in S corporation stock of the employer from unrelated business income tax.

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If for any reason we lose our S corporation status, we could be required to pay U.S. federal and state income tax, thereby reducing the amount of cash available to repay debt, reinvest in our operations or fulfill our other financial obligations. Applicable laws and regulations may change in a way that results in the taxation of us as a corporation other than as an S corporation. Furthermore, current law that exempts the ESOP Trust from U.S. federal income taxation and unrelated business income tax may change. Similarly, if the ESOP Trust becomes subject to U.S. federal and state income taxation, we may have to distribute cash to the ESOP Trust to allow it to pay these taxes, again reducing the amount of cash we have available to repay debt, to reinvest in our operations or to fulfill our other financial obligations.

The passage of legislation requiring earlier diversification opportunities in defined contribution plans may impair our ability to meet our debt and other financial obligations and to reinvest in our operations, because of increased demands on our cash resources due to participants electing to diversify earlier than anticipated.

The U.S. Congress has considered various proposals that would require earlier diversification opportunities within employee stock ownership plans than what are currently required by law. If a bill is passed which lowers the age or shortens the time period after which employees would have the right to diversify their investments in our stock made through our ESOP, our obligations to repurchase our stock from ESOP participants could increase. That would reduce the amount of cash we have available to repay debt, to reinvest in our operations or to fulfill our other financial obligations.

In order to succeed, we will have to keep up with rapid technological changes in a number of industries and various factors could impact our ability to keep pace with these changes.

Our success will depend on our ability to keep pace with technology changes in the following research fields:

•  defense operations support;

•  wireless communications;

•  industrial technology solutions;

•  naval architecture and marine engineering;

•  modeling and simulation;

•  chemical, biological, nuclear and environmental sciences; and

•  information technology

Technologies in these fields can change rapidly. Even if we remain abreast of the latest developments and available technology, the introduction of new services or technologies in these industries could have a negative effect on our business. The integration of diverse technologies involved in our research services is complex and in many instances has not been previously attempted. Our success will depend significantly on our ability to develop, integrate and deliver technologically advanced products and services at the same or greater pace as our competitors, many of which have greater resources than we do.

An economic downturn could harm our business.

Our business, financial condition, results of operations and our ability to meet our financial obligations may be affected by various economic factors. Unfavorable economic conditions may make it more difficult for us to maintain and continue our revenue growth. In an economic recession, or under other adverse economic conditions, customers and vendors may be more likely to be unable to meet contractual terms or their payment or delivery obligations. A decline in economic conditions may have a material adverse effect on our business, financial condition, results of operations and our ability to meet our financial obligations.

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Our employees may engage in misconduct or other improper activities, which could harm our business.

We are exposed to the risk that employee fraud or other misconduct could occur. Misconduct by employees could include intentional failures to comply with U.S. government procurement regulations, unauthorized activities, attempts to obtain reimbursement for improper expenses or the submission of falsified time records. Employee misconduct could also involve the improper use of our customers’ sensitive or classified information, which could result in regulatory sanctions against us and serious harm to our reputation. It is not always possible to deter employee misconduct, and the precautions we take to prevent and detect this activity may not be effective in controlling unknown or unmanaged risks or losses, which could harm our business, financial condition, results of operations and our ability to meet our financial obligations.

The interests of the ESOP Trust may not be aligned with your interests.

The ESOP Trust owns 100% of our outstanding shares of common stock. Consequently, the ESOP Trust can control the election of a majority of our directors and, except in limited circumstances, the outcome of all matters submitted to a vote of stockholders, and has the ability to change our management. The interests of the ESOP Trust may not be fully aligned with yours and this could lead to a strategy that is not in your best interests.

Environmental laws and regulations and our use of hazardous materials may subject us to significant liabilities.

Our operations are subject to U.S. federal, state and local environmental laws and regulations, as well as environmental laws and regulations in the various countries in which we operate. In addition, our operations are subject to environmental laws and regulations relating to the discharge, storage, treatment, handling, disposal and remediation of regulated substances and waste products, such as radioactive, biochemical or other hazardous materials and explosives. The following may require us to incur substantial costs in the future:

•  modifications to current laws and regulations;

•  new laws and regulations;

•  violations of environmental laws or the permits required for our operations;

•  new guidance or new interpretation of existing laws and regulations; or

•  the discovery of previously unknown contamination.

Risks Related to Our Industry

We are dependent on U.S. government contracts for substantially all of our revenue, and changes in the contracting policies or fiscal policies of the U.S. government could adversely affect our business, financial condition, results of operations and our ability to meet our financial obligations.

Approximately 95%, 96% and 98% of our revenue, respectively, was derived from contracts with agencies of the U.S. government for the fiscal years ended September 30, 2006, 2005, and 2004. In the fiscal years ended September 30, 2006, 2005 and 2004, contracts with the DoD accounted for approximately 89%, 88% and 91% of our total revenue, respectively, while contracts with other government agencies accounted for approximately 6%, 8% and 7% of our total revenue, respectively. We expect that U.S. government contracts are likely to continue to account for a significant portion of our revenue in the future. Accordingly, changes in U.S. government contracting policies could directly affect our financial performance. Among the factors that could materially adversely affect our U.S. government contracting business are:

•  budgetary constraints affecting U.S. government spending generally, or specific departments or agencies in particular, and changes in fiscal policies or available funding;

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•  changes in U.S. government programs or requirements;

•  curtailment of the U.S. government’s use of technology services firms;

•  the adoption of new laws or regulations;

•  technological developments;

•  U.S. government shutdowns (such as that which occurred during the U.S. government’s 1996 fiscal year);

•  competition and consolidation in the information technology industry; and

•  general economic conditions.

These or other factors could cause U.S. governmental agencies to reduce their purchases under contracts, to exercise their right to terminate contracts or not to exercise options to renew contracts, any of which could have a material adverse effect on our business, financial condition, results of operations and our ability to meet our financial obligations.

Many of our U.S. government customers are subject to increasing constraints. We have substantial contracts in place with many U.S. government departments and agencies, and our continued performance under these contracts, or award of additional contracts from these agencies, could be materially adversely affected by spending reductions or budget cutbacks at these agencies. Such reductions or cutbacks could have a material adverse effect on our business, financial condition, results of operations and our ability to meet our financial obligations.

The failure by the Congress to approve budgets timely for the U.S. federal agencies we support could delay or reduce spending and cause us to lose revenue.

On an annual basis, the Congress must approve budgets that govern spending by each of the U.S. government agencies we support. When the Congress is unable to agree on budget priorities, and thus is unable to pass the annual budget on a timely basis, then the Congress typically enacts a continuing resolution. A continuing resolution allows U.S. government agencies to operate at spending levels approved in the previous budget cycle. When U.S. government agencies must operate on the basis of a continuing resolution it may delay funding we expect to receive from clients on work we are already performing and will likely result in any new initiatives being delayed, and in some cases being cancelled, both of which may adversely affect our business, financial condition, results of operations and our ability to meet our financial obligations.

We may not receive the full amount of our backlog, which could lower future revenue.

The maximum contract value specified under a U.S. government contract is not necessarily indicative of revenue that we will realize under that contract. The Congress normally appropriates funds for a given program on a fiscal year basis, even though actual contract performance may take many years. As a result, U.S. government contracts ordinarily are only partially funded at the time of award, and normally the procuring agency commits additional monies to the contract only as the Congress makes appropriations in subsequent fiscal years. Estimates of future revenue attributed to backlog are not necessarily precise, and the receipt and timing of any of this revenue is subject to various contingencies such as changed U.S. government spending priorities and government decisions not to exercise options on existing contracts. Many of these contingencies are beyond our control. The backlog on a given contract may not ultimately be funded or may only be partially funded, which may cause our revenue to be lower than anticipated, and may adversely affect our business, financial condition, results of operations and our ability to meet our financial obligations.

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Many of our U.S. government customers spend their procurement budgets through Indefinite Delivery/Indefinite Quantity (ID/IQ) contracts, GSA Schedule contracts and Government Wide Acquisition Contracts (GWACs) under which we are required to compete for post-award orders.

Budgetary pressures and reforms in the procurement process have caused many U.S. government customers to purchase goods and services through ID/IQ, GSA Schedule contracts and other multiple award and/or GWAC contract vehicles. These contract vehicles have resulted in increased competition and pricing pressure requiring that we make sustained post-award efforts to realize revenue under the relevant contracts. There can be no assurance that we will increase revenue or otherwise sell successfully under these contract vehicles. Our failure to compete effectively in this procurement environment could harm our business, financial condition, results of operations and our ability to meet our financial obligations.

U.S. government contracts contain termination provisions that are unfavorable to us.

Generally, U.S. government agencies can terminate contracts with their suppliers at any time without cause. If a U.S. government agency does terminate one of its contracts with us without cause, we will likely be entitled to receive compensation for the services provided or costs incurred up to the date of termination as well as a negotiated amount of the fee on the contract and termination-related costs we incur. However, if a U.S. government contract is terminated because we defaulted under the terms of the contract, we may be liable for excess costs the U.S. government incurs in procuring the undelivered portion of the contract from another source. Termination of any of our large U.S. government contracts may negatively impact our revenue and may adversely affect our business, financial condition, results of operations and our ability to meet our financial obligations.

If we do not accurately estimate the expenses, time and resources necessary to satisfy our contractual obligations, our profit will be lower than expected.

The total price on a cost-reimbursement contract is based primarily on allowable costs incurred, but generally is subject to a maximum contract funding limit. U.S. government regulations require us to notify our customers of any cost overruns or underruns on a cost-reimbursement contract. If we incur costs in excess of the funding limitation specified in the contract, we may not be able to recover those cost overruns. As a result, on a cost-reimbursement contract we may not earn the full amount of the anticipated fee.

In a fixed-price contract, we estimate the costs of the project and agree to deliver the project for a definite, predetermined price regardless of our actual costs to be incurred over the life of the project. We must fully absorb cost overruns. Our failure to anticipate technical problems, estimate costs accurately or control costs during performance of a fixed-price contract may reduce the fee margin of a fixed-price contract or cause a loss. The provisions in our financial statements for estimated losses on our fixed-price contracts may not be adequate to cover all actual future losses.

Our operating margins and operating results may suffer if cost-reimbursement contracts increase in proportion to our total contract mix.

In general, cost-reimbursement contracts are the least profitable of our contract types. Our U.S. government customers typically determine what type of contract will be awarded to us. To the extent that we enter into more or larger cost-reimbursement contracts in proportion to our total contract mix in the future, our operating margins and operating results may suffer.

If the volume of services we provide under fixed-price contracts decreases in total or as a proportion of our total business, or if profit rates on these contracts decline, our operating margins and operating results may suffer.

We have historically earned higher relative profits on our fixed-price contracts. If the volume of services we deliver under fixed-price contracts decreases, or shifts to other types of contracts, our operating margins and operating results may suffer. Furthermore, we cannot assure you that we will be able to maintain our historic levels of profitability on fixed-price contracts in general.

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Our subcontractors’ failure to perform contractual obligations could damage our reputation as a prime contractor and thereby our ability to obtain future business.

As a prime contractor, we often rely significantly upon other companies as subcontractors to perform work we are obligated to deliver to our customers. A failure by one or more of our subcontractors to satisfactorily perform services on a timely basis may cause us to be unable to perform our duties as a prime contractor. We have limited involvement in the work our subcontractors perform, and as a result, we may have exposure to problems our subcontractors cause. Performance deficiencies on the part of our subcontractors could result in a government customer terminating our contract for default. A default termination could expose us to liability for the customer’s costs of reprocurement, damage our reputation, and hurt our ability to compete for future contracts.

Because U.S. government contracts are subject to government audits, contract payments are subject to adjustment and repayment which may result in revenue attributed to a contract being lower than expected.

U.S. government contract payments received that are in excess of allowable costs are subject to adjustment and repayment after government audit of the contract payments. All of our federal government contract indirect costs have been audited through fiscal year 2004. Indirect rates have been negotiated and settled through 2003. We submitted our fiscal year 2005 indirect expense rates to the federal government in March 2006 and submitted our fiscal year 2006 indirect expense rates to the federal government in March 2007. If the estimated reserves in our financial statements for excess billings and contract losses are not adequate, revenue attributed to our U.S. government contracts may be lower than expected.

If we fail to recover pre-contract costs, it may result in reduced fees or in losses.

Any costs we incur before the execution of a contract or contract renewal are incurred at our risk, and it is possible that the customer will not reimburse us for these pre-contract costs. At September 30, 2006, we had pre-contract costs of $3.4 million. While such costs were associated with specific anticipated contracts, we cannot be certain that contracts or contract renewals will be executed or that we will recover the related pre-contract costs.

Actual or perceived conflicts of interest may prevent us from being able to bid on or perform contracts.

U.S. government agencies have conflict of interest policies that may prevent us from bidding on or performing certain contracts. When dealing with U.S. government agencies that have conflict of interest policies, we must decide, at times with insufficient information, whether to participate in the design process and lose the chance of performing the contract or to turn down the opportunity to assist in the design process for the chance of performing on the contract. We have, on occasion, declined to bid on particular projects because of actual or perceived conflicts of interest, and we are likely to continue encountering such conflicts of interest in the future, particularly if we acquire other U.S. government contractors. Future conflicts of interest could cause us to be unable to secure key contracts with U.S. government customers.

As a U.S. government contractor, we must comply with complex procurement laws and regulations and our failure to do so could have a negative impact upon our business.

We must comply with and are affected by laws and regulations relating to the formation, administration and performance of U.S. government contracts, which may impose added costs on our business. If a government review or investigation uncovers improper or illegal activities, we may be subject to civil and/or criminal penalties and administrative sanctions, including termination of contracts, forfeiture of fees, suspension of payments, fines and suspension or debarment from doing business with U.S. government agencies, which may impair our ability to conduct our business.

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We derive significant revenue from U.S. government contracts awarded through a competitive bidding process which is an inherently unpredictable process.

We obtain most of our U.S. government contracts through a competitive bidding process that subjects us to risks associated with:

•  the frequent need to bid on programs in advance of the completion of their design, which may result in unforeseen technological difficulties and/or cost overruns;

•  the substantial time and effort, including design, development and promotional activities, required to prepare bids and proposals for contracts that may not be awarded to us; and

•  the design complexity and rapid rate of technological advancement of most of our research offerings.

Upon expiration, U.S. government contracts may be subject to a competitive re-bidding process. We may not be successful in winning contract awards or renewals in the future. Our failure to win contract awards, or to renew or replace existing contracts when they expire, would negatively impact our business, financial condition, results of operations and our ability to meet our financial obligations.

Our failure to obtain and maintain necessary security clearances may limit our ability to carry out confidential work for U.S. government customers, which could cause our revenue to decline.

As of September 30, 2006, we had approximately 278 DoD contracts that require us to maintain facility security clearances at our 32 sites, and approximately 2,700 of our employees held security clearances to enable performance on these U.S. government contracts. Each cleared facility has a Facility Security Officer and Key Management Personnel whom the DoD — Defense Security Service requires to be cleared to the level of the facility security clearance. In addition to these clearances, individual employees are selected to be cleared, based on the task requirement of the specific classified contract, for their technical, administrative or management expertise. Once the security clearance is granted, the employee is allowed access to the classified information on the contract based on the clearance and “need to know” for the information within the contract. Protection of classified information with regard to a classified U.S. government contract is paramount. Loss of a facility clearance or an employee’s inability to obtain and/or maintain a security clearance could result in a U.S. government customer terminating an existing contract or choosing not to renew a contract upon its expiration. If we cannot maintain or obtain the required security clearances for our facilities or our employees, or if these clearances are not obtained in a timely manner, we may be unable to perform on U.S. government contracts. Lack of required clearances could also impede our ability to bid on or win new U.S. government contracts, which may result in the termination of current research activities. Termination of current research activities may damage our reputation and our revenue would likely decline, which would adversely affect our business, financial condition, results of operations and our ability to meet our financial obligations.

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USE OF PROCEEDS

The exchange offer is intended to satisfy our obligations under the registration rights agreement. We will not receive any cash proceeds from the issuance of the exchange notes. In consideration for issuing the exchange notes, we will receive in exchange a like principal amount of outstanding notes. The outstanding notes surrendered in exchange for the exchange notes will be retired and canceled and cannot be reissued. Accordingly, issuance of the exchange notes will not result in any change in our capitalization.

RATIO OF EARNINGS TO FIXED CHARGES

The following table contains our consolidated ratio of earnings to fixed charges for each of the periods indicated. Earnings included in the calculation of this ratio consists of pre-tax earnings from operations, adjusted for fixed charges. Fixed charges included in the calculation of this ratio consist of cash interest paid and amortization of capitalized expenses related to indebtedness.

																Three Months
																Ended
	Years Ended September 30,															December 31,
Actual Data	2002			2003			2004			2005			2006			2006
Ratio of earnings to fixed charges		(1	)		(2	)		(2	)		(2	)		(2	)		(2	)

(1)	For fiscal year 2002 the ratio of earnings to fixed charges was not applicable as there were no fixed charges.
(2)	Earnings for fiscal years 2003 to 2006 and the three months ended December 31, 2006 were inadequate to cover fixed charges in those periods by $8.5 million, $4.7 million, $26.9 million, $9.1 million, and $3.4 million, respectively.

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CAPITALIZATION

The following tables set forth our capitalization as of September 30, 2006 and December 31, 2006 on an actual basis and as adjusted to give effect to the issuance of the outstanding notes, and the application of the net proceeds therefrom, as if they had occurred on September 30 and December 31, 2006, respectively.

You should read this table in conjunction with our audited consolidated financial statements and related notes included elsewhere in this prospectus, as well as the information set forth under the captions “Unaudited Pro Forma Condensed Financial Information,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Description of Other Indebtedness.”

	September 30, 2006
	Actual			As Adjusted
	(In thousands)
Debt:
Term B Senior Secured Revolving Credit Facility	$	12,300		$	—
Term B Senior Secured Term Loan		259,015			199,082
Senior unsecured bridge loan		170,000			—
New 101/4% senior unsecured notes due 2015		—			250,000
Total senior debt		441,315			449,082
Junior subordinated note		50,820			50,820
Redeemable subordinated warrants		35,234			35,234
Total subordinated debt		86,054			86,054
Total debt		527,369			535,136
Stockholders’ deficit
Common stock, $0.01 par value, 8,000,000 shares authorized, 5,210,126 shares issued and outstanding		52			52
Additional paid-in capital		91,829			91,829
Accumulated deficit		(99,171	)		(107,148	)
Total shareholder’s deficit		(7,290	)		(15,267	)
Total capitalization	$	520,079		$	519,869

	December 31, 2006
	Actual			As Adjusted
	(In thousands)
Debt:
Term B Senior Secured Revolving Credit Facility	$	32,550		$	—
Term B Senior Secured Term Loan		258,360			218,877
Senior unsecured bridge loan		170,000			—
New 101/4% senior unsecured notes due 2015		—			250,000
Total senior debt		460,910			468,877
Junior subordinated note		51,645			51,645
Redeemable subordinated warrants		37,258			37,258
Total subordinated debt		88,903			88,903
Total debt		549,813			557,780
Stockholders’ deficit
Common stock, $0.01 par value, 8,000,000 shares authorized, 5,207,883 shares issued and outstanding		52			52
Additional paid-in capital		91,737			91,737
Accumulated deficit		(113,283	)		(115,367	)
Total shareholder’s deficit		(21,494	)		(23,578	)
Total capitalization	$	528,319		$	534,202

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UNAUDITED PRO FORMA CONDENSED FINANCIAL INFORMATION

The following unaudited pro forma condensed financial information is based on our historical financial statements, adjusted to give effect to the issuance of the outstanding notes and the following acquisitions, in each case as if they each occurred on October 1, 2005, the first day of our 2006 fiscal year:

Acquisition	Acquisition Date
• BMH Associates, Inc.		— February 10, 2006
• Washington Consulting, Inc.		— February 24, 2006
• Micro Analysis and Design, Inc.		— May 19, 2006
• Certain assets of Anteon		— June 30, 2006

The method of combining historical financial statements for the preparation of the pro forma condensed consolidated financial data is for presentation only. Actual statements of our operations will reflect the operating results of the above noted acquisitions from the closing date of each acquisition with no retroactive restatements. The unaudited pro forma condensed consolidated financial data has been prepared by management and is provided for illustrative purposes only and does not purport to be indicative of the financial condition or results of operations that would have been reported had the issuance of the outstanding notes and the acquisitions occurred on the dates indicated, nor does it represent a forecast of the consolidated financial position or results of operations for any future period. The unaudited pro forma condensed consolidated financial data should be read in conjunction with the historical financial statements, together with the respective notes thereto, included elsewhere in this prospectus.

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UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
For the twelve months ended September 30, 2006

				Anteon and									Pro Forma
				Other						Adjustment			for the
	Historical			Acquisitions			Acquisition			for the			Acquisitions
	Alion			(a)			Adjustments			Offering			and Offering
	(In thousands)
Statement of Income:
Contract revenue	$	508,628		$	218,223		$	—		$	—		$	726,851
Direct contract expense		381,467			170,314			—			—			551,781
Gross profit		127,161			47,909			—			—			175,070
Operating expenses		129,466			37,400			(5,825	)(b)		—			168,541
								7,500	(c)
Operating income (loss)		(2,305	)		10,509			(1,675	)		—			6,529
Interest income (expense)		(29,691	)					(17,433	)(d)		(2,393	)(e)		(49,517	)
Other income (expense)		907			(789	)		—			—			118
Loss before income taxes		(31,089	)		9,720			(19,108	)		(2,393	)		(42,870	)
Income tax benefit (expense)		(26	)		—			—			—			(26	)
Net income (loss)	$	(31,115	)	$	9,720		$	(19,108	)	$	(2,393	)	$	(42,896	)

	At December 31,
	2006
Balance Sheet Data:
Cash and cash equivalents	$	340
Working capital		66,622
Total assets		672,486

See accompanying notes to Unaudited Pro Forma Condensed Consolidated Statement of Operations.

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Notes to Unaudited Pro Forma Condensed Consolidated Statement of Operations
(dollars in thousands)

The following adjustments have been reflected in the Unaudited Pro Forma Condensed Consolidated Statement of Operations:

(a) To reflect the historical results of operations of the following acquisitions:

• BMH Associates, Inc.	— February 10, 2006
• Washington Consulting, Inc.	— February 24, 2006
• Micro Analysis and Design, Inc.	— May 19, 2006
• Certain assets of Anteon	— June 30, 2006

The historical results of the acquisitions are broken out as follows:

	Other			Anteon
	Acquisitions			Acquisition
	(In thousands)
Statement of Income:
Contract revenue	$	26,861		$	191,362
Direct contract expense		16,389			153,925
Gross profit		10,472			37,437
Operating expenses		13,830			23,570
Operating income (loss)		(3,358	)		13,867
Interest income (expense)		—			—
Other income (expense)		(789	)		—
Loss before income taxes		(4,147	)		13,867
Income tax benefit (expense)		—			—
Net income (loss)	$	(4,147	)	$	13,867

(b)	Pro forma adjustment to reflect pre-acquisition costs paid by Washington Consulting, Inc., which include non-qualified deferred compensation costs, incentive compensation costs based on change in control, and transaction costs.
(c)	Pro forma adjustment to reflect the amortization of intangibles associated with the contracts acquired from Anteon.
(d)	Pro forma adjustment to reflect incremental interest expense associated with the Term B Senior Credit Facility and the Bridge Loan. The weighted average interest rate for the twelve month periods ended September 30, 2006 was 9.2%.
(e)	Reflects the following adjustments to interest expense as a result of the issuance of the outstanding notes and the redemption of the existing Bridge Loan and the pay down of a portion of the senior term loans under the Term B Senior Credit Facility:

	Twelve Months
	Ended
	September 30,
	2006
	(In thousands)
Interest on the new 101/4% senior unsecured notes due 2015	$	25,625
Elimination of historical cash interest expense on existing Bridge Loan		(18,632	)
Reduction in historical cash interest expense on Term B Senior Credit Facility		(5,815	)
Cash interest expense adjustment	$	1,178
Amortization of deferred fees and expenses for the outstanding notes		1,215
Total interest expense adjustments	$	2,393

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SELECTED CONSOLIDATED FINANCIAL DATA

The following selected consolidated financial data (other than funded contract backlog, unfunded contract backlog, and number of employees) as of and for the years ended September 30, 2002 through 2005 have been derived from our consolidated financial statements audited by KPMG LLP, independent registered public accounting firm. The consolidated operating data for the fiscal year ended September 30, 2002 and 2003 and the consolidated balance sheet data as of September 30, 2002 and 2003 are derived from the consolidated financial statements of Selected Operations of IITRI. The historical consolidated financial information of Selected Operations of IITRI has been carved out from the consolidated financial statements of IITRI using the historical results of operations and bases of assets and liabilities of the portion of IITRI’s business that was sold and gives effect to allocations of expenses from IITRI. The consolidated operating data and the consolidated balance sheet data for the Selected Operations of IITRI are derived from the consolidated financial statements of IITRI not included in this prospectus. The consolidated financial statements as of September 30, 2005 and for the years ended September 30, 2004 and 2005 are included elsewhere in this prospectus. The unaudited consolidated financial statements as of and for the three months ended December 31, 2005 are included elsewhere in this prospectus.

The following selected consolidated financial data (other than funded contract backlog, unfunded contract backlog, and number of employees) as of and for the year ended September 30, 2006 have been derived from our consolidated financial statements audited by Deloitte & Touche LLP, independent registered public accounting firm, and which are included elsewhere in this prospectus. The unaudited consolidated financial statements as of and for the three months ended December 31, 2006 are included elsewhere in this prospectus.

These results are not necessarily indicative of the results that may be expected for any future period and are not comparable to the prior period as a result of business acquisitions consummated in 2004, 2005 and 2006. All of the acquisitions have been accounted for using the purchase method of accounting, and accordingly the purchase price for each acquisition was allocated to identifiable assets acquired and liabilities assumed based upon their estimated values. Results of operations of these acquired businesses are included in our consolidated financial statements for the periods subsequent to the respective dates of acquisition. You should read the following information in conjunction with “Capitalization,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Business” and our historical consolidated financial statements, together with the notes thereto, included elsewhere in this prospectus.

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Selected Consolidated Financial Data of Alion Science and Technology Corporation

																Three Months Ended
	Years Ended September 30,															December 31,
	2002(1)			2003(2)			2004(3)			2005(4)			2006(5)			2005			2006
	(In thousands, except for per share data)
Consolidated Operating Data:
Contract revenue	$	201,738		$	165,917		$	269,940		$	369,231		$	508,628		$	101,289		$	181,139
Direct contract expenses		147,377			120,559			196,388			267,241			381,467			76,305			140,101
Operating expenses(6)		48,488			46,273			73,703			104,081			129,466			27,812			40,995
Operating income (loss)		5,873			(915	)		(151	)		(2,091	)		(2,305	)		(2,828	)		43
Interest expense(7)		(563	)		(11,724	)		(16,835	)		(38,696	)		(29,691	)		(5,445	)		(14,358	)
Other income (expense)(8)		(23	)		23			1,892			615			907			512			190
Income tax (expense) benefit(9)		(589	)		—			(17	)		(66	)		(26	)		(19	)		13
Net income (loss)	$	4,698		$	(12,616	)	$	(15,111	)	$	(40,238	)	$	(31,115	)	$	(7,780	)	$	(14,112	)
Basic and diluted loss per share	$	—		$	(6.05	)	$	(4.91	)	$	(9.50	)	$	(6.19	)	$	(1.52	)	$	(2.71	)
Basic and diluted weighted-average common shares outstanding		—			2,085,274			3,074,709			4,235,947			5,029,670			5,123,744			5,209,858
Consolidated Balance Sheet Data at End of Period:
Net accounts receivable	$	49,051		$	42,775		$	68,949		$	80,898		$	150,412		$	92,736		$	183,092
Total assets		71,096			144,754			188,461			334,249			650,969			112,892			672,486
Current portion of long-term debt		3,330			5,000			468			1,404			2,816			1,406			3,430
Long-term debt, excluding current portion		1,654			74,719			99,631			180,833			463,743			181,691			463,705
Redeemable common stock warrants		—			14,762			20,777			44,590			35,234			46,390			37,258
Long-term deferred gain on sale of building to Illinois Institute of Technology, excluding current portion		3,523			—			—			—			—			—			—
Other Data:
Depreciation and amortization	$	3,447		$	9,553		$	13,447		$	17,771		$	16,566		$	4,790		$	5,655
Capital expenditures		3,643			1,329			3,678			2,233			5,227			1,605			1,533
Cash flows provided by (used in):
Operating activities	$	14,713		$	14,264		$	5,675		$	35,140		$	(15,678	)	$	(14,655	)	$	(25,226	)
Investing activities		(4,466	)		(61,428	)		(23,625	)		(78,017	)		(284,423	)		(1,605	)		(8,093	)
Financing activities		(9,851	)		47,652			22,173			75,938			265,078			(6,259	)		30,904
Funded contract backlog(10)		72,000			107,000			161,000			193,000			386,000			179,000			333,000
Unfunded contract backlog(11)		1,431,000			1,435,000			1,793,000			2,581,000			3,861,000			2,644,000			4,269,000
Number of employees		1,622			1,604			1,880			2,508			3,575			2,472			3,439

(1)	Represents consolidated operating and balance sheet data of the Selected Operations of IITRI which was acquired by us on December 20, 2002.
(2)	For fiscal year 2003 (October 1, 2002 to September 30, 2003), the operations data presented reflects approximately nine months of our operations since the IITRI Acquisition occurred on December 20, 2002, which was at the end of IITRI’s first quarter of operations for fiscal 2003. During the period October 1, 2002 to December 20, 2002, Alion was organizationally a business shell, operationally inactive until the Transaction occurred.
(3)	During fiscal year 2004, we completed two acquisitions as described below. Operating results for these businesses are included in our consolidated totals from the respective dates of acquisitions. On October 31, 2003, we acquired 100% of the outstanding stock of Innovative Technology Solutions

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	Corporation (ITSC), for $4.0 million. The transaction is subject to an earn-out provision not-to-exceed $1.5 million. ITSC is a New Mexico corporation with approximately 53 employees, the majority of whom are located in New Mexico. As of September 30, 2006, we have recorded approximately $5.0 million of goodwill relating to this acquisition.
	On February 13, 2004, we acquired 100% of the outstanding stock of Identix Public Sector, Inc. (IPS, now known as Alion — IPS Corporation) for $8.0 million in cash. IPS, formerly ANADAC, was a wholly-owned subsidiary of Identix Incorporated. Following the closing, we paid Identix approximately $4.3 million for intercompany payables. As of September 30, 2006, we have recorded approximately $6.1 million of goodwill relating to this acquisition.
(4)	During fiscal year 2005, we completed four acquisitions and made one strategic investment as described below. The results of operations for the companies acquired are included in our operations from the dates of the acquisitions. On October 28, 2004, we purchased substantially all of the assets of Countermeasures for approximately $2.4 million. Countermeasures had two employees and was located in Hollywood, Maryland. As of September 30, 2006, we have recorded approximately $1.4 million in goodwill relating to this acquisition. On February 11, 2005, we acquired 100% of the outstanding stock of METI, an environmental and life sciences research and development company for approximately $7.0 million in cash. METI had approximately 110 employees and was headquartered in Research Triangle Park, North Carolina. As of September 30, 2006, we have recorded $5.6 million in goodwill related to this acquisition. On February 25, 2005, we acquired 100% of the outstanding stock of CATI, a flight training software and simulator development company, for approximately $7.3 million in cash. CATI had approximately 55 employees and was headquartered in Seaside, California. The transaction is subject to an earn-out provision not-to-exceed a cumulative amount of $8.3 million based on attaining certain cumulative revenue goals for fiscal years 2005, 2006, and 2007, and a second earn-out provision not-to-exceed $1.5 million for attaining certain revenue goals in the commercial aviation industry. As of September 30, 2006, we have recorded approximately $13.9 million in goodwill related to this acquisition. On April 1, 2005, we acquired 100% of the issued and outstanding stock of JJMA. We paid the equity holders of JJMA approximately $52.9 million, issued 1,347,197 shares of Alion common stock to the JJMA Trust valued at approximately $37.3 million, and agreed to make $8.3 million in future payments. Including acquisition costs of $1.3 million, the aggregate purchase price was $99.8 million. As of September 30, 2006, we have recorded approximately $57.8 million in goodwill related to the JJMA acquisition. On March 22, 2005, we acquired approximately 12.5 percent of the class A ordinary shares in VectorCommand Ltd. for $1.5 million, which investment is accounted for at cost.
(5)	During fiscal year 2006, we completed four acquisitions as described below. The results of operations for the companies acquired are included in our operations from the dates of the acquisitions. On February 10, 2006, we purchased 100% of the outstanding stock of BMH, a provider of advanced software, systems engineering and distributed interactive simulations for military training and experimentation, for approximately $20.0 million (less a $1.5 million hold back) plus additional contingent earn-out obligations over a two year period which can not exceed $6.0 million. As of September 30, 2006, we have recorded approximately $16.2 million in goodwill relating to this acquisition. On February 24, 2006, we acquired 100% of the issued and outstanding stock of WCI, a provider of enterprise IT and management consulting solutions and services to commercial and government customers, for $18.0 million (less a $1.5 million hold back) plus additional contingent earn-out obligations over a two year period which can not exceed $2.5 million. As of September 30, 2006, we have recorded approximately $17.4 million in goodwill relating to this acquisition.

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	On May 19, 2006, we acquired 100% of the issued and outstanding stock of MA&D, a provider of human factors engineering, modeling and simulation and software development for approximately $16.9 million (less a $2.0 million hold back) plus additional contingent earn-out obligations over a two year period which can not exceed approximately $4.1 million. As of September 30, 2006, we have recorded approximately $15.7 million in goodwill relating to this acquisition. On June 30, 2006, we acquired from Anteon a group of assets consisting primarily of customer contracts for approximately $221.4 million. As of September 30, 2006, we have recorded approximately $50.0 million for purchased contracts and approximately $174.0 million in goodwill relating to this acquisition.
(6)	Operating expenses include (i) transaction expenses of approximately $6.7 million and $6.4 million for fiscal years ended September 30, 2003 and 2002, respectively, and (ii) conversion and roll-out expenses of approximately $1.5 million for the fiscal year ended September 30, 2003.
(7)	For the years ended September 30, 2006, 2005 and 2004, interest expense was associated with the debt financing (which includes the related change in warrant valuation associated with the change in the share price of Alion stock) resulting from the IITRI Acquisition and the acquisitions which were completed in fiscal years 2006 and 2005, as described above.
(8)	Other income (expense) for the year ended September 30, 2004 includes a gain of approximately $2.1 million on the sale of our minority interest in Matrics Incorporated.
(9)	Income tax (expense) benefit primarily relates to non-recognition of S Corporation status for certain U.S. states.
(10)	Funded backlog represents the total amount of contracts that have been awarded and whose funding has been authorized minus the amount of revenue booked under the contracts from their inception to date.
(11)	Unfunded backlog refers to the estimated total value of contracts which have been awarded but whose funding has not yet been authorized for expenditure.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS

You should read the following discussion and analysis of our financial conditions and results of operations together with the “Capitalization”, “Unaudited Pro Forma Condensed Financial Information”, “Selected Consolidated Financial Data”, “Business” and our consolidated financial statements, together with the notes thereto, included elsewhere in this prospectus. The discussion contains forward-looking statements and involves numerous risks and uncertainties, including, but not limited to, those described in the “Risk Factors” section of this prospectus. Actual results may differ materially from those contained in any forward-looking statements. See “Forward-Looking Statements.”

The discussion and analysis that follows addresses only continuing operations and is organized to:

•  provide an overview of the business;

•  explain year-over-year trends in the results of operations;

•  describe our liquidity and capital resources;

•  explain critical accounting policies;

•  explain other obligations; and

•  disclose market and other risks.

Overview

With a 70-year legacy, we are a highly-experienced technology solutions company delivering scientific, research and development, and technology expertise and operational support to U.S. government agencies, primarily the DoD, and commercial customers. Based in McLean, Virginia, we design, develop, integrate, deliver and maintain, and upgrade technology solutions, products and tools for national defense, homeland security and other government programs. We deliver solutions in the following seven core business areas:

•  defense operations;

•  wireless communications;

•  industrial technology solutions;

•  naval architecture and marine engineering;

•  modeling and simulation;

•  chemical, biological, nuclear and environmental sciences; and

•  information technology.

We are an S corporation entirely owned by our non-leveraged ESOP, and as such are not subject to U.S. federal income tax or state income tax in many U.S. states.

Our sophisticated technology solutions in all of our core business areas are supported by our skilled employee base, which includes engineers, scientists and former military personnel. Approximately 72% of our employees have security clearances, with approximately 22% of our employees holding clearances at the Top Secret level or above, allowing us access to highly classified DoD information systems and networks. To enhance our technology solutions, we have approximately 120,000 square feet of laboratory facilities, which we use to conduct customer-funded research and development activities, and internally-funded research and development activities, to a lesser degree.

Comparison of Results of Operations

During the fiscal year ended September 30, 2006, we completed the acquisitions of BMH and WCI in February 2006, MA&D in May 2006 and the Anteon Contracts in June 2006 and during the fiscal year

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ended September 30, 2005, we completed the acquisitions of METI and CATI in February 2005, and JJMA in April 2005. For the fiscal year ended September 30, 2006, our operating results include the operating results for the acquisitions of METI, CATI and JJMA for the entire fiscal year; however, they include operating results for only 33 weeks of BMH, 31 weeks of WCI and 19 weeks of MA&D, and 13 weeks of operating results generated in support of the contracts acquired from Anteon. Operating results for the fiscal year ended September 30, 2005, do not include operating results for the BMH, WCI, MA&D and Anteon Asset Acquisition acquisitions. For the fiscal year ended September 30, 2005, the operating results include only approximately 28 weeks of operating results for the METI and CATI acquisitions and only 24 weeks of operating results for the JJMA acquisition. Significant differences in our results of operations for the periods presented arise from the effects of these acquisitions.

Three Months Ended December 31, 2006 Compared to Three Months Ended December 31, 2005

For purposes of comparability, the selected financial information provided in the table below reflects the relative financial impact of the BMH, WCI and MA&D acquisitions and for the work performed in support of the contracts acquired from Anteon, which we refer to as our “acquired operations,” as they relate to our financial performance for the three months ended December 31, 2006, compared to the financial performance for three months ended December 31, 2005. All of our operations, other than those acquired through the above-noted acquisitions are referred to as “non-acquired operations.”

	Three Months
	Ended															Three Months Ended
	December 31, 2006															December 31, 2005
										Consolidated
	Consolidated									Operations Less						Consolidated
	Operations of				Acquired					Acquired						Operations of
Financial Information	Alion				Operations*					Operations						Alion
	(Dollars in millions)															(Dollars in millions)
			%				%						%						%
			Revenue				Revenue						Revenue						Revenue
Total Revenue	$	181.1			$	79.5				$	101.6					$	101.3
Material and subcontract revenue		78.5		43.3%		38.4		48.3	%		40.1			39.5	%		32.8			32.4%
Total direct contract expenses		140.1		77.4%		62.7		78.9	%		77.4			76.2	%		76.3			75.3%
Major components of direct contract expenses
Direct labor expense		61.2		33.8%		24.1		30.3	%		37.1			36.5	%		41.4			40.9%
Other direct labor expense (ODC)		4.9		2.7%		1.3		1.6	%		3.6			3.5	%		2.6			2.6%
Material and subcontract (M&S) expense		74.0		40.9%		37.3		46.9	%		36.7			36.1	%		32.3			31.9%
Gross profit		41.0		22.6%		16.8		21.1	%		24.2			23.8	%		25.0			24.7%
Total operating expense		41.0		22.6%		15.2		19.1	%		25.7			25.3	%		27.8			27.4%
Major components of operating expense
Indirect personnel and facilities		17.7		9.8%		7.8		9.8	%		9.9			9.7	%		10.3			10.2%
General and administrative		13.0		7.2%		4.5		5.7	%		8.5			8.4	%		9.6			9.5%
Stock-based compensation (included in G&A expense)		3.6		2.0%		—		—			3.6			3.5	%		2.8			2.8%
Depreciation and amortization		5.6		3.1%		2.9		3.6	%		2.7			2.7	%		4.8			4.7%
Income (loss) from operations	$	0.0		0.1%	$	1.6		2.0	%	$	(1.5	)		(1.5	)%	$	(2.8	)		(2.8	)%

* For the three months ended December 31, 2006, the operations of acquired entities and the operating results generated in support of the acquired Anteon Contracts have been fully integrated within us on a consolidated basis. The selected financial information provided in the table represent actual results for the acquired and non-acquired operations rounded to the nearest one hundred thousand dollars.

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Revenues.  Revenues for the three months ended December 31, 2006 increased $79.8 million, or 78.8%, over the three months ended December 31, 2005. This increase is attributable to the following:

• Increase in revenue generated by the activities of the acquired operations	$	79.5 million
• Increase in revenue generated by the activities of the non-acquired operations	$	0.3 million
Total:	$	79.8 million

As a component of revenue, material and subcontract (M&S) revenue for the three months ended December 31, 2006 increased approximately $45.7 million, or 139.3%, over the three months ended December 31, 2005. The acquired operations generated approximately $38.4 million of the increase. M&S revenue increased to 43.3% of total revenue from 32.4% of total revenue for the three months ended December 31, 2006 and 2005, respectively. This increase was due primarily to the increase in content of M&S revenue to total revenue from acquired operations, primarily related to WCI and for work provided in support of the Anteon Contracts.

Direct Contract Expenses.  Direct contract expenses for the three months ended December 31, 2006 increased $63.8 million, or 83.6%, over the three months ended December 31, 2005. Approximately $62.7 million and $1.1 million in increased expenses were from acquired operations and non-acquired operations, respectively. Direct contract expenses were 77.4% and 75.3% of total revenue for the three months ended December 31, 2006 and 2005, respectively.

•  Direct labor expense for the three months ended December 31, 2006 increased $19.8 million, or 47.8%, over the three months ended December 31, 2005. Direct labor expense declined to 33.8% from 40.9% of total revenue for the three months ended December 31, 2006 and 2005, respectively. This decrease was due to the decrease in content of direct labor expense from acquired operations primarily related to WCI and for work provided in support of the Anteon Contracts.

•  M&S expense for the three months ended December 31, 2006 increased $41.7 million, or 129.1%, over the three months ended December 31, 2005. M&S expense increased to 40.9% from 31.9% of total revenue for the three months ended December 31, 2006 and 2005, respectively. The percent increase in M&S expense was due to the increase in content of M&S expense to total direct contract expense of the acquired operations, primarily related to WCI and for work provided in support of the Anteon Contracts. M&S expense was approximately 94.3% and 98.5% of M&S revenue for the three months ended December 31, 2006 and 2005, respectively.

M&S expense has been increasing relative to direct labor, as a result of contracts obtained in connection with our acquired operations as well as higher levels of M&S related work on contracts in the non-acquired operations. This increased level of M&S expense is expected to continue for at least the next two fiscal years or until backlog on these contracts is expended.

Gross Profit.  Gross profit was $41.0 million and $25.0 million for the three months ended December 31, 2006 and December 31, 2005, respectively. Gross profit was 22.6% and 24.7% of total revenue for the three months ended December 31, 2006 and 2005, respectively. Gross profit margins decreased due to the relative increase in M&S contract work. M&S contract work typically generates lower profit margins than contract direct labor work.

Operating Expenses.  Operating expenses for the three months ended December 31, 2006 increased $13.2 million, or 47.4%, over the three months ended December 31, 2005. Operating expenses were 22.6% and 27.4% of total revenue for the three months ended December 31, 2006 and 2005, respectively. The changes in major components of operating expenses were:

•  Operating expenses for indirect personnel and rental and occupancy expenses for the three months ended December 31, 2006 increased approximately $7.4 million, or 72.0%, from the three months ended December 31, 2005. Operating expenses for indirect personnel and facilities declined to 9.8% from 10.2% of total revenue for the three months ended December 31, 2006 and 2005, respectively.

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•  General and administrative (G&A) expense for the three months ended December 31, 2006 increased approximately $3.4 million, or 35.4%, over the three months ended December 31, 2005. G&A expenses were 7.2% and 9.5% of revenue for the three months ended December 31, 2006 and 2005, respectively. Approximately $1.2 million of the $3.4 million increase is due to increased fringe benefit expenses and approximately $1.0 million was due to third-party legal and accounting fees associated with financing expense and approximately $0.3 million for third party legal expense for contract protests. These additional expenses represent approximately 1.4% of total revenue. The remaining $0.9 million increase in G&A expense is associated with infrastructure costs to accommodate recent acquisitions.

•  Stock-based compensation expense (included in G&A expense) relates to the SAR and phantom stock plans. This expense for the three months ended December 31, 2006 increased approximately $0.8 million, or 28.6%, from the three months ended December 31, 2005. The increase in stock-based compensation expense results from the relative change in price of a share in Alion common stock and, to a lesser extent, the increase in the awards granted.

•  Depreciation and amortization expense for the three months ended December 31, 2006 increased approximately $0.8 million, or 16.7%, from the three months ended December 31, 2005. Depreciation expense primarily arises from fixed assets while amortization expense results primarily from purchase contracts. Depreciation and amortization expense was 3.1% and 4.7% of revenue for the three months ended December 31, 2006 and 2005, respectively.

Income (loss) from Operations.  There was operating income of $43,000 for the three months ended December 31, 2006, compared to an operating loss of $2.8 million for the three months ended December 31, 2005. Operating loss decreased because of the factors discussed above.

Other Income (Expense).  Other income (expense) for the three months ended December 31, 2006 increased approximately $9.2 million, or 187.2%, over the three months ended December 31, 2005. Interest expense for the three months ended December 31, 2006 increased approximately $9.0 million, or 163.7%, from the three months ended December 31, 2005, which was attributable to the following:

	Three Months Ended
	December 31,
	2006		2005
	(In millions)
Revolving facility	$	0.7	$	—
Senior term loan		5.7		2.6
Bridge loan		4.6		—
Subordinated Note		1.0		1.0
Accretion of warrants(a)		2.0		1.8
Other		0.4		—
Total	$	14.4	$	5.4

(a)  Reflects change in value assigned to the detachable warrants associated with mezzanine and subordinated notes based on the change in the value of our common stock and the number of warrants outstanding.

Income Tax (Expense) Benefit.  We have filed qualified subchapter S elections for all of our wholly-owned subsidiaries to treat them as disregarded entities for federal income tax purposes. Some states do not recognize the effect of these elections or our S corporation status. For our Canadian subsidiary, Alion Science and Technology (Canada) Corporation, we accrue a tax liability, as required. We recorded $13,000 income tax benefit and $19,000 income tax expense for the three months ended December 31, 2006 and 2005, respectively.

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Net Loss.  The net loss for the three months ended December 31, 2006 increased approximately $6.3 million, or 81.4%, from the three months ended December 31, 2005, because of the factors discussed above.

Year ended September 30, 2006 Compared to Year ended September 30, 2005

For purposes of comparability, the table below reflects the relative financial impact of the BMH, WCI, MA&D, Anteon Asset Acquisition, METI, CATI and JJMA acquisitions, which we refer to as our “acquired operations,” as they relate to our financial performance for the fiscal year ended September 30, 2006 compared to the financial performance for the fiscal year ended September 30, 2005. Significant differences in the results of our operations for the fiscal years September 30, 2006 and 2005, arise from the effects of these acquisitions. The following discussion and analysis include references to selected financial information in the table below in conjunction with our condensed consolidated financial statements provided elsewhere in this prospectus.

	Year Ended September 30, 2006								Year Ended September 30, 2005
						Consolidated								Consolidated
						Operations of								Operations of
	Consolidated					Alion Less			Consolidated					Alion Less
	Operations			Acquired		the Acquired			Operations			Acquired		the Acquired
Financial Information	of Alion			Operations*		Operations			of Alion			Operations		Operations
	(In millions)
Total revenue	$	508.6		$	222.2	$	286.4		$	369.2		$	65.3	$	303.9
Material and subcontract revenue		172.2			83.1		89.1			102.7			16.9		85.8
Total direct contract expenses		381.5			166.5		214.9			267.2			46.1		221.1
Major components of direct contract expense:
Direct labor cost		202.6			83.6		119.0			152.5			26.6		125.9
Other direct cost (ODC)		16.5			3.9		12.6			13.7			2.9		10.8
Material and subcontract (M&S) cost		162.3			79.0		83.3			101.0			16.6		84.4
Gross profit		127.2			55.7		71.5			102.0			19.2		82.8
Total operating expense		129.5			53.1		76.4			104.1			13.1		91.0
Major components of operating expense:
Indirect personnel and facilities		52.1			24.7		27.4			41.6			6.9		34.7
Other general and administrative		47.4			20.6		26.8			33.0			2.9		30.1
Depreciation and amortization		16.6			7.8		8.8			17.8			3.2		14.6
Stock-based compensation		10.7			—		10.7			10.6			0.0		10.6
Operating (loss) income	$	(2.3	)	$	2.6	$	(4.9	)	$	(2.1	)	$	6.1	$	(8.2	)

* For the year ended September 30, 2006, the operations of the acquired entities and the operating results generated in support of the Anteon Contracts have been fully integrated within us on a consolidated basis.

Contract Revenues.  Revenues increased $139.4 million to $508.6 million for fiscal year ended September 30, 2006, or 37.8%, from $369.2 million for the fiscal year ended September 30, 2005. The acquired operations generated approximately $156.9 million of the approximate $139.4 million in increased revenue. The non-acquired operations generated a net decrease in revenue of $17.5 million. The $17.5 million net decrease in revenue generated by the non-acquired operations was attributable to the following: 1) a decrease of approximately $12.3 million in naval architecture and ship design work due to delays in receipt

44

of new tasking related to new and existing U.S. Navy ship programs, 2) our unsuccessful bid for the follow-on support contract to the U.S. Navy for Guam Ordnance Services accounted for a decrease of approximately $7.0 million, 3) a reduced level of funding under the Department of Defense Modeling and Simulation Information Analysis Contract (MSIAC) accounted for a revenue reduction of approximately $6.0 million, 4) a reduction of approximately $2.9 million as a result of the completion of our analysis work coincident with the completion of the initial phase of the U.S. Government’s most recent Base Realignment and Closure (BRAC) process and 5) a reduction of approximately $2.1 million in support of Defense Spectrum Office. On the balance of our contracts, revenue generated by the non-acquired contracts increased approximately $12.8 million.

As a component of revenue, M&S revenue increased approximately $69.5 million to $172.2 million for the year ended September 30, 2006, or 67.7%, from $102.7 million for the year ended September 30, 2005. The acquired operations generated approximately $66.2 million of the $69.5 million M&S revenue increase. The non-acquired operations generated approximately $3.3 million of the M&S revenue increase. As a percentage of revenue, M&S revenue increased approximately 6.1% to 33.9% for the year ended September 30, 2006, from 27.8% for the year ended September 30, 2005. The percentage increase in M&S revenue was partially due to 1) the increase in content of M&S revenue to total revenue generated by the acquired operations, and 2) a result of the decrease in total contract revenue generated by the non-acquired operations (related to the issues described above).

Direct Contract Expenses.  Direct contract expenses increased approximately $114.3 million to $381.5 million, or 42.8%, for the fiscal year ended September 30, 2006, from $267.2 million for the fiscal year ended September 30, 2005. Acquired operations generated an increase of approximately $120.4 million direct contract expenses and the non-acquired operations generated a decrease of approximately $6.2 million attributable to the decrease in contract revenue generated by the non-acquired operations described above. Direct contract expenses were 75.0% of revenue for the fiscal year ended September 30, 2006, as compared to 72.4% for the fiscal year ended September 30, 2005. The changes in specific components of direct contract expenses are:

•  Direct labor expense for the fiscal year ended September 30, 2006 increased by $50.1 million, or 32.9%, to $202.6 million from $152.5 million for the fiscal year ended September 30, 2005. Direct labor expense decreased to 39.9% of revenue for the fiscal year ended September 30, 2006, from 41.3% of revenue in the fiscal year ended September 30, 2005, due to a shift from direct labor to M&S expense. The percentage decrease in direct labor expense is primarily due to the lower content of direct labor expense to total direct contract expense of the acquired operations. The content of direct labor expense generated by the JSC and Guam Ordnance Services contracts was higher in the fiscal year ended September 30, 2006 than in the fiscal year ended September 30, 2005.

•  M&S expense increased approximately $61.3 million, or 60.7%, to $162.3 million for the fiscal year ended September 30, 2006, compared to $101.0 million for the fiscal year ended September 30, 2005. M&S expense was 31.9% and 27.4% of revenue for the fiscal years ended September 30, 2006 and 2005, respectively. The percentage increase in M&S expense was primarily due to the higher content of M&S expense to total direct contract expense of the acquired operations. M&S expense, as a percentage of M&S revenue, was approximately 94.3% and 98.3% for the fiscal years ended September 30, 2006 and 2005, respectively, primarily as a result of increased profit margins on M&S work by acquired operations.

Gross Profit.  Gross profit increased $25.2 million, or 24.7%, to $127.2 million for the fiscal year ended September 30, 2006, from $102.0 million for the fiscal year ended September 30, 2005. Gross profit was 25.0% and 27.6% of revenue for the fiscal years ended September 30, 2006 and 2005, respectively. Our M&S work has been increasing relative to direct labor, as a result of contracts obtained in connection with our acquired operations as well as higher levels of M&S related work on contracts in the non-acquired operations. This trend is expected to continue for at least the next two fiscal years or until backlog on these contracts is expended. M&S effort typically generates lower profit margins than contract direct labor work.

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Operating Expenses.  Operating expenses increased $25.4 million, or 24.3% to $129.5 million for the fiscal year ended September 30, 2006, from $104.1 million for the fiscal year ended September 30, 2005. Acquired operations generated $40.0 million of increased operating expenses while non-acquired operations generated a decrease in operating expenses of approximately $14.6 million. Operating expense was 25.5% and 28.2% of revenue for the fiscal years ended September 30, 2006 and 2005, respectively. The changes in some of the specific components of operating expenses were:

•  Operating expenses for indirect personnel and rental and occupancy expenses increased approximately $10.5 million, or 25.2%, to $52.1 million for the fiscal year ended September 30, 2006, from $41.6 million for the fiscal year ended September 30, 2005. The increase is partially attributable to expense associated with integrating the BMH and WCI acquisitions in the second quarter of fiscal year 2006, the MA&D acquisition in the third quarter of fiscal year 2006 and the Anteon Asset Acquisition in the fourth quarter of fiscal year 2006. Additionally, due to the delays in approving the 2006 U.S. federal budget, contract funding was delayed, which results in increased indirect labor expense required in order to sustain our engineers and technical labor base. Operating expenses for indirect personnel and facilities were 10.2% and 11.3% of revenue for the fiscal years ended September 30, 2006 and 2005, respectively.

•  Stock-based compensation and deferred compensation relate primarily to the expense associated with the stock appreciation rights and phantom stock plans, included in G&A expense. Stock-based compensation was approximately 2.1% and 2.9% of revenue for the fiscal years ended September 30, 2006 and 2005, respectively. Stock-based compensation and deferred compensation relate primarily to the expense associated with the stock appreciation rights and phantom stock plans. This expense increased approximately $0.1 million, or 1.0%, to $10.7 million for the fiscal year ended September 30, 2006, compared to approximately $10.6 million for the fiscal year ended September 30, 2005. The increase in stock-based compensation expense results from the relative change in price of a share of our common stock in the fiscal year ended September 30, 2006 and, to a lesser extent, the increase in awards granted.

•  Other G&A expense increased approximately $14.4 million, or 43.6%, to $47.4 million for the year ended September 30, 2006, compared to $33.0 million for the year ended September 30, 2005. G&A expenses were 9.3% and 8.9% of revenue for the years ended September 30, 2006 and 2005, respectively. The increase consists of $8.4 million of additional third-party legal and accounting fees and approximately $4.9 million of additional employee fringe benefit expense, which is an element of G&A expense. These additional expenses represent approximately 2.6% of revenue.

•  Depreciation and amortization expense decreased approximately $1.2 million, or 6.7%, to $16.6 million for the year ended September 30, 2006, compared to $17.8 million for the year ended September 30, 2005. Depreciation expense primarily arises from fixed assets while amortization expense derives primarily from purchased contracts. Depreciation and amortization expense was 3.3% and 4.8% of revenue for the years ended September 30, 2006 and 2005, respectively.

Operating Loss.  For the year ended September 30, 2006, the loss from operations was $2.3 million compared with $2.1 million operating loss for the year ended September 30, 2005. The $0.2 million increase in loss is associated with factors discussed above.

Other Income and Expense.  Other income (expense) decreased approximately $9.3 million to approximately $28.8 million, or 24.4%, for the year ended September 30, 2006, from $38.1 million for the year ended September 30, 2005. As a component of other income (expense), interest expense decreased approximately $9.0 million, or 23.2%, to $29.7 million for the year ended September 30, 2006 from $38.7 million for the year ended September 30, 2005 primarily from a $19.2 million reduction in the

46

accretion of warrants offset by a $8.3 million increase in senior term loan interest. The components of interest expense are summarized in the following table:

	Year Ended September 30,
	2006		2005
	(In millions)
Revolving facility	$	1.0	$	0.2
Senior term loan		15.2		6.9
Bridge loan		4.8		—
Mezzanine Note — cash-pay interest		—		1.8
— accretion of debt discount		—		2.2
Subordinated note — PIK interest		2.4		2.3
— accretion of long-term deferred interest		0.8		0.6
— accretion of debt discount		0.9		0.9
Accretion of warrants(a)		4.3		23.5
Other		0.4		0.3
Total	$	29.7	$	38.7

(a) Reflects change in value assigned to the detachable warrants associated with mezzanine and subordinated notes based on the change in the value of our common stock.

The remaining decrease of approximately $0.3 million is attributable to miscellaneous expenses including bank fees and charitable donations.

Income Tax Expense.  We have filed qualified subchapter S elections for all of our subsidiaries to treat them as disregarded entities for federal income tax purposes. Some states do not recognize the effect of these elections or our S corporation status. We recorded $0.03 million and $0.07 million in state income tax expense for the years ended September 30, 2006 and 2005, respectively.

Net Loss.  The net loss decreased approximately $9.1 million, or 22.6%, to $31.1 million for the year ended September 30, 2006 as compared to $40.2 million for the year ended September 30, 2005. The $9.1 million decrease is associated with factors discussed above.

Year ended September 30, 2005 Compared to Year ended September 30, 2004

For purposes of comparability, the table below reflects the relative financial impact of the METI, CATI and JJMA acquisitions, which we refer to as our “acquired operations”, as they relate to our financial performance for the fiscal year ended September 30, 2005 compared to the financial performance for fiscal year ended September 30, 2004. Significant differences in the results of our operations for the years September 30, 2005 and 2004, arise from the effects of these acquisitions. The discussion of the results of operations will include references to the financial information shown in the table below in conjunction with our consolidated financial statements provided elsewhere in this prospectus. The financial information provided in the table is based on estimates from our management.

Acquisitions Completed in the Year ended September 30, 2005

•  We completed the acquisition of substantially all of the assets Countermeasures, Inc. on October 28, 2004. We acquired technology and software (e.g. “Buddy System^tm”, now known as Countermeasures^tm, used in vulnerability assessment) for identifying, quantifying and managing physical, infrastructure, program and electronic risks.

•  On February 11, 2005, we completed the acquisition of METI, an environmental and life sciences research and development company. METI had approximately 110 employees and was headquartered in Research Triangle Park, North Carolina.

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•  On February 25, 2005, we completed the acquisition of CATI, a provider of flight training software and simulator development systems. CATI had approximately 55 employees and was headquartered in Seaside, California.

•  On April 1, 2005, we completed the acquisition of JJMA, a provider of ship and systems design from mission analysis and feasibility trade-off studies through contract and detail design, production supervision, testing and logistics support for the commercial and naval markets. JJMA had approximately 600 employees and was headquartered in Iselin, New Jersey.

	Year Ended September 30, 2005								Year Ended September 30, 2004
						Consolidated								Consolidated
				Acquired		Operations of								Operations of
	Consolidated			Operations		Alion Less			Consolidated			Acquired		Alion Less
	Operations			(METI, CATI,		the Acquired			Operations			Operations		the Acquired
Financial Information	of Alion			and JJMA)*		Operations			of Alion			(ITSC and IPS)*		Operations
	(In millions)
Total revenue	$	369.2		$	65.3	$	303.9		$	269.9		$	28.4	$	241.6
Material and subcontract revenue		102.7			16.9		85.8			70.3			11.5		58.9
Total direct contract expenses		267.2			46.1		221.1			196.4			19.5		176.9
Major components of direct contract expense:
Direct labor cost		152.5			26.6		125.9			120.0			8.1		111.9
Other direct cost (ODC)		13.7			2.9		10.8			8.1			0.3		7.9
Material and subcontract (M&S) cost		101.0			16.6		84.4			68.3			11.1		57.1
Gross profit		102.0			19.2		82.8			73.6			5.3		68.3
Total operating expense		104.1			13.1		91.0			73.7			4.4		69.3
Major components of operating expense:
Indirect personnel and facilities		41.6			6.9		34.7			28.6			2.2		26.4
Other general and administrative		33.0			2.9		30.1			28.1			1.8		26.3
Depreciation and amortization		17.8			3.2		14.6			13.4			0.3		13.1
Stock-based compensation		10.6			0.0		10.6			2.5			0.0		2.5
Operating (loss) income	$	(2.1	)	$	6.1	$	(8.2	)	$	(0.2	)	$	0.9	$	(1.1	)

* For the years ended September 30, 2005 and 2004, the operations of the acquired entities have been fully integrated within us on a consolidated basis.

Contract Revenues.  Revenues increased $99.3 million, or 36.8%, to $369.2 million for the year ended September 30, 2005, from $269.9 million for the year ended September 30, 2004. This increase is attributable to the following:

• Revenue generated by the activities of acquired operations	$	65.3 million
• Revenue generated by the activities of the non-acquired operations	$	34.0 million
Total:	$	99.3 million

For the year ended September 30, 2005, additional revenue generated by the acquired operations included approximately $49.2 million, $8.0 million and $8.1 million from the activities of JJMA, METI and

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CATI, respectively. Additional revenue of approximately $34.0 million generated by the non-acquired operations included an increase of approximately $16.5 million in support to the U.S. Army Night Vision Hightech Omnibus contract, an increase of approximately $6.0 million to the Modeling and Simulation Information Analysis Center (MSIAC) contract to the DoD, and an increase of approximately $3.7 million in support of the Weapons Systems Technology Information Analysis Center contract. On the balance of our contracts performed by the non-acquired operations, revenue increased by approximately $7.7 million.

As a component of revenue, M&S revenue increased approximately $32.4 million, or 46.1%, to $102.7 million for the year ended September 30, 2005 from $70.3 million for the year ended September 30, 2004. M&S revenue of the acquired operations was approximately $16.9 million, of which approximately $13.6 million, $1.7 million and $1.6 million was generated by JJMA, CATI and METI, respectively. Approximately $15.5 million of M&S revenue increase was generated by non-acquired operations of which approximately $16.1 million of additional M&S revenue was generated in support to the U.S. Army Night Vision Hightech Omnibus contract and approximately $5.8 million was generated in support of the MSIAC contract. On the balance of our contracts performed by the non-acquired operations, M&S revenue decreased by approximately $6.4 million. As a percentage of revenue, M&S revenue was 27.8% for the fiscal year ended September 30, 2005 as compared to 26.1% for the year ended September 30, 2004. For the year ended September 30, 2005, the M&S revenue content of total revenue performed under contracts of the acquired operations was approximately 25.8% while the M&S content of total revenue performed by the non-acquired operations was approximately 28.2%. The revenue activity of the acquired operations has a higher percentage level of M&S revenue that results from the amount of subcontractor support required.

Direct Contract Expenses.  Direct contract expenses increased $70.8 million, or 36.1%, to $267.2 million for the year ended September 30, 2005 from $196.4 million for the year ended September 30, 2004. As a percentage of revenue, direct contract expenses were 72.4% and 72.8% for the years ended September 30, 2005 and 2004, respectively. The changes in specific components of direct contract expenses are:

•  Direct labor costs for the year ended September 30, 2005 increased by $32.5 million, or 27.1%, to $152.5 million from $120.0 million for the year ended September 30, 2004. As a percentage of revenue, direct labor cost was 41.3% for the year ended September 30, 2005 as compared to 44.5% for the year ended September 30, 2004. The percentage decrease in direct labor cost is directly associated with the relative percentage increase in M&S cost associated with the increase in the percentage of M&S revenue, as described above.

•  M&S cost increased approximately $32.7 million, or 47.9%, to $101.0 million for the year ended September 30, 2005, compared to $68.3 million for the year ended September 30, 2004. As a percentage of revenue, M&S cost was 27.5% for the year ended September 30, 2005 as compared to 25.3% for the year ended September 30, 2004. The percentage increase in M&S cost is directly associated with the relative percentage increase in M&S cost associated with the contracts, as described above. As a percentage of M&S revenue, M&S cost was approximately 98.3% and 97.2% for the years ended September 30, 2005 and 2004, respectively.

Gross Profit.  Gross profit increased $28.4 million, or 38.6%, to $102.0 million for the year ended September 30, 2005, from $73.6 million for the year ended September 30, 2004. The $28.4 million increase is attributable to the following:

• Gross profit generated by the activities of the acquired operations	$	19.2 million
• Gross profit generated by the activities of the non-acquired operations	$	9.2 million
Total:	$	28.4 million

As a percentage of revenue, gross profit was 27.6% for the year ended September 30, 2005 and 27.3% for the year ended September 30, 2004. For the year ended September 30, 2005, we experienced an increased proportion of M&S contract revenue, which typically generates lower profit margins; however, we were able to increase our overall gross profit margin due to an increase in profit margins on time-and-materials and fixed price contract work coupled with our ability to sustain our proportionate amount of time-and-material and fixed price contract work.

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Operating Expenses.  Operating expenses increased $30.4 million, or 41.3%, to $104.1 million for the year ended September 30, 2005, from $73.7 million for the year ended September 30, 2004. The $30.4 million increase is attributable to the following:

• Operating expense incurred by the activities of the acquired operations	$	13.1 million
• Operating expense incurred by activities of the non-acquired operations	$	17.3 million
Total:	$	30.4 million

As a percentage of revenue, operating expenses were 28.3% for the year ended September 30, 2005 as compared to 27.3% for the year ended September 30, 2004. The changes in specific components of operating expenses are:

•  Stock-based compensation, included in G&A expense, was approximately 2.9% and 0.9% of revenue for the years ended September 30, 2005 and 2004, respectively. Stock-based compensation and deferred compensation relate primarily to the expense associated with the stock appreciation rights and phantom stock plans. Stock-based compensation increased approximately $8.1 million, or 324% to $10.6 million for the year ended September 30, 2005, from approximately $2.5 million for the year ended September 30, 2004. The increase in stock-based compensation and deferred compensation is a result of the increase in the value of our common stock and the increase in awards granted.

•  Operating expenses for indirect personnel and facilities costs related to rental and occupancy expenses increased approximately $13.0 million, or 45.4%, to $41.6 million for the year ended September 30, 2005, from $28.6 million for the year ended September 30, 2004. As a percentage of revenue, operating expenses relating to indirect personnel and facilities expense was 11.3% for the year ended September 30, 2005 as compared to 10.6% for the year ended September 30, 2004. The increase, as a percentage of revenue, is partially attributable to the increase in indirect labor costs associated with the integration activities of the CATI, METI and JJMA acquisitions. Management intends to reduce facility lease costs through efforts to sublet excess space which resulted from additional space acquired through the acquisition process.

•  Other G&A expense increased approximately $4.9 million, or 17.4%, to $33.0 million for the year ended September 30, 2005, compared to $28.1 million for the year ended September 30, 2004. As a percentage of revenues, G&A expenses were 9.0% for the year ended September 30, 2005, compared to 10.4% for the year ended September 30, 2004. As a result of integrating the activities of CATI, METI and JJMA, the costs associated with providing G&A activities for the acquired operations have been partially absorbed by the existing G&A infrastructure, resulting in a decrease in expense expressed as a percentage of revenue.

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•  Depreciation and amortization expense increased approximately $4.4 million, or 32.8%, to $17.8 million for the year ended September 30, 2005, as compared to $13.4 million for the year ended September 30, 2004. Depreciation is associated primarily with the value assigned to fixed assets while amortization expense is associated primarily with the intangible asset value assigned to the purchased contracts of the acquired entities. The $4.4 million increase is primarily attributable to the following:

	Year Ended September 30,
	2005		2004
	(In millions)
Depreciation expense	$	4.4	$	2.8
Amortization expense for purchased contracts of:
— IITRI	$	10.2	$	10.2
— ITSC	$	0.1		—
— IPS	$	0.5	$	0.4
— METI	$	0.3		—
— JJMA	$	2.2		—
Amortization expense for non-compete agreements	$	0.1		—
Total	$	17.8	$	13.4

As a percentage of revenue, operating expense relating to depreciation and amortization expense was 4.8% for the year ended September 30, 2005 as compared to 5.0% for the year ended September 30, 2004.

Operating Loss.  For the year ended September 30, 2005, the loss from operations was $2.1 million compared with $0.2 million operating loss for the year ended September 30, 2004. The $1.9 million loss increase is associated with factors discussed above and is attributable to the following:

• Operating income generated from the acquired operations	$	6.1 million
• Operating loss generated from the non-acquired operations*	$	(8.0) million
Total:	$	(1.9) million

* For the year ended September 30, 2005, stock-based compensation expense of approximately $10.6 million was not attributed to the activities of acquired operations.

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Other Income and Expense.  As a category, other income and expense increased approximately $23.2 million, or 155.7%, to $38.1 million for the year ended September 30, 2005 as compared to $14.9 million for the year ended September 30, 2004. As a component of other income and expense, interest expense increased approximately $21.9 million, or 125.6%, to $38.7 million for the year ended September 30, 2005 from approximately $16.8 million for the year ended September 30, 2004. The $21.9 million increase in interest expense is attributable to the following:

	Year Ended September 30,
	2005		2004
	(In millions)
Revolving facility	$	0.2	$	0.8
Senior term loan		6.9		3.1
Mezzanine Note — cash-pay interest		1.8		2.4
— accretion of debt discount		2.2		0.7
Subordinated note — PIK interest		2.3		2.4
— accretion of long-term deferred interest		0.6		0.4
— accretion of debt discount		0.9		0.8
Agreements with officers		0.0		0.2
Accretion of warrants(a)		23.5		5.9
Other		0.3		0.1
Total	$	38.7	$	16.8

(a) Reflects change in value assigned to the detachable warrants associated with mezzanine and subordinated notes based on the change in the value of our common stock.

The remaining increase of approximately $1.3 million is attributable to interest expense and the recognition of a gain of approximately $2.1 million on the sale of our minority interest in Matrics, Inc. For the year ended September 30, 2005, we did not have any significant recognized gains.

Income Tax (Expense) Benefit.  We have filed qualified subchapter S elections for all of our wholly-owned subsidiaries to treat them as disregarded entities for U.S. federal income tax purposes. Some states do not recognize the effect of these elections or our S corporation status. As a result, we recorded approximately $0.07 million and $0.02 million of state income tax expense for the years ended September 30, 2005 and 2004, respectively.

Net Loss.  The net loss increased approximately $25.1 million, or 166.2%, to $40.2 million for the year ended September 30, 2005 as compared to $15.1 million for the year ended September 30, 2004. The $25.1 million increase is associated with factors discussed above.

Liquidity and Capital Resources

Our primary liquidity requirements are for debt service, working capital, capital expenditures, and acquisitions. The principal working capital need is to fund accounts receivable, which increases with the growth of the business. We are funding our present operations, and we intend to fund future operations, primarily through cash provided by operating activities and through use of a revolving credit facility.

The following discussion relates to our cash flow for the three months ended December 31, 2006 and 2005.

Operating activities used approximately $25.2 million and $14.7 million in net cash for the three months ended December 31, 2006 and 2005, respectively. The $10.5 million increase in use of cash is primarily attributable to the approximate $6.3 million increase in net loss and $20.7 million increase in use of cash to fund growth in accounts receivable, which was offset by the approximate $15.9 million decrease in payments of trade accounts payable and other liabilities.

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Net cash used in investing activities was approximately $8.1 million and $1.6 million for the three months ended December 31, 2006 and 2005, respectively. During the three months ended December 31, 2006, we paid approximately $6.6 million in acquisition related obligations (termination payments and earn-out) for JJMA, WCI and MA&D. We spent approximately $1.5 million for capital expenditures unrelated to acquisitions.

Net cash provided by financing activities was approximately $30.9 million for the three months ended December 31, 2006, compared to net cash used in financing activities of $6.3 million for the three months ended December 31, 2005. During the three months ended December 31, 2006, we borrowed approximately $20.3 million under the revolving credit facility for working capital needs and received $9.0 million from the issuance of common stock under the ESOP. During the three months ended December 31, 2005, we used cash to pay for increased distributions under the ESOP in the net amount of $5.9 million.

The following discussion relates to our cash flow for the fiscal years ended September 30, 2006 and 2005.

Operating activities used approximately $15.7 million in net cash for the year ended September 30, 2006 and generated approximately $35.1 million in net cash for the year ended September 30, 2005. The $50.8 million increase in generated cash is primarily attributable to the approximate $71.8 million increase in accounts receivable, offset by $33.1 million increase in accounts payable and accruals.

Net cash used in investing activities (principally for strategic acquisitions) was approximately $284.4 million and $78.0 million for the years ended September 30, 2006 and 2005, respectively. During the year ended September 30, 2006, we used cash of approximately $279.2 million to acquire BMH, WCI, MA&D and the Anteon Contracts and spent approximately $5.2 million for capital expenditures unrelated to acquisitions. During the year ended September 30, 2005, we paid, net of cash acquired, approximately $74.6 million in the aggregate for the acquisitions of CATI, METI and JJMA and for the assets of Countermeasures, Inc. and approximately $1.2 million for the investment in VectorCommand Ltd. In addition, we spent approximately $2.2 million for capital expenditures in fiscal year 2005.

Net cash provided by financing activities was approximately $265.1 million for the year ended September 30, 2006, compared to net cash provided by financing activities of approximately $75.9 million for the year ended September 30, 2005. The most significant components of our financing activities are: 1) net proceeds from (or repayment of) short term borrowings and 2) net proceeds from (or repayment of) long term debt securities. During the year ended September 30, 2006, we borrowed approximately $118.0 million in proceeds under the Term B Senior Credit Facility and borrowed $170.0 million pursuant to the Bridge Loan Agreement. The borrowed proceeds of approximately $288.0 million were used to fund acquisitions ($279.2 million), to pay certain debt issuance costs of approximately $7.8 million and to repay approximately $1.3 million of principal under the senior term loan. During the year ended September 30, 2006, the Company used cash of approximately $13.6 million to redeem the mezzanine warrants held by IIT and Dr. Atefi, and we also repurchased approximately $19.0 million in common stock in order to satisfy redemption obligations under the KSOP to former employees. During the year ended September 30, 2005, we borrowed $94.0 million in proceeds under the Term B Senior Credit Facility. We used approximately $58.7 million for the JJMA acquisition, approximately $20.2 million to redeem its mezzanine note and approximately $13.3 million to finance the other acquisitions discussed above.

Discussion of Debt Structure

For a complete discussion of the Term B Senior Credit Facility, the previously outstanding Bridge Loan Agreement, and our subordinated note, see “Description of Other Indebtedness” in this prospectus. For a complete discussion of the outstanding notes, see “Description of the Notes” in this prospectus.

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Other Obligations

Earn-outs

We have earn-out commitments related to the following acquisitions:

CATI — There is an earn-out provision not to exceed a total of $8.25 million based on the revenue of the business units that formerly comprised CATI for fiscal years 2005 through 2007. There is a second earn-out provision not to exceed $1.5 million based on attaining certain revenue goals in the commercial aviation industry. The obligations continue until September 2007. For the three months ended December 31, 2006 and the fiscal years ended September 30, 2006 and 2005, we recognized approximately zero, $2.0 million and zero, respectively, in earn-out obligation related to CATI.

BMH — There is an earn-out provision not to exceed a total of $6.0 million based on the revenue of the business units that formerly comprised BMH. The obligation continues until December 2007. For the three months ended December 31, 2006 and the fiscal year ended September 30, 2006, we recognized approximately $3.0 million and zero, respectively, in earn-out obligation related to BMH.

WCI — There is an earn-out provision not to exceed a total of $2.5 million based on the revenue of the business units that formerly comprised WCI. The obligation continues until September 2007. For each of the three months ended December 31, 2006 and the fiscal year ended September 30, 2006, we recognized approximately $1.25 million in earn-out obligation related to WCI.

MA&D — There is an earn-out provision not to exceed a total of $4.1 million based on the revenue of the business units that formerly comprised MA&D. The obligation continues until September 2007. For the three months ended December 31, 2006 and the fiscal year ended September 30, 2006, we recognized approximately zero and $1.5 million, respectively, in earn-out obligation related to MA&D, but no earn-out payment was made for fiscal year 2006 because the requisite revenue goals for MA&D were not met.

Lease Payments

As of December 31, 2006, our remaining minimum lease payment obligations under non-cancelable operating leases for the remainder of fiscal year 2007 and fiscal years ending 2008 through 2012 are $19.8 million, $25.5 million, $22.2 million, $16.5 million, $14.3 million and $9.7 million, respectively. The remaining aggregate obligations on these leases thereafter are approximately $22.8 million. Commercial facility lease expenses are included in these amounts. These commercial facility lease obligations are currently reimbursable costs under the Company’s government contracts.

Other contingent obligations which will impact our cash

Other contingent obligations which will impact our cash flow include:

•  obligations relating to deferred compensation programs for senior managers;

•  obligations related to the holder’s put rights associated with the subordinated warrants;

•  obligations relating to our stock based compensation plans; and

•  repurchase obligations under the KSOP.

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As of December 31, 2006, we have spent a cumulative total of $29.0 million to repurchase shares of our common stock in order to satisfy redemption obligations under the KSOP to former employees.

	Number
	of Shares				Total Value
Date	Repurchased		Share Price		Purchased
					(In thousands)
June 2003		5,248	$	11.13	$	58
July 2003		2,696	$	11.13		30
December 2003		50,031	$	14.71		736
May 2004		117	$	16.56		2
June 2004		727	$	16.56		12
June 2004		743	$	16.56		12
July 2004		48,309	$	16.56		800
December 2004		46,816	$	19.94		934
March 2005		5,691	$	19.94		113
June 2005		45,846	$	29.81		1,367
August 2005		1,090	$	33.78		37
September 2005		170,657	$	33.78		5,765
December 2005		211,537	$	35.89		7,592
June 2006		273,800	$	37.06		10,147
July 2006		32,420	$	37.06		1,201
August 2006		1,695	$	37.06		63
December 2006		2,243	$	41.02		92
Total					$	28,961

We believe that cash flow from operations and cash available under our revolving credit facility will provide us with sufficient capital to fulfill our current business plan and to fund our working capital needs for at least the next 24 months. Although we expect to have positive cash flow from operations, we will need to generate significant additional revenues beyond our current revenue base and to earn net income in order to repay principal and interest on the indebtedness we assumed under the Term B Senior Credit Facility, the outstanding notes and the remaining outstanding indebtedness we incurred to fund the IITRI Acquisition.

Our business plan calls for us to continue to acquire companies with complementary technologies. The Term B Senior Credit Facility allows us to make certain permitted acquisitions, and we intend to use a portion of the financing available to us under the Term B Senior Credit Facility to make permitted acquisitions.

We currently expect that we will need to refinance the Term B Senior Credit Facility before the end of fiscal year 2009. Our cash from operations will be insufficient to satisfy all of our obligations and we cannot be certain that we will be able to refinance on terms that will be favorable to us, if at all. Moreover, if our plans or assumptions change, if our assumptions prove inaccurate, if we consummate additional or larger investments in or acquisitions of other companies than are currently planned, if we experience unexpected costs or competitive pressures, or if our existing cash and projected cash flow from operations prove insufficient, we may need to obtain greater amounts of additional financing and sooner than expected. While it is our intention only to enter into new financing or refinancing that we consider advantageous, we cannot be certain that such sources of financing will be available to us in the future, or, if available, that financing could be obtained on terms favorable to us.

On February 8, 2007, we issued and sold $250.0 million of our 101/4% outstanding notes, which mature on February 1, 2015. Interest on the outstanding notes will accrue at the rate of 101/4% annually and will be payable semiannually in arrears on February 1 and August 1, commencing on August 1, 2007. The

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proceeds from the issuance of the outstanding notes were used to pay off all outstanding amounts under the Bridge Loan Agreement and approximately $72.0 million of the amounts outstanding under the Term B Senior Credit Facility.

Contract performance — Joint Spectrum Center Contract

During our fiscal year ended September 30, 2006, the support services contract to the JSC underwent a full and open competition for the follow-on support contract that was to commence beginning October 2005. Following rounds of protest filings in 2005 and 2006, it was finally determined in October 2006 that we would not receive the follow-on contract. Our performance under the JSC contract ended in December 2006.

Fiscal Year 2007 KSOP redemptions — Former JSC employees

During fiscal year 2007, former employees who worked on the JSC contract may request that we redeem shares of our common stock held by them through the KSOP. Under the KSOP and applicable law, we have certain rights to defer distribution of redemption amounts to later years. In the event we do not exercise these rights, we estimate that we may need to pay between approximately $8.0 million and $15.0 million during fiscal year 2007 to repurchase those shares.

Fiscal Year 2008 Phantom Stock Payouts

During fiscal year 2008, we will redeem shares of phantom stock from certain of our senior executives that they received as five-year retention and performance incentives following the IITRI Acquisition and formation of Alion. We estimate that the amount of such redemptions could be between approximately $12.0 million and $14.1 million, depending on the per share price of our common stock at the time of redemption. Despite the fact that the redemption amounts for those shares are payable during fiscal year 2008, we have certain rights to defer distribution of all or part of the redemption amounts to later years pursuant to the terms of the applicable phantom stock plans.

Contractual Obligations

The following table summarizes our contractual and other forecasted long-term debt obligations as of February 8, 2007. For contractual obligations, we included payments that we have a legal obligation to make.

	Payments Due by Fiscal Year
	Total		2007*		2008-2010		2011-2012		2013 and After
	(In thousands)
Contractual Obligations:
Long-term debt(1)	$	849,123	$	27,249	$	197,541	$	89,464	$	532,869
Lease Obligations		71,151		12,506		46,234		9,648		2,763
Total contractual obligations	$	918,274	$	39,755	$	243,775	$	99,112	$	535,632

* Estimated obligations for the remainder of fiscal year 2007.

1. Includes interest payments and forecasted debt obligations. This amount reflects interest or principal payments with respect to the $15.0 million aggregate principal amount of incremental term loans borrowed on January 4, 2007; extension of the maturity date of the senior term loans outstanding under the Term B Senior Credit Facility to February 6, 2013; issuance of $250.0 million of the outstanding notes on February 8, 2007; repayment of the entire outstanding balance of the previously outstanding Bridge Loan on February 8, 2007; and re-payment of approximately $72.0 million in outstanding principal of senior term loans on February 8, 2007, under the Term B Senior Credit Facility.

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Off-Balance Sheet Financing Arrangements

We account for operating leases entered into in the routine course of business in accordance with Statement of Financial Accounting Standards No. 13, Accounting for Leases.  We have no off-balance sheet financing arrangements other than our operating leases. We have no relationship with any unconsolidated or special purpose entity, nor have we issued any guarantees.

Summary of Critical Accounting Policies

Revenue Recognition

Our revenue results from technology services under a variety of contracts, some of which provide for reimbursement of costs plus fees and others of which are fixed-price or time-and-material type contracts. We generally recognize revenue when a contract has been executed, the contract price is fixed or determinable, delivery of the services or products has occurred and collectibility of the contract price is considered probable.

We recognize revenue on cost-reimbursement contracts as we incur costs and include estimated fees earned. We recognize time-and-material contract revenue at negotiated, fixed, contractually billable rates as we deliver labor hours and incur other direct expenses. We use various performance measures under the percentage of completion method to recognize revenue for fixed-price contracts. The process of estimating contract costs at completion and recognizing revenue appropriately involves significant management estimates. Actual costs may differ from estimated costs and affect estimate profitability and the timing of revenue recognition. From time to time, facts develop that require us to revise our estimated total costs or revenues expected. We record the cumulative effect of revised estimates in the period in which the facts requiring revised estimates become known. We recognize the full amount of anticipated losses on any type of contract in the period in which they become known. For each of the periods presented, the cumulative effects of revised estimates were immaterial to the financial performance of the Company. Revised estimates did not generate any anticipated losses for any period presented. Further, the Company had no cost overruns on fixed price contracts that materially affected financial performance in any of the periods presented.

Contracts with agencies of the U.S. government are subject to periodic funding by the contracting agency concerned. A contract may be fully funded at its inception or ratably throughout its period of performance as services are provided. If we determine contract funding is not probable, we defer revenue recognition until realization is probable.

Contract costs on federal government contracts are subject to audit by the U.S. government and adjustment through negotiations between us and government representatives. The government considers us to be a major contractor and maintains an office on site to perform various audits. The government has audited all of our U.S. government contract indirect costs through fiscal year 2004. Indirect rates have been negotiated and settled through fiscal year 2003. We submitted our fiscal year 2005 indirect expense rates to the government in March 2006 and submitted our fiscal year 2006 indirect expense rates to the government in March 2007. We have recorded revenue on U.S. government contracts in amounts we expect to realize.

We recognize revenue on unpriced change orders as we incur expenses and only to the extent it is probable that we will recover such costs. We recognize revenue in excess of costs on unpriced change orders only when management can also reliably estimate the amount of excess and experience provides a sufficient basis for recognition. We recognize revenue on claims as expenses are incurred only to the extent it is probable that we will recover such costs and we can reliably estimate the amount we will recover.

We generate software revenue from licensing software and providing services. In general, professional services are essential to the functionality of the solution sold, and we apply the percentage of completion method, as prescribed by AICPA SOP 81-1, Accounting for Performance on Construction-Type and Certain Production-Type Contracts, to recognize revenue.

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Goodwill and Intangible Assets

The purchase price that we pay to acquire the stock or assets of an entity must be assigned to the net assets acquired based on the estimated fair value of those net assets. The purchase price in excess of the estimated fair value of the tangible net assets and separately identified intangible assets acquired represents goodwill. The purchase price allocation related to acquisitions involves significant estimates and management judgments that may be adjusted during the purchase price allocation period.

We account for goodwill and other intangible assets in accordance with the provisions of SFAS No. 142, which requires, among other things, the discontinuance of goodwill amortization. In addition, goodwill is to be reviewed at least annually for impairment or more frequently if events and circumstances indicate that the asset might be impaired. We have elected to perform this review annually at the end of each fiscal year. An impairment loss would be recognized to the extent that the carrying amount exceeds the asset’s fair value. The process of evaluating any impairment to goodwill involves significant management estimates. These annual reviews have resulted in no adjustments. The Company’s review consists of two steps. First, we estimate our fair value using an estimate of the fair value of our common stock based upon a valuation performed by an independent, third-party firm and compares it to our carrying amount. Second, if the carrying amount exceeds our fair value, an impairment loss is recognized for any excess of the carrying amount of goodwill over the implied fair value of that goodwill. The implied fair value of goodwill is determined by allocating the fair value in a manner similar to a purchase price allocation, in accordance with FASB Statement No. 141, Business Combinations. The residual fair value after this allocation is the implied fair value of the goodwill.

As of December 31, 2006, we had goodwill of approximately $391.2 million, subject to annual impairment review. As of December 31, 2006, we had a recorded a net intangible asset balance of approximately $71.2 million, comprised primarily of purchased contracts which were acquired in connection with the IITRI Acquisition and the ITSC, IPS, Countermeasures, METI, CATI, JJMA, BMH, WCI, MA&D and Anteon Contract acquisitions. The intangible assets have an estimated useful life of one to thirteen years and are amortized using the straight-line method.

We completed a goodwill impairment analysis in the fourth quarter of fiscal year 2006 and determined that an impairment charge to earnings was not required. We will perform a similar review in the fourth quarter of fiscal year 2007. For the three months ended December 31, 2006, there were no events that indicated goodwill impairment as of December 31, 2006.

Recently Issued Accounting Pronouncements

In December 2004, the Financial Accounting Standards board (FASB) issued SFAS No. 123 (revised 2004), Share-Based Payment, a revision of SFAS No. 123, Accounting for Stock-Based Compensation (SFAS 123(R)). SFAS 123(R) supersedes Accounting Principles Board Opinion No. 25, Accounting for Stock Issued to Employees. SFAS 123(R) requires all share-based payments to employees, including grants of employee stock options, to be recognized in the financial statements based on their fair value. SFAS 123(R)became effective in the first quarter of fiscal 2007. We determined that there will be no impact from adopting this statement, given the fact that we currently recognize compensation expense associated with our stock appreciation rights and phantom stock.

In March 2005, the FASB issued Interpretation No. (FIN) 47, Accounting for Conditional Asset Retirement Obligations — an Interpretation of FASB Statement No. 143. FIN 47 clarifies the definition of a conditional asset retirement obligation, as used in SFAS No. 143, as a legal obligation to perform an asset retirement activity in which the timing and (or) method of settlement are conditional on a future event that may or may not be within the control of the entity. FIN 47 requires a liability to be recorded if the fair value of the obligation can be reasonably estimated. The adoption of this interpretation was effective no later than December 31, 2005. The adoption of this interpretation did not have a significant impact on the financial position or our results of operations.

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In June 2005, the FASB issued SFAS No. 154, Accounting Changes and Error Corrections — a replacement of APB Opinion No. 20 and FASB Statement No. 3. SFAS No. 154 provides guidance on the accounting for and reporting of accounting changes and error corrections. It established, unless impracticable, retrospective application as the required method for reporting a change in accounting principle in the absence of explicit transition requirements specific to the newly adopted accounting principle. SFAS No. 154 also provides guidance for determining whether retrospective application of a change in accounting principle is impracticable and for reporting a change when retrospective application is impracticable. The correction of an error in previously issued financial statements is not an accounting change. However, the reporting of an error correction involves adjustments to previously issued financial statements similar to those generally applicable to reporting an accounting change retrospectively. Therefore, the reporting of a correction of an error by restating previously issued financial statements is also addressed by SFAS No. 154. SFAS No. 154 shall be effective for accounting changes and correction of errors made in fiscal years beginning after December 15, 2005.

In June 2006, the FASB issued Interpretation No. (FIN) 48, Accounting for Uncertainty in Income Taxes. FIN 48 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements in accordance with FASB Statement No. 109, Accounting for Income Taxes. This interpretation prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. This interpretation also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. The interpretation is effective for fiscal years beginning after December 15, 2006. We determined that adopting this interpretation will not have a significant impact on the financial position or our results of operations.

In September 2006, the FASB issued SFAS No. 157, Fair Value Measurements, which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. Where applicable, this Statement simplifies and codifies related guidance within generally accepted accounting principles (GAAP). This statement is effective for financial statements issued for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years. We are currently analyzing the expected impact from adopting this statement on our financial statements, but we currently do not believe its adoption will have a significant impact on the financial position or our results of operations.

In September 2006, the FAS issued SFAS No. 158, Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans, which requires employers to recognize the overfunded or underfunded status of a defined benefit postretirement plan (other than a multiemployer plan) as an asset or liability in its statement of financial position and to recognize changes in that funded status in the year in which the changes occur through comprehensive income of a business entity. This statement is effective for us in fiscal year 2007. We are currently analyzing the expected impact of adoption of this statement on our financial statements.

In September 2006, the SEC issued Staff Accounting Bulletin No. 108 (SAB 108), Financial Statements — Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements. SAB 108 requires companies to quantify the impact of all correcting misstatements, including both the carryover and reversing effects of prior year misstatements, on the current year financial statements. This pronouncement is effective for us in fiscal year 2007. We do not believe SAB 108 will have a material effect on our financial statements and related disclosures.

Quantitative and Qualitative Disclosures About Market Risk

Interest rate risk

Our exposure to interest rate risk is primarily due to the debt we incurred to finance the IITRI Acquisition and the subsequent refinancing of a portion of that debt in August 2004 and additional financing undertaken by us in October 2004, April 2005, March 2006, June 2006, January 2007 and

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February 2007. The subordinated note has a stated fixed interest rate, and therefore presents no risk of change to interest charges as a result of an increase in market interest rates.

The balance drawn under the $50.0 million senior revolving credit facility bears interest at variable rates currently based on Credit Suisse’s (CS) prime rate plus a maximum spread of 225 basis points. The senior term loan balance drawn under the Term B Senior Credit Facility bears interest at variable rates currently tied to the Eurodollar rate. Such variable rates increase the risk that interest charges will increase materially if market interest rates increase. The balance drawn under the outstanding notes bears interest at a stated fixed rate of 10.25%. As of December 31, 2006, we have reduced, in part, the maximum total amount of variable interest rate risk on the senior term loan outstanding under the Term B Senior Credit Facility by entering into three interest rate cap agreements that cover the first $92.5 million of principal borrowed (which balance declines over time).

Under the first cap agreement, in exchange for our payment to a senior lender of approximately $0.3 million, our maximum effective rate of interest payable with regard to an approximately $36.8 million portion of the outstanding principal balance of the Term B Senior Credit Facility will not exceed 6.64% (i.e., LIBOR 3.89% cap plus maximum 2.75% Eurodollar spread) for the period September 30, 2004 through September 29, 2005 and is not to exceed 7.41% (i.e., LIBOR 4.66% cap plus 2.75% maximum Eurodollar spread) for the period September 30, 2005 through September 29, 2007. The notional principal declines over time to $34.5 million at September 2007. Under the second cap agreement, in exchange for our payment to a senior lender of approximately $0.1 million, our maximum effective interest rate payable with regard to an approximately $28.0 million additional portion of the outstanding principal balance under the Term B Senior Credit Facility will not exceed 7.75% (i.e., LIBOR 5.0% cap plus maximum 2.75% Eurodollar spread) through the date of termination of the second interest rate cap agreement on September 30, 2007. Under the third cap agreement, in exchange for our payment to a senior lender of approximately $43,600, our maximum effective interest rate payable with regard to an approximately $30.0 million additional portion of the outstanding principal balance under the Term B Senior Credit Facility will not exceed 8.25% (i.e., LIBOR 5.50% cap plus maximum 2.75% Eurodollar spread) through the date of termination of the third interest rate cap agreement on September 30, 2007.

The remaining outstanding aggregate balance under the Term B Senior Credit Facility over $92.5 million, which was approximately $165.9 million as of December 31, 2006, is not subject to any interest cap rate cap agreements or arrangements. For a description of the existing interest rate cap arrangements, see “Description of Other Indebtedness” in this prospectus. The balance on the previously outstanding Bridge Loan bore interest at variable rates tied to the Eurodollar rate. As of December 31, 2006, the total balance of $170.0 million was not subject to any interest rate cap agreements or arrangements.

As of February 28, 2007, the approximate impact of a 1% increase in the interest rate, as applied to principal balances drawn under the Term B Senior Credit Facility that are not covered by the current interest rate cap agreement, would be $1.2 million, $2.2 million, $2.2 million, $2.2 million, $2.1 million and $2.1 million for the remainder of fiscal year ending September 30, 2007, and for the fiscal years ending September 30, 2008, 2009, 2010, 2011 and 2012, respectively.

We do not use derivatives for trading purposes. We invest our excess cash in short-term, investment grade, and interest-bearing securities.

Foreign currency risk

Because our expenses and revenues from our international contracts are generally denominated in U.S. dollars, we do not believe that our operations are subject to material risks associated with currency fluctuations.

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Risk associated with value of our common stock

We have exposure to change in the fair market value of our common stock as the economic basis for the estimate of contingent obligations relating to, among other things, obligations related to the holder’s put rights associated with our subordinated note warrants.

The value of those obligations would increase by approximately $4.4 million if the price of our stock were to increase by 10% and would decrease by approximately $4.4 million if the price of our stock were to decrease by 10%. Such changes would be reflected as a component of interest expense in our consolidated statements of operations.

We also have exposure to change in the fair market value of our stock as the economic basis for the estimate of contingent obligations relating to our repurchase obligations under the KSOP and obligations relating to stock appreciation rights and phantom stock programs.

The amount of such exposure will depend upon a number of factors. These factors include, but are not limited to, the number of our employees who might seek to redeem shares of our stock for cash following termination of employment, and the number of employees who might exercise their rights under the stock appreciation and phantom stock programs during any particular time period.

S Corporation Status

The Code provides that a corporation that meets certain requirements may elect to be taxed as an S corporation for U.S. federal income tax purposes. Since the ESOP Trust is our only stockholder, and we only have one class of stock, we qualify to be taxed as an S corporation.

An S corporation, unlike other corporations, generally does not pay U.S. federal corporate income tax on its net income. Rather, such income is allocated to the S corporation’s shareholders. Shareholders must take into account their allocable share of income when filing their income tax returns. An ESOP is a tax-exempt entity and does not pay tax on its allocable share of S corporation income. We are subject to other taxes such as franchise and business taxes in certain jurisdictions. Because neither we nor the ESOP Trust should be required to pay U.S. federal corporate income tax, we expect to have substantially more cash available to repay our debt and invest in our operations than we would if we were to be taxed as a corporation.

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BUSINESS

Overview

With a 70-year legacy, we are a highly-experienced technology solutions company delivering scientific, research and development, and technology expertise and operational support primarily to the U.S. Department of Defense (DoD) and other U.S. government agencies and commercial customers. Based in McLean, Virginia, we design, develop, integrate, deliver and maintain, and upgrade technology solutions, products and tools for national defense, homeland security and other government programs. For example, we design and engineer complete naval vessels and components for naval vessels for the U.S. Navy; we manage and support the implementation of major U.S. Air Force programs by providing financial, procurement and logistics services; we develop and conduct battle simulations for the U.S. Army to prepare soldiers for combat environments; and we assist the DoD in managing the use of the wireless communications spectrum to optimize the efficient transmission of sensitive data.

We have grown revenue from $156.1 million from operations of our predecessor in fiscal year 2000 to $508.6 million in fiscal year 2006, representing a compounded annual growth rate of 21.8%. Over the same period, our Adjusted EBITDA grew at a compounded annual growth rate of 31.6% from $9.8 million to $50.8 million. This growth has been accomplished through organic growth from new and existing contracts, and through acquisitions. Our compounded organic revenue and Adjusted EBITDA growth rates from fiscal year 2000 to fiscal year 2006 were 9.2% and 18.9%, respectively. Since January 1, 2003, we have completed 11 stock and asset acquisitions. Our largest acquisition is the Anteon Asset Acquisition which occurred on June 30, 2006 for consideration of approximately $221.4 million.

On a pro forma basis, for the fiscal year ended September 30, 2006, we generated approximately $726.9 million in revenue and approximately $72.4 million in Adjusted EBITDA. As of September 30, 2006, our backlog was approximately $4.2 billion or roughly 5.8 times our pro forma revenue for the fiscal year ended September 30, 2006.

We have a broad customer and contract base. As of September 30, 2006 we served approximately 350 customers including all branches of the U.S. military, a number of Cabinet-level U.S. government agencies, as well as state and foreign governments to a lesser degree. We recorded approximately 95.2% of our pro forma revenue for the fiscal year ended September 30, 2006 from U.S. government contracts, and approximately 91.0% of our pro forma revenue came from approximately 200 different customers in the DoD. The following branches of the DoD contributed to our pro forma revenue for the fiscal year ended September 30, 2006: the Navy (45.8%), the Army (18.1%), the Air Force (15.1%) and all other branches of the DoD (11.9%). As of September 30, 2006, we had a portfolio of over 800 active contracts and task orders with a large portion of our contracts and task orders (based on contract revenue) having cost-reimbursement and time-and-materials pricing structures and a smaller portion (based on contract revenue) having fixed-price pricing structures.

We deliver solutions in the following seven core business areas:

•  defense operations;

•  wireless communications;

•  industrial technology solutions;

•  naval architecture and marine engineering;

•  modeling and simulation;

•  chemical, biological, nuclear and environmental sciences; and

•  information technology.

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The following charts show our pro forma revenue by core business area and contract type for the fiscal year ended September 30, 2006:

Pro Forma Revenue by Core Business Area	Pro Forma Revenue by Contract Type
($ in millions)	($ in millions)

Total Pro Forma Revenue for the Fiscal Year Ended September 30, 2006: $726.9 million

Our sophisticated technology solutions in all of our core business areas are supported by our skilled employee base, which includes engineers, scientists and former military personnel. Approximately 72% of our employees have security clearances, with approximately 22% of our employees holding clearances at the Top Secret level or above, allowing us access to highly classified DoD information systems and networks. To enhance our technology solutions, we have approximately 120,000 square feet of laboratory facilities, which we use to conduct customer-funded research and development activities, and to a lesser degree, internally-funded research and development activities.

Alion has a long operating history in providing a broad range of technology solutions. We have supported the Information Analysis Centers (IACs) and the Extremely Low Frequency (ELF) Submarine Communications program for over 20 years, and we have supported the DoD for over 40 years in ensuring that military communications equipment and networks can operate as intended without causing or suffering from interference. Examples of our technology solutions include:

•  For the U.S. Intelligence Security Command (INSCOM) — Army Directed Studies Office (ADSO), we develop intelligence scenarios incorporating a suite of technologies, using modeling and simulation technologies, animation, video, and audio, to depict U.S., allied, hostile, and non-combatant forces, as well as the social, cultural, and physical attributes that exist in the supported command area of operations.

•  In support of the Defense Advanced Research Projects Agency (DARPA) Real-Time Adversarial Intelligence and Decision-Making (RAID) Program, we are providing simulation support and developing capabilities leveraging emerging technologies in adversarial and deception reasoning for anticipating enemy actions and deceptions, with particular focus on providing real-time support to tactical commanders in urban operations.

•  We are providing technology solutions to the Pacific Command (PACOM) and the Northern Command (NORTHCOM) of the U.S. Army in the development of a pandemic modeling decision support tool that will permit assessment of the impact of infectious diseases, like Bird Flu, on the readiness of a military organization.

•  In support of the U.S. Navy’s Office of Naval Research, we are developing a “transformable craft,” or T-Craft, to deliver payloads across open ocean and onto the shore. The vehicle is designed to

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operate as a surface effect ship for transit at sea, converting to a fully-skirted air-cushion vehicle for operation in very shallow water, across sand-bars or mud-flats, and for limited mobility on dry land. The concept vehicle is intended to operate over water at speeds in excess of 40 knots over a transit range of 2,500 nautical miles without payload; and 500-600 nautical miles with up to 750 tons, to enable transfer of cargo from sea to shore where no port facilities exist.

Our History

We were incorporated as a Delaware corporation in October 2001 as part of a planned employee buyout of IIT Research Institute (IITRI), a not-for-profit government contractor in the technology services sector controlled by the Illinois Institute of Technology, which was incorporated and began operations in 1936. On December 20, 2002, we purchased substantially all of the assets and certain liabilities of IITRI (the IITRI Acquisition), and a majority of the employees of IITRI acquired a 100% ownership interest in our common stock through our ESOP. Since the date we were established, we have always been a 100% ESOP-owned S corporation. We believe that our ESOP ownership structure helps create an organizational culture that promotes excellence because our employees are both professionally and personally invested in our success. In addition, as an S corporation, we are not subject to U.S. federal income tax or state income tax in many U.S. states. See “Employee Stock Ownership Plan.”

Industry Overview

We see the following trends that will continue to drive increased DoD and other U.S. government agencies’ spending and greater dependence on technology services contractors.

Continuing Growth in Overall DoD Budget/Spending.  In addition to projected increases in overall DoD spending on contracting out to the private sector, our government customers are also increasing their dependence and spending on the specific types of services and solutions we provide. The DoD budget for federal fiscal year 2007, excluding supplemental funding relating to operations in Iraq and Afghanistan, has been proposed to the Congress at $439.3 billion, representing a 48.0% increase over federal fiscal year 2001. Federal fiscal year 2005 DoD actual spending excluding supplemental funding relating to operations in Iraq and Afghanistan was $400.1 billion. Work contracted out to the private sector is expected to continue to grow, with the DoD forecasting its budget to grow to over $499.0 billion (excluding supplemental funding) by federal fiscal year 2011.

Growing Spending in the DoD Operations and Maintenance Accounts.  The current growth in U.S. military spending is being primarily driven by increases in the Operations and Maintenance (O&M) portion of the budget, rather than weapons and other procurement. The O&M portion of the DoD budget, which includes the majority of the services we provide to the U.S. military, such as engineering, information technology and logistics, is the largest and fastest growing segment of DoD military spending. For federal fiscal year 2006, the DoD budgeted O&M spending to be $147.0 billion, which represents 35.0% of the total DoD military budget, and is projected by the DoD to increase approximately 4.0% annually, on average, through federal fiscal year 2009 to $165.0 billion. The federal fiscal year 2007 budget for O&M spending has been proposed at $152.0 billion.

Projected Increases in Private Sector Information Technology Government Spending.  The U.S. government is the largest consumer of information technology services and solutions in the United States. We believe that the U.S. government’s spending on information technology will continue to increase in the next several years. INPUT, an independent U.S. government market research firm, expects this trend to continue, with U.S. government spending on information technology to increase from $63.3 billion in federal fiscal year 2006 to $80.5 billion in federal fiscal year 2011, representing an annual growth rate of 5.0%. Moreover, this data may not fully reflect U.S. government spending on classified programs such as intelligence programs, operational support services to U.S. armed forces and complementary technical services, such as sophisticated systems engineering.

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Expected Growth in DoD Research and Development Expenditures.  The DoD research and development budget grew by 2.2% to $73.1 billion in the federal fiscal year 2007. That budget includes increased funding for both the DARPA and the U.S. Air Force, both of which are our customers.

More Budget Dollars for Homeland Security.  There has been significant growth in the Department of Homeland Security (DHS) budget, which is $42.7 billion for federal fiscal year 2007, up from the $40.3 billion budget for federal fiscal year 2006. From fiscal year 2000 through federal fiscal year 2006, the budget for DHS and its predecessor organizations has grown at a 17.0% compounded annual rate. We are currently pursuing DHS procurements.

Increased Reliance on Technology Services Contractors.  The U.S. government is expected to continue its practice of contracting out for technical services, to companies such as Alion, as it downsizes and replaces government employees with more cost-effective commercial vendors. In addition, the DoD estimates that over 40.0% of civilian personnel in military depots and industrial facilities will be eligible to retire by federal fiscal year 2009. We believe this will result in a shortage of technically-skilled replacements in the U.S. government and increased use of contracted services.

Growing Opportunities for Sophisticated Technology Solution Providers.  In February 2006, the DoD completed its Quadrennial Defense Review (QDR), which details the DoD’s strategic plans and procurement trends. According to a summary of the QDR prepared by the DoD, the QDR is aimed at emphasizing agility, flexibility, speed, responsiveness and pre-emptive military concepts, all of which rely on information technology systems. The QDR also emphasizes the increasing importance of net-centric warfare, which involves enabling critical relationships between organizations and people to accelerate the speed of business processes, operational decision-making and subsequent actions. Finally, the QDR introduces the concept of the 21st Century Total Force, highlighting the contractor’s role in integrated long-term support of the DoD. We believe the following specific industry trends, as excerpted from the QDR, will further increase demand for contracted-out services in our target markets:

•  Shift from an emphasis on ships, guns, tanks and planes to a focus on information, knowledge, and timely, actionable intelligence.

•  Implement enterprise-wide changes to ensure that organizations, processes and procedures effectively support DoD’s strategic direction.

•  Emphasize joint command and control for homeland defense and civil support missions, including communication and command and control systems that are interoperable with other agencies and state and local governments.

•  Nearly double unmanned aerial vehicle (UAV) coverage capacity by accelerating the acquisition of Predator UAVs and Global Hawk UAVs.

•  Build a larger naval fleet that includes 11 Carrier Strike Groups, balance the need to transform and recapitalize the naval fleet, improve affordability and provide stability for the shipbuilding industry.

•  Accelerate procurement of Littoral Combat Ships to provide power projection capabilities in littoral waters.

•  Make additional investments in information assurance capabilities to protect information and the DoD’s computer networks.

•  Improve DoD’s information sharing with other U.S. agencies and with international allies and partners by developing information protection policies and exploiting the latest commercial technologies.

•  Continue to pursue enabling technologies for transformational logistics and innovative operational concepts such as Seabasing.

•  Increase investment to implement the Global Information Grid, protect information and networks and focus research and development on its protection.

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•  Develop a new bandwidth requirements model to determine optimum network size and capability to best support operational forces.

•  Expand training programs to accommodate planners from other agencies and working with the DHS.

Continuing Impact of U.S. Government Procurement Reform.  In recent years, U.S. government agencies have had increased access to alternative choices in contract vehicles — such as indefinite delivery/indefinite quantity contracts (ID/IQs), Government Wide Acquisition Contracts (GWACs), General Services Administration (GSA) schedule contracts and agency-specific Blanket Purchase Agreements (BPAs). These choices have created a more market-based environment in U.S. government procurement, increased contracting flexibility and provided U.S. government agencies with multiple channels to access contractor services. Contractors’ successful past performance, as well as technical capabilities and management skills, remain critical elements of the award process. We believe the increased flexibility associated with multiple channel access, such as ID/IQs, GWACs, GSA schedule contracts and BPAs, will result in continued utilization of these contracting vehicles in the future, and will facilitate access to service providers to meet increased demand for required services and solutions.

Competitive Strengths

Our key competitive strengths include:

Sophisticated technology solutions.  We offer sophisticated technology solutions in all of our core business areas, which we have developed over our 70-year operating history. Our sophisticated technology solutions are supported by our skilled employee base, which includes engineers, scientists and former military personnel. This allows us to combine engineering capabilities, scientific skills and domain expertise to provide solutions that incorporate current technologies with real-world understanding of and experience with DoD programs, systems and networks. Approximately 72% of our employees have security clearances, with approximately 22% of our employees holding clearances at the Top Secret level or above, allowing us access to highly classified DoD systems and networks. To further enhance our technology solutions, we have approximately 120,000 square feet of laboratory facilities, which we use to conduct customer-funded research and development activities, and to a lesser degree, internally-funded research and development activities.

Strong reputation and long-term customer relationships.  As a result of our sophisticated technology solutions and long operating history, we have developed a strong reputation in our industry and with our customers for providing quality expertise in our core business areas. We have long-term relationships with many of our customers under various programs that are strategically important to the defense of the United States and the burgeoning homeland defense needs of federal and state governments. For example, our relationships with IACs and the ELF program span over 20 years and our support to the wireless spectrum management community spans over 40 years.

Diverse customer base with multiple contract vehicles.  As of September 30, 2006, we served approximately 350 customers including all branches of the U.S. military, a number of Cabinet-level U.S. government agencies, and the White House. We earn revenue from our diversified customer base through a broad array of task orders that are issued under multiple contract vehicles awarded by U.S. government agencies and through other contracts we hold. Our multiple contract vehicles provide us with more flexibility to obtain tasking and associated funding from the U.S. government. As of September 30, 2006, we had a portfolio of over 800 active contracts and task orders. No active task order or single-award contract accounted for more than 13% of our revenue for the fiscal year ended September 30, 2006. In addition, on a pro forma basis, no active task order or single-award contract accounted for more than 9% of our revenue for the same period.

Large contract backlog and strong revenue visibility.  Management estimates that contract backlog has historically generated approximately 80% of our next twelve months’ revenue and will continue to do so in fiscal year 2007. As of September 30, 2006, our backlog was approximately $4.2 billion or roughly 5.8 times our pro forma revenue for the fiscal year ended September 30, 2006. Approximately $386 million of this

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backlog is funded. Our contracts with backlog as of September 30, 2006 had an expected weighted average life of approximately 5.1 years. We believe that the strength of our backlog provides us with longer-term visibility of our future revenue.

Attractive business model with strong free cash flow.  We have a business model that generates strong free cash flow as a result of our low capital expenditure requirements, moderate working capital needs and the fact that we pay negligible taxes. We also achieve stable cash flow due to the diversity of our revenue streams, long-term nature of our contracts and stable margins. As an S Corporation, we do not pay U.S. federal income tax or income tax in most states because we are a pass-through tax entity. Our business model allows us to better service our debt, fund internal research and development and pursue strategic acquisitions.

Strong management and highly experienced board of directors.  The seven senior members of our management team have approximately 150 years of combined experience in the defense and related industry sectors, and have significant experience in government contracting. All members of senior management hold meaningful equity stakes through direct investment in our common stock through the ESOP and/or equity-based performance incentives. Our management team is supported by a board of directors with diverse experience in the U.S. government and the U.S. Armed Forces at senior policy levels, including Edward C. Aldridge, former Under Secretary of Defense for Acquisition, Technology and Logistics; Admiral Harold W. Gehman, Jr. USN (Ret.), former NATO Supreme Allied Commander, Atlantic; General George A. Joulwan USA (Ret.), former NATO Supreme Allied Commander, Europe; and General Michael E. Ryan, USAF (Ret.), former Chief of Staff of the U.S. Air Force.

Business Strategy

Our objective is to continue to grow both organically and through strategic acquisitions by capitalizing on our skilled work force and our sophisticated solutions competencies. The key strategies for meeting this objective are described below.

Broaden our existing core competencies.  We continually seek to develop new expertise and keep pace with developments in technology by hiring skilled employees, investing in research and development and acquiring new technologies that broaden the scope of our core business areas. In recent years through our acquisition program, we have enhanced several of our core business areas including defense operations, information technology, modeling and simulation and naval architecture and marine engineering. We also seek to broaden our technology skills by providing training to new and current employees. For example, we have established Alion University to provide our employees with financial, administrative and managerial training and education. In addition, we conduct customer-funded, and to a lesser degree, internally-funded, research and development activities each year. These efforts are designed to position us to remain at the forefront of the U.S. federal and commercial technology solutions markets and enhance our ability to service the needs of our customers.

Leverage experience and reputation to expand market share.  We perform a variety of services for a broad base of customers, including Cabinet-level U.S. government agencies, as well as state and foreign governments to a lesser degree. We plan to leverage our sophisticated set of capabilities as well as our customer relationships in order to expand our market presence by delivering solutions to new customers. We also believe we can grow our revenue by offering the new capabilities we have obtained through our recent acquisitions or developed internally. We believe that our strong relationships with our customers and our sophisticated technology capabilities will allow us to continue to increase market share.

Continue to improve financial performance and increase scale.  We believe a key element of our success has been our continued focus on growing our business and achieving operating efficiencies attendant to increased size. Over the last five years, we have established a track record of consistent revenue and Adjusted EBITDA growth. From fiscal year 2000 to fiscal year 2006, our revenue grew at a compounded annual growth rate of 21.8% from $156.1 million to $508.6 million. Over the same period, our Adjusted EBITDA grew at a compounded annual growth rate of 31.6% from $9.8 million to $50.8 million. Through our focus on reducing operating costs and growing our business, we have expanded our Adjusted EBITDA

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margins from 6.3% in fiscal year 2000 to 10.0% in fiscal year 2006. (Adjusted EBITDA margin is the ratio of Adjusted EBITDA to revenue.) We believe our cost structure will further benefit from operating cost synergies achieved through the Anteon Asset Acquisition. We intend to continue to strengthen our financial performance by growing our business, both organically and through strategic acquisitions, by achieving additional cost efficiencies and by continuing to reduce operating costs where possible. As we improve financial performance, we believe we will strengthen our position to win business as a result of a more competitive cost structure. We plan to leverage our increased scale and skill set to allow us to bid on larger government programs and broaden our customer base.

Pursue a disciplined acquisition strategy.  The U.S. government technology industry provides many opportunities to grow through acquisitions. We have maintained a disciplined acquisition strategy. We have evaluated a large number of opportunities, pursued a more limited number and completed 11 acquisitions since January 1, 2003. The success of our acquisition strategy stems from the quality of assets we acquire, our pricing discipline and our proven ability to successfully integrate acquisition. The Anteon Asset Acquisition occurred on June 30, 2006 and its integration is substantially complete. We have successfully integrated all of our other acquisitions into our operations and information systems with an average integration completion time of approximately 90 days. We intend to continue to pursue strategic acquisitions of companies with talents and technologies complementary to our current fields and to our future business goals in order to broaden our customer base and expand our core competencies.

Acquisitions

For purposes of the discussion below, “run-rate revenue” at the time of an acquisition is calculated as revenue from October 1, 2005 through the date of acquisition, annualized. “Run-rate revenue” as of November 30, 2006 is calculated as revenue for November 2006, annualized.

The Anteon Asset Acquisition.  On June 30, 2006, in connection with a divestiture required by the U.S. Justice Department as part of General Dynamics’s acquisition of Anteon, we acquired certain assets of Anteon including certain contracts and limited fixed assets for consideration of approximately $221.4 million. The Anteon Asset Acquisition included a portfolio of contracts that provide technical and operational support to the DoD, in particular the U.S. Navy and U.S. Air Force. The Anteon Asset Acquisition provided us with a broader customer base in supporting the U.S. Navy in the design, acquisition and lifetime support of surface ships and submarines. This acquisition expanded our design engineering and program management expertise to include acoustics, advanced materials and undersea warfare design expertise and enhanced our existing naval architecture and marine engineering skills. Additionally, the Anteon Asset Acquisition provided us with another relationship with the U.S. Air Force Acquisition Office and the opportunity to build on our U.S. Air Force business relationships. The Anteon Asset Acquisition also expanded our competencies and expertise through the addition of approximately 890 personnel. In October 2006, the ESOP received cash contributions totaling approximately $5.2 million in connection with rollovers into the ESOP by employees acquired as part of the Anteon Asset Acquisition.

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On December 18, 2006, we filed with the SEC on Form 8-K/A certain audited and unaudited financial results with respect to the contracts we acquired in the Anteon Asset Acquisition (the Anteon Contracts). The audited and unaudited financial results included audited revenues, direct expenses and gross profit with respect to the Anteon Contracts for the years ended December 31, 2005, 2004 and 2003 and unaudited revenues, direct expenses and gross profit with respect to the Anteon Contracts for the six months ended June 30, 2006 and 2005.

Anteon Contracts

Statements of Revenues and Direct Expenses

	For the Year Ended December 31,
	2003		2004		2005
	(In thousands)
Revenues	$	81,690	$	130,027	$	215,068
Direct expenses		58,289		94,872		160,840
Gross profit		23,401		35,155		54,228

Anteon Contracts

Statements of Revenues and Direct Expenses

	For the Six Months Ended June 30,
	2005		2006
	(In thousands)
Revenues	$	118,954	$	138,336
Direct expenses		89,214		100,656
Gross profit		29,740		37,680

Anteon’s revenue for the last twelve months ended June 30, 2006 was $234.5 million. As of November 30, 2006, Anteon’s run-rate revenue was $237.4 million.

In order to fund the purchase of contracts and related assets from Anteon, we borrowed $50.0 million in incremental term loans under our Term B Senior Credit Facility and $170.0 million in Bridge Loans. See “Description of Other Indebtedness.”

The Anteon Asset Acquisition has been accounted for using the purchase method of accounting, and accordingly the purchase price was allocated to identifiable assets acquired and liabilities assumed based upon their estimated fair values. The estimated fair values included in the purchase price allocation are preliminary and based upon currently available information and are expected to be finalized in the third quarter of fiscal year 2007. We are still in the process of strategically assessing our combined business which may give rise to different allocations among the purchased assets. Accordingly, final adjustments to the purchase price allocations may be required. We believe that the integration of the Anteon Contracts into our business is substantially complete. We fully integrated the Anteon Contracts into our existing services, and therefore we do not manage the Anteon Contracts as a stand-alone business.

BMH, WCI and MA&D Acquisitions.  In February 2006, we acquired BMH for consideration of approximately $26.0 million (approximately $6.0 million of which was in the form of contingent earn-out payments that may be paid over a two-year period following closing). BMH’s run-rate revenue at the time of the acquisition was $22.1 million. As of November 30, 2006, BMH’s run-rate revenue was $23.2 million. BMH had over 145 software and domain engineers supporting the U.S. Navy and the Joint Forces in the rapidly growing area of modeling and simulation.

In February 2006, we acquired WCI for consideration of approximately $20.5 million (approximately $2.5 million of which was in the form of contingent earn-out payments that may be paid over a two-year

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period following closing). WCI’s run-rate revenue at the time of the acquisition was $19.6 million. As of November 30, 2006, WCI’s run rate revenue was $26.5 million. WCI had approximately 60 consultants providing information technology implementation solutions, management solutions and enterprise solutions assurance to the public and private sectors.

In May 2006, we acquired MA&D for consideration of up to $21.0 million, approximately $4.1 million of which was in the form of contingent earn-out payments that may be paid over a two-year period following closing. As of December 31, 2006, the total consideration will not exceed approximately $19.5 million for the fiscal year ended September 30, 2006; $1.5 million of our earn-out obligations will not be realized because the requisite revenue goals for MA&D were not met. MA&D’s run rate revenue at the time of the acquisition was $15.6 million. As of November 30, 2006, MA&D’s run rate revenue was $15.9 million. MA&D provided human systems integration and modeling solutions to the DoD.

The JJMA Acquisition.  On April 1, 2005, we acquired JJMA for consideration of approximately $99.8 million, consisting of approximately $52.9 million in cash at closing, approximately $8.3 million in deferred payments, approximately $37.3 million in Alion common stock and $1.3 in transaction expenses. JJMA had approximately 600 employees and was a provider of ship and systems design from mission analysis and feasibility trade-off studies through contract and detail design, production supervision, testing and logistics support for the commercial and naval markets. This acquisition strengthened our relationship with the U.S. Navy and enhanced our core competences through the addition of naval architecture and marine engineering capabilities.

Recent Contract Awards

Office of Naval Research Contract Award.  In January 2007, we were awarded a five-year contract with a potential value of approximately $20 million by the Office of Naval Research Sea Warfare and Weapons Department, Ship Systems and Engineering Division. The contract was awarded after a re-compete of a contract we had held for ten years. Under the contract, we will continue to provide technical, engineering and program management expertise to support advanced naval power systems, platform survivability and advanced platform concepts.

Joint Support Ships Contract Award.  In December 2006, we were chosen, as part of a team led by SNC-Lavalin ProFac, Inc., as one of two finalists to develop new Joint Support Ships for the Canadian government. The SNC-Lavalin ProFac team has been awarded one of two project definition phase contracts, for which our responsibilities will be the ship design, signatures, survivability, cost engineering, human-systems engineering and systems engineering. The total value of the contract to us is approximately $9 million.

NIEHS Recompete Contract Award.  In January 2007, we were awarded a ten-year contract with the potential value of approximately $51 million by National Institute of Environmental Health Science (NIEHS) to provide research support in inhalation toxicology to the NIEHS.

Environmental Assistance Team Contract Award.  In June 2006, we were awarded a seven-year contract with the potential value of approximately $23.1 million by the U.S. Environmental Protection Agency (EPA) to operate under the Environmental Services Assistance Team (ESAT) Region 6. Under the contract, we provide sample analysis, analytical and field support services, quality assurance support, data review and validation, technical information and electronic data transfers, and other support functions at the EPA Region 6 Laboratory. We assist the Office of Solid Waste and the Office of Superfund Remediation and Technology Innovation in meeting the requirements and objectives of applicable environmental laws. Through this contract, we assist the EPA and state and local agencies in identifying environmental hazards and ensuring their safe and effective remediation.

Environmental Assistance Team Contract Award.  In March 2006, we were awarded a seven-year contract with the potential value of approximately $19.5 million by the EPA to operate under the ESAT

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Region 7. Under the contract, we provide sample analysis, analytical and field support services, quality assurance support, data review and validation, technical information and electronic data transfers, and other support functions at the EPA Region 7 Science and Technology Center. We assist the Office of Solid Waste and the Office of Superfund Remediation and Technology Innovation in meeting the requirements and objectives of applicable environmental laws. Through this contract, we assist the EPA and state and local agencies in identifying environmental hazards and ensuring their safe and effective remediation.

Navy Shipboard Weapon System Contract Award.  In March 2006, we were awarded a five-year task order with a potential value of approximately $15.2 million under our existing SeaPort Enhanced multiple award contract (MAC) to support the U.S. Navy upgrade of shipboard Tomahawk weapon control systems. Under the task order, we will continue to work with the U.S. Navy to engineer and support upgrades of existing Tomahawk weapon control systems to the Tactical Tomahawk Weapon Control System (TTWCS) configuration on CG 47 and DDG 51 class ships. TTWCS is the next-generation system for Tomahawk cruise missile flight planning and control. TTWCS deployment is part of the U.S. Navy’s efforts to improve the flexibility and responsiveness of Tomahawk cruise missiles, add new capabilities, and upgrade existing fleet systems.

Joint Warfare Simulation Contract Award.  In March 2006, we were awarded a five-year contract with a potential value of approximately $48.5 million to provide modeling and simulation technologies to enhance joint experimentation at the U.S. Joint Forces Command. Under the contract, our team will conduct research and development in critical technical areas for future experimentation and for today’s warfighter. These areas include individual and small unit infantry training, situational awareness capability, training technology for distributed and joint systems, sensor simulation technology, visual simulation technology, and information management for modeling and simulation networking. Our task is to bring technological enhancements and innovative thinking to improve modeling and simulation capabilities to support joint experimentation, training and current operations.

AMMTIAC Contract Award.  In December 2005, we were awarded an eight-year contract with a potential value of approximately $99.3 million to operate the Advanced Materials, Manufacturing and Testing Information Analysis Center (AMMTIAC). AMMTIAC provides DoD and defense industrial base contractors with engineering and technological support in three key areas: materials selection and behavior including process science and corrosion; manufacturing technology, including the application of advanced methods and robotics; and materials, manufacturing, and system inspection and testing. AMMTIAC will provide capabilities formerly supported by three separate DoD IACs: the Advanced Materials and Processes Technology IAC (AMPTIAC), the Manufacturing Technology IAC (MTIAC) and the Nondestructive Testing IAC (NTIAC). Previously, we had operated AMPTIAC and MTIAC. The contract was awarded for $4.1 million on December 30, 2005 and has a $33.9 million ceiling in its first three-year period.

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Core Business Areas

We offer sophisticated technology solutions in the following seven core business areas: defense operations, wireless communications, industrial technology solutions, naval architecture and marine engineering, modeling and simulation, chemical, biological, nuclear, and environmental sciences and information technology. The percentage distribution of our revenue, by core business area, is provided in the table below for the periods set forth below.

	For the Fiscal Year Ended September 30,
	Actual												Pro Forma
Revenue(1)	2004				2005				2006				2006
	($ in millions)
Defense Operations	$	105.1	39.0	%	$	131.4	35.6	%	$	159.0	31.3	%	$	229.2	31.5	%
Wireless Communications		37.8	14.0	%		56.0	15.2	%		47.0	9.2	%		47.0	6.5	%
Industrial Technology Solutions		35.9	13.3	%		51.7	14.0	%		45.6	9.0	%		45.7	6.3	%
Naval Architecture and Marine Engineering		1.1	0.4	%		51.0	13.8	%		142.2	28.0	%		275.8	38.0	%
Modeling and Simulation		22.1	8.2	%		34.9	9.5	%		47.5	9.3	%		53.2	7.3	%
Chemical, Biological, Nuclear, and
Environmental Sciences		32.5	12.0	%		33.2	9.0	%		40.9	8.0	%		41.8	5.7	%
Information Technology		35.4	13.1	%		11.0	3.0	%		26.4	5.2	%		34.2	4.7	%
	$	269.9	100.0	%	$	369.2	100.0	%	$	508.6	100.0	%	$	726.9	100.0	%

	For the Three Months Ended December 31,
	Actual
Revenue	2005				2006
	($ in millions)
Defense Operations	$	31.4	31.0	%	$	61.3	33.9	%
Wireless Communications		12.0	11.8	%		10.3	5.7	%
Industrial Technology Solutions		12.3	12.2	%		11.5	6.3	%
Naval Architecture and Marine Engineering		23.9	23.6	%		69.4	38.3	%
Modeling and Simulation		8.1	8.0	%		8.9	4.9	%
Chemical, Biological, Nuclear, and
Environmental Sciences		10.1	9.9	%		11.2	6.2	%
Information Technology		3.5	3.5	%		8.5	4.7	%
	$	101.3	100.0	%	$	181.1	100.0	%

(1) Beginning in 2005 the descriptions of the core business areas were modified. The results for 2004 have been re-categorized using the modified core business area descriptions.

Defense Operations.  We provide defense operations services to the DoD, including the following individual service components:

•  Military transformation:  we identify and analyze issues and programs of major importance for the Office of the Secretary of Defense and related U.S. military services transformation initiatives such as joint warfare experimentation. We also integrate Command, Control, Communication and Computer Intelligence (C4I) initiatives and develop net-centric initiatives.

•  Logistics management:  we provide support to the U.S. Army on a broad range of requirements including infrastructure assessment, defense industrial base assessment, financial management, cost analysis, and base realignment, from planning to implementation.

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•  Readiness assessments and operational support:  we deliver strategic planning and decision-making process improvements by providing technical assistance and decision support tools, such as Full Spectrum Analysis and Distributed Information System Collaboration Architecture.

•  Training and education services:  we assist the DoD in the development of its department-wide education and training policies. We develop the necessary technology, compile the information to be used in the courseware, and then translate this into an electronic or web-based advanced distant learning medium so that the student can interact with the courseware from a remote location.

•  Critical infrastructure protection, risk and vulnerability analysis: we provide techniques, tools, and operational support to assess vulnerabilities and defend infrastructure, such as ports, power plants and communications nodes.

Wireless Communications.  We provide wireless communications research and spectrum engineering services primarily to the DoD, but also to other agencies of the U.S. government. To a lesser extent, we provide wireless communications research and spectrum engineering services to commercial customers. We have expertise in four primary areas:

•  Wireless and communications-electronics engineering:  we perform work for the government “communications-electronics” and commercial wireless communities. The term “communications-electronics” refers to all devices or systems that use the radio frequency spectrum. Our work for the government sector includes such tasks as conducting modeling and simulation of communications networks and analyzing radar and space systems performance. For our commercial customers, we determine whether wireless communication networks have the geographic coverage the customers desire, and whether the systems operate free of interference, and we make recommendations designed to improve network performance. We also evaluate and make recommendations for the design of radio transmitters, receivers and antennas for our commercial customers. In the area of net-centric operations, we design next generation wireless networks and devices, including frequency and bandwidth-adaptive systems.

•  Spectrum management:  we perform studies and analyses related to the manner in which the radio frequency spectrum may be utilized without interruption or interference by both new and existing users and technologies. In addition, we assess existing and new technologies for their ability to utilize the radio frequency spectrum efficiently — in other words, to accomplish designated tasks without using too much of the available radio frequency spectrum. Our services, which include providing spectrum policy advice, are used to support decisions of senior U.S. government officials in domestic and foreign initiatives.

•  C4ISR system engineering:  we deliver Command, Control, Communication and Computer Intelligence, Surveillance, and Reconnaissance (C4ISR) engineering and analysis support for radio frequency communications, radar and Identification Friend or Foe to DoD system developers and integrators. We also develop automated spectrum management software to assign frequencies to multiple users of the radio frequency spectrum in an effort to minimize interference. Our software tool, Spectrum XXItm, is the automated spectrum management system used worldwide by the DoD, and it is now also being used by other agencies of the U.S. government. We also design, integrate and deploy spectrum monitoring software to locate and track violators of the rules and regulations of spectrum usage.

•  Electromagnetic environmental effects:  we perform studies and analyses to measure and predict electromagnetic environmental effects for both government and commercial customers. Our work has involved building automated tools designed to predict the effects of potential hazards of electromagnetic radiation to ordnance, fuel and personnel.

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Industrial Technology Solutions.  We provide the following services to our federal government customers including the DoD and, to a lesser extent, to commercial customers:

•  Reliability, material and manufacturing engineering:  we apply technology to enhance production, improve performance, reduce cost and extend life of complex engineered products.

•  Sensor technology development:  we develop, evaluate, adapt and integrate sensor technologies and provide support to the DoD’s Night Vision and Electronic Sensors Directorate.

•  Facilities engineering/construction management:  we provide expertise in engineering, architecture and related disciplines (e.g., construction management, logistics, design oversight and inspection).

•  Research and analysis center management:  we manage a number of DoD information analysis centers such as the Advanced Materials, Manufacturing and Testing Information Analysis Center (AMMTIAC) which is a recent combination of the Advanced Materials Processes Technology Information Analysis Center (AMPTIAC), the Manufacturing Technology Information Analysis Center (MTIAC), and the Non Destructive Testing Information Analysis Center (NTIAC). We also manage the DuPage Manufacturing Research Center.

•  Aerospace coating production and application:  we develop and apply coatings designed to protect government and commercial satellites.

•  Innovative manufacturing technologies:  we develop and integrate systems for low-volume productivity (e.g., laser cladding of parts) and rapid manufacturing systems.

We also operate acoustical laboratories through which we have the capability to test and evaluate various components for sound transmission, absorption and intensity; field measurement testing; equipment vibration and isolation; noise abatement; and active silencing.

Naval Architecture/Marine Engineering.  We provide technical services for ship and systems design from the initial phase of mission analysis and feasibility trade-off studies through contract and detail design, production supervision, testing and logistics support for the commercial and naval markets.

•  Ship design:  we provide total ship design services for military and commercial customers. The services encompass whole ship systems engineering including requirements definition, concept analysis, feasibility studies and contract design, detail design and production support.

•  Naval architecture:  we provide systems engineering/design integration, hull form development and performance analysis, structural design and analysis, weight engineering, and impact and damage stability analysis.

•  Marine engineering:  we design and engineer ship systems including propulsion, electrical, fluids/piping, auxiliary, HVAC, deck machinery, and machinery automation and control systems. We provide expertise for machinery integration, test and trials, failure analysis, modeling and simulation, and integrated logistics support.

•  Combat systems engineering:  we provide services including mission and threat analysis, evaluation of candidate warfare and combat systems, development of specifications and installation drawings for topside and below-deck interface requirements, and ship modernizations.

•  Program management:  we furnish acquisition planning, business and financial management, configuration and data management, test and evaluation support, and production analysis and management in all life cycle phases of equipment, systems, and ships.

•  Transformable Craft:  in support of the U.S. Navy’s Office of Naval Research, we are developing a “transformable craft,” or T-Craft, to deliver payloads across open ocean and onto the shore. The vehicle is designed to operate as a surface effect ship for transit at sea, converting to a fully-skirted air-cushion vehicle for operation in very shallow water, across sand-bars or mud-flats, and for limited mobility on dry land. The concept vehicle is intended to operate over water at speeds in excess of 40

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knots over a transit range of 2,500 nautical miles without payload; and 500-600 nautical miles with up to 750 tons, to enable transfer of cargo from sea to shore where no port facilities exist.

Modeling and Simulation.  Our modeling and simulation operations assist our customers in examining the outcome of events by providing services such as:

•  Wargaming, experimentation, scenario design and execution:  we design and conduct strategic and operations analytic wargames to evaluate future operational concepts and force transformation initiatives, create and implement training scenarios for two-dimensional and three-dimensional (3-D) simulation systems, we support Joint Forces Command’s Millennium Challenge, and we support Joint Conflict and Tactical Simulation (JCATS) scenarios.

•  C4I integration:  we design and develop policies for the DoD to enable standard automated interfaces between simulation and C4I systems which support improved planning, training and military operations.

•  Analysis and visualization:  we develop terrain modeling databases and realistic 3-D visual systems for flight simulation and other training systems. We manage the Modeling and Simulation Information Analysis Center (MSIAC) for the DoD.

•  Phenomenological modeling:  we develop phenomenological models for nuclear, chemical, biological and electromagnetic environments.

Chemical, Biological, Nuclear and Environmental Sciences.  Our chemical, biological, nuclear and environmental sciences operations provide a wide range of research primarily to the DoD and the EPA, but also to other departments of U.S. federal and state governments, including:

•  Chemical/biological agent detection and decontamination:  we develop, test and evaluate methods for detection, and chemical decontamination of chemical, biological and other toxic agents, and we operate a chemical agent surety laboratory. We provide analytical methods to enhance safe handling of chemical substances and design methods to convert harmful chemical and biological materials into harmless materials.

•  Laboratory support:  using our laboratory facilities we analyze materials, wastes and effluents to determine constituents and/or properties; develop and validate analytical methods and instruments; and develop, test and implement methods for measuring air quality.

•  Life sciences:  we provide analysis, testing, operational and laboratory support in the areas of biotechnology, biomedical sciences and toxicology.

•  Detection, recovery and disposal of unexploded ordnance and explosives:  we demilitarize conventional, toxic/radioactive and chemical warfare material, and we decontaminate and demolish buildings and equipment contaminated with explosives. We provide these services through our wholly-owned subsidiary, Human Factors Applications, Inc.

•  Environmental sciences:  we provide analysis, operational and laboratory support in: air pollution research, toxicology, ecology and habitat, and quality assurance program support; exhaust plume dispersion calculations and modeling; emissions modeling; air and water pollution equipment evaluations; and technology evaluations of waste streams.

•  Nuclear safety and analysis:  we provide nuclear safety and analysis services to the U.S. Department of Energy and its National Laboratories as well as to the commercial nuclear power industry.

Information Technology.  Our information technology operations provide the following services primarily to agencies of the U.S. government, including the DoD, as well as to commercial customers:

•  Enterprise architecture development and integration:  we design, develop and implement enterprise information systems.

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•  Applications development:  we develop web-based and stand-alone solutions, as well as decision support tools.

•  Knowledge management:  we deliver solutions for data warehousing/mining, decision support, and information analysis.

•  Network design and secure network operations:  we provide information assurance, business continuity and disaster planning, network planning and designs for virtual private networks.

•  Independent verification and validation:  we implement modeling and simulation, test and evaluation, and database monitoring.

•  Medical informatics:  we develop and integrate technologies for acquisition, storage and use of information, including decision support in the field of biomedicine.

Software Tools and Technology Products

We provide a series of software tools and technology products that complement our core business areas. While our software tools and technology products represent less than 0.1% of our total revenue, they play an important role in enhancing our service and solutions offerings and increasing customer satisfaction. Examples include:

•  Frequency Assignment & Certification Engineering Tool (FACET^tm): this software tool automates the assignment of radio frequencies, which we refer to as spectrum management, in a way that is designed to minimize interference between multiple users of the radio frequency spectrum.

•  Advanced Cosite Analysis Tool (ACAT^tm):  this software tool is designed to permit co-location of numerous antennas on towers, rooftops and other platforms by predicting interference between the various systems and informing the user how to minimize interference.

•  Spectrum Monitoring Automatic Reporting and Tracking System (SMART^tm):  this system characterizes the frequency usage in a given geographic area, allowing the customer to remotely monitor the spectrum to identify unauthorized users and to look for gaps in the spectrum usage.

•  X-IG^tm:  this software provides 3-D images for managing and displaying visuals of terrain and environment used in flight simulation and other training systems.

•  MobSim^tm/SimViewer^tm:  this software provides for tracking components across multiple modes of transportation (e.g., air, sea, rail and truck).

•  Virtual Ocean^tm:  this software provides visualization of ship motions based on analytically correct representation of the seaway.

•  Countermeasures^tm:  we provide vulnerability/risk assessment software used to analyze and quantify physical or electronic security.

•  CaveDog^tm:  this product is a small, remote-controlled hemispherical, multi-spectral vision robot vehicle used for surveillance and reconnaissance.

•  Real Time Location System (RTLS^tm):  this product is designed to enable customers to track thousands of users in a defined area, such as a seaport, a football stadium or an office building, using low cost antennas and badges.

•  Isis-3D^tm:  we provide fire code software with specific models for weapon thermal hazard response, including aerosol and radiation models.

•  PRISM^®:  we provide software used for system level failure rate modeling with the ability to model both operating and non-operating failure rates. The system considers non-component failure causes through process assessment.

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Contract Profile

We have a diverse contract base, with no task order or single-award contract representing more than 13% of our revenue for the fiscal year ended September 30, 2006. As of September 30, 2006, we had a portfolio of over 800 active contracts and task orders. Approximately 81% of our pro forma fiscal year 2006 revenues were generated under our prime contracts, and approximately 19% of our pro forma fiscal year 2006 revenues were generated under subcontracts. Our contracts have one of three types of pricing structures: cost-reimbursement contracts, fixed-price contracts and time-and-material contracts.

•  Cost-reimbursement contracts are structured to allow us to recover our direct labor and allocable indirect costs, plus a fee that may be fixed or variable depending on the contract arrangement. Allocable indirect costs refer to those costs related to operating our business that can be recovered under a contract.

•  Fixed-price contracts oblige customers to pay us a fixed dollar amount to cover all direct and indirect costs, and fees. Under fixed-price contracts we assume the risk of any cost overruns and receive the benefit of any cost savings.

•  Time-and-material contracts are structured to allow us to recover our labor, related indirect expenses and fee through fixed hourly labor billing rates, and to recover certain material and other direct costs through cost reimbursable provisions without fee.

In addition to traditional, close-ended contracts, our contracts may be structured as multiple award contracts (such as ID/IQ contracts, GSA Schedule contracts, BPAs and GWACs), under which we are required to make sustained post-award efforts to realize revenue under such contracts.

Our historical contract mix, measured as a percentage of total revenue and pro forma contract mix, measured as a percentage of total pro forma revenue, is summarized in the table below for the periods set forth below.

	For the Year Ended September 30,
	Actual												Pro Forma
Contract Type	2004				2005				2006				2006
	($ in millions)
Cost-reimbursement	$	159.5	59.1	%	$	216.2	58.6	%	$	326.3	64.2	%	$	519.4	71.5	%
Fixed-price		44.3	16.4	%		76.6	20.7	%		91.6	18.0	%		53.3	7.3	%
Time-and-material		66.1	24.5	%		76.4	20.7	%		90.7	17.8	%		154.2	21.2	%
Total	$	269.9	100.0	%	$	369.2	100.0	%	$	508.6	100.0	%	$	726.9	100.0	%

	For the Three Months Ended December 31,
	Actual
Contract Type	2005				2006
	($ in millions)
Cost-reimbursement	$	63.1	62.3	%	$	124.7	68.9	%
Fixed-price		19.3	19.0	%		30.4	16.7	%
Time-and-material		18.9	18.7	%		26.0	14.4	%
Total	$	101.3	100.0	%	$	181.1	100.0	%

Any costs we incur prior to the award of a new contract or prior to modification of an existing contract are at our own risk. This is a practice that is customary in our industry, particularly when a contractor has received oral advice of a contract award, but has not yet received the authorizing contract documentation. In most cases the contract is later executed or modified and we receive full reimbursement for our costs. We cannot be certain, however, when we commence work prior to authorization of a contract, that the contract will be executed or that we will be reimbursed for our costs. As of September 30, 2006, we had incurred $3.4 million in pre-contract costs at our own risk.

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We compete for key contracts from various agencies of the U.S. government. Our business development and technical personnel target contract opportunities and perform detailed analyses on each customer’s priorities and overall market dynamics. Depending upon whether the targeted contract is a renewal or a new opportunity, we typically will have from three to 18 months to develop and execute our competitive strategy regarding that contract. Once we have decided to pursue a contract, we mobilize a core group of employees with the requisite expertise to lead the bidding and proposal preparation effort. We have a network of consultants and other industry experts to supplement our internal capabilities as necessary.

Our contract administration and cost accounting policies and practices are subject to oversight by federal government inspectors, technical specialists and auditors. All costs associated with a federal government contract are subject to audit by the federal government. An audit may reveal that some of the costs that we may have charged against a government contract are not in fact allowable, either in whole or in part. In these circumstances, we would have to return to the federal government any monies paid to us for non-allowable costs, plus interest and possibly penalties. Contract costs on federal government contracts are subject to audit by the federal government and adjustment through negotiations with government representatives. The government considers us to be a major contractor and maintains an office at our facilities to perform various audits. The government has audited all of our federal government contract indirect costs through fiscal year 2004. We submitted our fiscal year 2005 indirect expense rates to the government in March 2006 and submitted our fiscal year 2006 indirect expense rates to the government in March 2007. Indirect rates have been negotiated and settled through fiscal year 2003. We have recorded revenue on federal government contracts in amounts we expect to realize.

At each stage of the contracting process, we attempt to reduce financial and performance risks. At the pre-award stage, we frequently bid through teaming agreements with other contractors having complementary technical strengths that enhance the likelihood of winning the contract, including, in many instances, our main competitors. Sometimes, before a U.S. government agency has actually signed or begun funding for services under a contract or task order, our employees will begin providing services. We have internal procedures in place designed to ensure that such “at risk” provisions of services only occur when funding is delayed due to bureaucratic or other technical reasons and it remains highly probable that we will ultimately receive funding.

Once we win a contract or task order, we assign a program manager and, at a lower level, a task leader, whose job is to ensure timely and high quality performance of services. Program managers are given access to our financial management information systems to assist them in monitoring our incurred costs and preventing these costs from exceeding funded costs under our contracts and task orders. Program managers also interface with our customers to determine whether their needs are being satisfied.

Contract Backlog

Our contract backlog represents an estimate, as of a specific date, of the remaining future revenue anticipated from existing contracts. On September 30, 2006 and on December 31, 2006, our total contract backlog was approximately $4,247.0 million and $4,602 million, respectively, of which approximately $386.0 million and $333 million, respectively, was funded. The two elements of our backlog are described below.

•  Funded backlog reflects amounts that have been awarded to us and whose funding has been authorized by the customer, less revenue previously recognized under the same contracts.

•  Unfunded backlog represents the total estimated value of contracts awarded to us, but whose funding has not yet been authorized by the customer.

Because the U.S. government operates under annual appropriations, agencies of the U.S. government typically fund contracts on an incremental basis. As a result, only a portion of the total contract backlog is “funded.” Funded backlog generally varies depending on procurement and funding cycles and other factors beyond our control. In addition, pre-negotiated contract options, options not yet exercised by a customer for additional years and other extension opportunities included in contracts are included in unfunded backlog.

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Changes in our contract backlog calculation result from additions for future revenue as a result of the execution of new contracts or the extension or renewal of existing contracts, reductions as a result of completing contracts, reductions due to early termination of contracts, and adjustments due to changes in estimates of the revenue to be derived from previously included contracts. Estimates of future revenue from contract backlog are by their nature inexact and the receipt and timing of these revenue are subject to various contingencies, many of which are outside of our control. Accordingly, period-to-period comparisons are difficult and not necessarily indicative of any future trends in revenue. The table below shows the value of our funded and unfunded contract backlog as of September 30, 2004, 2005 and 2006, respectively, and December 31, 2005 and 2006, respectively.

	September 30,						December 31,
	Actual
	2004		2005		2006		2005		2006
	($ in millions)						($ in millions)
Backlog:
Funded	$	161	$	193	$	386	$	179	$	333
Unfunded	$	1,793	$	2,581	$	3,861	$	2,644	$	4,269
Total	$	1,954	$	2,774	$	4,247	$	2,823	$	4,602

Proposal backlog represents an estimate, as of a specific date, of the proposals we have in process or submitted and for which we are waiting to hear results of the award. It consists of two elements:

•  in-process backlog, which refers to proposals that we are preparing to submit following a request from a customer, and

•  submitted backlog, which refers to proposals that we have submitted to a customer and for which we are awaiting an award decision.

The amount of our proposal backlog that ultimately may be realized as revenues depends upon our success in the competitive proposal process, and on the receipt of tasking and associated funding under the ensuing contracts. We will not be successful in winning contract awards for all of the proposals that we submit to potential customers. Our past success rates for winning contract awards from our proposal backlog should not be viewed as an indication of our future success rates. The table below shows the value of our proposal backlog as of September 30, 2004, 2005, and 2006, respectively and December 31, 2005 and 2006, respectively.

	September 30,						December 31,
	Actual
	2004		2005		2006		2005		2006
	($ in millions)						($ in millions)
In-process	$	56	$	276	$	650	$	248	$	141
Submitted	$	425	$	1,121	$	474	$	1,056	$	950
Total	$	481	$	1,397	$	1,124	$	1,304	$	1,091

Customers

We provide scientific, research and development and technical expertise and operational support to a diverse group of U.S. government customers, in addition to state and local government and commercial customers. As of September 30, 2006, we serviced approximately 350 customers including all branches of the U.S. military, a number of Cabinet-level U.S. government agencies, and the White House. For our pro forma fiscal year ended September 30, 2006, the DoD accounted for approximately 91.0% of our total revenue, including approximately 200 contracts with customers such as the U.S. Navy, the U.S. Army, the U.S. Air Force, U.S. Joint Forces Command (USJFCOM), Defense Information Systems Agency and DARPA. Other U.S. federal, state, and local government customers accounted for 4.7% of total pro forma revenue, including the National Institute of Environmental Health Sciences (NIEHS), U.S. Department of

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Energy (DOE) and the EPA. Lastly, commercial and international customers accounted for the remaining 4.5% of total pro forma revenue. The table below shows revenue by customer type for the periods set forth below.

	For the Year Ended September 30,
	Actual												Pro Forma
	2004				2005				2006				2006
	($ in millions)
U.S. Department of Defense (DoD)	$	244.9	90.7	%	$	324.1	87.8	%	$	451.8	88.8	%	$	660.0	90.8	%
Other U.S. Civilian Government Agencies		19.0	7.0	%		30.3	8.2	%		30.1	5.9	%		33.9	4.7	%
Commercial and International		6.0	2.2	%		14.8	4.0	%		26.7	5.2	%		33.0	4.5	%
Total	$	269.9	100	%	$	369.2	100	%	$	508.6	100.0	%	$	726.9	100.0	%

	For the Three Months Ended December 31,
	Actual
Contract Type	2005					2006
			($ in millions)
U.S. Department of Defense (DoD)	$	94.0		92.8	%	$	163.9	90.5	%
Other U.S. Civilian Government Agencies		5.6		5.5	%		6.9	3.8	%
Commercial and International		1.7		1.7	%		10.3	5.7	%
Total	$	101.3		100.0	%	$	181.1	100.0	%

Foreign Operations

In fiscal years 2004, 2005 and 2006, nearly 100% of our revenue was derived from services provided under contracts with U.S.-based customers. We treat revenues resulting from U.S. government customers as sales within the United States regardless of where the services are performed.

Business Development and Promotional Activities

We primarily promote our contract research services by meeting face-to-face with customers or potential customers, by obtaining repeat work from satisfied customers, and by responding to requests for proposals (RFPs) and similar international requests that our customers and prospective customers publish or direct to our attention. We use our knowledge of and experience with U.S. government procurement procedures, and relationships with government personnel, to help anticipate the issuance of RFPs or other potential customer requests and to maximize our ability to respond effectively and in a timely manner to these requests. We use our resources to respond to RFPs and other potential customer requests that we believe we have a good opportunity to win and that represent either our core research fields or logical extensions of those fields for new research. In responding to an RFP or other potential customer requests, we draw on our expertise in various business areas to reflect the technical skills we could bring to the performance of a particular contract.

Our business developers, who also work face to face with our customers, are experienced in marketing to government customers and have knowledge of the services and products they are representing as well as the particular customer’s organization, mission and culture. These professionals also possess a working knowledge of rules governing the marketing limitations that are unique to the government arena. This includes knowledge of government funding systems, conflict of interest restrictions, procurement integrity limitations and other pertinent procedural requirements designed to establish a level competitive playing field and to ensure the appropriate use of public funds.

Our technical staff is an integral part of our promotional efforts. They develop relationships with our customers over the course of contracts that can lead to additional business. They are also exposed to new

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research opportunities that become available in the course of performing tasks on current contracts. We hold weekly company-wide business development meetings to review specific proposal opportunities and to agree on our strategy in pursuing these opportunities. At times we also use independent consultants for promoting business, developing proposal strategies and preparing proposals.

For internally-funded research and development we spent approximately $0.4 million, $0.5 million, and $2.0 million in fiscal years 2004, 2005 and 2006, respectively. This is in addition to the substantial research and development activities that we have undertaken on projects funded by our customers. We believe that actively fostering an environment of innovation is critical to our ability to grow our business and attract new business in that it allows us to be proactive in addressing issues of national concern in public health, safety and national defense. As an example, in anticipation of an RFP for hi-tech contract work from the Army’s Night Vision Laboratory (NVESD), we invested our own research and development dollars in the development of a prototype that supports our warfighter, called CaveDogtm, a small, remotely-controlled robot that can search caves and tunnels. We attribute our subsequent success in our bid for the high-tech contract work in part to this initiative. This contract work has resulted in over $75 million in new task orders for us over the past three fiscal years.

Resources

For most of our work, we use computer and laboratory equipment and other supplies that are readily available from multiple vendors. As such, disruption in availability of these types of resources from any particular vendor should not have a material impact on our ability to perform our contracts. In some of the specialized work we perform in a laboratory, we depend on the supply of special materials and equipment whose unavailability could have adverse effects on the experimental tasks performed at the laboratory. However, we believe that the overall impact of these types of delays or disruptions on our total operations and financial condition is likely to be minimal.

Patents and Proprietary Information

Our research and development and engineering services do not depend on patent protection. In accordance with applicable law, our U.S. government contracts often provide government agencies with certain rights to our inventions and copyright works, including use of the inventions by government agencies, and a right to exploit these inventions or have them exploited by third-party contractors, including our competitors. Similarly, our U.S. government contracts often license to us patents and copyright works owned by third parties. We maintain an active program to track and protect our intellectual property.

Competition

The U.S. government engineering and technology services industries are comprised of a large number of enterprises ranging from small, niche oriented companies to multi-billion dollar corporations that serve a large number of U.S. government customers. Due to the diverse requirements of U.S. government customers and the highly competitive nature of large contracting initiatives, corporations frequently form teams to pursue contract opportunities. Prime contractors leading large proposal efforts typically select team members on the basis of their relevant capabilities and experience particular to each opportunity. As a result of these circumstances, companies that are competitors for one opportunity may be team members for another opportunity.

We frequently compete against well-known firms in the industry as a prime contractor. Our competitors include Booz Allen Hamilton, CACI International, Inc., Science Applications International Corporation, Battelle Memorial Institute, SRA International, Inc. and the services divisions of Lockheed Martin Corporation, General Dynamics Corporation and Northrop Grumman Corporation. In the commercial arena, we compete most often with smaller, but highly specialized technical companies, as well as a number of larger companies. These competitors include Westinghouse, General Electric, Enercon, Accenture, BearingPoint, Evans and Sutherland, CAE and L-3 Communications Corporation.

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Competition also takes place at the task level, where knowledge of the customer and its procurement requirements and environment is often the key to winning business. We have been successful in ensuring our presence on numerous contracts and GSA schedules, and in competing for tasks under those contracts. Through the variety of contractual vehicles at our disposal, as either a prime contractor or subcontractor, we have the capability to market our services to any U.S. government agency. Because of our experience with providing services to a diverse array of U.S. government departments and agencies, we have first-hand knowledge of our customers and their goals, problems and challenges.

In most cases, government contracts for which we compete are awarded based on a competitive process. We believe that in general, the key factors considered in awarding contracts are:

•  technical capabilities and approach;

•  quality of personnel, including management capabilities;

•  successful past contract performance; and

•  price.

It is our experience that in awarding contracts to perform complex technological programs, the two most important considerations for a customer are technical capabilities and price. Our overall win rate over the past two fiscal years has been approximately 38%, based on the dollar value of the relevant contracts. For re-bid of contracts where we are the incumbent, our win rate has been approximately 84% over the last three fiscal years, based on the number of those contracts. We believe that our knowledge of our customers, our U.S. government contracting and technical capabilities, and our pricing policies enable us to compete effectively.

Corporate Culture, Employees and Recruiting

We strive to create an organizational culture that promotes excellence in job performance, respect for the ideas and judgment of our colleagues and recognition of the value of the unique skills and capabilities of our professional staff. We seek to attract highly qualified and ambitious staff. We strive to establish an environment in which all employees can make their best personal contribution and have the satisfaction of being part of a unique team. We believe that we have a track record of successfully attracting and retaining highly skilled employees because of the quality of our work environment, the professional challenges of our assignments, and the financial and career advancement opportunities we make available to our staff.

As of September 30, 2006, we employed approximately 3,600 employees, of which approximately 3,300 were full-time employees. Approximately 37% of our employees have Ph.D.s and masters degrees, and approximately 63% of our employees have college degrees. Approximately 72% of our employees have security clearances, with approximately 22% of our employees holding clearances at the Top Secret level or above. We believe that our relationship with our employees is good. None of our employees are covered by a collective bargaining agreement.

We view employees as our most valuable asset. Our success depends in large part on attracting and retaining talented, innovative and experienced professionals at all levels. We rely on the availability of skilled technical and administrative employees to perform our research, development and technological services for our customers. The market for certain skills in areas such as information technology and wireless communications is at times extremely competitive. This makes recruiting and retention of employees in these and other specialized areas extremely important. We recognize that our benefits package, work environment, incentive compensation, and employee-owned culture will be important in recruiting and retaining these highly skilled employees.

Environmental Matters

Our operations are subject to U.S. federal, state and local and foreign laws and regulations relating to, among other things, emissions and discharges into the environment, handling and disposal of regulated substances and wastes, and contamination by regulated substances. Some of our operations may require

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environmental permits and/or controls to prevent and reduce air and water pollution, and these permits are subject to modification, renewal and revocation by issuing authorities.

Operating and maintenance costs associated with environmental compliance and prevention of contamination at our facilities are a normal, recurring part of our operations. These costs are not material relative to our total operating costs or cash flows and are generally allowable as contract costs under our contracts with the U.S. government. These costs have not been material in the past and, based on information presently available to us and on U.S. government environmental policies relating to allowable costs in effect at this time, all of which are subject to change, we do not expect these to have a material impact on us. Based on historical experience, we believe that a significant percentage of the total environmental compliance costs associated with our facilities will continue to be allowable costs.

Under existing U.S. environmental laws, potentially responsible parties can be held jointly and severally liable and, therefore, we would be potentially liable to the government or third parties for the full cost of investigating or remediating contamination at our sites or at third-party sites in the event contamination is identified and remediation is required. In the unlikely event that we were required to fully fund the remediation of a site, the statutory framework would allow us to pursue rights of contribution from other potentially responsible parties.

Properties

Our principal operating facilities are located in McLean, Virginia and Chicago, Illinois, and consist of approximately 23,823 square feet and 49,231 square feet of office space, respectively, held under leases. We also lease approximately 80 additional office facilities totaling approximately 750,000 square feet. Of these, our largest offices are located in Fairfax, Alexandria, Vienna, Arlington, Norfolk, Suffolk, and Newport News, Virginia; Washington, DC; Swissvale and West Conshohocken, Pennsylvania; Huntsville, Alabama; Mystic, Connecticut; Annapolis and Lanham, Maryland; Orlando, Florida; Rome, New York; Iselin, New Jersey; Pascagoula, Mississippi; Fairborn, Ohio; Mt. Clements, Michigan; Boulder, Colorado; Durham, North Carolina; Bath, Maine; San Diego, California; Albuquerque and Los Alamos, New Mexico; and Warrenville, Illinois.

We lease twelve laboratory facilities totaling approximately 120,000 square feet, for research functions in connection with the performance of our contracts. Of these, our largest laboratories are located in Washington, DC; Durham, North Carolina; Chicago and Geneva, Illinois; Annapolis and Lanham, Maryland; and Rome, New York. The lease terms vary from one to eight years, and are generally at market rates.

Aggregate average monthly base rental expense for fiscal years 2006 and 2005 was $1,849,940 and $1,091,594, respectively.

We periodically enter into other lease agreements that are, in most cases, directly chargeable to current contracts. These obligations are usually either covered by currently available contract funds or cancelable upon termination of the related contracts.

All leased space is considered to be adequate for the operation of our business, and no difficulties are foreseen in meeting any future space requirements.

Legal Proceedings

We are party to a number of lawsuits arising in the normal course of our business. We do not believe that any pending litigation will have a material adverse effect on our financial condition or results of operations. We are not aware of any threat of future litigation that would have a material adverse affect on our financial condition or results of operations.

As a government contractor, we may be subject from time to time to U.S. government inquiries relating to our operations and audits by the U.S. Defense Contract Audit Agency. Contractors found to have violated the False Claims Act, or which are indicted or convicted of violations of other U.S. laws, may

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be suspended or debarred from U.S. government contracting for some period. Such an event could also result in fines or penalties. Given our dependence on U.S. government contracts, suspension or debarment could have a material adverse effect on our business, financial condition, results of operations and our ability to meet our financial obligations. We are not aware of any such pending U.S. government claims or investigations.

Estate of Joseph Hudert vs. Alion Science and Technology Corporation; Estate of Frank Stotmeister vs. Alion Science and Technology Corporation.  On December 23, 2004, the estate of Joseph Hudert filed an action against Grunley-Walsh Joint Venture, L.L.C. (Grunley-Walsh) and us in the District of Columbia Superior Court for damages in excess of $80.0 million. On January 6, 2005, the estate of Frank Stotmeister filed an action against us in the same court on six counts, some of which are duplicate causes of action, claiming $30.0 million for each count. Several other potential defendants may be added to these actions in the future. Other defendants in these actions include another construction subcontractor of the GSA. These actions have since been removed to the Federal District Court for the District of Columbia. The discovery process has begun in these actions.

The suits arose in connection with a steam pipe explosion that occurred on or about April 23, 2004 on a construction site located at 17th Street, N.W. in Washington, D.C. The plaintiffs died, apparently as a result of the explosion. Joseph Hudert was an employee of Grunley-Walsh, who was the prime contractor on the site, and Frank Stotmeister was an employee of Cherry Hill Construction Company Inc., which was a subcontractor on the site. Grunley-Walsh had a contract with the GSA for construction on 17th Street N.W. near the Old Executive Office Building in Washington, D.C. Sometime after the award of the construction contract to Grunley-Walsh, we were awarded a separate contract by GSA. Our responsibilities on this particular contract with the GSA were non-supervisory monitoring of Grunley-Walsh’s activities and reporting to GSA of any deviations from contract requirements.

We intend to defend these lawsuits vigorously. Based on the facts underlying the lawsuit known to us at this time, and our non-supervisory monitoring role at the project site, our management believes that the potential for Alion to incur a material loss as a result of the lawsuits is remote. Therefore, our management does not believe that these lawsuits will have a material adverse effect upon us, our operations, cash flows, or financial condition.

Our primary provider of general liability insurance, St. Paul Travelers, has assumed defense of these lawsuits. However, since there is some uncertainty as to whether St. Paul Travelers received timely notice of a potential claim by us in connection with these lawsuits under our general liability insurance policy, St. Paul Travelers indicated, when it assumed defense of the lawsuits, that it was doing so subject to a reservation of rights to deny coverage. Nevertheless, even if St. Paul Travelers is ultimately able to properly deny coverage as a result of late notice of the lawsuits, our management does not believe that the lawsuits will have a material adverse effect upon us, our operations, cash flows, or financial condition. We have notified our excess insurance carrier, American International Group, regarding these lawsuits.

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EMPLOYEE STOCK OWNERSHIP PLAN

The Alion Science and Technology Corporation Employee Stock Ownership Savings and Investment Trust (The ESOP Trust) holds record title to 100% of our outstanding shares of common stock on behalf of the participants in The Employee Stock Ownership Plan (ESOP) component of the Alion Science and Technology Corporation Employee Ownership, Savings and Investment Plan, which we refer to as the KSOP (the KSOP). The KSOP also has a traditional 401(k) component, which we also refer to as the non-ESOP component of the KSOP. Our eligible employees can purchase beneficial interests in our common stock by rolling over their eligible retirement account balances into the ESOP through a one-time ESOP investment election available to new hires and/or directing a portion of their pre-tax payroll income to be invested in the ESOP. The trustee of the ESOP Trust, State Street Bank & Trust Company, uses the monies that eligible employees invest in the ESOP to make semi-annual purchases of our shares of common stock for allocation to those employees’ ESOP accounts.

We make retirement contributions to the ESOP on behalf of our eligible employees. We also make matching contributions in the ESOP component of the KSOP on behalf of our eligible employees.

The ESOP Trust holds record title to all of the shares of our common stock allocated to the employees’ ESOP accounts and, except in certain limited circumstances, the trustee of the ESOP Trust will vote those shares on behalf of the employees at the direction of the ESOP committee. The ESOP committee is appointed by our chief executive officer and president. The ESOP committee is comprised of four members of our management team and three other employees and is responsible for the financial management and administration of our ESOP.

As part of the stock purchase agreement pursuant to which the ESOP Trust acquired a 100% ownership interest in our common stock, we agreed with the ESOP Trust that:

•  We will not take any steps without the ESOP Trust’s consent to change our status as an S corporation;

•  We will not enter into any transactions with any of our officers or directors without approval from our board of directors or compensation committee;

•  We will obtain the ESOP Trust’s consent before effecting our first public offering of common stock to be listed on any securities exchange;

•  We will not take actions that would prevent the ESOP Trust from acquiring any additional shares of our common stock under the control share acquisition provisions of the Delaware General Corporation Law;

•  We will repurchase any shares of common stock distributed to participants in the ESOP component of the KSOP, to the extent required by the ESOP, any ESOP-related documents and applicable laws;

•  We will maintain the KSOP and the ESOP Trust so that they will remain in compliance with the qualification and tax exemption requirements under the Internal Revenue Code; and

•  We will use our best efforts to ensure that the ESOP Trust fully enjoys its right to elect a majority of our board of directors and to otherwise control us.

Certain of the covenants listed above will lapse if the ESOP Trust fails to own or otherwise control at least 20% of the voting power of all of our capital stock.

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MANAGEMENT

The names, ages and positions of our officers and directors, as of February 28, 2007, are set forth below:

				Position	Term		Director
Name	Age		Position	Since	Expires		Since
Bahman Atefi		54	President, Chief Executive Officer and Chairman of the Board(1)	December 2001		2008		2001
Stacy Mendler		44	Chief Operating Officer and Executive Vice President(1)	September 2006
John (Jack) Hughes		55	Executive Vice President, Chief Financial Officer and Treasurer(1)	September 2005
Randy Crawford		56	Sector Senior Vice President and Manager — Engineering and Information Technology Sector(1)	May 2002
Rob Goff		61	Sector Senior Vice President and Manager — Defense Operations Integration Sector(1)	February 2004
Scott Fry		57	Sector Senior Vice President and Manager — Engineering and Integration Solutions Sector	October 2005
James Fontana		49	Senior Vice President, General Counsel and Secretary	January 2004
Edward C. “Pete” Aldridge		68	Director			2009		2003
Leslie Armitage		38	Director			2007		2002
Lewis Collens		69	Director			2007		2002
Admiral (Ret.) Harold W. Gehman, Jr.		64	Director			2007		2002
Donald E. Goss		76	Director			2009		2002
General (Ret.) George A. Joulwan		67	Director			2008		2002
General (Ret.) Michael E. Ryan		65	Director			2008		2002

(1) Member of the ESOP Committee

Officers.

Bahman Atefi was appointed Chief Executive Officer of Alion in December 2001. He is also Chairman of our board of directors. Dr. Atefi also serves as chairman of the ESOP committee. Dr. Atefi served as president of IITRI from August 1997, and as its chief executive officer from October 2000 until December 20, 2002, the closing date of the IITRI Acquisition. Dr. Atefi has also been chairman of the board of directors of Human Factors Applications, Inc. since February 1999. From June 1994 to August 1997, Dr. Atefi served as manager of the energy and environmental group at Science Applications International Corporation. In this capacity, he was responsible for operation of a 600-person business unit, with annual revenues in 1997 of approximately $80 million, which provided scientific and engineering support to the U.S. Department of Energy, Nuclear Regulatory Commission, EPA, DoD, as well as commercial and international customers. Dr. Atefi is a member of the board of trustees of Illinois Institute of Technology. Dr. Atefi received a BS in Electrical Engineering from Cornell University, a master’s degree in nuclear engineering and a doctor of science in nuclear engineering from the Massachusetts Institute of Technology.

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Stacy Mendler has served as Chief Operating Officer and Executive Vice President of Alion since September 2006. She served as Executive Vice President and Chief Administrative Officer of Alion from September 2005 until September 2006, and as Senior Vice President and Chief Administrative Officer of Alion from May 2002 until September 2005. She is also a member of our ESOP committee. Ms. Mendler served IITRI as senior vice president and director of administration from October 1997 until December 20, 2002, the closing date of the IITRI Acquisition. As of May 2002, Ms. Mendler was IITRI’s chief administrative officer, as well as senior vice president. She also served as IITRI’s assistant corporate secretary from November 1998 through completion of the IITRI Acquisition and has been a member of the board of directors of Human Factors Applications, Inc. since February 1999. From February 1995 to October 1997, Ms. Mendler was vice president and group contracts manager for the energy and environment group at Science Applications International Corporation where she managed strategy, proposals, contracts, procurements, subcontracts and accounts receivable. Ms. Mendler received a BBA in Marketing from James Madison University and a MS in Contracts and Acquisition Management from Florida Institute of Technology.

John (Jack) Hughes has served as Executive Vice President, Chief Financial Officer and Treasurer of Alion since September 2005. He served as Senior Vice President, Chief Financial Officer and Treasurer from October 2002 until September 2005. Mr. Hughes is also a member of our ESOP Committee. From July 1998 to September 2002, Mr. Hughes served as co-founder and principal of Phoenix Financial & Advisory Services LLC, responsible for providing strategic planning, operations, financing, merger/acquisition, marketing/communications and business development support to small and mid-sized companies in the technology, media and entertainment industries. Mr. Hughes has also served as principal consultant of HKSBS, LLC from July 2002 to September 2002 and currently serves on the HKSBS advisory board. In his position as a principal consultant, Mr. Hughes functioned as the team leader for the financial advisory services division. From November 1992 to May 1998, Mr. Hughes served as senior vice president and chief financial officer of BTG Inc., responsible for business and operations management, strategic planning, mergers and acquisitions, and arranging financing for a $600 million business with 1,650 employees. Mr. Hughes received a BS in Economics and Business from Frostburg State University and has performed graduate coursework in contract formation, government procurement and financial management.

Randy Crawford has served as Sector Senior Vice President and Sector Manager for Alion’s Engineering and Information Technology Sector since September 2005. Mr. Crawford served as Sector Senior Vice President and Sector Manager for Alion’s Spectrum Engineering Sector from May 2002 until September 2005. He is also a member of our ESOP committee. Mr. Crawford has been a member of the board of directors of Human Factors Applications, Inc. since September 2000. Mr. Crawford served IITRI as spectrum engineering sector senior vice president and manager from October 2000 through December 20, 2002, the date of completion of the IITRI Acquisition. From January 1997 to October 2000, Mr. Crawford served as group manager of IITRI’s spectrum engineering group. Mr. Crawford received a BSEE from Virginia Tech and an MSEE from The George Washington University.

Rob Goff has served as Sector Senior Vice President and Sector Manager for Alion’s Defense Operations Sector since February 2004. He has also served as a member of our ESOP committee since January 2005. Mr. Goff served as Vice President and Operations Manager for IITRI from July 1999 until September 2001. From December 20, 2002 (the closing date of the IITRI Acquisition) until February 2004, Mr. Goff was Senior Vice President and Group Manager for Alion; he held this same position for IITRI from September 2001 until December 20, 2002. Prior to working for IITRI, Mr. Goff served on active duty for 30 years, retiring at the rank of Major General from the U.S. Army. Mr. Goff received a BS from the U.S. Army Military Academy at West Point, followed by a Masters degree in Spanish Language and Literature from Middlebury College, and a MBA from Long Island University.

Scott Fry has served as Senior Vice President and Sector Manager for Alion’s Engineering and Integration Solutions Sector since September 2006. Mr. Fry served as Senior Vice President and Sector Manager of Alion’s JMS Maritime Sector from October 2005 until September 2006, and as Senior Vice President and Deputy Sector Manager for the JMS Maritime Sector from April 2005 to October 2005. Prior to joining Alion, Mr. Fry served in the U.S. Navy for 32 years, retiring in the rank of Vice Admiral.

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His career included command and staff positions both at sea and ashore with the U.S. Navy, NATO, and Joint Chiefs of Staff. In his last active duty assignment he commanded the United States Sixth Fleet during Operation Iraqi Freedom and the Global War on Terrorism. Mr. Fry received a B.S. from the United States Naval Academy in Annapolis, Maryland.

James Fontana has served as Senior Vice President, General Counsel and Secretary of Alion since January 2004. He has more than 20 years of experience as an attorney specializing in government contracts and technology law, and possesses a wide range of legal subject matter expertise. From February 2003 to January 2004, Mr. Fontana was in private practice as the principal of the Law Offices of James C. Fontana, and from April 1997 to January 2003 he served as General Counsel of Getronics Government Solutions, LLC (formerly Wang Federal) and Vinnell Corporation, and was Senior Corporate Counsel to BDM International, Inc., Vinnell’s parent company. Mr. Fontana is a graduate of Temple University School of Law. He received his undergraduate degree from The American University, where he majored in economics.

Directors.

Bahman Atefi. See biography above.

Edward C.“Pete” Aldridge has served as a director of Alion since November 2003. Mr. Aldridge retired from government service in May 2003 as the Under Secretary of Defense for Acquisition, Technology, and Logistics, a position he held since May 2001. In this position, Mr. Aldridge was responsible for all matters relating to DoD acquisition, research and development, advanced technology, international programs, and the industrial base. From March 1991 to May 2001, Mr. Aldridge also served as president and CEO of the Aerospace Corporation, president of McDonnell Douglas Electronic Systems, Secretary of the Air Force, and numerous other positions within the DoD. He is currently a director of Lockheed Martin Corporation and Global Crossing, Ltd.

Leslie Armitage has served as a director of Alion since May 2002. Ms. Armitage currently serves as a Partner in the Relativity Fund, a position she has held since January 2006. Ms. Armitage served as a Partner of The Carlyle Group from January 1999 until May 2005. In June 1997, Ms. Armitage became a founding member of Carlyle Europe. Ms. Armitage also served on the board of directors of Vought Aircraft Industries, Inc., Honsel International Technologies, and United Component, Inc.

Lewis Collens has served as a director of Alion since May 2002. Since 1990, Mr. Collens has served as president of Illinois Institute of Technology. Mr. Collens also served as chief executive officer of IITRI from 1990 to October 2000. Mr. Collens also serves as chairman of the board for IITRI and as a director for Dean Foods Company, Amsted Industries and Colson Group. Mr. Collens is one of Illinois Institute of Technology’s two representatives on our board of directors.

Admiral (Ret.) Harold W. Gehman, Jr. has served as a director of Alion since September 2002. Admiral Gehman retired from over 35 years of active duty in the U.S. Navy in October 2000. While in the U.S. Navy, Admiral Gehman served as NATO’s Supreme Allied Commander, Atlantic and as the Commander in Chief of the U.S. Joint Forces Command from September 1997 to September 2000. Since his retirement in November 2000, Admiral Gehman has served as an independent consultant to the U.S. Government from October 2000 to present and Science Applications International Corporation from January 2002 to present. Admiral Gehman currently serves on the board of directors of Maersk Lines, Ltd., Transystems Corp., and Burdeshaw Associates, Ltd. He also currently serves as a member of the board of advisors for Anser Institute for Homeland Security, Old Dominion University Research Foundation, and Old Dominion University College of Engineering. In addition, Admiral Gehman is a senior fellow at the National Defense University and is chairman of the Government of Virginia’s Advisory Commission for Veterans Affairs. Most recently, Admiral Gehman agreed to chair the Space Shuttle Mishap Interagency Investigation Board, which will provide an independent review of the events and activities that led up to the loss of seven astronauts on February 1, 2003 on board the Space Shuttle Columbia.

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Donald E. Goss has served as a director of Alion since May 2002. Mr. Goss has served as trustee and chairman of the audit committee for Illinois Institute of Technology since 1982, as well as the chairman of the audit committee and a member of the board of governors for IITRI since 1985. Mr. Goss has also served on the Finance Council and as chair of the audit committee for the Catholic Archdiocese of Chicago, Illinois since 1985. Mr. Goss has also served as a member of the board of governors for the Chicago Zoological Society at Brookfield Zoo since 1998. Mr. Goss retired from Ernst & Young as partner, after 37 years of service, in March 1990, and he has remained retired since that date. Mr. Goss is one of Illinois Institute of Technology’s two representatives on our board of directors.

General (Ret.) George A. Joulwan has served as a director of Alion since May 2002. General Joulwan retired from 36 years of service in the military in September 1997. While in the military, General Joulwan served as commander in chief for the U.S. Army, for U.S. Southern Command in Panama from 1990-1993 and served as commander in chief of the U.S. European Command and NATO Supreme Allied Command from 1993-1997. From 1998 to 2000, General Joulwan served as an Olin Professor at the U.S. Military Academy at West Point. General Joulwan has also served as an adjunct professor at the National Defense University from 2001 to 2002. Since 1998, General Joulwan has served as president of One Team, Inc., a strategic consulting company. General Joulwan also currently serves as a director for General Dynamics Corporation, Accenture NSS, TRS-LLC and IAP Worldwide Services.

General (Ret.) Michael E. Ryan has served as a director of Alion since May 2002. General Ryan retired from the military in 2001 after 36 years of service. He served his last four years as the 16th Chief of Staff of the Air Force, responsible for organizing, training and equipping over 700,000 active duty, reserve and civilian members. He is currently president of the consulting firm, Ryan Associates, focusing on national defense issues, a position he has held since January 2001. He is chairman of the board of CAE USA, Inc. and the Air Force Village Charitable Foundation. He serves on the board of directors of United Services Automobile Association, Circadence Corporation, VT Griffin, Inc., and Selex Sensor Airborne Systems (US) Inc. He is a senior trustee of the Air Force Academy Falcon Foundation.

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Executive Compensation

The following table sets forth all compensation with respect to our chief executive officer and our other most highly paid executive officers (the Named Executive Officers), whose total salary and bonus exceeded $100,000 for the fiscal years ended September 30, 2006, 2005, and 2004.

										Long-Term
	Annual Compensation									Compensation
								Other Annual		LTIP			LTIP			All Other
Name and Principal Position	Year		Salary		Bonus			Compensation		Awards(2)			Payouts			Compensation
Bahman Atefi		2006		480,576		490,000	(1)					(3)		1,443,780	(8)		676,788	(12)
Chief Executive Officer		2005		438,609		425,000			—		—						1,152,461	(13)
		2004		406,156		410,000			—		—						68,717	(14)
Stacy Mendler		2006		293,937		180,000	(1)					(4)		609,026	(9)		61,493	(15)
Chief Operating Officer		2005		262,450		215,000			—		—						289,253	(16)
and Executive VP		2004		216,243		115,000			—		—						48,854	(17)
Randy Crawford		2006		278,510		135,000	(1)					(5)					391,482	(18)
Engineering and Information		2005		286,982		125,000			—		—						52,905	(19)
Technology Sector Senior		2004		257,752		90,000			—		—						44,538	(20)
VP and Sector Manager
Rob Goff		2006		307,403		160,000	(1)					(6)		39,821	(10)		52,388	(21)
Defense Operations		2005		286,169		150,000			—		—						47,383	(22)
Integration Sector Senior		2004		243,271		200,000			—		—						39,106	(23)
VP and Sector Manager
John (Jack) Hughes		2006		299,370		180,000	(1)					(7)		277,044	(11)		54,292	(24)
Executive VP, Chief		2005		280,771		215,000			—		—						53,674	(25)
Financial Officer		2004		245,195		135,000			—		—						48,044	(26)
and Treasurer

(1)	Approved bonus amounts for fiscal year 2006 were paid in December 2006.
(2)	See “— Phantom Stock Plans” for details related to phantom stock grants. See the “Aggregate SAR Exercises in Last Fiscal Year and Fiscal Year End/SAR Values” table, set forth below, for details related to SAR grants.
(3)	In November 2005, Dr. Atefi was awarded 50,153 shares of retention-based phantom stock under the Second Phantom Stock Plan. In February 2005, Dr Atefi was awarded 65,926 shares of performance-based phantom stock and 43,951 shares of retention-based phantom stock under the Second Phantom Stock Plan. In November 2003 and February 2003, Dr. Atefi was awarded 18,695 shares and 65,500 shares, respectively, of phantom stock under the Initial Phantom Stock Plan. Each phantom stock plan is described more fully below.
(4)	In November 2005, Ms. Mendler was awarded 25,076 shares of retention-based phantom stock under the Second Phantom Stock Plan. In February 2005, Ms. Mendler was awarded 24,151 shares of retention-base phantom stock and 36,227 shares of performance-based phantom stock under the Second Phantom Stock Plan. In November 2003 and February 2003, Ms. Mendler was awarded 6,798 shares and 28,500 shares, respectively, of phantom stock under the Initial Phantom Stock Plan. Each phantom stock plan is described more fully below.
(5)	In November 2005, Mr. Crawford was awarded 4,179 shares of retention-based phantom stock under the Second Phantom Stock Plan. In February 2005, Mr. Crawford was awarded 25,075 shares of performance-based phantom stock under the Second Phantom Stock Plan. In November 2003 and February 2003, Mr. Crawford was awarded 6,798 shares and 33,000 shares, respectively, of phantom stock under the Initial Phantom Stock Plan. Each phantom stock plan is described more fully below.
(6)	In November 2005, Mr. Goff was awarded 8,080 shares of retention-based phantom stock under the Second Phantom Stock Plan. In February 2005, Mr. Goff was awarded 25,075 shares of performance-based phantom stock under the Second Phantom Stock Plan. In February 2003, Mr. Goff was awarded 3,399 shares of phantom stock under the Initial Phantom Stock Plan. Each phantom stock

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	plan is described more fully below. In 2003, Mr. Goff received an award of 2,500 SARs. In 2002 Mr. Goff received an award of 1,200 SARs.
(7)	In November 2005, Mr. Hughes was awarded 25,076 shares of retention-based phantom stock under the Second Phantom Stock Plan. In February 2005, Mr. Hughes was awarded 30,297 shares of retention-base phantom stock and 45,445 shares of performance-based phantom stock under the Second Phantom Stock Plan. In November 2003 and February 2003, Mr. Hughes was awarded 6,798 shares and 10,000 shares, respectively, of phantom stock under the Initial Phantom Stock Plan. Each phantom stock plan is described more fully below.
(8)	2006 includes $1,443,780 paid to Dr. Atefi for redemption of phantom stock.
(9)	2006 includes $609,026 paid to Ms. Mendler for the redemption of phantom stock.
(10)	2006 includes $39,821 paid to Mr. Goff for redemption of SARs.
(11)	2006 includes 277,044 paid to Mr. Hughes for the redemption of phantom stock.
(12)	2006 includes $571,177 for redemption of warrants, $59,585 in health and welfare benefits paid by Alion, $23,936 in leased cars paid by Alion, Company matching contributions of $13,650 under Alion’s KSOP, $4,300 in club membership dues, $3,610 in long-term and short-term disability paid by Alion, and $530 in term life insurance premiums paid by Alion.
(13)	2005 includes $1,051,005 paid to Dr. Atefi for the redemption of the amount due under his Deferred Compensation Agreement, $44,249 in health and welfare benefits paid by Alion, Company matching contributions of $25,970 under Alion’s KSOP, $23,936 in leased cars paid by Alion, $3,800 in club membership dues, $2,828 in long-term and short-term disability paid by Alion, and $673 in term life insurance premiums paid by Alion.
(14)	2004 includes $27,172 in health and welfare benefits paid by Alion, $23,936 in leased cars paid by Alion, Company matching contributions of $11,817 under Alion’s KSOP, $1,164 in long-term and short-term disability paid by Alion, $648 in term life insurance premiums and $3,980 in club membership dues paid by Alion.
(15)	2006 includes $32,152 in health and welfare benefits paid by Alion, Company matching contributions of $13,650 under Alion’s KSOP plan, $12,687 in leased cars paid by Alion, $2,484 in long-term and short-term disability paid by Alion, and $520 in term life insurance premiums paid by Alion.
(16)	2005 includes $241,016 paid to Ms. Mendler for the redemption of the amount due her under the Executive Deferred Compensation Plan, $25,497 in health and welfare benefits paid by Alion, $12,687 in leased cars paid by Alion, Company matching contributions of $7,415 under Alion’s KSOP, $2,066 in long-term and short-term disability paid by Alion, and $572 in term life insurance premiums paid by Alion.
(17)	2004 includes $19,938 in health and welfare benefits paid by Alion, Company matching contributions of $14,185 under Alion’s KSOP, $13,097 in leased cars paid by Alion, $1,164 in long-term and short-term disability paid by Alion, and $470 in term life insurance premiums paid by Alion.
(18)	2006 includes $338,338 paid to Mr. Crawford for distributions from the IITRI Flexible Option Plan, $26,635 in health and welfare benefits paid by Alion, Company matching contributions of $13,650 under Alion’s KSOP, $9,981 in leased cars paid by Alion, $2,384 in long-term and short-term disability paid by Alion, and $494 in term life insurance premiums paid by Alion.
(19)	2005 includes $20,807 in health and welfare benefits paid by Alion, Company matching contributions of $18,198 under Alion’s KSOP, $11,188 in leased cars paid by Alion, $2,111 in long-term and short-term disability paid by Alion and $601 in term life insurance premiums paid by Alion.
(20)	2004 includes $19,755 in health and welfare benefits paid by Alion, Company matching contributions of $13,291 under Alion’s KSOP, $9,794 in leased cars paid by Alion, $1,164 in long-term and short-term disability paid by Alion, and $534 in term life insurance premiums paid by Alion.
(21)	2006 includes $10,572 for distributions from the IITRI Flexible Option Plan, Company matching contributions of $13,650 under Alion’s KSOP, $12,151 in health and welfare benefits paid by Alion,

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	$12,600 in leased cars paid by Alion, $2,493 in long-term and short-term disability paid by Alion, $400 in health club membership fees, and $522 in term life insurance paid by Alion.
(22)	2005 includes Company matching contributions of $18,509 under Alion’s KSOP, $13,138 in health and welfare benefits paid by Alion, $12,600 in leased cars paid by Alion, $2,112 in long-term and short-term disability paid by Alion, $425 in health club membership fees, and $599 in term life insurance paid by Alion.
(23)	2004 includes Company matching contributions of $13,753 under Alion’s KSOP, $11,889 in health and welfare benefits paid by Alion, $11,792 in leased cars paid by Alion, $1,164 in long-term and short-term disability paid by Alion, and $508 in term life insurance paid by Alion.
(24)	2006 includes $25,428 in health and welfare benefits paid by Alion, Company matching contributions of $13,650 under Alion’s KSOP, $12,196 in leased cars paid by Alion, $2,494 in long-term and short-term disability paid by Alion, and $524 in term life insurance premiums paid by Alion.
(25)	2005 includes $20,850 in health and welfare benefits paid by Alion, Company matching contributions of $17,315 under Alion’s KSOP, $12,196 in leased cars paid by Alion, $2,134 in long-term and short-term disability paid by Alion, $534 in term life insurance premiums, and $645 in club membership dues paid by Alion.
(26)	2004 includes $19,650 in health and welfare benefits paid by Alion, Company matching contributions of $14,423 under Alion’s KSOP, $12,196 in leased cars paid by Alion, $1,164 in long-term and short-term disability paid by Alion, and $533 in term life insurance premiums paid by Alion.

Stock Appreciation Rights (SAR) Plans

In November 2002, our board of directors adopted the Alion Science and Technology Corporation 2002 Stock Appreciation Rights Plan (the 2002 SAR Plan). The purpose of the 2002 SAR Plan was to attract, retain, reward and motivate employees responsible for our continued growth and development and our future financial success. The 2002 SAR Plan is administered by the compensation committee of our board of directors or its delegate (the administrative committee). The 2002 SAR Plan has a 10-year term and permits grants to our directors, officers, employees and consultants. In November 2004, our board of directors amended the 2002 SAR Plan to provide that, on or after October 3, 2004, there would be no further grants under the 2002 SAR Plan. Grants made prior to October 3, 2004 remain in force. Under the 2002 SAR Plan, from December 2002 through November 2003, we issued 236,400 SARs to directors, officers, and employees. Outstanding SAR awards cannot exceed the equivalent of 10% of our outstanding shares of common stock on a fully diluted basis (assuming the exercise of any outstanding options, warrants and rights including, without limitation, SARs, and assuming the conversion into stock of any outstanding securities convertible into stock) which amount may be adjusted in the event of a merger or other significant corporate transaction or in other circumstances. The 2002 SAR Plan contains a provision to prevent an award to a person who is or would become (if the award were made) a “disqualified person”. For this purpose, “disqualified person” means any individual who directly or beneficially holds at least 10% of our equity, including outstanding common stock and “synthetic equity”, such as SARs or phantom stock. Any award that violates this provision is void. Should a grantee become a “disqualified person”, the full amount of any outstanding award that has not yet vested shall be forfeited.

A grantee has the right to receive payment for vested SARs equal to the difference between the appraised value of a share of our common stock as of the grant date and the appraised value of a share of our common stock as of the exercise date based on the most recent valuation of common stock held by the ESOP Trust. Grants to employees vest at 20% per year; grants to members of our board of directors vest ratably over each member’s then-current term of office. The 2002 SAR Plan contains a provision for accelerated vesting in the event of death, disability or a change in control of the Company or in other circumstances. Under the 2004 amendment to the 2002 SAR Plan, SARs are normally paid at the time the award becomes fully vested, or else upon the SAR holder’s earlier death, disability or termination of service. However, a grantee may request payment for any portion of an SAR that was vested on or before December 31, 2004 at any time, and can continue to hold such unexercised SARs for up to 60 days after the date at which a grant becomes completely vested. The 2002 SAR Plan permits the compensation

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committee to defer payments if it determines that payment is administratively impracticable or would jeopardize our solvency (provided that such impracticability or insolvency was unforeseeable as of the grant date), or if the payment would violate a loan covenant or similar contract, or not be deductible under Section 162(m) of the Internal Revenue Code, or if the payment would violate U.S. federal securities laws or other applicable law.

In November 2005, our board of directors amended the 2002 SAR plan to eliminate the timely exercise requirement for an employee to receive payment for vested SARs and to permit employees to make two separate one-time elections, 1) to receive payment for SARs as they vest each year or when fully vested and 2) to receive payment for SARs already vested.

As of September 30, 2006, we had granted under the 2002 SAR Plan, 236,400 SARs, of which approximately 151,591 SARs remain outstanding.

On January 13, 2005, our board of directors adopted a second SAR plan, the Alion Science and Technology Corporation 2004 Stock Appreciation Rights Plan (the 2004 SAR Plan), to comply with the deferred compensation provisions of the American Jobs Creation Act of 2004. The 2004 SAR Plan is administered by the compensation committee of our board of directors or its delegate (the administrative committee). The 2004 SAR Plan has a 10-year term and permits grants to our directors, officers, employees and consultants. Under the 2004 SAR Plan, the chief executive officer has the authority to award SARs, as he deems appropriate; however, awards to executive officers are subject to the approval of the administrative committee of the 2004 SAR Plan. Outstanding SAR awards cannot exceed the equivalent of 12% of our outstanding shares of common stock on a fully diluted basis (assuming the exercise of any outstanding options, warrants and rights including, without limitation, SARs, and assuming the conversion into stock of any outstanding securities convertible into stock), which amount may be adjusted in the event of a merger or other significant corporate transaction or in other special circumstances. As per the 2002 SAR Plan, awards may not be made to a “disqualified person.”

Awards to employees vest ratably over four years and awards to directors vest ratably over each director’s term of service. The 2004 SAR Plan contains a provision for accelerated vesting in the event of death, disability or a change in control of the Company or in other circumstances. SARs are normally paid on the first anniversary of the date the award becomes fully vested, or else upon the SAR holder’s earlier death, disability or termination of service, or change in control. Under the 2004 SAR Plan, a SAR holder may elect to defer the proceeds of the SAR into the Alion Science and Technology Corporation Executive Deferred Compensation Plan for a 5-year period, if he or she is eligible for such plan, by filing a deferral election with the Company at least one year in advance of the payment event. The 2004 SAR Plan permits the compensation committee to defer payments if it determines that payment is administratively impracticable or would jeopardize the our solvency (provided that such impracticability or insolvency was unforeseeable as of the grant date), or if the payment would violate a loan covenant or similar contract, or not be deductible under Section 162(m) of the Internal Revenue Code or if the payment would violate U.S. federal securities laws or other applicable law.

A grantee under the 2004 SAR Plan has the right to receive payment for vested SARs equal to the difference between the appraised value of a share of our common stock as of the grant date and the appraised value of a share of our common stock as of the exercise date per the most recent valuation of the common stock held by the ESOP Trust. For SARs granted under the 2004 SAR Plan before November 9, 2005 and outstanding when a change in control of the Company occurs, payment is based on the number of SARs multiplied by the share price at the date of the change in control (or earlier valuation, if higher).

In November 2005, the board of directors amended the 2004 SAR Plan to permit employees to make a one-time election to receive payment for SARs as they vest each year or when fully vested and to eliminate the timely exercise requirement for an employee to receive payment for vested SARs.

As of September 30, 2006, we had granted, under the 2004 SAR Plan, 534,775 SARs of which approximately 478,588 SARs remain outstanding. There were no grants of SARs to the Named Executive Officers pursuant to our stock appreciation rights plans during the fiscal year ended September 30, 2006.

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Subject to certain restrictions under the respective SAR plan, our board of directors may amend or terminate either SAR plan at any time.

The following table sets forth information regarding the exercise of SARs during fiscal year 2006 by the Named Executive Officers and SARs held by them at September 30, 2006.

Aggregated SAR Exercises in Last Fiscal Year and Fiscal Year End/SAR Values*

					Number of Securities		Value of Unexercised
					Underlying Unexercised		In-the-Money
	Shares				Options/SARs at		Options/SARs at
	Acquired on		Value		Fiscal Year End (Number)		Fiscal Year End (Dollars)
Name	Exercise		Realized		Exercisable/Unexercisable(4)		Exercisable/Unexercisable(5)
	(In dollars)*
Bahman Atefi(1)		—		—		—		—
Stacy Mendler(1)		—		—		—		—
Randy Crawford(1)		—		—		—		—
John (Jack) Hughes(1)		—		—		—		—
Rob Goff(1)(2)		720	$	18,641		0/480	$	0/$14,890
(3)		1,000	$	21,180		0/1,500	$	0/$39,465

*	Refers to the “Alion Science and Technology Corporation 2002 Stock Appreciation Rights (SAR) Plan” and “Alion Science and Technology Corporation 2004 Stock Appreciation Rights Plan” (see above, “— Stock Appreciation Rights (SAR) Plans” for more information regarding the SAR Plans).
(1)	No SAR awards during the fiscal year ended September 30, 2006.
(2)	In 2002, Mr. Goff was awarded 1,200 SARs at the exercise price of $10.00 per share. As of September 30, 2006, the value of our common stock was $41.02 per share.
(3)	In 2003, Mr. Goff was awarded 2,500 SARs at the exercise price of $14.71 per share. As of September 30, 2006, the value of our common stock was $41.02 per share.
(4)	The number of exercisable and unexercisable SARs is dependent on the plan vesting schedule. For example, as of September 30, 2006, for Mr. Goff, only 60% of the 1,200 SARs awarded in 2002 have vested, resulting in 720 exercisable SARs, of which all had been exercised as of September 30, 2006. As of September 30, 2006, the remaining SARs were unexercisable.
(5)	The value of exercisable and unexercisable SARs is dependent on the difference between the exercise price per share and the current fair value per share of our common stock. For example, as of September 30, 2006, for Mr. Goff, the exercise price for his SARs awarded in 2002 was $10 per share and the value per share of our common stock was $41.02.

Phantom Stock Plans

Phantom stock refers to hypothetical shares of our common stock. Each recipient of a phantom stock award receives a grant of a specified number of shares. Recipients, upon vesting, are generally entitled to receive an amount of money equal to the product of the number of hypothetical shares vested and the then current value of our common stock, based on the most recent valuation of the shares of common stock held by the ESOP Trust. Phantom stock may increase, or decrease, in value over time, resulting in cash payments under the phantom stock awards that may be greater, or less than, the value of the phantom stock at the date of grant. The compensation committee of the board of directors administers our phantom stock plans and is authorized to grant phantom stock to key management employees and outside directors.

Initial Phantom Stock Plan

In February 2003, the compensation committee of our board of directors approved, and the board of directors subsequently adopted, the Alion Science and Technology Phantom Stock Plan (the Initial Phantom Stock Plan). The Initial Phantom Stock Plan has a term of ten years. The Initial Phantom Stock Plan is administered by the compensation committee or by the board of directors (if it so chooses) which

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may grant key management employees awards of phantom stock. Under the Initial Phantom Stock Plan, awards vest according to the following schedule:

	Vested Amount for Grant in
	February			November
Anniversary from Grant Date	2003			2003
1st		—			20	%
2nd		—			20	%
3rd		50	%		20	%
4th		25	%		20	%
5th		25	%		20	%

The Initial Phantom Stock Plan contains provisions for acceleration of vesting in the event of the employee’s death, disability, or a change in control of the Company or in other circumstances. Terminated employees will usually forfeit their rights to all unvested phantom stock. In certain instances, however, an employee may receive a pro rata portion of his or her unvested phantom stock upon termination. For awards made prior to November 9, 2005, when an employee voluntarily terminates for good reason or is involuntarily terminated for any reason other than cause or just cause, as defined in his or her employment agreement with us, then that employee will receive a pro rata portion of his or her unvested phantom stock based on a ratio:

•  the numerator of which is the number of months from the date of grant of the phantom stock through the end of the month of such termination; and

•  the denominator of which is 60.

For awards made on or after November 9, 2005, when an employee voluntarily terminates for good reason or is involuntarily terminated for any reason other than cause or just cause, as defined in the Initial Phantom Stock Plan, then that employee will receive a pro rata portion of his or her phantom stock equal to the greater of (i) the amount vested under the award’s normal vesting schedule, or (ii) the number of shares of phantom stock multiplied by the ratio set forth above.

Phantom stock awards issued under the Initial Phantom Stock Plan are normally paid at the time the award becomes fully vested, or else upon the employee’s earlier death, disability or termination of service. However, a grantee may request payment for any portion of a phantom stock award that was vested on or before December 31, 2004, by filing a written election to exercise with the compensation committee at least 6 months before the requested exercise date and at least 3 months in advance of the ESOP valuation date that will apply to such exercise, and can continue to hold such unexercised phantom stock awards until the award becomes completely vested.

In November 2005, the board of directors amended the Initial Phantom Stock Plan to permit employees to make a one-time election to receive payment for phantom shares as they vest each year or when fully vested. This election does not apply to awards vested before December 31, 2004 under the Initial Phantom Stock Plan, because the phantom stock holder may already exercise such awards at any time. An award holder who does not make an acceleration election as described above may elect to defer the proceeds of phantom stock into the Alion Science and Technology Corporation Executive Deferred Compensation Plan for a 5 year period, if he or she is eligible for the plan, by filing a deferral election with the Company at least one year in advance of the payment event. A 180 day election period applies for phantom stock awards vested on or before December 31, 2004.

As of September 30, 2006, the Company had 117,971 shares of phantom stock outstanding under the Initial Phantom Stock Plan.

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Second Phantom Stock Plan

On November 9, 2004, our compensation committee approved, and the full board adopted, The Alion Science and Technology Corporation Performance Shares and Retention Phantom Stock Plan (the Second Phantom Stock Plan) to comply with the requirements of the American Jobs Creation Act. The Second Phantom Stock Plan permits awards of retention share phantom stock and performance share phantom stock. A retention award is for a fixed number of shares determined at the date of grant. A performance award is for an initial number of shares subject to change at the vesting date. Performance phantom shares are subject to forfeiture for failure to achieve a specified threshold value for a share of our common stock as of the vesting date. If the value of a share of our common stock equals the threshold value but does not exceed the target value, the number of performance shares in a given grant may be decreased by a specified percentage (up to 50%). If the value of a share of our common stock exceeds a pre-established target price on the vesting date, the number of performance shares in a given grant may be increased by a specified percentage (up to 20%).

Performance share awards vest three years from date of grant (unless otherwise provided in an individual award agreement) and retention share awards vest as specified in each individual award agreement, provided that the grantee is still employed by the Company. Accelerated vesting is provided in the event of death, disability, involuntary termination without cause, or upon a change in control of the Company or in other circumstances, unless the individual award agreement provides otherwise. Grants are to be paid out on the “payment date” specified in the award agreement, which is generally five years and sixty days from the date of grant, unless the award holder elected to accelerate payment by filing an election no later than December 31, 2005, or elects to defer the proceeds of phantom stock into the Alion Science and Technology Corporation Executive Deferred Compensation Plan, as described below.

In November 2005, the board of directors amended the Second Phantom Stock Plan to permit employees to make a one-time election to receive payment for phantom shares as they vest each year or when fully vested. An award holder who does not make an acceleration election as described above may elect to defer the proceeds of phantom stock into the Alion Science and Technology Corporation Executive Deferred Compensation Plan for a 5 year period, if he or she is eligible for the plan, by filing a deferral election with the Company at least one year in advance of the payment event.

As of September 30, 2006, the Company had granted 207,778 shares of performance incentive phantom stock and 228,693 shares of retention incentive phantom stock to executive officers of the Company pursuant to the Second Phantom Stock Plan. Depending on the future financial performance of the Company, grantees may vest in performance phantom shares at a greater (up to 20% more) or lesser (up to 50% less) number of shares than the target number of shares disclosed above.

Director Phantom Stock Plan

On November 9, 2005, our compensation committee approved, and the full board adopted, the Alion Science and Technology Corporation Board of Directors Phantom Stock Plan (the Director Phantom Stock Plan). The Director Phantom Stock Plan provides for annual awards of shares of phantom stock to our non-employee directors. The number of shares of phantom stock granted each year to each non-employee director is equal to the quotient obtained by dividing $35,000 by the fair market value of one share of our stock as of the date of the award rounded up to the next highest whole number. Fair market value is determined by the compensation committee in its sole discretion using the most recent valuation of our common stock made by an independent appraisal that meets the requirements of IRC Section 401(a)(28)(C), as of a date that is no more than 12 months before the date of the award.

Grants under the Director Phantom Stock Plan vest in one-third increments each year for three years from the date of the award. Vesting of an award accelerates upon a grantee’s death or disability or upon a change of control of the Company or in other circumstances. Before each award is granted (or within 30 days of the grant date for individuals who become a director on the grant date), a director may elect whether to receive payment for phantom shares as they vest, or when the award is fully vested. A director who elects to receive payment when an award has fully vested may elect to defer the proceeds of the award

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into the Alion Science and Technology Director Deferred Compensation Plan provided the election is made no later than one year before the award fully vests. All payments made under the awards are required to be in cash.

As of September 30, 2006, the Company had granted 7,808 shares of phantom stock under the Director Phantom Stock Plan.

Under the three phantom stock plans, members of our compensation committee who are eligible to receive phantom stock or who have been granted phantom stock may vote on any matters affecting the administration of the plan or the grant of phantom stock, except that a member cannot act upon the granting of phantom stock to himself or herself. These voting provisions also apply to members of our board of directors when the board resolves to act under the plans.

When granted, phantom stock provides the employee or director with the right to receive payment upon exercise of the phantom stock. The terms of each phantom stock grant are evidenced in a phantom stock agreement which determines the:

•  Date of grant;

•  Number of shares of the phantom stock awarded; and

•  Provisions governing vesting of the phantom stock awarded.

The plans also provide that phantom stock awarded at different times need not contain similar provisions.

Under the plans, the payment that we will make upon the vesting of phantom stock is intended to be made in one lump sum within 60 days of the date of vesting unless a later date is set forth in an individual award agreement. The compensation committee, or our board of directors, if it resolves to do so, may delay payment for five years. If the payment is delayed, it will include interest accrued at the prime rate as of the date of vesting until the payment date. In general, we expect that the compensation committee, or the board if it resolves to do so, will examine our available cash and anticipated cash needs in determining whether to delay payment. Under limited circumstances, payments from the exercise of phantom stock may be rolled over into any non-qualified deferred compensation plan available to the employee.

No voting or other rights associated with ownership of our common stock is given to phantom stockholders. References to shares of common stock under the plan are for accounting and valuation purposes only. As a result, an employee or director who receives phantom stock does not have any of the rights of a stockholder as a result of a grant of phantom stock.

All three phantom stock plans permit the compensation committee to defer payments if it determines that payment is administratively impracticable or would jeopardize the solvency of the Company (provided that such impracticability or insolvency was unforeseeable as of the grant date), or if the payment would violate a loan covenant or similar contract, or not be deductible under Section 162(m) of the Internal Revenue Code or if the payment would violate U.S. federal securities laws or other applicable law.

All three phantom stock plans contain a provision to prevent an award to a person who is or would become (if the award were made) a “disqualified person” for as long as we maintain the ESOP. For this purpose, “disqualified person” means any individual who directly or beneficially (such as under our ESOP) holds at least 10% of our equity, including outstanding common stock and “synthetic equity”, such as SARs or phantom stock. Any award that violates this provision is void.

Subject to adjustments for merger or other significant corporate transactions or special circumstances, the shares of common stock that may be used for awards under all of three phantom stock plans shall not exceed 2,000,000 shares (whether or not such awards have expired, terminated unexercised, or become unexercisable, or have been forfeited or otherwise terminated, surrendered or cancelled).

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The number of shares of the Company’s common stock used for reference purposes with respect to grants of phantom stock under the three phantom stock plans is as of September 30, 2006 as follows:

							Cumulative Shares
	Shares Issued by			Cumulative Shares			Authorized Under
Date of Issuance	Plan			Issued by Plan			all Plans
February 2003		171,000	(1)		171,000	(1)		173,000	(1)
November 2003		52,685	(1)		223,685	(1)		225,000	(1)
February 2005		311,192	(2)		311,192	(2)		2,000,000	(2)
August 2005		2,960	(2)		314,152	(2)		2,000,000	(2)
November 2005		122,318	(2)		436,781	(2)		2,000,000	(2)
November 2005		7,808	(3)		444,589	(3)		2,000,000	(3)

(1)	Number of shares authorized under the Initial Phantom Stock Plan as periodically amended and approved by the compensation committee of our board of directors.
(2)	Number of shares authorized under the Second Phantom Stock Plan as periodically amended and approved by the compensation committee of our board of directors.
(3)	Number of shares authorized under the Director Phantom Stock Plan as periodically amended and approved by the compensation committee of our board of directors.

The following table sets forth information regarding phantom stock granted to the Named Executive Officers pursuant to the phantom stock plans as of September 30, 2006.

	Number of Shares,
Name	Units, or Rights			Full Vesting Period	Period Until Payout
Bahman Atefi		65,500(1	)	February 2008(2)	February 2008(3)
		18,695(1	)	November 2008(2)	November 2008(3)
		65,926(4	)	February 2008(5)	February 2010(5)
		43,951(4	)	February 2008(5)	February 2010(5)
		27,863(4	)	November 2010(5)	November 2010(5)
		22,290(4	)	November 2008(5)	November 2008(5)
John (Jack) Hughes		10,000(1	)	February 2008(2)	February 2008(3)
		6,798(1	)	November 2008(2)	November 2008(3)
		30,297(8	)	February 2008(5)	February 2010(5)
		45,445(8	)	February 2008(5)	February 2010(5)
		11,145(8	)	November 2008(5)	November 2008(5)
		13,931(8	)	November 2010(5)	November 2010(5)
Stacy Mendler		28,500(1	)	February 2008(2)	February 2008(3)
		6,798(1	)	November 2008(2)	November 2008(3)
		24,151(6	)	February 2008(5)	February 2010(5)
		36,227(6	)	February 2008(5)	February 2010(5)
		11,145(6	)	November 2008(5)	November 2008(5)
		13,931(6	)	November 2010(5)	November 2010(5)
Randy Crawford		33,000(1	)	February 2008(2)	February 2008(3)
		6,798(1	)	November 2008(2)	November 2008(3)
		25,075(7	)	February 2008(5)	February 2010(5)
		4,179(7	)	November 2008(5)	November 2008(5)
Rob Goff		3,399(1	)	November 2008(2)	November 2008(3)
		25,075(9	)	February 2008(5)	November 2010(5)
		8,080(9	)	November 2008(5)	November 2008(5)

(1)	The initial set of awards made in February 2003 was made solely to our executive management team. The awards made in November 2003 were made to our executive and senior management.
(2)	Pursuant to the Initial Phantom Stock Plan, recipients will become fully vested on the fifth year from the grant date, or approximately February 2008 and November 2008.

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(3)	Pursuant to the Initial Phantom Stock Plan, or applicable award agreement, recipients will be paid commencing on the fifth year from the date of grant.
(4)	Pursuant to the Second Phantom Stock Plan, in February 2005, Dr. Atefi was awarded 65,926 shares of performance-based phantom stock and 43,951 shares of retention-based phantom stock. In November 2005, Dr. Atefi was awarded 27,863 shares and 22,290 shares of retention-based phantom stock, which vest on November 2008 and 2010, respectively.
(5)	Pursuant to the Second Phantom Stock Plan, recipients may be awarded performance-based or retention-based phantom stock. Under this plan, performance-based phantom stock will become fully vested three years from the date of grant; retention-based phantom stock will become fully vested as specified in the individual agreements. Under this plan, recipients of performance-based and retention-based phantom stock will be paid commencing on the fifth year from date of grant.
(6)	Pursuant to the Second Phantom Stock Plan, in February 2005, Ms. Mendler was awarded 24,151 shares of retention-based phantom stock and 36,227 shares of performance-based phantom stock. In November 2005, Ms. Mendler was awarded 11,145 shares and 13,931 shares of retention-based phantom stock, which vest on November 2008 and 2010, respectively.
(7)	Pursuant to the Second Phantom Stock Plan, in February 2005, Mr. Crawford was awarded 25,075 shares of performance-based phantom stock. In November 2005, Mr. Crawford was awarded 4,179 shares of retention-based phantom stock, which will vest on November 2008.
(8)	Pursuant to the Second Phantom Stock Plan, in February 2005, Mr. Hughes was awarded 30,297 shares of retention-based phantom stock and 45,445 shares of performance-based phantom stock. In November 2005, Mr. Hughes was awarded 11,145 shares and 13,931 shares of retention-based phantom stock, which vest on November 2008 and 2010, respectively.
(9)	Pursuant to the Second Phantom Stock Plan, in February 2003, Mr. Goff was awarded 25,075 shares of performance-based phantom stock. In November 2005, Mr. Goff was awarded 8,080 shares of retention-based phantom stock, which will vest on November 2008.

Board of Directors

Our directors are divided into three classes. The first class of directors consists of two directors — Donald E. Goss and Edward C. Aldridge. Their term expires on the date of the annual meeting of our shareholder(s) in 2009. The second class of directors consists of three directors — Leslie Armitage, Lewis Collens and Admiral Harold W. Gehman, Jr. Their term expires on the date of the annual meeting of our shareholder(s) in 2007. The third class of directors consists of three directors — Bahman Atefi, General George A. Joulwan and General Michael E. Ryan. The term of the third class of directors expires on the date of the annual meeting of our shareholder(s) in 2008. As the holder of the subordinated note and warrants, Illinois Institute of Technology is entitled to nominate two representatives whom the ESOP Trust is required to elect to our board of directors. Messrs. Collens and Goss are Illinois Institute of Technology’s board representatives.

Compensation of Directors

Our non-employee directors receive an annual retainer of $25,000, payable in quarterly installments, for their services as members of the board of directors. These services include preparation for and attendance in person at four board meetings per year and all committee meetings that take place on the same day as a full board meeting. In addition, each director receives a fee of $2,500 for in-person attendance at each additional board meeting, and $1,000 for telephone attendance at each additional board meeting. Each chairman of a board committee receives $2,500 per year for each year he or she serves in such capacity. Board committee members receive $1,000 and committee chairmen receive $1,500 per committee meeting if the committee meeting occurs on a day other than the day of a full Alion board meeting. We reimburse directors for reasonable travel expenses in connection with attendance at board of directors and board committee meetings.

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Each of our non-employee directors receives an annual award of $35,000 in shares of phantom stock under our Director Phantom Stock Plan. Each award vests ratably over a three year period. Our directors also have the option to participate in a deferred compensation plan for tax deferral of their annual compensation and/or payments to be made upon exercise of their phantom stock awards.

Our employee directors will not receive any additional compensation for their services as members of the board.

Board Independence

Our board of directors’ mandate requires that a majority of our directors be independent as determined under applicable securities laws. Our board of directors has determined that a majority of the members of the board of directors as a whole, and each member of the audit and finance committee and compensation committee, has no material relationship with us and is “independent” within the meaning of applicable securities laws. Our corporate governance and compliance committee is comprised of a majority of independent directors. Dr. Atefi is not independent as he is our president and chief executive officer.

Establishment of Committees

Our board of directors has established three committees. As of September 30, 2006, the committees were comprised of the following members:

Committee	Chairperson	Members
Audit and Finance Committee	Donald Goss	Leslie Armitage, Harold Gehman, Michael Ryan
Compensation Committee	Harold Gehman	Pete Aldridge, Leslie Armitage, Lewis Collens, George Joulwan
Governance and Compliance Committee	Michael Ryan	Bahman Atefi, George Joulwan, Harold Gehman

Our board of directors has determined that Mr. Donald E. Goss qualifies as “audit committee financial expert” as defined in Item 401(h) of Regulation S-K, and that he is “independent” as the term is used in Item 7(d)(3)(iv) of Schedule 14A under the Securities Exchange Act.

Compensation Committee Interlocks and Insider Participation

In October 2003, our board of directors established a compensation committee. As indicated above, the members of the compensation committee are Harold Gehman (Chairman), Leslie Armitage, Lewis Collens, George Joulwan, and Pete Aldridge. Dr. Atefi is a member of the board of trustees of the Illinois Institute of Technology where Mr. Collens is the President. Dr. Atefi is our President and Chief Executive Officer.

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CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Since the beginning of our last fiscal year, including any currently proposed transactions, no directors, executive officers or immediate family members of such individuals were engaged in transactions with us or any of our subsidiaries involving more than $60,000, other than executive compensation arrangements described in “Management — Executive Compensation.”

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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED STOCKHOLDERS MATTERS

The following table sets forth certain information as of February 28, 2007, regarding the beneficial ownership of our common stock by certain beneficial owners and all directors and Named Executive Officers, both individually and as a group. We know of no other person not disclosed herein beneficially owning more than 5% of our common stock. The address of the beneficial owner (as required) and the dates applicable to the beneficial ownership indicated are set forth in the footnotes below.

			Amount and Nature of			Percentage
Name of Beneficial Owner	Title of Class		Beneficial Ownership			of Class(1)
Five Percent Security Holders:
Illinois Institute of Technology(2)		Common stock		1,080,437(3	)		17.2
Directors(4) and Executive Officers:
Bahman Atefi		Common stock		67,004(5	)		1.3
John (Jack) Hughes		Common stock		7,105(5	)		*
Stacy Mendler		Common stock		72,109(5	)		1.4
Randy Crawford		Common stock		48,468(5	)		*
Rob Goff		Common stock		10,028(5	)		*
All Directors and Executive Officers as a Group (5 Persons )		Common stock		204,714(5	)		3.9

*	less than 1%.
(1)	Applicable percentages based on 5,207,883 shares outstanding on February 28, 2006, and also includes shares of common stock subject to warrants that were exercisable within 60 days of February 28, 2006. Such shares are deemed to be outstanding for the purposes of computing the percentage ownership of the individual or entity holding the shares, but are not deemed outstanding for purposes of computing the percentage of any other person shown in the table. This table is based upon information in our possession and believed to be accurate. Unless indicated in the footnotes to this table and subject to community property laws where applicable, we believe that each of the shareholders named in this table has sole voting and investment power with respect to the shares indicated as beneficially owned.
(2)	Illinois Institute of Technology’s address is 3300 South Federal Street, Chicago, IL 60616.
(3)	The number of shares deemed to be beneficially held by IIT represents currently exercisable warrants held by IIT under the subordinated warrant for an aggregate of 1,080,437 shares of common stock.
(4)	No directors (other than Dr. Atefi) are believed by us to be beneficial owners of our common stock.
(5)	Includes beneficial ownership shares of our common stock pursuant to the KSOP.

Changes in Control

We do not know of any arrangements, the operation of which may at a subsequent date result in a change in control of the Company.

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DESCRIPTION OF OTHER INDEBTEDNESS

Term B Senior Credit Facility

As of December 31, 2006, the Term B Senior Credit Facility consisted of:

•  a senior term loan in the approximate amount of $258.4 million;

•  a $50.0 million senior revolving credit facility under which approximately $32.6 million was outstanding as of December 31, 2006, and approximately $4.5 million of which was allocated for letters of credit and as such is not available to be borrowed; and

•  a $150.0 million uncommitted incremental term loan “accordion” facility.

The discussion below describes the Term B Senior Credit Facility, as modified by Amendments One, Two, and Three, Increment Four and Amendment Four (as defined below); certain of the initial debt agreements (and other related instruments) used to finance the IITRI Acquisition; and the outstanding notes issued and sold by us in order to re-finance the amounts outstanding under the previously effective Bridge Loan Agreement and to repay amounts outstanding under the Term B Senior Credit Facility.

On August 2, 2004, we entered into a new Term B Senior Credit Facility with a syndicate of financial institutions for which Credit Suisse serves as arranger, administrative agent and collateral agent, and for which LaSalle Bank National Association serves as syndication agent. On April 1, 2005, we entered into an incremental term loan facility and an amendment to the Term B Senior Credit Facility (Amendment One), which added $72.0 million in term loans to our total indebtedness under the Term B Senior Credit Facility. On March 24, 2006, we entered into a second incremental term loan facility and second amendment to the Term B Senior Credit Facility (Amendment Two), which increased the term loan commitment under the Term B Senior Credit Facility by $68.0 million. Amendment Two also increased the revolving credit commitment under the senior revolving credit facility from $30.0 million to $50.0 million. On June 30, 2006, we entered into a third incremental term loan facility and amendment to the Term B Senior Credit Facility (Amendment Three), which added $50.0 million in term loans to our total indebtedness under the Term B Senior Credit Facility. On January 4, 2007, we entered into a fourth incremental term loan facility (Increment Four), which added $15.0 million in term loans to our total indebtedness under the Term B Senior Credit Facility. On February 6, 2007, we entered into a fourth amendment to the Term B Senior Credit Facility (Amendment Four).

The Term B Senior Credit Facility requires us to repay one percent of the principal balance of the senior term loan during each of the first eight years (fiscal years 2005 through 2012) and the first quarter of fiscal year 2013 in equal quarterly principal installments and the remaining principal balance outstanding during the ninth and final year (2013) in one principal installment. As of December 31, 2006, through the quarter ending September 30, 2008, we were obligated to pay quarterly principal installments of approximately $0.7 million. As of February 8, 2007, through the quarter ending December 31, 2012, we are currently obligated to pay quarterly principal installments of approximately $0.6 million. On February 6, 2013, the senior term loan maturity date, we are obligated to pay a principal installment of the outstanding balance.

Under the senior revolving credit facility, we may request up to $40.0 million in letters of credit and may borrow up to $5.0 million in swing line loans for short-term borrowing needs. We must pay all principal obligations under the senior revolving credit facility in full no later than August 2, 2009.

We may prepay all or any portion of our debt under the Term B Senior Credit Facility in minimum increments of $1.0 million, generally without penalty or premium, except for customary breakage costs associated with pre-payment of Eurodollar-based loans. If we issue certain permitted debt, or sell, transfer or dispose of certain assets, we must use all net proceeds to repay any amounts outstanding under the Term B Senior Credit Facility. If we have excess cash flow for any fiscal year, we must use 50% of the net proceeds or excess cash flow to repay amounts outstanding under the Term B Senior Credit Facility. If our

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leverage ratio is less than 2.00 to 1.00, we must use only 25% of net proceeds or excess cash flow to repay amounts outstanding under the Term B Senior Credit Facility.

If we borrow any additional term loan, including under the uncommitted incremental term loan facility, and certain terms of such loan are more favorable to the new lenders than existing terms under the Term B Senior Credit Facility, the applicable interest rate spread on the senior term loans can increase. As a result, additional term loans could increase our interest expense under our existing term loans. Our significant subsidiaries Human Factors Application, Inc. (HFA); Alion — CATI Corporation (CATI); Alion — METI Corporation (METI); Alion — JJMA Corporation (JJMA); Alion — BMH Corporation (BMH); Washington Consulting, Inc. (WCI); and Alion — MA&D Corporation (MA&D) guaranteed our obligations under the Term B Senior Credit Facility.

Use of Proceeds.  On August 2, 2004, we borrowed $50.0 million through the senior term loan under the Term B Senior Credit Facility and used approximately $47.2 million to retire our then outstanding senior term loan and revolving credit facility administered by LaSalle Bank including principal and accrued unpaid interest and paid approximately $2.8 million in transaction fees. In October 2004, we borrowed approximately $22.0 million of the senior term loan to retire our existing $19.6 million mezzanine note and to pay approximately $2.4 million in accrued unpaid interest and prepayment premium. On April 1, 2005, we borrowed $72.0 million in an incremental term loan under the Term B Senior Credit Facility. We used approximately $58.7 million of the incremental term loan proceeds to pay a portion of the JJMA acquisition price, and approximately $1.3 million to pay transaction fees associated with the incremental term loan. We used approximately $12.0 million of the $72.0 million in incremental term loan proceeds to pay a portion of the BMH acquisition price. On March 24, 2006, we entered into Amendment Two which made available to us $68.0 million in additional incremental term loans. We used approximately $16.5 million of these incremental term loan proceeds to pay a portion of the WCI acquisition price, and approximately $13.6 million to redeem the mezzanine warrants held by IIT and our chief executive officer. On May 15, 2006, we borrowed $15.0 million of the incremental term loans made available under Amendment Two in order to pay a portion of the MA&D acquisition price. On June 30, 2006, we borrowed $21.0 million of the incremental term loans made available under Amendment Two in order to pay a portion of the acquisition price for the Anteon Asset Acquisition. On June 30, 2006, we also borrowed $50.0 million in incremental term loans under Amendment Three, of which approximately $34.0 million was used to pay a portion of the acquisition price for the Anteon Asset Acquisition. We used $10.0 million of the loan proceeds under Amendment Three to pay down a portion of the outstanding balance on our senior revolving credit facility, and approximately $6.0 million to pay transaction fees associated with the incremental term loan and the Bridge Loan Facility. On January 4, 2007, we borrowed $15.0 million in an incremental term loan under the Term B Senior Credit Facility. We used approximately $14.7 million of the loan proceeds to pay down the outstanding balance under our senior revolving credit facility, and approximately $0.3 million to pay transaction fees associated with the incremental term loan.

The Term B Senior Credit Facility permits us to use the remainder of our senior revolving credit facility for working capital needs, other general corporate purposes, and to finance permitted acquisitions. The Term B Senior Credit Facility permits us to use any proceeds from the uncommitted incremental term loan facility to finance permitted acquisitions and for any other purpose permitted by any future incremental term loan.

Security.  The Term B Senior Credit Facility is secured by a security interest in all of our current and future tangible and intangible property, as well as all of the current and future tangible and intangible property of our subsidiaries, HFA, CATI, METI, JJMA, BMH, WCI, and MA&D.

Interest and Fees.  Under the Term B Senior Credit Facility, the senior term loan and the senior revolving credit facility can each bear interest at either of two floating rates. As of December 31, 2006, we were entitled to elect that interest be payable on our senior term loan at an annual rate equal to either: 1) the applicable alternate base interest rate charged by CS plus a 175 basis point spread or, 2) the Eurodollar rate plus a 275 basis point spread. As of February 6, 2007, the spread associated with the alternate base interest rate charged by CS from time to time was lowered to 150 basis points, and the

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spread associated with the Eurodollar rate in effect from time to time was lowered to 250 basis points. We were also entitled to elect that interest be payable on the senior revolving credit facility at an annual rate dependent on our leverage ratio and whether the borrowing is a Eurodollar or an alternate base rate (ABR) borrowing. Under the Term B Senior Credit Facility, if we were to elect a Eurodollar borrowing under our senior revolving credit facility, interest would be payable at an annual rate equal to the Eurodollar rate plus additional basis points as reflected in the table below under the column “Eurodollar Spread” corresponding to our leverage ratio at the time. As of February 6, 2007, under the Term B Senior Credit Facility, if we were to elect an ABR borrowing under our senior revolving credit facility, we would pay interest at an alternate base interest rate based on the greater of CS’s prime rate or a U.S. federal funds effective rate, plus additional basis points reflected in the table below under the columns “Prime Rate ABR Spread” or “U.S. Federal Funds ABR Spread” corresponding to our leverage ratio at the time of each interest payment.

			U.S. Federal
	Eurodollar		Funds ABR		Prime Rate
Leverage Ratio	Spread		Spread		ABR Spread
	(in basis points)		(in basis points)		(in basis points)
Category 1		275		225		175
Greater than or equal to 3.00 to 1.00
Category 2		250		200		150
Greater than or equal to 2.50 to 1.00 but less than 3.00 to 1.00
Category 3		225		175		125
Greater than or equal to 2.00 to 1.00 but less than 2.50 to 1.00
Category 4		200		150		100
Less than 2.00 to 1.00

On April 1, 2005, we elected to have the senior term loan bear interest at the Eurodollar rate and the senior revolving credit facility bear interest at the ABR rate based on CS’s prime rate. As of December 31, 2006, the Eurodollar rate on the senior term loan was 8.11% (5.36% plus 2.75% Eurodollar spread) and the ABR rate was 10.0% (8.25% plus 1.75% spread).

Interest Rate Cap Agreements.  The Term B Senior Credit Facility required us to maintain interest rate hedge agreements acceptable to CS to cap our interest expense on at least 40% of our long-term senior debt for a period of at least two years from the date the first such agreement was put into place. This covenant expired on August 16, 2006. We currently have three interest rate cap agreements in place with our senior lenders.

The interest rate cap agreements cap the floating component of the total interest rate we pay, but do not affect spreads based on leverage ratio. The actual effective rate of interest that we pay on principal subject to each cap agreement is equal to the floating component (which is capped) plus the applicable spread. The applicable interest rate spread in the Term B Senior Credit Facility is added to the applicable capped interest rate to determine our effective interest rate on the notional principal subject to the interest rate cap agreement.

In August 2004, we paid approximately $319,000 to cap our rate at 6.64% (3.89% floating rate cap plus 2.75% spread) on $36.9 million in notional principal from September 2004 through September 2005 and 7.41% (4.66% floating rate cap plus 2.75% spread) from September 2005 through September 2007. The notional principal declines over time to $34.5 million at September 2007. In April 2005, Amendment One reduced the Eurodollar spread to 225 basis points, such that the total interest payable with respect to the principal amount covered by the first cap agreement was reset to 6.91% (4.66% floating rate cap plus 2.25% spread). In March 2006, Amendment Two increased the Eurodollar spread to 250 basis points, such that the total interest payable with respect to the principal amount covered by the first cap agreement was reset to 7.16% (4.66% floating rate cap plus 2.50% spread). In June 2006, Amendment Three increased the

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Eurodollar spread to 275 basis points, such that the total interest payable with respect to the principal amount covered by the first cap agreement was reset to 7.41% (4.66% floating rate cap plus 2.75% spread). In February 2007, Amendment Four decreased the Eurodollar spread to 250 basis points, such that the total interest payable with respect to the principal amount covered by the first cap agreement was reset to 7.16% (4.66% floating rate cap plus 2.50% spread).

In April 2005, we paid approximately $117,000 to cap our interest rate at 7.25% (5.00% floating rate cap plus 2.25% spread) on an additional $28.0 million in notional principal through September 2007. In March 2006, Amendment Two increased the Eurodollar spread to 250 basis points, such that the total interest payable with respect to the principal amount covered by the second cap agreement was reset to 7.50% (5.00% floating rate cap plus 2.50% spread). In June 2006, Amendment Three increased the Eurodollar spread to 275 basis points, such that the total interest payable with respect to the principal amount covered by the second cap agreement was reset to 7.75% (5.00% floating rate cap plus 2.75% spread). In February 2007, Amendment Four decreased the Eurodollar spread to 250 basis points, such that the total interest payable with respect to the principal amount covered by the second cap agreement was reset to 7.50% (5.00% floating rate cap plus 2.50% spread).

In April 2006, we paid approximately $43,600 to cap our interest rate at 8.00% (5.50% floating rate cap plus 2.50% spread) on an additional $30.0 million in notional principal through September 2007. In June 2006, Amendment Three increased the Eurodollar spread to 275 basis points, such that the total interest payable with respect to the principal amount covered by the third cap agreement was reset to 8.25% (5.50% floating rate cap plus 2.75% spread). In February 2007, Amendment Four decreased the Eurodollar spread to 250 basis points, such that the total interest payable with respect to the principal amount covered by the third cap agreement was reset to 8.00% (5.50% floating rate cap plus 2.50% spread).

Other Fees and Expenses.  Each quarter we are required to pay a commitment fee equal to 50 basis points per year on the prior quarter’s daily unused balance of the revolving credit facility and the senior term loan. As of December 31, 2006, there was approximately $32.6 million outstanding on the revolving credit facility and there was no unused balance on the senior term loan. For the year ended September 30, 2006 and the three months ended December 31, 2006, we paid an aggregate commitment fee of approximately $0.3 million and $20,000, respectively, for the revolving credit facility and no commitment fee for the senior term loan.

In addition to issuance and administrative fees, we are required to pay a fronting fee not to exceed 25 basis points for each letter of credit issued under the revolving credit facility. Each quarter we are required to pay interest in arrears at the revolving credit facility rate for all outstanding letters of credit. In addition to other fees and expenses under the Term B Senior Credit Facility, we are required to pay an annual agent’s fee.

Financial Covenants.  The Term B Senior Credit Facility requires us to meet certain financial performance measures over the life of the facility. These financial measures are used by our lenders in evaluating our leverage capacity, debt service ability and liquidity that result from the calculation of a senior secured leverage ratio and an interest coverage ratio as required by the terms of the Term B Senior Credit Facility. As defined in the beginning of this prospectus, both the senior secured leverage ratio and interest coverage ratios refer to the non-GAAP terms “EBITDA” and “Adjusted EBITDA.”

The Term B Senior Credit Facility adjusts EBITDA for purposes of calculating compliance with certain financial covenants in the event that we acquire another business pursuant to pre-approved procedures and requirements which the Term B Senior Credit Facility refers to as a “Permitted Acquisition” and in cases where we sell certain significant assets. In those cases, EBITDA will be adjusted for a particular accounting period so that Adjusted EBITDA takes into account the pro forma effect of such acquisition or asset sale as if it had taken place at the beginning of that particular accounting period.

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Adjusted EBITDA has limitations as an analytical tool, and is not to be considered in isolation or as a substitute for analysis of our financial performance or liquidity as reported under GAAP. Some of these limitations are:

•  Adjusted EBITDA does not reflect our cash expenditures, or future requirements for capital expenditures or contractual commitments;

•  Adjusted EBITDA does not reflect changes in, or cash requirements for, our working capital needs;

•  Adjusted EBITDA does not reflect interest expense, or the cash requirements necessary to service interest or principal payments, on our debt; and

•  although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and Adjusted EBITDA does not reflect any cash requirements for such replacements.

The calculation and reconciliation to the most comparable financial measure calculated and presented in accordance with GAAP is included in the tables below.

Alion Science and Technology Corporation
Non-GAAP Measures — EBITDA and Adjusted EBITDA
For the Twelve Months Ended December 31, 2005 and 2006

	Actual
Calculation of EBITDA	2005			2006
	(Dollars in thousands)
Net loss	$	(42,054	)	$	(37,447	)
Plus: Interest expense		37,148			38,604
Plus: Income tax expense (benefit)		34			(6	)
Plus: Depreciation and amortization expense		19,073			17,431
EBITDA	$	14,201		$	18,582

Calculation of Adjusted EBITDA	2005		2006
	(Dollars in thousands)
EBITDA	$	14,201	$	18,582
Plus: Non-cash contributions to the ESOP (including Company 401-k match)(1)		5,980		8,796
Plus: Non-cash stock-based compensation expenses(2)		12,927		11,574
Plus: Adjustments permitted by certain covenants in the Term B Senior Credit Facility and Bridge Loan Agreement(3)		4,425		17,340
Adjusted EBITDA	$	37,533	$	56,292

(1)	Non-cash contributions to the ESOP consists of common stock issued to the ESOP Trust in satisfaction of employer contribution liability, which includes the employer match and profit-sharing contributions to the KSOP.
(2)	Non-cash stock-based compensation expenses include stock-based compensation associated with the stock appreciation rights plans, phantom stock plans and the subordinated warrants.
(3)	Adjustments consist of the following:

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	For the Twelve Months
	Ended December 31,
	Actual
	2005		2006
	(In thousands)
Acquisition & financing related fees & expenses	$	1,915	$	8,015
Labor costs as a result of delays in funding for a government program(1)	$	—	$	862
Accelerated compensation and severance expense(2)	$	844	$	1,080
Facility start-up/closure expenses and lease breakage costs	$	488	$	1,875
Write down of assets related to the Transport Business shutdown	$	—	$	1,255
Board-directed investigation expenses(3)	$	—	$	1,284
Legal fees related to Joint Spectrum Center (JSC) contract protest(4)	$	737	$	1,355
Impact of Hurricane Katrina	$	337	$	768
Other	$	104	$	846
Total	$	4,425	$	17,340

Alion Science and Technology Corporation
Non-GAAP Measures — EBITDA and Adjusted EBITDA
For the Twelve Months Ended September 30, 2005 and 2006

	Actual						Pro Forma(1)
Calculation of EBITDA	2005			2006			2006
	(Dollars in thousands)
Net loss	$	(40,238	)	$	(31,115	)	$	(42,896	)
Plus: Interest expense		38,696			26,691			49,517
Plus: Income tax expense		66			26			26
Plus: Depreciation and amortization expense		17,771			16,566			24,133
EBITDA	$	16,295		$	15,168		$	30,780

	Actual				Pro Forma(1)
Calculation of Adjusted EBITDA	2005		2006		2006
	(Dollars in thousands)
EBITDA	$	16,295	$	15,168	$	30,780
Plus: Non-cash contributions to ESOP (including Company 401-K match)(2)		5,707		7,871		10,067
Plus: Non-cash stock-based compensation expenses(3)		10,628		10,738		10,738
Plus: Adjustments permitted by certain covenants in the Term B Senior Credit Facility and Bridge Loan Agreement(4)		3,759		17,012		20,816
Adjusted EBITDA	$	36,389	$	50,789	$	72,401

(1)	“Pro forma” as applied to the Company’s results of operations for a particular period means the results after issuance of the outstanding notes and all Alion acquisitions (including the Anteon Asset Acquisition) that occurred on or after the first day of the relevant period, in each case, as though they occurred on the first day of the relevant period.
(2)	Non-cash contributions to the ESOP consists of common stock issued to the ESOP Trust in satisfaction of employer contribution liability, which includes the employer match and profit-sharing contributions to the KSOP.
(3)	Non-cash stock-based compensation expenses include stock-based compensation associated with the stock appreciation rights plans, phantom stock plans and the subordinated warrants.
(4)	Adjustments consist of the following:

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	For the Years Ended
	September 30,
	Actual				Pro Forma
	2005		2006		2006
			(In thousands)
Acquisition & financing related fees & expenses	$	1,912	$	7,549	$	7,549
Additional costs savings generated through reduced general and administrative expenses and allocation of a portion of Alion’s corporate expenses to the Anteon Contracts	$	—	$	—	$	3,804
Labor costs as a result of delays in funding for a government program(1)	$	—	$	862	$	862
Accelerated compensation and severance expense(2)	$	—	$	1,080	$	1,080
Facility start-up/closure expenses and lease breakage costs	$	388	$	1,711	$	1,711
Write down of assets related to the Transport Business shutdown	$	—	$	1,255	$	1,255
Board-directed investigation expenses(3)	$	—	$	1,284	$	1,284
Legal fees related to Joint Spectrum Center (JSC) contract protest(4)	$	145	$	1,657	$	1,657
Impact of Hurricane Katrina	$	337	$	768	$	768
Other	$	977	$	846	$	846
Total	$	3,759	$	17,012	$	20,816

(1)	Expenses incurred as a result of increased headcount for a government program that was later suspended due to a dispute between the Congress and the U.S. Navy.
(2)	Primarily related to: (i) Alion’s agreement to accelerate payment of a senior officer’s long-term incentive compensation in connection with the termination of his employment, and (ii) the granting of severance amounts to certain senior officers as part of certain agreements relating to the termination of their employment, including non-compete arrangements.
(3)	Expenses incurred in connection with an investigation that was expedited in order to maintain the effectiveness of our current registration statement.
(4)	Legal fees expended in our protest of the loss of the next award of the JSC contract.

Leverage Ratio.  As of December 31, 2006, our leverage ratio was calculated by dividing the total outstanding amount of all of our consolidated indebtedness, but excluding the amount owed under our subordinated note and the aggregate amount of letters of credit issued on our behalf other than drawings which have not been reimbursed, by our Adjusted EBITDA for the previous four fiscal quarters on a rolling basis. The maximum total leverage ratio is measured as of the end of each of our fiscal quarters. As of December 31, 2006, for each of the following time periods, we will be permitted to maintain a maximum leverage ratio not greater than the following:

Period	Ratio
June 30, 2006 through September 30, 2007		6.50 to 1.00
October 1, 2007 through June 30, 2008		6.00 to 1.00
July 1, 2008 through June 30, 2009		5.75 to 1.00
Thereafter		5.25 to 1.00

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The calculations of our leverage ratio for the twelve months ended December 31, 2005 and 2006, and for the twelve months ended September 30, 2005 and 2006, are set forth in the table below.

Alion Science and Technology Corporation
Computation of Leverage Ratio
Under the Term B Senior Credit Facility
For the Twelve Months Ended December 31, 2005 and 2006

	2005		2006
	(Dollars in thousands)
Numerator:
Revolving credit facility	$	—	$	33,404
Term B Senior Credit facility debt outstanding, at face value		142,560		258,360
Bridge loan		—		170,000
Total debt outstanding	$	142,560	$	461,764
Denominator:
Adjusted EBITDA	$	37,533	$	56,292
Plus: permitted covenant adjustments		3,550		17,229
Adjusted EBITDA with pro forma effect of acquisitions	$	41,083	$	73,521
Leverage ratio		3.47		6.28

Alion Science and Technology Corporation
Computation of Leverage Ratio
Under the Term B Senior Credit Facility
For the Twelve Months Ended September 30, 2005 and 2006

	2005		2006
	(Dollars in thousands)
Numerator:
Revolving credit facility	$	—	$	12,300
Term B Senior Credit facility debt outstanding, at face value		142,920		259,015
Bridge loan		—		170,000
Total debt outstanding	$	142,920	$	441,315
Denominator:
Adjusted EBITDA	$	36,389	$	50,789
Plus: permitted covenant adjustments		7,345		21,612
Adjusted EBITDA with pro forma effect of acquisitions	$	43,734	$	72,401
Leverage ratio		3.27		6.10

Our leverage ratio covenant was converted into a senior secured leverage ratio covenant pursuant to Amendment Four. Beginning February 6, 2007, our senior secured leverage ratio is calculated by dividing the total outstanding amount of all of our consolidated indebtedness secured by a lien, but excluding the outstanding notes and the amount owed under the subordinated note and the aggregate amount of letters of credit issued on our behalf other than drawings which have not been reimbursed, by our Adjusted EBITDA for the previous four fiscal quarters on a rolling basis. The maximum total senior secured leverage ratio is measured as of the end of each of our fiscal quarters. Beginning as of February 6, 2007, for each of the

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following time periods, we will be permitted to maintain a maximum senior secured leverage ratio not greater than the following:

Period	Ratio
February 6, 2007 through September 30, 2007		4.00 to 1.00
October 1, 2007 through September 30, 2008		3.75 to 1.00
October 1, 2008 through September 30, 2009		3.25 to 1.00
Thereafter		3.00 to 1.00

Interest Coverage Ratio.  As of December 31, 2006, our interest coverage ratio is calculated by dividing the Company’s Adjusted EBITDA, less amounts we spend attributable to property, plant, equipment and other fixed assets, by our consolidated interest expense. As of December 31, 2006, for each of the following time periods, we will be required to maintain a minimum interest coverage ratio not less than the following:

Period	Ratio
June 30, 2006 through September 30, 2007		1.65 to 1.00
October 1, 2007 through September 30, 2008		1.75 to 1.00
Thereafter		2.00 to 1.00

The calculations of our interest coverage ratio for the twelve months ended December 31, 2005 and 2006, and for the twelve months ended September 30, 3005 and 2006, are set forth in the table below.

Alion Science and Technology Corporation
Computation of Interest Coverage Ratio
Under the Term B Senior Credit Facility
For the Twelve Months Ended December 31, 2005 and 2006

	2005		2006
	(Dollars in thousands)
Numerator:
Adjusted EBITDA	$	37,533	$	56,292
Plus: permitted covenant adjustments		3,550		17,229
Adjusted EBITDA with pro forma effect of acquisitions		41,083		73,521
Less: Capital expenditures		3,238		5,155
Adjusted EBITDA with pro forma effect of acquisitions less capital expenditures	$	37,845	$	68,366

	2005		2006
	(Dollars in thousands)
Denominator:
Consolidated interest expense	$	8,680	$	27,012
Interest coverage ratio		4.36		2.53

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Alion Science and Technology Corporation
Computation of Interest Coverage Ratio
Under the Term B Senior Credit Facility
For the Twelve Months Ended September 30, 2005 and 2006

	2005		2006
	(Dollars in thousands)
Numerator:
Adjusted EBITDA	$	36,389	$	50,789
Plus: permitted covenant adjustments		7,345		21,612
Adjusted EBITDA with pro forma effect of acquisitions		43,734		72,401
Less: Capital expenditures		2,233		5,227
Adjusted EBITDA with pro forma effect of acquisitions less capital expenditures	$	41,501	$	67,174

	2005		2006
	(Dollars in thousands)
Denominator:
Consolidated interest expense	$	9,328	$	19,349
Interest coverage ratio		4.45		3.47

Our interest coverage ratio was modified pursuant to Amendment Four. Beginning February 6, 2007, in order for us to remain in compliance with this covenant, the interest coverage ratio for any period of four consecutive quarters, in each case taken as one accounting period, cannot be less than 1.35 to 1.00.

The Term B Senior Credit Facility includes other covenants which, among other things, restrict our ability to do the following without the prior consent of syndicate bank members that have extended more than 50% or more of the aggregate amount of all loans then outstanding under the Term B Senior Credit Facility:

•  incur additional indebtedness other than permitted additional indebtedness after satisfying a leverage based incurrence test;

•  consolidate, merge or sell all or substantially all of our assets;

•  make certain loans and investments including acquisitions of businesses, other than permitted acquisitions;

•  pay dividends or distributions other than distributions needed for the ESOP to satisfy our repurchase obligations and for certain payments required under our equity based incentive plans;

•  enter into certain transactions with our shareholders and affiliates;

•  enter into certain transactions not permitted under ERISA;

•  grant certain liens and security interests;

•  enter into sale and leaseback transactions;

•  change lines of business;

•  repay subordinated indebtedness before it is due and redeem or repurchase certain equity;

•  pay certain earn-outs in connection with permitted acquisitions; or

•  use the proceeds of our borrowings other than as permitted by the Term B Senior Credit Facility.

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Events of Default.  The Term B Senior Credit Facility contains customary events of default including, without limitation:

•  payment default;

•  breach of representations and warranties;

•  uncured covenant breaches;

•  default under certain other debt exceeding an agreed amount;

•  bankruptcy and insolvency events;

•  notice of debarment, suspension or termination under a material government contract;

•  certain ERISA violations;

•  unstayed judgments in excess of an agreed amount;

•  failure of our subordinated note to be subordinated to the Term B Senior Credit Facility;

•  failure of any guarantee of the Term B Senior Credit Facility to be in effect;

•  failure of the security interests to be valid, perfected first priority security interests in the collateral;

•  failure to remain an S-corporation;

•  imposition on the ESOP Trust of certain taxes in excess of an agreed amount;

•  final determination that the ESOP is not a qualified plan;

•  incurrence of a civil or criminal liability in excess of $5 million of us or any subsidiary arising from a government investigation;

•  the actual termination of a material contract due to alleged fraud, willful misconduct, negligence, default or any other wrongdoing; or

•  change of control (as defined below).

For purposes of the Term B Senior Credit Facility, a change of control generally occurs when, before we list our common stock to trade on a national securities exchange and we obtain net proceeds from an underwritten public offering of at least $30.0 million, the ESOP Trust fails to own at least 51% of our outstanding equity interests, or, after we have such a qualified public offering, any person or group other than IIT or the ESOP Trust owns more than 37.5% of our outstanding equity interests. A change of control may also occur if a majority of the seats (other than vacant seats) on our board of directors shall at any time be occupied by persons who were neither nominated by our board nor were appointed by directors so nominated. A change of control may also occur if a change of control occurs under any of our material indebtedness including the notes, the Company’s subordinated note and the warrants issued with the subordinated note.

For the years ended September 30, 2006 and 2005 and as of December 31, 2006, we were in compliance with the financial covenants set forth in the Term B Senior Credit Facility.

Bridge Loan Agreement

On June 30, 2006, we entered into a Bridge Loan Agreement with Credit Suisse and borrowed $170.0 million (the Bridge Loan). Certain of our subsidiaries guaranteed the Bridge Loan Agreement. We used the proceeds from the Bridge Loan to pay part of the cost of acquiring the Anteon Contracts. On February 8, 2007, we used a majority of the proceeds of the sale of the outstanding notes to repay all amounts outstanding under the Bridge Loan Agreement.

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The Bridge Loan Agreement required us to meet certain financial performance measures and to comply with certain other covenants. For the year ended September 30, 2006 and as of December 31, 2006, we were in compliance in all material respects with the covenants set forth in the Bridge Loan Agreement.

Subordinated Note

On December 20, 2002, we issued a $39.9 million note to IITRI (our subordinated note) together with warrants to purchase approximately 1,080,437 shares of our common stock $0.01 par value per share common stock in partial consideration for the acquisition of substantially all of the assets and liabilities of IITRI, excluding the assets and liabilities of IITRI’s Life Sciences Operation, for aggregate total proceeds of $127.3 million (the IITRI Acquisition). On July 1, 2004, the Illinois Institute of Technology (IIT) acquired all of IITRI’s rights and interests in the Subordinated Note and related warrant agreement. On June 30, 2006, the Company and IIT entered into an agreement, which increased interest payable on the Subordinated Note from December 21, 2006 through December 20, 2008.

The Subordinated Note bears interest at (i) 6.0% through December 20, 2006, (ii) approximately 6.4% from December 21, 2006 through December 20, 2007, and (iii) 6.7% from December 21, 2007 through December 20, 2008. Interest is payable quarterly by the issuance of paid-in-kind or PIK notes maturing at the same time as the Subordinated Note. The issuance of the PIK notes has the effect of deferring the underlying cash interest expense on the Subordinated Note. Beginning in December 2008, the Subordinated Note will bear interest at 16.0% per year payable quarterly in cash through the time of repayment in full of the Subordinated Note. Principal on the Subordinated Note will be payable in equal installments of $19.95 million in December 2009 and December 2010. The PIK notes are also due in equal installments of approximately $7.4 million on these same dates.

Estimated Interest and Principal Payments

Commencing March 31, 2007 and during the remainder of fiscal year 2007 and the next six fiscal years, at a minimum, we expect that we will have to make the estimated interest and principal payments set forth below. These estimates include the effects of the following financing transactions subsequent to December 31, 2006 (See “Prospectus Summary — Recent Developments”):

•  additional borrowings of $15.0 million of senior term loans on January 4, 2007, under the Term B Senior Credit Facility;

•  extension of the maturity date of the senior term loans outstanding under the Term B Senior Credit Facility to February 6, 2013;

•  issuance of $250.0 million in outstanding notes on February 8, 2007;

•  repayment of the entire outstanding balance of the Bridge Loan on February 8, 2007; and

•  repayment of $72.0 million in outstanding principal of senior term loans on February 8, 2007, under the Term B Senior Credit Facility.

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	6-Fiscal Year Period ($ In thousands)
	2007*		2008		2009		2010		2011		2012		Thereafter
Bank revolving credit facility
- Interest(1)	$	386	$	250	$	250	$	250	$	250	$	250	$	750
Senior Secured Term B Loan
- Interest(2)		12,979		16,398		16,274		16,292		16,554		16,712		8,482
- Principal(3)		1,668		2,224		2,224		2,224		2,224		2,224		209,574
Outstanding Notes
- Interest(4)		12,216		25,625		25,625		25,625		25,625		25,625		64,063
- Principal(4)		—		—		—		—		—		—		250,000
Subordinated Note
- Interest(5)		—		—		6,384		3,192		—		—		—
- Principal(5)		—		—		27,352		27,352		—		—		—
Total cash — Pay interest		25,581		42,273		48,533		45,359		42,429		42,587		73,295
Total cash — Pay principal		1,668		2,224		29,576		29,576		2,224		2,224		459,574
Total	$	27,249	$	44,497	$	78,109	$	74,935	$	44,653	$	44,811	$	532,869

*	Estimated interest and principal payments for the remainder of fiscal year 2007.
(1)	We anticipate accessing, from time to time, our $50.0 million bank revolving credit facility to finance our ongoing working capital needs. The remaining term of the revolving credit facility is approximately two years; however, we expect to access a revolving credit facility as an on-going requirement to fund working capital at least through 2012. As of March 31, 2007, for the remainder of fiscal year 2007, the average balance drawn on our then revolving credit facility is projected to be approximately $2.0 million. For the fiscal years 2008 through 2012, we anticipate the balance drawn on the revolving credit facility will be minimal. As of March 31, 2007, we have borrowed approximately $32.5 million under the revolving credit facility and $4.5 million has been deemed borrowed for letters of credit. Interest expense value includes an estimate for the unused balance fee on the $50.0 million revolving credit facility.
(2)	As of March 31, 2007, the projected average annual senior term loan balance we estimate will be drawn under the Term B Senior Credit Facility is as follows: $227.6 million, $219.6 million, $217.4 million, $215.1 million, $212.9 million, and $210.7 million for the remainder of fiscal year 2007 and for fiscal years ending September 30, 2008 through 2012, respectively. We expect we will need to refinance the Term B Senior Credit Facility before the end of fiscal year 2012 and expect interest expense to continue at levels similar to prior years. Based on an estimated LIBOR rate plus the CS Eurodollar spread, the effective annual interest rate for the remainder of fiscal year 2007, and for fiscal years ending September 30, 2008 through 2012 is estimated to be approximately 7.6%, 7.5%, 7.5%, 7.6%, 7.8%, and 7.9%, respectively. The effective interest rate takes into account the interest rate cap agreements which limit the interest rate on a portion, but not all, of the outstanding principal balance of the Term B Senior Credit Facility. The cap agreements expire in September 2007. Outstanding principal balances not under the cap agreements had interest based on the Eurodollar rate. The senior term loan matures February 6, 2013. As of March 31, 2007, the approximate impact of a 1% increase in the interest rate, as applied to principal balances drawn under the senior term loan not covered by the current interest rate cap agreements would be $1.4 million, $2.2 million, $2.2 million, $2.2 million, $2.1 million, and $2.1 million for the remainder of fiscal year 2007 and for fiscal years ending September 30, 2008 through 2012, respectively. Estimated interest expense includes an estimate for the commitment fee on the senior term loan.
(3)	The Term B Senior Credit Facility requires us to repay approximately 1.0 percent of the principal balance outstanding under the senior term loan annually. Approximately 6.0 percent of the principal will be paid during fiscal years 2007 through 2012 and the first quarter of fiscal year 2013 and the

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	remaining principal balance will be repaid on February 6, 2013, the senior term loan maturity date. The table reflects the balance drawn of $258.4 million as of March 31, 2007, plus the $15.0 million in additional term loans drawn under the Term B Senior Credit Facility on January 4, 2007, less a $72.0 million repayment of the Term B Senior loan on February 8, 2007 from the proceeds of sale of $250.0 million outstanding notes, resulting in expected aggregate annual principal payments of approximately $1.7 million for the remainder of fiscal year 2007 and approximately $2.2 million in each of fiscal years 2008 through 2012. The remaining principal balance of approximately $209.6 million is to be paid on February 6, 2013. The Term B Senior Credit Facility also requires us to make mandatory prepayments of principal depending upon whether we generate certain excess cash flow in a given fiscal year, issues or incurs certain debt or sells certain assets. As of February 28, 2007, no mandatory prepayments are due.
(4)	The table reflects the issuance of $250.0 million of outstanding notes on February 8, 2007. The principal amount of $250.0 million is due and payable on February 1, 2015.
(5)	The subordinated note bears interest at (i) 6.0% through December 20, 2006, (ii) approximately 6.4% from December 21, 2006 through December 20, 2007, and (iii) 6.7% from December 21, 2007 through December 20, 2008. Interest is payable quarterly by the issuance of paid-in-kind or PIK notes maturing at the same time as the subordinated note. The issuance of the PIK notes has the effect of deferring the underlying cash interest expense on the subordinated note. Commencing December 2008, the subordinated note will bear interest at 16.0% per year payable quarterly in cash through the time of repayment in full of the subordinated note. Principal on the subordinated note will be payable in equal installments of $19.95 million in December 2009 and December 2010; the PIK notes are also due in equal installments of approximately $7.4 million on these same dates.

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THE EXCHANGE OFFER

Purpose of the Exchange Offer; Exchange Terms

The outstanding notes were sold to the initial purchaser on February 8, 2007 in a private placement pursuant to a purchase agreement. The initial purchaser subsequently re-sold the outstanding notes to qualified institutional buyers (“QIB”), as defined in Rule 144A under the Securities Act, in reliance on Rule 144A, and to persons in offshore transactions in reliance on Regulation S under the Securities Act.

As a condition to the initial sale of the outstanding notes we entered into a registration rights agreement with the initial purchaser. Pursuant to the registration rights agreement, we must:

•  file with the SEC by May 9, 2007, a registration statement under the Securities Act with respect to the exchange notes, and

•  use our reasonable best efforts to cause the registration statement to become effective under the Securities Act on or before October 6, 2007.

We have agreed to issue and exchange the exchange notes for all outstanding notes properly surrendered and not withdrawn before the expiration of the exchange offer. A copy of the registration rights agreement has been filed as an exhibit to the registration statement which includes this prospectus. The registration statement is intended to satisfy some of our obligations under the registration rights agreement and the purchase agreement.

Outstanding notes in an aggregate principal amount of $250,000,000 are currently issued and outstanding. The maximum aggregate principal amount of exchange notes that will be issued in exchange for outstanding notes is $250,000,000. The terms of the exchange notes and the outstanding notes will be substantially the same in all material respects, except that the exchange notes will not be subject to transfer restrictions and will not be entitled to certain registration rights as provided in this prospectus. See “Description of Notes.”

The outstanding notes and the exchange notes bear interest at a rate of 101/4% per year, payable semiannually in arrears on February 1 and August 1, commencing on August 1, 2007. Holders of exchange notes will receive interest from the date of the last payment of interest on the outstanding notes or, if no interest has been paid on the outstanding notes, from the date of the original issuance of the outstanding notes. Holders of exchange notes will not receive any interest on outstanding notes tendered and accepted for exchange. In order to exchange your outstanding notes for transferable exchange notes in the exchange offer, you will be required to make the following representations, which are included in the letter of transmittal:

•  any exchange notes that you receive will be acquired in the ordinary course of your business;

•  you have no arrangements or understanding with any person to participate in the distribution of the exchange notes;

•  you are not our “affiliate” as defined in Rule 405 of the Securities Act, or if it you are our affiliate, that you will comply with the registration and prospectus delivery requirements of the Securities Act to the extent applicable;

•  if you are not a broker-dealer, that you are not engaged in and do not intend to engage in the distribution of the exchange notes; and

•  if you are a broker, that you will receive the exchange notes for your own account in exchange for outstanding notes that were acquired as a result of market-making activities and that you will be required to acknowledge that it will deliver a prospectus in connection with any resale of such exchange notes.

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Upon the terms and subject to the conditions set forth in this prospectus and in the letter of transmittal, we will accept for exchange any outstanding notes properly tendered in the exchange offer, and the exchange agent will deliver the exchange notes promptly after the expiration date of the exchange offer.

If you tender your outstanding notes, you will not be required to pay brokerage commissions or fees, but you may be required to pay transfer taxes with respect to the exchange of the outstanding notes in connection with the exchange offer and certain other taxes described below under “The Exchange Offer — Transfer Taxes.” We will not apply a service charge and we will pay all expenses in connection with the exchange offer.

We make no recommendation to you as to whether you should tender or refrain from tendering all or any portion of your existing outstanding notes into this exchange offer. In addition, no one has been authorized to make this recommendation. You must make your own decision whether to tender into this exchange offer and, if so, the aggregate amount of outstanding notes to tender after reading this prospectus and the letter of transmittal and consulting with your advisors, if any, based on your financial position and requirements.

Expiration Date; Extensions; Termination; Amendments

The exchange offer expires at 5:00 p.m., New York City time, on          , 2007, unless we extend the exchange offer, in which case the expiration date will be the latest date and time to which we extend the exchange offer.

In order to extend the exchange offer, we will:

•  notify the exchange agent of any extension by written notice; and

•  issue a press release or other public announcement that will include disclosure of the approximate number of outstanding notes deposited; such press release or announcement would be issued prior to 9:00 a.m., New York City time, on the next business day after the previously scheduled expiration date.

We expressly reserve the right, so long as applicable law allows:

•  to delay our acceptance of outstanding notes for exchange;

•  to terminate the exchange offer if any of the conditions set forth under “The Exchange Offer — Conditions of the Exchange Offer” have not been satisfied or waived by us;

•  to waive any condition to the exchange offer;

•  to amend any of the terms of the exchange offer; and

•  to extend the expiration date and retain all outstanding notes tendered in the exchange offer, subject to your right to withdraw your tendered outstanding notes as described under “The Exchange Offer — Withdrawal of Tenders.”

Any waiver or amendment to the exchange offer will apply to all outstanding notes tendered, regardless of when or in what order the outstanding notes were tendered. If the exchange offer is amended in a manner that we think constitutes a material change, or if we waive a material condition of the exchange offer, we will promptly disclose the amendment or waiver by means of a prospectus supplement that will be distributed to the registered holders of the outstanding notes, and we will extend the exchange offer to the extent required by Rule 14e-1 under the Exchange Act.

We will promptly follow any delay in acceptance, termination, extension or amendment by oral or written notice of the event to the exchange agent, followed promptly by oral or written notice to the registered holders. Should we choose to delay, extend, amend or terminate the exchange offer, we will have no obligation to publish, advertise or otherwise communicate this announcement, other than by making a timely release to an appropriate news agency.

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In the event we terminate the exchange offer, all outstanding notes previously tendered and not accepted for payment will be returned promptly to the tendering holders.

In the event that the exchange offer is withdrawn or otherwise not completed, exchange notes will not be given to holders of outstanding notes who have validly tendered their outstanding notes and all outstanding notes will be returned promptly to the tendering holders.

Resale of Exchange Notes

Under existing SEC interpretations, the exchange notes will be freely transferable by holders other than our affiliates after the exchange offer without further registration under the Securities Act if the holder of the exchange notes represents to us in the exchange offer that it is acquiring the exchange notes in the ordinary course of its business, that it has no arrangement or understanding with any person to participate in the distribution of the exchange notes and that it is not an affiliate of the Company, as such terms are interpreted by the SEC; provided, however, that broker-dealers receiving exchange notes in the exchange offer will have a prospectus delivery requirement with respect to resales of such exchange notes. The SEC has taken the position that broker-dealers may fulfill their prospectus delivery requirements with respect to exchange notes (other than a resale of an unsold allotment from the original sale of the notes) with the prospectus contained in the exchange offer registration statement.

However, we have not asked the SEC to consider this particular exchange offer in the context of a no-action letter. Therefore, you cannot be sure that the SEC will treat it in the same way it has treated other exchange offers in the past.

If you tender outstanding notes in the exchange offer with the intention of participating in any manner in a distribution of the exchange notes:

•  you cannot rely on those interpretations by the SEC staff, and

•  you must comply with the registration and prospectus delivery requirements of the Securities Act in connection with a secondary resale transaction and such a secondary resale transaction must be covered by an effective registration statement containing the selling security holder information required by Item 507 or 508, as applicable, of Regulation S-K of the Securities Act.

Only broker-dealers that acquired the outstanding notes as a result of market-making activities or other trading activities may participate in the exchange offer. Each broker-dealer that receives exchange notes for its own account in exchange for outstanding notes, where such outstanding notes were acquired by such broker-dealer as a result of market-making activities or other trading activities, must acknowledge that it will deliver a prospectus in connection with any resale of the exchange notes. Please read the section captioned “Plan of Distribution” for more details regarding the transfer of exchange notes.

Acceptance of Outstanding Notes for Exchange

We will accept for exchange outstanding notes validly tendered pursuant to the exchange offer, or defectively tendered, if such defect has been waived by us, on or before the later of: (1) the expiration date of the exchange offer and (2) the satisfaction or waiver of the conditions specified below under “The Exchange Offer — Conditions of the Exchange Offer.” Tenders of outstanding notes will be accepted only in minimum denominations equal to $2,000 or integral multiples of $1,000 in excess thereof.

We expressly reserve the right, in our sole discretion, to:

•  delay acceptance for exchange of outstanding notes tendered under the exchange offer, subject to Rule 14e-1 under the Exchange Act, which requires that an offeror pay the consideration offered or return the securities deposited by or on behalf of the holders promptly after the termination or withdrawal of a tender offer; and

•  terminate the exchange offer and not accept for exchange any outstanding notes not theretofore accepted for exchange, if any of the conditions set forth below under “The Exchange Offer —

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Conditions of the Exchange Offer” have not been satisfied or waived by us or in order to comply in whole or in part with any applicable law. In all cases, exchange notes will be issued only after timely receipt by the exchange agent of certificates representing outstanding notes, or confirmation of book-entry transfer, a properly completed and duly executed letter of transmittal, or a manually signed facsimile thereof, and any other required documents. For purposes of the exchange offer, we will be deemed to have accepted for exchange validly tendered outstanding notes, or defectively tendered outstanding notes with respect to which we have waived such defect, if, as and when we give oral, confirmed in writing, or written notice to the exchange agent. Promptly after the expiration date, we will deposit the exchange notes with the exchange agent, who will act as agent for the tendering holders for the purpose of receiving the exchange notes and transmitting them to the holders. The exchange agent will deliver the exchange notes to holders of outstanding notes accepted for exchange after the exchange agent receives the exchange notes.

If, for any reason, we delay acceptance for exchange of validly tendered outstanding notes or we are unable to accept for exchange validly tendered outstanding notes, then the exchange agent may, nevertheless, on our behalf, retain tendered outstanding notes, without prejudice to our rights described under “The Exchange Offer — Expiration Date; Extensions; Termination; Amendments,” “The Exchange Offer — Conditions of the Exchange Offer” and “The Exchange Offer — Withdrawal of Tenders,” subject to Rule 14e-1 under the Exchange Act, which requires that an offeror pay the consideration offered or return the securities deposited by or on behalf of the holders thereof promptly after the termination or withdrawal of a tender offer.

If any tendered outstanding notes are not accepted for exchange for any reason, or if certificates are submitted evidencing more outstanding notes than those that are tendered, certificates evidencing outstanding notes that are not exchanged will be returned, without expense, to the tendering holder, or, in the case of outstanding notes tendered by book-entry transfer into the exchange agent’s account at a book-entry transfer facility under the procedure set forth under “The Exchange Offer — Procedures for Tendering Outstanding Notes,” such outstanding notes will be credited to the account maintained at such book-entry transfer facility from which such outstanding notes were delivered, unless otherwise requested by such holder under Special Delivery Instructions in the letter of transmittal, promptly following the exchange date or the termination of the exchange offer.

Tendering holders of outstanding notes exchanged in the exchange offer will not be obligated to pay brokerage commissions with respect to the exchange of their outstanding notes other than as described in the instructions to the letter of transmittal. We will pay all other charges and expenses in connection with the exchange offer.

Procedures for Tendering Outstanding Notes

Any beneficial owner whose outstanding notes are registered in the name of a broker, dealer, commercial bank, trust company or other nominee or held through a book-entry transfer facility and who wishes to tender outstanding notes should contact such registered holder promptly and instruct such registered holder to tender outstanding notes on such beneficial owner’s behalf.

Tender of Outstanding Notes Held Through Depository Trust.  The exchange agent and The Depository Trust Company (“DTC”) have confirmed that the exchange offer is eligible for the DTC automated tender offer program. Accordingly, DTC participants may electronically transmit their acceptance of the exchange offer by causing DTC to transfer outstanding notes to the exchange agent in accordance with DTC’s automated tender offer program procedures for transfer. DTC will then send an agent’s message to the exchange agent. If you instruct DTC to send an agent message to the exchange agent, then you must comply with all of the procedures and requirements of the DTC automated tender offer program.

The term “agent’s message” means a message transmitted by DTC, received by the exchange agent and forming part of the book-entry confirmation, which states that DTC has received an express acknowledgment from the participant in DTC tendering outstanding notes that are the subject of that book-entry confirmation that the participant has received and agrees to be bound by the terms of the letter of

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transmittal, and that we may enforce such agreement against such participant. In the case of an agent’s message relating to guaranteed delivery, the term means a message transmitted by DTC and received by the exchange agent that states that DTC has received an express acknowledgment from the participant in DTC tendering outstanding notes that they have received and agree to be bound by the notice of guaranteed delivery.

Tender of Outstanding Notes Held in Certificated Form.  For a holder to validly tender outstanding notes held in certificated form:

•  the exchange agent must receive at its address set forth in this prospectus a properly completed and validly executed letter of transmittal, or a manually signed facsimile thereof, together with any signature guarantees and any other documents required by the instructions to the letter of transmittal, and

•  the exchange agent must receive certificates for tendered outstanding notes at such address, or such outstanding notes must be transferred pursuant to the procedures for book-entry transfer described above. A confirmation of such book-entry transfer must be received by the exchange agent prior to the expiration date of the exchange offer. A holder who desires to tender outstanding notes and who cannot comply with the procedures set forth herein for tender on a timely basis or whose outstanding notes are not immediately available must comply with the procedures for guaranteed delivery set forth below.

Letters of transmittal and outstanding notes should be sent only to the exchange agent, and not to us or to any book-entry transfer facility.

The method of delivery of outstanding notes, letters of transmittal and all other required documents to the exchange agent is at the election and risk of the holder tendering outstanding notes. Delivery of such documents will be deemed made only when actually received by the exchange agent. If such delivery is by mail, we suggest that the holder use properly insured, registered mail with return receipt requested, and that the mailing be made sufficiently in advance of the expiration date of the exchange offer to permit delivery to the exchange agent prior to such date. No alternative, conditional or contingent tenders of outstanding notes will be accepted.

Signature Guarantee.  Signatures on the letter of transmittal must be guaranteed by an eligible institution unless:

•  the letter of transmittal is signed by the registered holder of the outstanding notes tendered therewith, or by a participant in one of the book-entry transfer facilities whose name appears on a security position listing it as the owner of those outstanding notes, or if any outstanding notes for principal amounts not tendered are to be issued directly to the holder, or, if tendered by a participant in one of the book-entry transfer facilities, any outstanding notes for principal amounts not tendered or not accepted for exchange are to be credited to the participant’s account at the book-entry transfer facility, and neither the Special Issuance Instructions nor the Special Delivery Instructions box on the letter of transmittal has been completed, or

•  the outstanding notes are tendered for the account of an eligible institution.

An eligible institution is a firm that is a participant in the Security Transfer Agents Medallion program or the Stock Exchange Medallion program, which is generally a member of a registered national securities exchange, a member of the National Association of Securities Dealers, Inc., or a commercial bank or trust company having an office in the United States.

Book-Entry Transfer.  The exchange agent will seek to establish a new account or utilize an existing account with respect to the outstanding notes at DTC promptly after the date of this prospectus. Any financial institution that is a participant in the book-entry transfer facility system and whose name appears on a security position listing it as the owner of the outstanding notes may make book-entry delivery of outstanding notes by causing the book-entry transfer facility to transfer such outstanding notes into the

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exchange agent’s account. The confirmation of a book-entry transfer of outstanding notes into the exchange agent’s account at a book-entry transfer facility is referred to in this prospectus as a “book-entry confirmation.” Delivery of documents to the book-entry transfer facility in accordance with that book-entry transfer facility’s procedures does not constitute delivery to the exchange agent.

Guaranteed Delivery.  If you wish to tender your outstanding notes and:

(1) certificates representing your outstanding notes are not lost but are not immediately available,

(2) time will not permit your letter of transmittal, certificates representing your outstanding notes and all other required documents to reach the exchange agent on or prior to the expiration date of the exchange offer, or

(3) the procedures for book-entry transfer cannot be completed on or prior to the expiration date of the exchange offer, you may nevertheless tender if all of the following are complied with:

•  your tender is made by or through an eligible institution; and

•  on or prior to the expiration date of the exchange offer, the exchange agent has received from the eligible institution a properly completed and validly executed notice of guaranteed delivery, by manually signed facsimile transmission, mail or hand delivery, in substantially the form provided with this prospectus. The notice of guaranteed delivery must:

(a) set forth your name and address, the registered number(s) of your outstanding notes and the principal amount of outstanding notes tendered;

(b) state that the tender is being made thereby;

(c) guarantee that, within three New York Stock Exchange trading days after the date of the notice of guaranteed delivery, the letter of transmittal or facsimile thereof properly completed and validly executed, together with certificates representing the outstanding notes, or a book-entry confirmation, and any other documents required by the letter of transmittal and the instructions thereto, will be deposited by the eligible institution with the exchange agent; and

(d) the exchange agent receives the properly completed and validly executed letter of transmittal or facsimile thereof with any required signature guarantees, together with certificates for all outstanding notes in proper form for transfer, or a book-entry confirmation, and any other required documents, within three New York Stock Exchange trading days after the date of the notice of guaranteed delivery.

Other Matters.  Exchange notes will be issued in exchange for outstanding notes accepted for exchange only after timely receipt by the exchange agent of:

•  certificates for (or a timely book-entry confirmation with respect to) your outstanding notes,

•  a properly completed and duly executed letter of transmittal or facsimile thereof with any required signature guarantees, or, in the case of a book-entry transfer, an agent’s message, and

•  any other documents required by the letter of transmittal.

We will determine, in our sole discretion, all questions as to the form of all documents, validity, eligibility, including time of receipt, and acceptance of all tenders of outstanding notes. Our determination will be final and binding on all parties. Alternative, conditional or contingent tenders of outstanding notes will not be considered. We reserve the absolute right to reject any or all tenders of outstanding notes that are not in proper form or the acceptance of which, in our opinion, would be unlawful. We also reserve the right to waive any defects, irregularities or conditions of tender as to particular outstanding notes.

Our interpretation of the terms and conditions of the exchange offer, including the instructions in the letter of transmittal, will be final and binding.

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Any defect or irregularity in connection with tenders of outstanding notes must be cured within the time we determine, unless waived by us. We will not consider the tender of outstanding notes to have been validly made until all defects and irregularities have been waived by us or cured. Neither we, the exchange agent, nor any other person will be under any duty to give notice of any defects or irregularities in tenders of outstanding notes, or will incur any liability to holders for failure to give any such notice.

Withdrawal of Tenders

Except as otherwise provided in this prospectus, you may withdraw your tender of outstanding notes at any time prior to the expiration date.

For a withdrawal to be effective:

•  the exchange agent must receive a written notice of withdrawal at the address set forth below under “The Exchange Offer — Exchange Agent,” or

•  you must comply with the appropriate procedures of DTC’s automated tender offer program system.

Any notice of withdrawal must:

•  specify the name of the person who tendered the outstanding notes to be withdrawn, and

•  identify the outstanding notes to be withdrawn, including the principal amount of the outstanding notes.

If outstanding notes have been tendered pursuant to the procedure for book-entry transfer described above, any notice of withdrawal must specify the name and number of the account at DTC to be credited with the withdrawn outstanding notes and otherwise comply with the procedures of DTC.

We will determine all questions as to validity, form, eligibility and time of receipt of any withdrawal notices. Our determination will be final and binding on all parties. We will deem any outstanding notes so withdrawn not to have been validly tendered for exchange for purposes of the exchange offer.

Any outstanding notes that have been tendered for exchange but that are not exchanged for any reason will be returned to their holder without cost to the holder or, in the case of outstanding notes tendered by book-entry transfer into the exchange agent’s account at DTC according to the procedures described above, such outstanding notes will be credited to an account maintained with DTC for the outstanding notes. This return or crediting will take place as soon as practicable after withdrawal, rejection of tender or termination of the exchange offer. You may retender properly withdrawn outstanding notes by following one of the procedures described under “The Exchange Offer — Procedures for Tendering Outstanding Notes” at any time on or prior to the expiration date.

Conditions of the Exchange Offer

We may terminate, waive any conditions to or amend the exchange offer or, subject to Rule 14e-1 under the Exchange Act which requires that an offeror pay the consideration offered or return the securities deposited by or on behalf of the holders thereof promptly after the termination or withdrawal of the exchange offer, postpone the acceptance for exchange of outstanding notes so tendered if, on or prior to the expiration date of the exchange offer, we determine that the exchange offer would violate applicable law or any applicable interpretation of the staff of the SEC or that any litigation has been instituted or threatened that would impair our ability to proceed with the exchange offer. We reserve the right to waive any defects, irregularities or conditions of surrender as to particular outstanding notes.

Transfer Taxes

You will pay any tax applicable to the transfer and exchange of outstanding notes pursuant to the exchange offer.

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Consequences of Failing to Exchange

If you do not exchange your outstanding notes for exchange notes in the exchange offer, you will remain subject to the restrictions on transfer of the outstanding notes:

•  as set forth in the legend printed on the outstanding notes as a consequence of the issuance of the outstanding notes pursuant to the exemptions from, or in transactions not subject to, the registration requirements of the Securities Act and applicable state securities laws; and

•  otherwise set forth in the offering circular distributed in connection with the private offering of the outstanding notes.

In general, you may not offer or sell the outstanding notes unless they are registered under the Securities Act, or if the offer or sale is exempt from registration under the Securities Act and applicable state securities laws. Except as required by the registration rights agreement, we do not intend to register resales of the outstanding notes under the Securities Act.

Appraisal Rights

You will not have dissenters’ rights or appraisal rights in connection with the exchange offer.

Accounting Treatment

The exchange notes will be recorded at the same carrying value as the outstanding notes, as reflected in our accounting records on the date of the exchange. Accordingly, we will not recognize any gain or loss for accounting purposes upon the consummation of the exchange offer. We will amortize the expenses of the exchange offer over the term of the exchange notes.

Exchange Agent

Wilmington Trust Company has been appointed as exchange agent for the exchange offer. You should direct questions and requests for assistance, requests for additional copies of this prospectus, the letter of transmittal or any other documents to the exchange agent. You should send certificates for outstanding notes, letters of transmittal and any other required documents to the exchange agent addressed as follows:

Wilmington Trust Company
Rodney Square North
1100 North Market Streeet
Wilmington, DE 19890-1626
Attn: Alisha Clendaniel
Tel: 302-686-6470
Fax: 302-636-4139

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DESCRIPTION OF THE NOTES

On February 8, 2007, Alion Science and Technology Corporation issued $250.0 million in aggregate principal amount of outstanding notes under an indenture between us, our subsidiary guarantors and Wilmington Trust Company, as trustee (in such capacity the “Trustee”) (the “Indenture”), in a private transaction that was not subject to the registration requirements of the Securities Act. Alion Science and Technology Corporation will issue the exchange notes under the Indenture. The terms of the outstanding notes and the exchange notes (collectively, the “Notes”) include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act. Upon the issuance of exchange notes, or the effectiveness of a shelf registration statement, the Indenture will be subject to and governed by the Trust Indenture Act.

The following summary of certain provisions of the Indenture and the Registration Rights Agreement is not and does not purport to be complete and is subject to, and is qualified in its entirety by reference to, all the provisions of the Indenture and the Registration Rights Agreement, including the definitions of certain terms therein and those terms made a part of the Indenture by the Trust Indenture Act. We urge you to read the Indenture and the Registration Rights Agreement because they, and not this description, define your rights as holders of the Notes. Copies of the Indenture and the Registration Rights Agreement may be obtained from us upon request, once they become available, as indicated under “Where You Can Find Additional Information.”

Capitalized terms used in this “Description of the Notes” section and not otherwise defined herein have the meanings set forth under the subheading “— Certain Definitions.” As used in this “Description of the Notes” section, “we,” “us” and “our” refers to Alion Science and Technology Corporation and to its subsidiaries and the “Company” refers only to Alion Science and Technology Corporation but not to any of its Subsidiaries.

Brief Description of the Notes and the Guarantees

The Notes:

•  are senior unsecured obligations of the Company;

•  rank pari passu in right of payment with all existing and future senior Indebtedness of the Company including Indebtedness outstanding under and which may be borrowed pursuant to the Term B Senior Credit Facility;

•  are guaranteed on a senior unsecured basis by the Subsidiary Guarantors;

•  are structurally subordinated to all liabilities of our Subsidiaries that are not Subsidiary Guarantors and to claims of holders, if any, of Preferred Stock of our Subsidiaries that are not Subsidiary Guarantors;

•  are effectively subordinated to the Secured Indebtedness under the Term B Senior Credit Facility to the extent of the collateral securing such Secured Indebtedness;

•  are effectively subordinated to all liabilities of our Subsidiaries that are not Subsidiary Guarantors; and

•  are subject to registration with the SEC pursuant to the Registration Rights Agreement.

The Guarantee of the Notes of each Guarantor:

•  is a senior unsecured obligation of such Guarantor;

•  ranks pari passu in right of payment with all existing and future senior Indebtedness of such Guarantor;

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•  is effectively subordinated to all Secured Indebtedness of such Guarantor, to the extent of the collateral securing such Indebtedness, including any guarantee under the Term B Senior Credit Facility;

•  is structurally subordinated to all existing and future Indebtedness and claims of holders of Preferred Stock of Subsidiaries, if any, of such Guarantor that do not guarantee the Notes; and

•  is subject to registration with the SEC pursuant to the Registration Rights Agreement.

Principal, Maturity and Interest

The outstanding notes were issued on February 8, 2007 in an aggregate principal amount of $250.0 million, and the exchange notes being offered in this exchange offer will be issued in an aggregate principal amount of $250.0 million. The Notes will be issued only in fully registered form, without coupons, in denominations of $2,000 and any greater multiples of $1,000. No service charge will be made for any registration of transfer or exchange of the Notes, but in certain circumstances the Company may require payment of a sum sufficient to cover any transfer tax or other similar governmental charge payable in connection therewith. The Notes will mature on February 1, 2015. Subject to our compliance with the covenants described under the subheading “— Certain Covenants — Limitation on Indebtedness”, we are permitted to issue more Notes from time to time under the Indenture (the “Additional Notes”). The Notes and the Additional Notes, if any, will be treated as a single class for all purposes of the Indenture, including waivers, amendments, redemptions and offers to purchase. Unless the context otherwise requires, for all purposes of the Indenture and this “Description of the Notes”, references to the Notes include any Additional Notes actually issued.

Interest on the Notes will accrue at the rate of 10.25% per annum and will be payable semiannually in arrears on February 1 and August 1, commencing on August 1, 2007. The Company will make each interest payment to the Holders of record of the Notes on the immediately preceding January 15 and July 15. All payments of principal, premium, if any, and interest with respect to the Notes registered in the name of or held by The Depository Trust Company (“DTC”) or its nominee will be made by wire transfer of immediately available funds to the accounts specified by DTC for the benefit of the Holders. The Company will pay interest on overdue principal at 1% per annum in excess of the above rate and will pay interest on overdue installments of interest at 1% per annum in excess of the above rate to the extent lawful.

Interest on the Notes will accrue from the Issue Date.  Interest will be computed on the basis of a 360-day year comprised of twelve 30-day months.

Additional interest may accrue on the Notes in certain circumstances pursuant to the Registration Rights Agreement. See “— Registration Rights.”

Optional Redemption

Except as set forth below, we will not be entitled to redeem the Notes at our option prior to February 1, 2011.

On and after February 1, 2011, we will be entitled at our option to redeem all or a portion of these Notes from time to time upon not less than 30 nor more than 60 days’ notice, at the redemption prices set forth below (expressed in percentages of principal amount on the redemption date), plus accrued and unpaid interest to the redemption date (subject to the right of Holders of record on the relevant record date to receive interest due on the relevant interest payment date), if redeemed during the 12-month period commencing on February 1 of the years set forth below:

Period	Redemption Price
2011		105.125	%
2012		102.563	%
2013 and thereafter		100.000	%

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In addition, any time prior to February 1, 2010, we will be entitled at our option on one or more occasions to redeem Notes in an aggregate principal amount not to exceed 35% of the aggregate principal amount of the Notes originally issued at a redemption price (expressed as a percentage of principal amount on the redemption date) of 110.25%, plus accrued and unpaid interest to the redemption date, with the net cash proceeds from one or more Qualified Equity Offerings; provided, however, that:

(1) at least 65% of the aggregate principal amount of Notes remains outstanding immediately after the occurrence of each such redemption (other than Notes held, directly or indirectly, by any Affiliate of the Company); and

(2) each such redemption occurs within 90 days after the date of the related Qualified Equity Offering.

Prior to February 1, 2011, we will be entitled at our option to redeem all, but not less than all, of the Notes at a redemption price equal to 100% of the principal amount of the Notes plus the Applicable Premium as of, and accrued and unpaid interest to, the redemption date (subject to the right of Holders on the relevant record date to receive interest due on the relevant interest payment date). Notice of such redemption must be mailed by first-class mail to each Holder’s registered address, not less than 30 nor more than 60 days prior to the redemption date.

“Applicable Premium” means with respect to a Note at any redemption date, the greater of (1) 1.00% of the principal amount of such Note and (2) the excess, if any, of (A) an amount equal to the present value at such redemption date of (i) the redemption price of such Note on February 1, 2011 (such redemption price being described in the second paragraph in this “— Optional Redemption” section exclusive of any accrued interest) plus (ii) all required remaining scheduled interest payments due on such Note through February 1, 2011 (but excluding accrued and unpaid interest to the redemption date), computed using a discount rate equal to the Adjusted Treasury Rate, over (B) the principal amount of such note on such redemption date.

“Adjusted Treasury Rate” means, with respect to any redemption date, (1) the yield, under the heading which represents the average for the immediately preceding week, appearing in the most recently published statistical release designated “H.15(519)” or any successor publication which is published weekly by the Board of Governors of the Federal Reserve System and which establishes yields on actively traded United States Treasury securities adjusted to constant maturity under the caption “Treasury Constant Maturities”, for the maturity corresponding to the Comparable Treasury Issue (if no maturity is within three months before or after February 1, 2011, yields for the two published maturities most closely corresponding to the Comparable Treasury Issue shall be determined and the Adjusted Treasury Rate shall be interpolated or extrapolated from such yields on a straight line basis, rounding to the nearest month) or (2) if such release (or any successor release) is not published during the week preceding the calculation date or does not contain such yields, the rate per year equal to the semi-annual equivalent yield to maturity of the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such redemption date, in each case calculated on the third Business Day immediately preceding the redemption date, plus 0.50%.

“Comparable Treasury Issue” means, with respect to any redemption date, the United States Treasury security selected by the Quotation Agent as having a maturity comparable to the remaining term of the Notes from such redemption date to February 1, 2011, that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of a maturity most nearly equal to February 1, 2011.

“Comparable Treasury Price” means, with respect to any redemption date, if clause (ii) of the Adjusted Treasury Rate is applicable, the average of three, or such lesser number as is obtained by the Trustee, Reference Treasury Dealer Quotations for such redemption date.

“Quotation Agent” means the Reference Treasury Dealer selected by the Trustee after consultation with the Company.

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“Reference Treasury Dealer” means Credit Suisse Securities (USA) LLC and its successors and assigns and two other nationally recognized investment banking firms selected by the Company that are primary U.S. Government securities dealers.

“Reference Treasury Dealer Quotations” means with respect to each Reference Treasury Dealer and any redemption date, the average, as calculated by the Quotation Agent, of the bid and asked prices for the Comparable Treasury Issue, expressed in each case as a percentage of its principal amount, quoted in writing to the Quotation Agent by such Reference Treasury Dealer at 5:00 p.m., New York City time, on the third Business Day immediately preceding such redemption date.

Selection and Notice of Redemption

If the Company is redeeming less than all the Notes at any time, the Trustee will select Notes on a pro rata basis to the extent practicable unless the Notes are listed on any national securities exchange, and in such event the Trustee will select Notes for redemption in accordance with the rules and requirements of such exchange.

We will redeem Notes of $2,000 or less in whole and not in part. We will cause notices of redemption to be mailed by first-class mail at least 30 but not more than 60 days before the redemption date to each holder of Notes to be redeemed at its registered address.

If any Note is to be redeemed in part only, the notice of redemption that relates to that Note will state the portion of the principal amount thereof to be redeemed. We will issue a new Note in a principal amount equal to the unredeemed portion of the original Note in the name of the holder upon cancellation of the original Note. Notes called for redemption become due on the date fixed for redemption. On and after the redemption date, interest ceases to accrue on Notes or portions of them called for redemption.

Mandatory Redemption; Offers to Purchase; Open Market Purchases

We are not required to make any mandatory redemption or sinking fund payments with respect to the Notes. However, under certain circumstances, we may be required to offer to purchase Notes as described under the captions “— Change of Control” and “— Certain Covenants — Limitation on Sales of Assets and Subsidiary Stock”. We are entitled at our option at any time and from time to time purchase Notes in the open market or otherwise.

Ranking

Senior Indebtedness versus Notes

Payments of principal of, and premium, if any, and interest on the Notes and the payment of the Subsidiary Guaranties, if required, will rank pari passu in right of payment to the Senior Indebtedness of the Company and the Subsidiary Guarantors, including the obligations of the Company, and, to the extent applicable, the Subsidiary Guarantors, under the Term B Senior Credit Facility. The Notes will be guaranteed by the Subsidiary Guarantors and will rank senior in right of payment to all existing and future Subordinated Obligations of the Company and the Subsidiary Guarantors, as the case may be. However, the Notes will be effectively subordinated in right of payment to all of the Company’s and the Subsidiary Guarantor’s existing and future Secured Indebtedness to the extent of the collateral securing such Indebtedness.

As of September 30, 2006, after giving pro forma effect to the issuance of the outstanding notes and the use of proceeds:

(1) the Company’s Senior Indebtedness would have been approximately $449.1 million, consisting of approximately $199.1 million of Secured Indebtedness under the Term B Senior Credit Facility and $250.0 million of Indebtedness in respect of the Notes;

(2) the Senior Indebtedness of the Subsidiary Guarantors would have been approximately $449.1 million, including approximately $199.1 million of Secured Indebtedness consisting of their

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respective guaranties of Senior Indebtedness of the Company under the Term B Senior Credit Facility and $250.0 million consisting of their respective guaranties of the Notes; and

(3) the Company’s Subordinated Indebtedness would have been approximately $86.1 million, consisting of approximately $50.8 million of Subordinated Indebtedness under the Company’s Junior Subordinated Note and the Company’s payment-in-kind notes issued in lieu of cash payment of interest under the Company’s Junior Subordinated Note and approximately $35.2 million of Subordinated Indebtedness pursuant to the Company’s Junior Warrants issued pursuant to the Company’s Junior Subordinated Note.

Although the Indenture will contain limitations on the amount of additional Senior Indebtedness and additional Subordinated Indebtedness the Company and the Subsidiary Guarantors may incur, under certain circumstances the amount of such Senior Indebtedness and Subordinated Indebtedness could be substantial. See “— Certain Covenants — Limitation on Indebtedness”. The Indenture will permit the Company to refinance the Junior Subordinated Note and the Junior Warrants using Refinancing Indebtedness.

Liabilities of Subsidiaries versus Notes

Most of our operations are conducted through the Company, but some of our operations are conducted through our Subsidiaries. Some of our Subsidiaries are not Guaranteeing the Notes, and, as described above under “— Guaranties”, Subsidiary Guaranties may be released under certain circumstances. In addition, our future Subsidiaries may not be required to guarantee the Notes. Claims of creditors of such non-guarantor Subsidiaries, including trade creditors and creditors holding Indebtedness or Guarantees issued by such non-guarantor Subsidiaries, and claims of holders of Preferred Stock, if any, of such non-guarantor Subsidiaries generally will have priority with respect to the assets and earnings of such non-guarantor subsidiaries over the claims of the Company’s creditors, including holders of the Notes. Accordingly, the Notes will be effectively subordinated to creditors (including trade creditors) and holders of Preferred Stock, if any, of such non-guarantor Subsidiaries.

The Foreign Subsidiaries and certain other subsidiaries of the Company will not be Guaranteeing the Notes. As of September 30, 2006, the Company’s non-guarantor Subsidiaries held less than 1.0% of our consolidated assets. During the year ended September 30, 2006, the Company’s non-guarantor Subsidiaries generated less than 1.0% of our total net sales and less than 1.0% of our Adjusted EBITDA. As of September 30, 2006, the total liabilities of our non-guarantor Subsidiaries were approximately $2.1 million, including trade payables. Although the Indenture limits the incurrence of Indebtedness by certain of our Subsidiaries, such limitation is subject to a number of significant qualifications and exceptions. Moreover, the Indenture does not impose any limitation on the incurrence by our non-guarantor Subsidiaries of liabilities that are not considered Indebtedness under the Indenture. See “— Certain Covenants — Limitation on Indebtedness”.

Guarantees

Each direct and indirect Restricted Subsidiary of the Company that is a Domestic Subsidiary and that guarantees the obligations of the Company under the Term B Senior Credit Facility will jointly and severally, irrevocably and unconditionally guarantee on a senior basis the performance and punctual payment when due, whether at Stated Maturity, by acceleration or otherwise, of all obligations of the Company under the Indenture and the Notes, whether for payment of principal of, premium, if any, or interest or additional interest on the Notes, expenses, indemnification or otherwise (all such obligations guaranteed by such Guarantors being herein called the “Guaranteed Obligations”). Such Guarantors will agree to pay, in addition to the amount stated above, any and all expenses (including reasonable counsel fees and expenses) incurred by the Trustee or the holders in enforcing any rights under the Guarantees.

The Guaranteed Obligations will be general unsecured senior obligations of each Subsidiary Guarantor, will rank pari passu in right of payment with all existing and any future Senior Indebtedness of such Subsidiary Guarantor, will be effectively subordinated to all Secured Indebtedness of such Subsidiary Guarantor, to the extent of the collateral securing such Indebtedness, and will rank senior in right of

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payment to all existing and future Subordinated Indebtedness of such Subsidiary Guarantor. The Notes will be structurally subordinated to Indebtedness of the Subsidiaries of the Company that do not guarantee the Notes.

Each Guarantee of a Restricted Subsidiary will be limited to an amount not to exceed the maximum amount that can be guaranteed by the applicable Guarantor without rendering such Guarantee, as it relates to such Guarantor, voidable under applicable laws relating to fraudulent conveyance or fraudulent transfer or similar laws affecting the rights of creditors generally. However, this limitation may not be effective to protect the Guarantee from being voided under fraudulent transfer law, or may reduce the Subsidiary Guarantor’s obligation to an amount that effectively makes the Guaranty worthless. See “Risk Factors — Risks Related to the Notes and our Debt Structure — The indebtedness represented by the Notes and the guarantees may be unenforceable due to fraudulent conveyance statutes. After the Issue Date, the Company will cause certain domestic Subsidiaries that Incur or guarantee certain Indebtedness to execute and deliver to the Trustee supplemental indentures pursuant to which such Restricted Subsidiary will guarantee payment of the Notes on the same basis. See “— Certain Covenants — Future Guarantors.”

Each Guarantee will be a continuing guarantee and, subject to the next succeeding paragraph, shall:

(1) remain in full force and effect until payment in full of all the Guaranteed Obligations;

(2) be binding upon each such Guarantor and its successors; and

(3) inure to the benefit of and be enforceable by the Trustee, the holders of the Notes and their successors, transferees and assigns.

A Guarantee of a Restricted Subsidiary will be released upon:

(a) the sale, disposition or other transfer (including through merger or consolidation) of the Capital Stock (including any sale, disposition or other transfer following which the applicable Guarantor is no longer a Restricted Subsidiary), or all or substantially all the assets, of the applicable Guarantor if such sale, disposition or other transfer is made in compliance with the Indenture, in each case other than to the Company or a Subsidiary of the Company; provided, however, that such Guarantor is released from its guarantees, if any, of, and all pledges and security, if any, granted in connection with, the Term B Senior Credit Facility and any other Indebtedness of the Company or of any Restricted Subsidiary of the Company;

(b) the Company designating such Guarantor to be an Unrestricted Subsidiary in accordance with the provisions set forth under “— Certain Covenants — Limitation on Restricted Payments” and the definition of “Unrestricted Subsidiary;”

(c) the release or discharge of all Guarantees by such Restricted Subsidiary and the repayment of all Indebtedness of such Restricted Subsidiary which, if Incurred by such Restricted Subsidiary, would require such Restricted Subsidiary to Guarantee the Notes under the covenant described under “— Certain Covenants — Future Guarantors;” or

(d) our exercise of our legal defeasance option or covenant defeasance option as described under “— Defeasance” or if our obligations under the Indenture are discharged in accordance with the terms of the Indenture.

Book-Entry, Delivery and Form

The outstanding notes were offered and sold to qualified institutional buyers in reliance on Rule 144A (“Rule 144A Notes”). The outstanding notes were also offered and sold in offshore transactions in reliance on Regulation S (“Regulation S Notes”). Following the initial distribution of Rule 144A Notes and Regulation S Notes, such outstanding notes may be transferred to certain institutional “accredited investors” in the secondary market (“IAI Notes”). Except as set forth below, Notes will be issued in registered, global form in minimum denominations of $2,000 and integral multiples of $1,000 in excess of $2,000. The exchange notes will be exchanged only against tender of the outstanding notes.

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Depository Procedures

The following description of the operations and procedures of DTC is provided solely as a matter of convenience. These operations and procedures are solely within the control of DTC and are subject to changes by DTC. We take no responsibility for these operations and procedures, and we urge investors to contact DTC or its participants directly to discuss these matters.

DTC has advised us that DTC is a limited-purpose trust company organized under the laws of the State of New York, a “banking organization” within the meaning of the New York Banking Law, a member of the Federal Reserve System, a “clearing corporation” within the meaning of the Uniform Commercial Code and a “clearing agency” registered pursuant to the provisions of Section 17A of the Exchange Act. DTC was created to hold securities for its participating organizations (collectively, the “Participants”) and to facilitate the clearance and settlement of transactions in those securities between Participants through electronic book-entry changes in accounts of its Participants. The Participants include securities brokers and dealers (including the initial purchasers), banks, trust companies, clearing corporations and certain other organizations. Access to DTC’s system is also available to other entities such as banks, brokers, dealers and trust companies that clear through or maintain a custodial relationship with a Participant, either directly or indirectly (collectively, the “Indirect Participants”). Persons who are not Participants may beneficially own securities held by or on behalf of DTC only through the Participants or the Indirect Participants. The ownership interests in, and transfers of ownership interests in, each security held by or on behalf of DTC are recorded on the records of the Participants and Indirect Participants.

DTC has also advised us that, pursuant to procedures established by it:

(1) upon deposit of the Notes, DTC will credit the accounts of participants designated by the initial purchasers with portions of the principal amount of the Notes; and

(2) ownership of these interests in the Notes will be shown on, and the transfer of ownership of these interests will be effected only through, records maintained by DTC (with respect to the Participants) or by the Participants and the Indirect Participants (with respect to other owners of beneficial interests in the Notes).

Investors in the Notes who are Participants in DTC’s system may hold their interests therein directly through DTC. Investors in the Notes who are not Participants may hold their interests therein indirectly through organizations which are Participants in such system. All interests in a Note may be subject to the procedures and requirements of DTC. The laws of some states require that certain Persons take physical delivery in definitive form of securities that they own. Consequently, the ability to transfer beneficial interests in a Note to such Persons will be limited to that extent. Because DTC can act only on behalf of Participants, which in turn act on behalf of Indirect Participants, the ability of a Person having beneficial interests in a Note to pledge such interests to Persons that do not participate in the DTC system, or otherwise take actions in respect of such interests, may be affected by the lack of a physical certificate evidencing such interests.

Except as described below, owners of an interest in the Notes will not have Notes registered in their names, will not receive physical delivery of Notes in certificated form and will not be considered the registered owners or “Holders” thereof under the Indenture for any purpose.

Payments in respect of the principal of, and interest and premium and additional interest, if any, on a Note registered in the name of DTC or its nominee will be payable to DTC in its capacity as the registered Holder under the Indenture. Under the terms of the Indenture, the Company and the Trustee will treat the Persons in whose names the notes, including the Notes, are registered as the owners of the Notes for the purpose of receiving payments and for all other purposes. Consequently, we do not and will not, and nor does the Trustee or any agent of us or the Trustee have or will have, any responsibility or liability for:

(1) any aspect of DTC’s records or any Participant’s or Indirect Participant’s records relating to or payments made on account of, or transfers or exchanges of, beneficial ownership interests in the

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Notes or for maintaining, supervising or reviewing any of DTC’s records or any Participant’s or Indirect Participant’s records relating to the beneficial ownership interests in the Notes; or

(2) any other matter relating to the actions and practices of DTC or any of its participants or indirect participants.

DTC has advised us that its current practice, upon receipt of any payment in respect of securities such as the Notes (including principal and interest), is to credit the accounts of the relevant Participants with the payment on the payment date unless DTC has reason to believe it will not receive payment on such payment date. Each relevant Participant is credited with an amount proportionate to its beneficial ownership of an interest in the principal amount of the relevant security as shown on the records of DTC. Payments by the Participants and the Indirect Participants to the beneficial owners of Notes will be governed by standing instructions and customary practices and will be the responsibility of the Participants or the Indirect Participants and will not be the responsibility of DTC, the Trustee or us. Neither we nor the Trustee will be liable for any delay by DTC or any of its Participants in identifying the beneficial owners of the Notes, and we and the Trustee may conclusively rely on and will be protected in relying on instructions from DTC or its nominee for all purposes.

Transfers between Participants in DTC will be effected in accordance with DTC’s procedures, and will be settled in same-day funds.

DTC has advised the Company that it will take any action permitted to be taken by a Holder of Notes only at the direction of one or more Participants to whose account DTC has credited the interests in the Notes and only in respect of such portion of the aggregate principal amount of the Notes as to which such Participant or Participants has or have given such direction. However, if there is an Event of Default under the Notes, DTC reserves the right to exchange the Notes for legended Notes in certificated form, and to distribute such Notes to its Participants.

Although DTC has agreed to the foregoing procedures in order to facilitate transfers of and exchanges into the Notes among Participants, it is under no obligation to perform such procedures, and such procedures may be discontinued or changed at any time. Neither we nor the Trustee nor any of our or their respective agents will have any responsibility for the performance by DTC or its Participants or Indirect Participants of their respective obligations under the rules and procedures governing their operations.

Exchange of Notes for Certificated Notes

A Note is exchangeable for a definitive Note in registered certificated form (a “Certificated Note”) if:

(1) DTC (A) notifies the Company that it is unwilling or unable to continue as depositary for the Notes or (B) has ceased to be a clearing agency registered under the Exchange Act and, in each case, a successor depositary is not appointed;

(2) the Company, at its option, notifies the Trustee in writing that it elects to cause the issuance of the Certificated Notes; or

(3) there has occurred and is continuing a Default with respect to the Notes.

In addition, beneficial interests in a Note may be exchanged for Certificated Notes upon prior written notice given to the Trustee by or on behalf of DTC in accordance with the Indenture. In all cases, Certificated Notes delivered in exchange for any Note or beneficial interests in Notes will be registered in the names, and issued in any approved denominations, requested by or on behalf of the depositary (in accordance with its customary procedures) and will bear any applicable restrictive legend unless a legend is not required by applicable law.

Same Day Settlement and Payment

The Company will make payments in respect of the Notes (including principal, premium, if any, interest and additional interest, if any) by wire transfer of immediately available funds to the accounts

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specified by the Note Holder. The Company will make all payments of principal, interest and premium and additional interest, if any, with respect to Certificated Notes by wire transfer of immediately available funds to the accounts specified by the Holders of the Certificated Notes or, if no such account is specified, by mailing a check to each such Holder’s registered address. The Notes are expected to trade in DTC’s Same-Day Funds Settlement System, and any permitted secondary market trading activity in such notes will, therefore, be required by DTC to be settled in immediately available funds. The Company expects that secondary trading in any Certificated Notes will also be settled in immediately available funds.

The information in this Section concerning DTC and DTC’s book-entry system has been obtained from sources that we believe to be reliable, but we do not take responsibility for any inaccuracies of which we are not aware.

Registration Rights

In the event that:

(1) applicable interpretations of the staff of the SEC do not permit the Company to effect this registered exchange offer; or

(2) for any other reason we do not consummate the registered exchange offer within 240 days of the Issue Date; or

(3) an initial purchaser shall notify us promptly after becoming aware following consummation of the registered exchange offer that outstanding notes held by it are not eligible to be exchanged for exchange notes in the registered exchange offer; or

(4) certain holders shall notify us promptly after becoming aware that they are prohibited by law or SEC policy from participating in the registered exchange offer or may not resell the exchange notes acquired by them in the registered exchange offer to the public without delivering a prospectus,

then, we will, subject to certain exceptions,

(A) promptly file a shelf registration statement (the “Shelf Registration Statement”) with the SEC covering resales of the outstanding notes or the exchange notes, as the case may be;

(B) (i) in the case of clause (1) or (2) above, use our reasonable best efforts to cause the Shelf Registration Statement to be declared effective under the Securities Act on or prior to the 360th day after the Issue Date and (ii) in the case of clause (3) or (4) above, use our reasonable best efforts to cause the Shelf Registration Statement to be declared effective under the Securities Act on or prior to the 120th day after the date on which the Shelf Registration Statement is required to be filed; and

(C) use our reasonable best efforts to keep the Shelf Registration Statement effective until the earliest of (i) the time when the Notes covered by the Shelf Registration Statement can be sold pursuant to Rule 144 without any limitations under clauses (c), (e), (f) and (h) of Rule 144, (ii) two years from the Issue Date and (iii) the date on which all Notes registered thereunder are disposed of in accordance therewith.

The Company will, in the event a Shelf Registration Statement is filed, among other things, provide to each holder for whom such Shelf Registration Statement was filed copies of the prospectus which is a part of the Shelf Registration Statement, notify each such holder when the Shelf Registration Statement has become effective and take certain other actions as are required to permit unrestricted resales of the Notes or the Exchange Notes, as the case may be. A holder selling such outstanding notes or exchange notes pursuant to the Shelf Registration Statement generally would be required to be named as a selling security holder in the related prospectus and to deliver a prospectus to purchasers, will be subject to certain of the civil liability provisions under the Securities Act in connection with such sales and will be bound by the provisions of the Registration Rights Agreement that are applicable to such holder (including certain indemnification obligations).

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The Company may require each holder requesting to be named as a selling security holder to furnish to the Company such information regarding the holder and the distribution of the outstanding notes or exchange notes by the holder as the Company may from time to time reasonably require for the inclusion of the holder in the Shelf Registration Statement, including requiring the holder to properly complete and execute such selling security holder notice and questionnaires, and any amendments or supplements thereto, as the Company may reasonably deem necessary or appropriate. The Company may refuse to name any holder as a selling security holder that fails to provide us with such information. If the Company is required to file a Shelf Registration Statement with respect to any Notes, the Company will be entitled to delay filing such Shelf Registration Statement or, if the Company has already filed such a Shelf Registration Statement, from time to time require all holders of Notes to delay or discontinue the offer, sale or other disposition of Notes pursuant to said Shelf Registration Statement for a reasonable period of time not to exceed 90 days (the “Shelf Suspension Period”).

The Company will pay additional cash interest on the Notes, subject to certain exceptions,

(1) if the exchange offer is not consummated on or before the 240th day after the Issue Date;

(2) if obligated to file a Shelf Registration Statement, the Shelf Registration Statement is not declared effective on or prior to the 360th day after the Issue Date, or

(3) after the exchange offer registration statement or the Shelf Registration Statement, as the case may be, is declared effective, such Registration Statement thereafter ceases to be effective or usable prior to the expiration of the Company’s obligation to maintain its effectiveness (subject to certain exceptions).

(each such event referred to in the preceding clauses (1) through (3), a “Registration Default”); from and including the date on which any such Registration Default shall occur to but excluding the date on which all Registration Defaults have been cured; provided, however, that the Company will not be required to pay any additional cash interest during any Shelf Suspension Period and after the Company cures such Registration Default.

The rate of the additional interest will be (a) so long as the Company is subject to the filing requirements of the Exchange Act and fully complies, subject to Rule 12b-25 of the Exchange Act, with all such filing requirements, 0.25% per annum for the first 90-day period immediately following the occurrence of a Registration Default, and such rate will increase by an additional 0.25% per annum with respect to each subsequent 90-day period until all Registration Defaults have been cured, up to a maximum additional interest rate of 1.0% per annum and (b) otherwise, 0.50% per annum for the first 90-day period immediately following the occurrence of a Registration Default, and such rate will increase by an additional 0.50% per annum with respect to each subsequent 90-day period until all Registration Defaults have been cured, up to a maximum additional interest rate of 2.0% per annum. The Company will pay such additional interest on regular interest payment dates. Such additional interest will be in addition to any other interest payable from time to time with respect to the outstanding notes and the exchange notes.

All references in the Indenture, in any context, to any interest or other amount payable on or with respect to the Notes shall be deemed to include any additional interest pursuant to the Registration Rights Agreement.

If we effect the registered exchange offer, we will be entitled to close the registered exchange offer 30 days after the commencement thereof provided that we have accepted all outstanding notes theretofore validly tendered in accordance with the terms of the registered exchange offer.

Change of Control

Upon the occurrence of any of the following events (each a “Change of Control”), each Holder shall have the right to require that the Company repurchase such Holder’s Notes at a purchase price in cash equal to 101% of the principal amount thereof on the date of purchase plus accrued and unpaid interest, if

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any, to the date of purchase (subject to the right of holders of record on the relevant record date to receive interest due on the relevant interest payment date):

(1) any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act), other than the Permitted Holder, is or becomes the beneficial owner (as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that such person shall be deemed to have “beneficial ownership” of all shares that any such person has the right to acquire, whether such right is exercisable immediately or only after the passage of time), directly or indirectly, of more than 35% of the total voting power of the Voting Stock of the Company; provided, however, that the Permitted Holder beneficially owns (as defined in 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, in the aggregate a lesser percentage of the total voting power of the Voting Stock of the Company than such other person and does not have the right or ability by voting power, contract or otherwise to elect or designate for election a majority of the Board of Directors of the Company (for the purposes of this clause (1), such other person shall be deemed to beneficially own any Voting Stock of a specified person held by a parent entity, if such other person is the beneficial owner (as defined above in this clause (1)), directly or indirectly, of more than 35% of the voting power of the Voting Stock of such parent entity and the Permitted Holder beneficially owns (as defined in this proviso), directly or indirectly, in the aggregate a lesser percentage of the voting power of the Voting Stock of such parent entity and does not have the right or ability by voting power, contract or otherwise to elect or designate for election a majority of the board of directors of such parent entity);

(2) individuals who on the Issue Date constituted the Board of Directors of the Company (together with any new directors whose election by such Board of Directors of the Company or whose nomination for election by the shareholders of the Company was approved by a vote of 662/3% of the directors of the Company, then still in office who were either directors on the Issue Date or whose election or nomination for election was previously so approved) cease for any reason to constitute a majority of the Board of Directors of the Company then in office;

(3) the adoption of a plan relating to the liquidation or dissolution of the Company; and

(4) the merger or consolidation of the Company with or into another Person or the merger of another Person with or into the Company, or the sale of all or substantially all the assets of the Company (determined on a consolidated basis) to another Person other than (A) a transaction in which the survivor or transferee is a Person that is controlled by the Permitted Holder or (B) a transaction following which (i) in the case of a merger or consolidation transaction, holders of securities that represented 100% of the Voting Stock of the Company immediately prior to such transaction (or other securities into which such securities are converted as part of such merger or consolidation transaction) own directly or indirectly at least a majority of the voting power of the Voting Stock of the surviving Person in such merger or consolidation transaction immediately after such transaction and in substantially the same proportion as before the transaction and (ii) in the case of a sale of assets transaction, each transferee becomes an obligor in respect of the Notes and a Subsidiary of the transferor of such assets.

Within 30 days following any Change of Control, unless we have previously mailed a redemption notice with respect to all outstanding Notes as described under “— Optional Redemption”, we will mail a notice to each Holder with a copy to the Trustee (the “Change of Control Offer”) stating:

(1) that a Change of Control has occurred and that such Holder has the right to require us to purchase such Holder’s Notes at a purchase price in cash equal to 101% of the principal amount thereof on the date of purchase, plus accrued and unpaid interest, if any, to the date of purchase (subject to the right of Holders of record on the relevant record date to receive interest on the relevant interest payment date);

(2) the circumstances and relevant facts regarding such Change of Control (including information with respect to pro forma historical income, cash flow and capitalization, in each case after giving effect to such Change of Control);

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(3) the purchase date (which shall be no earlier than 30 days nor later than 60 days from the date such notice is mailed); and

(4) the instructions, as determined by us, consistent with the covenant described hereunder, that a Holder must follow in order to have its Notes purchased.

While the Notes are in global form, a Holder may exercise its option to elect for the purchase of the Notes through the facilities of DTC, subject to its rules and regulations.

The Company will not be required to make a Change of Control Offer following a Change of Control if a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth in the Indenture applicable to a Change of Control Offer to be made by the Company and purchases all Notes validly tendered and not withdrawn under such Change of Control Offer.

A Change of Control Offer may be made in advance of a Change of Control, conditioned upon the occurrence of such Change of Control, if a definitive agreement is in place for the Change of Control at the time of making of the Change of Control Offer.

The Company will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other applicable securities laws or regulations in connection with the repurchase of Notes as a result of a Change of Control. To the extent that the provisions of any securities laws or regulations conflict with the provisions of the covenant described in the Indenture, the Company will comply with the applicable securities laws and regulations and shall not be deemed to have breached its obligations under the covenant described in the Indenture by virtue of its compliance with such securities laws or regulations.

The Change of Control purchase feature of the Notes may in certain circumstances make more difficult or discourage a sale or takeover of the Company and, thus, the removal of incumbent management. The Change of Control purchase feature is a result of negotiations between the Company and the initial purchaser. The Company has no present intention to engage in a transaction involving a Change of Control, although it is possible that we could decide to do so in the future. Subject to the limitations discussed below, the Company could, in the future, enter into certain transactions, including acquisitions, refinancings or other recapitalizations, that would not constitute a Change of Control under the Indenture, but that could increase the amount of indebtedness outstanding at such time or otherwise affect our capital structure or credit ratings. Restrictions on our ability to Incur additional Indebtedness are contained in the covenants described under “— Certain Covenants — Limitation on Indebtedness”, “— Limitation on Liens” and “— Limitation on Sale/Leaseback Transactions”. Such restrictions can only be waived with the consent of the holders of a majority in principal amount of the Notes then outstanding. Except for the limitations contained in such covenants, however, the Indenture will not contain any covenants or provisions that may afford holders of the Notes protection in the event of a highly leveraged transaction.

Future indebtedness that we may incur may contain prohibitions on the occurrence of certain events that would constitute a Change of Control or require the repurchase of such indebtedness upon a Change of Control. Moreover, the exercise by the holders of their right to require us to repurchase their Notes could cause a default under such indebtedness, even if the Change of Control itself does not, due to the financial effect of such repurchase on us. Finally, the Company’s ability to pay cash to the holders of Notes following the occurrence of a Change of Control may be limited by the Company’s then existing financial resources. There can be no assurance that sufficient funds will be available when necessary to make any required repurchases.

The definition of “Change of Control” includes a disposition of all or substantially all of the assets of the Company to any Person. Although there is a limited body of case law interpreting the phrase “substantially all”, there is no precise established definition of the phrase under applicable law. Accordingly, in certain circumstances there may be a degree of uncertainty as to whether a particular transaction would involve a disposition of “all or substantially all” of the assets of the Company. As a result, it may be unclear as to whether a Change of Control has occurred and whether a holder of Notes may require the Company to make an offer to repurchase the Notes as described above.

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The provisions under the Indenture relative to our obligation to make an offer to repurchase the Notes as a result of a Change of Control may be waived or modified with the written consent of the holders of a majority in principal amount of the Notes.

Certain Covenants

The Indenture contains covenants including, among others, the following:

Limitation on Indebtedness

(a) The Company will not, and will not permit any Restricted Subsidiary to, Incur, directly or indirectly, any Indebtedness; provided, however, that the Company and the Subsidiary Guarantors will be entitled to Incur Indebtedness if, on the date of such Incurrence and after giving effect thereto on a pro forma basis the Consolidated Coverage Ratio exceeds 2.0 to 1.0.

(b) Notwithstanding the foregoing paragraph (a), the Company and the Restricted Subsidiaries will be entitled to Incur any or all of the following Indebtedness:

(1) Indebtedness Incurred by the Company pursuant to the Term B Senior Credit Facility; provided, however, that, immediately after giving effect to any such Incurrence, the aggregate principal amount of all Indebtedness Incurred under this clause (1) and then outstanding does not exceed $360.0 million less the sum of all principal payments with respect to such Indebtedness pursuant to paragraph (a)(3)(A) of the covenant described under “— Limitation on Sales of Assets and Subsidiary Stock;”;

(2) Indebtedness owed to and held by the Company or a Restricted Subsidiary; provided, however, that (A) any subsequent issuance or transfer of any Capital Stock which results in any such Restricted Subsidiary ceasing to be a Restricted Subsidiary or any subsequent transfer of such Indebtedness (other than to the Company or a Restricted Subsidiary) shall be deemed, in each case, to constitute the Incurrence of such Indebtedness by the obligor thereon, (B) if the Company is the obligor on such Indebtedness, such Indebtedness is expressly subordinated to the prior payment in full in cash of all obligations with respect to the Notes, and (C) if a Subsidiary Guarantor is the obligor on such Indebtedness, such Indebtedness is expressly subordinated to the prior payment in full in cash of all obligations of such Subsidiary Guarantor with respect to its Subsidiary Guaranty;

(3) the outstanding notes and the exchange notes (but excluding any Additional Notes);

(4) Indebtedness outstanding on the Issue Date (other than Indebtedness described in clause (1), (2) or (3) of this covenant, but including the Junior Subordinated Notes and the Junior Warrants);

(5) Indebtedness of a Restricted Subsidiary Incurred and outstanding on or prior to the date on which such Subsidiary was acquired by the Company (other than Indebtedness Incurred in connection with, or to provide all or any portion of the funds or credit support utilized to consummate, the transaction or series of related transactions pursuant to which such Subsidiary became a Subsidiary or was acquired by the Company); provided, however, that on the date of such acquisition and after giving pro forma effect thereto, the Company would have been entitled to Incur at least $1.00 of additional Indebtedness pursuant to paragraph (a) of this covenant;

(6) Refinancing Indebtedness in respect of Indebtedness Incurred pursuant to paragraph (a) or pursuant to clause 3, 4 or 5 or this clause 6; provided, however, that to the extent such Refinancing Indebtedness directly or indirectly Refinances Indebtedness of a Subsidiary Incurred pursuant to clause 5, such Refinancing Indebtedness shall be Incurred only by such Subsidiary;

(7) Hedging Obligations consisting of Interest Rate Agreements (and renewals thereof) directly related to Indebtedness permitted to be Incurred by the Company and its Restricted Subsidiaries pursuant to the Indenture;

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(8) obligations in respect of performance, bid, appeal and surety bonds and completion guarantees provided by the Company or any Restricted Subsidiary in the ordinary course of business;

(9) Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds in the ordinary course of business; provided, however, that such Indebtedness is extinguished within two Business Days of its Incurrence;

(10) Indebtedness consisting of the Subsidiary Guaranty of a Subsidiary Guarantor and any Guarantee by a Subsidiary Guarantor of Indebtedness Incurred pursuant to paragraph (a) or pursuant to clause (1), (2), (3) or (4) or pursuant to clause (6) to the extent the Refinancing Indebtedness Incurred thereunder directly or indirectly Refinances Indebtedness Incurred pursuant to paragraph (a) or pursuant to clause (3) or (4);

(11) Indebtedness of any Foreign Subsidiary to the extent Incurred for working capital purposes;

(12) Indebtedness of the Company or any Subsidiary Guarantor incurred to finance the acquisition, construction or improvement of any fixed or capital assets, and extensions, renewals and replacements of any such Indebtedness that do not increase the outstanding principal amount thereof; provided that (a) such Indebtedness is incurred prior to or within 90 days after such acquisition or the completion of such construction or improvement and (b) the aggregate principal amount of Indebtedness outstanding at any time pursuant to this paragraph, when taken together with the aggregate principal amount of all Capital Lease Obligations and Synthetic Lease Obligations outstanding at such time pursuant to the immediately succeeding paragraph (13), shall not exceed the greater of $25.0 million and 2.5% of Total Assets;

(13) Capital Lease Obligations and Synthetic Lease Obligations; provided that the aggregate amount of all Capital Lease Obligations and Synthetic Lease Obligations outstanding at any time pursuant to this paragraph, when taken together with the aggregate principal amount of Indebtedness outstanding at such time pursuant to the immediately preceding paragraph (12), shall not exceed the greater of $25.0 million and 2.5% of Total Assets;

(14) Permitted Subordinated Indebtedness of the Company or any Restricted Subsidiary incurred to (a) finance a Permitted ESOP Transaction (b) finance a Permitted Acquisition or (c) refinance existing Indebtedness of a Person that becomes a wholly-owned Subsidiary of the Company as a result of a Permitted Acquisition (so long as such Indebtedness is not incurred in contemplation of the applicable Permitted Acquisition); provided that the aggregate amount of all Permitted Indebtedness outstanding at any time pursuant to this paragraph shall not exceed $35.0 million;

(15) Indebtedness of the Company or any Restricted Subsidiary constituting reimbursement obligations with respect to letters of credit issued in the ordinary course of business, including letters of credit in respect of workers’ compensation claims, or other Indebtedness with respect to reimbursement type obligations regarding workers’ compensation claims; provided that upon the drawing of such letters of credit or the incurrence of such Indebtedness, such obligations are reimbursed within 30 days following such drawing or incurrence;

(16) Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently drawn against insufficient funds in the ordinary course of business, so long as such Indebtedness is extinguished within 30 days of the applicable Incurrence;

(17) Indebtedness arising from agreements of the Company or any Restricted Subsidiary providing for indemnification, adjustment of purchase price, earn-outs, or similar obligations, in each case, incurred or assumed in connection with any business acquisition or any disposition of any business, assets or Subsidiary other than guarantees of Indebtedness incurred by any Person acquiring all or any portion of such business, assets or Subsidiary for the purpose of financing such acquisition; provided that (a) the total amount of such Indebtedness which may be Incurred with respect to any such transaction shall not exceed the gross proceeds including non-cash proceeds actually received by the Company or any Restricted Subsidiary in connection therewith and (b) such Indebtedness is not

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reflected on the balance sheet of the Company or any Restricted Subsidiary under GAAP, as in effect on the Issue Date;

(18) Indebtedness constituting obligations of the Company or any Restricted Subsidiary under deferred compensation agreements entered into in the ordinary course; provided that such obligations are satisfied within 30 days of becoming due; and

(19) Indebtedness of the Company or any Restricted Subsidiary, including Additional Notes, in an aggregate principal amount which, when taken together with all other Indebtedness of the Company and its Restricted Subsidiaries outstanding on the date of such Incurrence (other than Indebtedness permitted by clauses (1) through (18) above or paragraph (a)) does not exceed $35.0 million.

(c) Notwithstanding the foregoing, neither the Company nor any Subsidiary Guarantor will incur any Indebtedness pursuant to the foregoing paragraph (b) if the proceeds thereof are used, directly or indirectly, to Refinance any Subordinated Obligations of the Company or any Subsidiary Guarantor unless such Indebtedness shall be subordinated to the Notes or the applicable Subsidiary Guaranty to at least the same extent as such Subordinated Obligations.

(d) For purposes of determining compliance with this covenant:

(1) any Indebtedness remaining outstanding under the Term B Senior Credit Facility after the application of the net proceeds from the sale of the Notes will be treated as Incurred on the Issue Date under clause (1) of paragraph (b) above;

(2) in the event that an item of Indebtedness (or any portion thereof) meets the criteria of more than one of the types of Indebtedness described above, the Company, in its sole discretion, will classify such item of Indebtedness (or any portion thereof) at the time of Incurrence and will only be required to include the amount and type of such Indebtedness in one of the above clauses;

(3) the Company will be entitled to divide and classify an item of Indebtedness in more than one of the types of Indebtedness described above; and

(4) any Indebtedness originally classified as Incurred pursuant to one of the clauses in paragraph (b) above (other than pursuant to clause (1) of paragraph (b) above) may later be reclassified by the Company such that it will be deemed as having been Incurred pursuant to paragraph (a) above or another clause in paragraph (b) above, as applicable, to the extent that such reclassified Indebtedness could be Incurred pursuant to such new clause at the time of such reclassification.

(e) For purposes of determining compliance with any U.S. dollar denominated restriction on the Incurrence of Indebtedness where the Indebtedness Incurred is denominated in a different currency, the amount of such Indebtedness will be the U.S. Dollar Equivalent determined on the date of the Incurrence of such Indebtedness; provided, however, that if any such Indebtedness denominated in a different currency is subject to a Currency Agreement with respect to U.S. dollars covering all principal, premium, if any, and interest payable on such Indebtedness, the amount of such Indebtedness expressed in U.S. dollars will be as provided in such Currency Agreement. The principal amount of any Refinancing Indebtedness Incurred in the same currency as the Indebtedness being Refinanced will be the U.S. Dollar Equivalent of the Indebtedness Refinanced, except to the extent that (1) such U.S. Dollar Equivalent was determined based on a Currency Agreement, in which case the Refinancing Indebtedness will be determined in accordance with the preceding sentence, and (2) the principal amount of the Refinancing Indebtedness exceeds the principal amount of the Indebtedness being Refinanced, in which case the U.S. Dollar Equivalent of such excess will be determined on the date such Refinancing Indebtedness is Incurred.

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Limitation on Restricted Payments

(a) The Company will not, and will not permit any Restricted Subsidiary, directly or indirectly, to make a Restricted Payment if at the time the Company or such Restricted Subsidiary makes such Restricted Payment:

(1) a Default shall have occurred and be continuing (or would result therefrom);

(2) the Company is not entitled to Incur an additional $1.00 of Indebtedness pursuant to paragraph (a) of the covenant described under “— Limitation on Indebtedness”; or

(3) the aggregate amount of such Restricted Payment and all other Restricted Payments since the Issue Date would exceed the sum of (without duplication):

(A) 50% of the Consolidated Net Income accrued during the period (treated as one accounting period) from the beginning of the fiscal quarter immediately following the fiscal quarter during which the Issue Date occurs to the end of the most recent fiscal quarter ending at least 45 days prior to the date of such Restricted Payment (or, in case such Consolidated Net Income shall be a deficit, minus 100% of such deficit); plus

(B) 100% of the aggregate Net Cash Proceeds received by the Company (x) from the issuance or sale of its Qualified Capital Stock subsequent to the Issue Date, (y) as a contribution in respect of the outstanding Qualified Capital Stock of the Company by its stockholders subsequent to the Issue Date and (z) from optional employee contributions to the ESOP; plus

(C) the amount by which Indebtedness of the Company is reduced on the Company’s balance sheet upon the conversion or exchange subsequent to the Issue Date of any Indebtedness of the Company convertible or exchangeable for Capital Stock (other than Capital Stock that constitutes Disqualified Stock) of the Company (less the amount of any cash, or the fair value of any other property, distributed by the Company upon such conversion or exchange); provided, however, that the foregoing amount shall not exceed the Net Cash Proceeds received by the Company or any Restricted Subsidiary from the sale of such Indebtedness (excluding Net Cash Proceeds from sales to a Subsidiary of the Company or to an employee stock ownership plan or to a trust established by the Company or any of its Subsidiaries for the benefit of their employees); plus

(D) an amount equal to the sum of (i) the net reduction in the Investments (other than Permitted Investments) made by the Company or any Restricted Subsidiary in any Person resulting from repurchases, repayments or redemptions of such Investments by such Person, proceeds realized on the sale of such Investment and proceeds representing the return of capital (excluding dividends and distributions), in each case received by the Company or any Restricted Subsidiary, and (ii) to the extent such Person is an Unrestricted Subsidiary, the portion (proportionate to the Company’s equity interest in such Subsidiary) of the Fair Market Value of the net assets of such Unrestricted Subsidiary at the time such Unrestricted Subsidiary is designated a Restricted Subsidiary; provided, however, that the foregoing sum shall not exceed, in the case of any such Person or Unrestricted Subsidiary, the amount of Investments (excluding Permitted Investments) previously made (and treated as a Restricted Payment) by the Company or any Restricted Subsidiary in such Person or Unrestricted Subsidiary.

(b) The preceding provisions will not prohibit:

(1) any Restricted Payment made out of the Net Cash Proceeds of the substantially concurrent sale of, or made by exchange for, Qualified Capital Stock of the Company or a substantially concurrent cash capital contribution received by the Company from its shareholders; provided, however, that (A) such Restricted Payment shall be excluded in the calculation of the amount of Restricted Payments and (B) the Net Cash Proceeds from such sale or such cash capital contribution (to the extent so used for such Restricted Payment) shall be excluded from the calculation of amounts under clause (3)(B) of paragraph (a) above;

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(2) any purchase, repurchase, redemption, defeasance or other acquisition or retirement for value of Subordinated Obligations of the Company or a Subsidiary Guarantor made by exchange for, or out of the proceeds of the substantially concurrent Incurrence of, Indebtedness of such Person which is permitted to be Incurred pursuant to the covenant described under “— Limitation on Indebtedness”; provided, however, that such purchase, repurchase, redemption, defeasance or other acquisition or retirement for value shall be excluded in the calculation of the amount of Restricted Payments;

(3) dividends paid within 60 days after the date of declaration thereof if at such date of declaration such dividend would have complied with this covenant; provided, however, that at the time of payment of such dividend, no other Default shall have occurred and be continuing (or result therefrom); provided further, however, that such dividend shall be included in the calculation of the amount of Restricted Payments;

(4) the declaration and payments of dividends on Disqualified Stock issued pursuant to the covenant described under “— Limitation on Indebtedness”; provided, however, that at the time of payment of such dividend, no Default shall have occurred and be continuing (or result therefrom); provided further, however, that such dividends shall be excluded in the calculation of the amount of Restricted Payments;

(5) repurchases of Capital Stock deemed to occur upon exercise of stock options or warrants if such Capital Stock represents a portion of the exercise price of such options or warrants; provided, however, that such Restricted Payments shall be excluded in the calculation of the amount of Restricted Payments;

(6) cash payments in lieu of the issuance of fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Capital Stock of the Company; provided, however, that any such cash payment shall not be for the purpose of evading the limitation of the covenant described under this subheading (as determined in good faith by the Board of Directors or the Compensation Committee thereof); provided further, however, that such payments shall be excluded in the calculation of the amount of Restricted Payments;

(7) in the event of a Change of Control, and if no Default shall have occurred and be continuing, the payment, purchase, redemption, defeasance or other acquisition or retirement of Subordinated Obligations of the Company or any Subsidiary Guarantor, in each case, at a purchase price not greater than 101% of the principal amount of such Subordinated Obligations, plus any accrued and unpaid interest thereon; provided, however, that prior to such payment, purchase, redemption, defeasance or other acquisition or retirement, the Company (or a third party to the extent permitted by the Indenture) has made a Change of Control Offer with respect to the Notes as a result of such Change of Control and has repurchased all Notes validly tendered and not withdrawn in connection with such Change of Control Offer; provided further, however, that such payments, purchases, redemptions, defeasances or other acquisitions or retirements shall be included in the calculation of the amount of Restricted Payments;

(8) payments of intercompany Subordinated Obligations, the Incurrence of which was permitted under clause 2 of paragraph (b) of the covenant described under “— Limitation on Indebtedness”; provided, however, that no Default has occurred and is continuing or would otherwise result therefrom; provided further, however, that such payments shall be excluded in the calculation of the amount of Restricted Payments;

(9) any purchase or redemption of Subordinated Obligations of the Company or a Subsidiary Guarantor from Net Available Cash to the extent permitted by the covenant described under “— Limitation on Sales of Assets and Subsidiary Stock” after the Company (or a Restricted Subsidiary, as the case may be) has made an offer to the Holders of the Notes to purchase the Notes pursuant to clause (a)(3)(C) of such covenant; provided, however, that such purchase or redemption shall be excluded in the calculation of the amount of Restricted Payments;

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(10) in the event of an Asset Disposition that requires the Company to offer to repurchase Notes pursuant to the covenant described under “— Certain Covenants — Limitation on Sales of Assets and Subsidiary Stock”, and if no Default shall have occurred and be continuing, the payment, purchase, redemption, defeasance or other acquisition or retirement of Subordinated Obligations of the Company or any Subsidiary Guarantor, in each case, at a purchase price not greater than 100% of the principal amount (or, if such Subordinated Obligations were issued with original issue discount, 100% of the accreted value) of such Subordinated Obligations, plus any accrued and unpaid interest thereon; provided, however, that (A) prior to such payment, purchase, redemption, defeasance or other acquisition or retirement, the Company has made an offer with respect to the Notes pursuant to the provisions of the covenant described under “— Certain Covenants — Limitation on Sales of Assets and Subsidiary Stock” and has repurchased all Notes validly tendered and not withdrawn in connection with such offer and (B) the aggregate amount of all such payments, purchases, redemptions, defeasances or other acquisitions or retirements of all such Subordinated Obligations may not exceed (x) the amount by which Net Available Cash was reduced as a result of the offer with respect to the Notes less (y) the Net Available Cash actually used to consummate the offer of the Notes (and any other Senior Indebtedness included in such offer); provided further, however, that such Restricted Payments shall be included in the calculation of the amount of Restricted Payments;

(11) the redemption or repurchase for value of any Capital Stock of the Company as a result of distributions by the ESOT of such Capital Stock to the former JSC participants pursuant to the ESOP Plan Documents as a result of their voluntary or involuntary termination of employment with the Company or any Controlled Group member during the JSC Termination Period; provided, however, that the aggregate amount of Restricted Payments made pursuant to this clause (11) will not exceed $13.0 million;

(12) Permitted ESOP Transactions or purchases, repurchases, redemptions, defeasances or other acquisitions or retirements for value of the Junior Subordinated Note or the Junior Warrants; provided, however, that the aggregate amount of Restricted Payments made pursuant to this clause (12) will not exceed $25.0 million; or

(13) Restricted Payments in an amount which, when taken together with all Restricted Payments made pursuant to this clause (13), does not exceed $30.0 million; provided, however, that (A) at the time of each such Restricted Payment, no Default shall have occurred and be continuing (or result therefrom) and (B) the amount of Restricted Payments made pursuant to this clause (13) shall be included in the calculation of the amount of Restricted Payments.

Limitation on Restrictions on Distributions from Restricted Subsidiaries

The Company will not, and will not permit any Restricted Subsidiary to, create or otherwise cause or permit to exist or become effective any consensual encumbrance or restriction on the ability of any Restricted Subsidiary to (a) pay dividends or make any other distributions on its Capital Stock to the Company or a Restricted Subsidiary or pay any Indebtedness owed to the Company or a Subsidiary Guarantor, (b) make any loans or advances to the Company or a Subsidiary Guarantor or (c) transfer any of its property or assets to the Company or a Subsidiary Guarantor, except:

(1) with respect to clauses (a), (b) and (c),

(A) any encumbrance or restriction pursuant to an agreement in effect at or entered into on the Issue Date, including the Term B Senior Credit Facility in effect on the Issue Date;

(B) any encumbrance or restriction with respect to a Restricted Subsidiary pursuant to an agreement relating to any Indebtedness Incurred by such Restricted Subsidiary on or prior to the date on which such Restricted Subsidiary was acquired by the Company (other than Indebtedness Incurred as consideration in, or to provide all or any portion of the funds or credit support utilized to consummate, the transaction or series of related transactions pursuant to which such Restricted

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Subsidiary became a Restricted Subsidiary or was acquired by the Company) and outstanding on such date;

(C) any encumbrance or restriction pursuant to an agreement effecting a Refinancing of Indebtedness Incurred pursuant to an agreement referred to in clause (A) or (B) of clause (1) of this covenant or this clause (C) or contained in any amendment to an agreement referred to in clause (A) or (B) of clause (1) of this covenant or this clause (C); provided, however, that the encumbrances and restrictions with respect to such Restricted Subsidiary contained in any such refinancing agreement or amendment are no less favorable to the Noteholders than encumbrances and restrictions with respect to such Restricted Subsidiary contained in such predecessor agreements; and

(D) any encumbrance or restriction with respect to a Restricted Subsidiary imposed pursuant to an agreement entered into for the sale or disposition of all or substantially all the Capital Stock or assets of such Restricted Subsidiary pending the closing of such sale or disposition;

(E) any encumbrance or restriction pursuant to applicable law, rule, regulation or order;

(F) restrictions on cash, cash equivalents, Temporary Cash Investments or other deposits or net worth imposed under contracts entered into in the ordinary course of business, including such restrictions imposed by customers or insurance, surety or bonding companies;

(G) any encumbrance or restriction with respect to a Foreign Subsidiary entered into the ordinary course of business or pursuant to the terms of Indebtedness that was Incurred by such Foreign Subsidiary in compliance with the terms of Indenture;

(H) provisions contained in any license, permit or other accreditation with a regulatory authority entered into the ordinary course of business;

(I) provisions in agreements or instruments which prohibit the payment or making of dividends or other distributions other than on a pro rata basis; and

(2) with respect to clause (c) only,

(A) any encumbrance or restriction consisting of customary nonassignment provisions in leases governing leasehold interests to the extent such provisions restrict the transfer of the lease or the property leased thereunder; and

(B) any encumbrance or restriction contained in security agreements or mortgages securing Indebtedness of a Restricted Subsidiary to the extent such encumbrance or restriction restricts the transfer of the property subject to such security agreements or mortgages.

Limitation on Sales of Assets and Subsidiary Stock

(a) The Company will not, and will not permit any Restricted Subsidiary to, directly or indirectly, consummate any Asset Disposition unless:

(1) the Company or such Restricted Subsidiary receives consideration at the time of such Asset Disposition at least equal to the Fair Market Value (including as to the value of all non-cash consideration), as determined in good faith by the Board of Directors of the Company, of the shares and assets subject to such Asset Disposition;

(2) at least 75% of the consideration thereof received by the Company or such Restricted Subsidiary is in the form of cash or cash equivalents; and

(3) an amount equal to 100% of the Net Available Cash from such Asset Disposition is applied by the Company (or such Restricted Subsidiary, as the case may be) to any of the following:

(A) to prepay, repay, redeem or purchase Senior Indebtedness selected by the Company (in each case other than Indebtedness owed to the Company or an Affiliate of the Company) within

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one year from the later of the date of such Asset Disposition or the receipt of such Net Available Cash;

(B) to acquire Additional Assets within one year from the later of the date of such Asset Disposition or the receipt of such Net Available Cash; and

(C) to make an offer to the holders of the Notes (and to holders of other Senior Indebtedness designated by the Company) to purchase Notes (and such other Senior Indebtedness) pursuant to and subject to the conditions contained in the Indenture;

provided, however, that in connection with any prepayment, repayment or purchase of Indebtedness pursuant to clause (A) or (C) above, the Company or such Restricted Subsidiary shall permanently retire such Indebtedness and shall cause the related loan commitment (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased.

Notwithstanding the foregoing provisions of this covenant, the Company and the Restricted Subsidiaries will not be required to apply any Net Available Cash in accordance with this covenant except to the extent that the aggregate Net Available Cash from all Asset Dispositions which is not applied in accordance with this covenant exceeds $7.5 million. Pending the final application of any Net Available Cash, the Company or any of the Restricted Subsidiaries may temporarily reduce outstanding revolving Indebtedness that is Senior Indebtedness or otherwise invest the Net Available Cash in any manner that is not prohibited by the Indenture.

For the purposes of this covenant, the following are deemed to be cash or cash equivalents:

(1) the assumption or discharge of Senior Indebtedness of the Company or any Restricted Subsidiary (other than obligations in respect of Disqualified Stock of the Company or Preferred Stock of a Subsidiary Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness in connection with such Asset Disposition; and

(2) securities received by the Company or any Restricted Subsidiary from the transferee that are promptly converted by the Company or such Restricted Subsidiary into cash, to the extent of cash received in that conversion.

(b) In the event of an Asset Disposition that requires the purchase of Notes (and other Senior Indebtedness) pursuant to clause (a)(3)(C) above, the Company will purchase Notes tendered pursuant to an offer by the Company for the Notes (and such other Senior Indebtedness) at a purchase price of 100% of their principal amount (or, in the event such other Senior Indebtedness was issued with significant original issue discount, 100% of the accreted value thereof) without premium, plus accrued but unpaid interest (or, in respect of such other Senior Indebtedness, such lesser price, if any, as may be provided for by the terms of such other Senior Indebtedness) in accordance with the procedures (including prorating in the event of oversubscription) set forth in the Indenture. If the aggregate purchase price of the securities tendered exceeds the Net Available Cash allotted to their purchase, the Company will select the securities to be purchased on a pro rata basis but in round denominations, which in the case of the Notes will be denominations of $2,000 principal amount or $1,000 multiples thereof. The Company shall not be required to make such an offer to purchase Notes (and other Senior Indebtedness) pursuant to this covenant if the Net Available Cash available therefor is less than $7.5 million (which lesser amount shall be carried forward for purposes of determining whether such an offer is required with respect to the Net Available Cash from any subsequent Asset Disposition). Upon completion of such an offer to purchase, Net Available Cash will be deemed to be reduced by the aggregate amount of such offer.

(c) The Company will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this covenant. To the extent that the provisions of any securities laws or regulations conflict with provisions of this covenant, the Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this covenant by virtue of its compliance with such securities laws or regulations.

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Limitation on Affiliate Transactions

(a) The Company will not, and will not permit any Restricted Subsidiary to, enter into or permit to exist any transaction (including the purchase, sale, lease or exchange of any property, employee compensation arrangements or the rendering of any service) with, or for the benefit of, any Affiliate of the Company (an “Affiliate Transaction”) unless:

(1) the terms of the Affiliate Transaction are no less favorable to the Company or such Restricted Subsidiary than those that could be obtained at the time of the Affiliate Transaction in arm’s-length dealings with a Person who is not an Affiliate;

(2) if such Affiliate Transaction involves an amount in excess of $10.0 million, the terms of the Affiliate Transaction are set forth in writing and a majority of the non-employee directors of the Company disinterested with respect to such Affiliate Transaction have determined in good faith that the criteria set forth in clause (1) are satisfied and have approved the relevant Affiliate Transaction as evidenced by a resolution of the Board of Directors; and

(3) if such Affiliate Transaction involves an amount in excess of $20.0 million, the Board of Directors of the Company shall also have received a written opinion from an Independent Qualified Party to the effect that such Affiliate Transaction is fair, from a financial standpoint, to the Company and its Restricted Subsidiaries or is not less favorable to the Company and its Restricted Subsidiaries than could reasonably be expected to be obtained at the time in an arm’s-length transaction with a Person who was not an Affiliate.

(b) The provisions of the preceding paragraph (a) will not prohibit:

(1) any Investment (other than a Permitted Investment) or other Restricted Payment, in each case permitted to be made pursuant to (but only to the extent included in the calculation of the amount of Restricted Payments made pursuant to paragraph (a)(3) of) the covenant described under “— Limitation on Restricted Payments”;

(2) any issuance of securities, or other payments, awards or grants in cash, securities or otherwise pursuant to, or the funding of, employment arrangements, stock options and stock ownership plans approved by the Board of Directors of the Company;

(3) loans or advances to employees in the ordinary course of business in accordance with the past practices of the Company or its Restricted Subsidiaries, but in any event not to exceed $1.0 million in the aggregate outstanding at any one time;

(4) the payment of reasonable fees to directors of the Company and its Restricted Subsidiaries who are not employees of the Company or its Restricted Subsidiaries;

(5) any transaction with the Company, a Restricted Subsidiary or joint venture or similar entity which would constitute an Affiliate Transaction solely because the Company or a Restricted Subsidiary owns an equity interest in or otherwise controls such Restricted Subsidiary, joint venture or similar entity;

(6) the issuance or sale of any Capital Stock (other than Disqualified Stock) of the Company;

(7) earn-out payments (A) made in connection with acquisitions permitted under the Indenture and (B) negotiated prior to the consummation of the applicable acquisition; and

(8) any agreement as in effect on the Issue Date and described in this prospectus or any renewals or extensions of any such agreement (so long as such renewals or extensions are not less favorable to the Company or the Restricted Subsidiaries) and the transactions evidenced thereby.

Limitation on Line of Business

The Company will not, and will not permit any Restricted Subsidiary, to engage in any business other than a Related Business.

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Limitation on Liens

The Company will not, and the Company will not permit any Restricted Subsidiary to, directly or indirectly, Incur or permit to exist any Lien (the “Initial Lien”) of any nature whatsoever on any of its properties (including Capital Stock of a Restricted Subsidiary), whether owned at the Issue Date or thereafter acquired, securing any Indebtedness, other than Permitted Liens, without effectively providing that the Notes shall be secured equally and ratably with (or prior to) the obligations so secured for so long as such obligations are so secured.

Any Lien created for the benefit of the Holders of the Notes pursuant to the preceding sentence shall provide by its terms that such Lien shall be automatically and unconditionally released and discharged upon the release and discharge of the Initial Lien.

Limitation on Sale/Leaseback Transactions

The Company will not, and will not permit any Restricted Subsidiary to, enter into any Sale/Leaseback Transaction with respect to any property unless:

(1) the Company or such Restricted Subsidiary would be entitled to (A) Incur Indebtedness in an amount equal to the Attributable Debt with respect to such Sale/Leaseback Transaction pursuant to the covenant described under “— Limitation on Indebtedness” and (B) create a Lien on such property securing such Attributable Debt without equally and ratably securing the Notes pursuant to the covenant described under “— Limitation on Liens”;

(2) the net proceeds received by the Company or any Restricted Subsidiary in connection with such Sale/Leaseback Transaction are at least equal to the Fair Market Value (as determined by the Board of Directors of the Company) of such property; and

(3) the Company applies the proceeds of such transaction in compliance with the covenant described under “— Limitation on Sale of Assets and Subsidiary Stock”.

Merger and Consolidation

(a) The Company will not consolidate with or merge with or into, or convey, transfer or lease, in one transaction or a series of transactions, directly or indirectly, all or substantially all its assets to, any Person, unless:

(1) the resulting, surviving or transferee Person (the “Successor Company”) shall be a Person organized and existing under the laws of the United States of America, any State thereof or the District of Columbia and the Successor Company (if not the Company) shall expressly assume, by an indenture supplemental thereto, executed and delivered to the Trustee, in form satisfactory to the Trustee, all the obligations of the Company under the Notes and the Indenture;

(2) immediately after giving pro forma effect to such transaction (and treating any Indebtedness which becomes an obligation of the Successor Company or any Subsidiary as a result of such transaction as having been Incurred by such Successor Company or such Subsidiary at the time of such transaction), no Default shall have occurred and be continuing;

(3) immediately after giving pro forma effect to such transaction, the Successor Company would be able to Incur an additional $1.00 of Indebtedness pursuant to paragraph (a) of the covenant described under “— Limitation on Indebtedness”; and

(4) the Company shall have delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that such consolidation, merger or transfer and such supplemental indenture (if any) comply with the Indenture;

provided, however, that clause (3) will not be applicable to (A) a Restricted Subsidiary consolidating with, merging into or transferring all or part of its properties and assets to the Company (so long as no Capital Stock of the Company is distributed to any Person) or (B) the Company merging with an Affiliate of the

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Company solely for the purpose and with the sole effect of reincorporating the Company in another jurisdiction.

For purposes of this covenant, the sale, lease, conveyance, assignment, transfer or other disposition of all or substantially all of the properties and assets of one or more Subsidiaries of the Company, which properties and assets, if held by the Company instead of such Subsidiaries, would constitute all or substantially all of the properties and assets of the Company on a consolidated basis, shall be deemed to be the transfer of all or substantially all of the properties and assets of the Company.

The Successor Company will be the successor to the Company and shall succeed to, and be substituted for, and may exercise every right and power of, the Company under the Indenture, and the predecessor Company, except in the case of a lease, shall be released from the obligation to pay the principal of and interest on the Notes.

(b) The Company will not permit any Subsidiary Guarantor to consolidate with or merge with or into, or convey, transfer or lease, in one transaction or a series of transactions, all or substantially all of its assets to any Person unless:

(1) the resulting, surviving or transferee Person (if not such Subsidiary) shall be a Person organized and existing under the laws of the jurisdiction under which such Subsidiary was organized or under the laws of the United States of America, or any State thereof or the District of Columbia, and such Person shall expressly assume, by a Guaranty Agreement, in a form satisfactory to the Trustee, all the obligations of such Subsidiary, if any, under its Subsidiary Guaranty, provided that the foregoing shall not be required in the case of a Subsidiary Guarantor (x) that has been disposed of in its entirety to another Person (other than to the Company or an Affiliate of the Company), whether through a merger, consolidation or sale of Capital Stock or assets or (y) that, as a result of the disposition of all or a portion of its Capital Stock, ceases to be a Subsidiary, in both cases, if in connection therewith the Company provides an Officers’ Certificate to the Trustee to the effect that the Company will comply with its obligations under the covenant described under “— Limitation on Sales of Assets and Subsidiary Stock” in respect of such disposition;

(2) immediately after giving effect to such transaction or transactions on a pro forma basis (and treating any Indebtedness which becomes an obligation of the resulting, surviving or transferee Person as a result of such transaction as having been issued by such Person at the time of such transaction), no Default shall have occurred and be continuing; and

(3) the Company delivers to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that such consolidation, merger or transfer and such Guaranty Agreement, if any, complies with the Indenture.

Future Guarantors

The Company will cause each Domestic Restricted Subsidiary that Incurs any Indebtedness (other than Indebtedness permitted to be Incurred pursuant to clause (2), (7), (8) or (9) of paragraph (b) of the covenant described under “— Limitation on Indebtedness”) to, and each Foreign Subsidiary that enters into a Guarantee of any Indebtedness (other than a Foreign Subsidiary that Guarantees Indebtedness Incurred by another Foreign Subsidiary) to, in each case, at the same time, execute and deliver to the Trustee a Guaranty Agreement pursuant to which such Restricted Subsidiary will Guarantee payment of the Notes on the same terms and conditions as those set forth in the Indenture.

SEC Reports

Notwithstanding that the Company may not be subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act, the Company will file with the SEC (to the extent the SEC will accept such filings) and, in any event, will provide the Trustee and Noteholders with such annual reports and such information, documents and other reports as are specified in Section 13 and 15(d) of the Exchange Act and applicable to a U.S. corporation subject to such Sections, such information, documents and other

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reports to be so filed and provided at the times specified for the filings of such information, documents and reports under such Sections. If the SEC will not accept such filings for any reason, the Company will post the reports specified in the preceding sentence on its website within the time periods that would apply if the Company were required to file those reports with the SEC.

At any time that any of the Company’s Subsidiaries are Unrestricted Subsidiaries, then the quarterly and annual financial information required by the preceding paragraph will include a reasonably detailed presentation, either on the face of the financial statements or in the footnotes thereto, and in “Management’s Discussion and Analysis of Financial Condition and Results of Operations”, of the financial condition and results of operations of the Company and its Restricted Subsidiaries separate from the financial condition and results of operations of the Unrestricted Subsidiaries of the Company.

In addition, the Company will furnish to the Holders of the Notes and to prospective investors, upon the requests of such Holders, any information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act so long as the Notes are not freely transferable under the Securities Act.

Defaults

Each of the following is an Event of Default:

(1) a default in the payment of interest on the Notes when due, continued for 30 days;

(2) a default in the payment of principal of any Note when due at its Stated Maturity, upon optional redemption, upon required purchase, upon declaration of acceleration or otherwise;

(3) the failure by the Company to comply with its obligations under “— Certain Covenants — Merger and Consolidation” above;

(4) the failure by the Company to comply for 30 days after notice with any of its obligations in the covenants described above under “Change of Control” (other than a failure to purchase Notes) or under “— Certain Covenants” under “— Limitation on Indebtedness”, “— Limitation on Restricted Payments”, “— Limitation on Restrictions on Distributions from Restricted Subsidiaries”, “— Limitation on Sales of Assets and Subsidiary Stock” (other than a failure to purchase Notes), “— Limitation on Affiliate Transactions”, “— Limitation on Line of Business”, “— Limitation on Liens”, “— Limitation on Sale/Leaseback Transactions”, “— Future Guarantors” or “— SEC Reports”;

(5) the failure by the Company or any Subsidiary Guarantor to comply for 60 days after notice with its other agreements contained in the Indenture;

(6) Indebtedness of the Company, any Subsidiary Guarantor or any Significant Subsidiary is not paid within any applicable grace period after final maturity or is accelerated by the holders thereof because of a default and the total amount of such Indebtedness unpaid or accelerated exceeds $30.0 million (the “cross acceleration provision”);

(7) certain events of bankruptcy, insolvency or reorganization of the Company, a Subsidiary Guarantor or any Significant Subsidiary (the “bankruptcy provisions”);

(8) any judgment or decree for the payment of money in excess of $30.0 million is entered against the Company, a Subsidiary Guarantor or any Significant Subsidiary, remains outstanding for a period of 60 consecutive days following such judgment and is not discharged, waived or stayed (the “judgment default provision”); or

(9) any Subsidiary Guaranty ceases to be in full force and effect (other than in accordance with the terms of such Subsidiary Guaranty) or any Subsidiary Guarantor denies or disaffirms its obligations under its Subsidiary Guaranty.

However, a default under clauses (4) and (5) will not constitute an Event of Default until the Trustee or the holders of 25% in principal amount of the notes outstanding notify the Company of the default and the Company does not cure such default within the time specified after receipt of such notice.

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If an Event of Default occurs and is continuing, the Trustee or the holders of at least 25% in principal amount of the notes outstanding may declare the principal of and accrued but unpaid interest on all the Notes to be due and payable. Upon such a declaration, such principal and interest shall be due and payable immediately. If an Event of Default relating to certain events of bankruptcy, insolvency or reorganization of the Company occurs and is continuing, the principal of and interest on all the Notes will ipso facto become and be immediately due and payable without any declaration or other act on the part of the Trustee or any holders of the Notes. Under certain circumstances, the holders of a majority in principal amount of the notes outstanding may rescind any such acceleration with respect to the Notes and its consequences.

Subject to the provisions of the Indenture relating to the duties of the Trustee, in case an Event of Default occurs and is continuing, the Trustee will be under no obligation to exercise any of the rights or powers under the Indenture at the request or direction of any of the holders of the Notes unless such holders have offered to the Trustee reasonable indemnity or security against any loss, liability or expense. Except to enforce the right to receive payment of principal, premium (if any) or interest when due, no holder of a Note may pursue any remedy with respect to the Indenture or the Notes unless:

(1) such holder has previously given the Trustee notice that an Event of Default is continuing;

(2) holders of at least 25% in principal amount of the notes outstanding have requested the Trustee to pursue the remedy;

(3) such holders have offered the Trustee reasonable security or indemnity against any loss, liability or expense;

(4) the Trustee has not complied with such request within 60 days after the receipt thereof and the offer of security or indemnity; and

(5) holders of a majority in principal amount of the notes outstanding have not given the Trustee a direction inconsistent with such request within such 60-day period.

Subject to certain restrictions, the holders of a majority in principal amount of the notes outstanding are given the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or of exercising any trust or power conferred on the Trustee. The Trustee, however, may refuse to follow any direction that conflicts with law or the Indenture or that the Trustee determines is unduly prejudicial to the rights of any other holder of a Note or that would involve the Trustee in personal liability.

If a Default occurs, is continuing and is known to the Trustee, the Trustee must mail to each holder of the Notes notice of the Default within 90 days after it occurs. Except in the case of a Default in the payment of principal of or interest on any Note, the Trustee may withhold notice if and so long as it in good faith determines that withholding notice is not opposed to the interest of the holders of the Notes. In addition, the Company is required to deliver to the Trustee, within 120 days after the end of each fiscal year, a certificate indicating whether the signers thereof know of any Default that occurred during the previous year. The Company is required to deliver to the Trustee, within 30 days after the occurrence thereof, written notice of any event which would constitute certain Defaults, their status and what action we are taking or propose to take in respect thereof.

Amendments and Waivers

Subject to certain exceptions, the Indenture may be amended with the consent of the holders of a majority in principal amount of the Notes then outstanding (including consents obtained in connection with a tender offer or exchange for the Notes) and any past default or compliance with any provisions may also be waived with the consent of the holders of a majority in principal amount of the Notes then outstanding. However, without the consent of each holder of an outstanding Note affected thereby, an amendment or waiver may not, among other things:

(1) reduce the amount of Notes whose holders must consent to an amendment;

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(2) reduce the rate of or extend the time for payment of interest on any Note;

(3) reduce the principal of or change the Stated Maturity of any Note;

(4) reduce the amount payable upon the redemption of any Note or change the time at which any Note may be redeemed as described under “— Optional Redemption” above ;

(5) make any Note payable in money other than that stated in the Note;

(6) impair the right of any holder of the Notes to receive payment of principal of and interest on such holder’s Notes on or after the due dates therefor or to institute suit for the enforcement of any payment on or with respect to such holder’s Notes;

(7) make any change in, the amendment or waiver provisions which require each holder’s consent;

(8) make any change in the ranking or priority of any Note that would adversely affect the Noteholders; or

(9) make any change in, or release other than in accordance with the Indenture, any Subsidiary Guaranty that would adversely affect the Noteholders.

Notwithstanding the preceding, without the consent of any holder of the Notes, the Company, the Subsidiary Guarantors (with respect to a Subsidiary Guaranty or any provision of the Indenture to which it is a party) and the Trustee may amend, modify or supplement the Indenture, any Subsidiary Guaranty or the Notes:

(1) to cure any ambiguity, omission, defect or inconsistency;

(2) to provide for the assumption by a successor corporation of the obligations of the Company or any Subsidiary Guarantor under the Indenture;

(3) to provide for uncertificated Notes in addition to or in place of certificated Notes (provided that the uncertificated Notes are issued in registered form for purposes of Section 163(f) of the Code, or in a manner such that the uncertificated Notes are described in Section 163(f)(2)(B) of the Code);

(4) to add Guarantees with respect to the Notes, including any Subsidiary Guaranties, or to secure the Notes;

(5) to add to the covenants of the Company or a Subsidiary Guarantor for the benefit of the holders of the Notes or to surrender any right or power conferred upon the Company or a Subsidiary Guarantor;

(6) to make any change that does not adversely affect the rights of any holder of the Notes;

(7) to comply with any requirement of the SEC in connection with the qualification of the Indenture under the Trust Indenture Act;

(8) to conform the text of the Indenture, the Notes and the Subsidiary Guaranties to any provision of this “Description of the Notes” to the extent that such provision in this “Description of the Notes” was intended to be a verbatim recitation of a provision of the Indenture, the Notes and the Subsidiary Guaranties;

(9) to make any amendment to the provisions of the Indenture, any Subsidiary Guaranty or the Notes relating to the transfer and legending of Notes; provided, however, that (a) compliance with the Indenture as so amended would not result in Notes being transferred in violation of the Securities Act or any other applicable securities law and (b) such amendment does not materially and adversely affect the rights of Holders to transfer Notes;

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(10) to provide for the issuance of Exchange Notes; or

(11) to evidence and provide for the acceptance and appointment of a successor Trustee.

The consent of the holders of the Notes is not necessary under the Indenture to approve the particular form of any proposed amendment. It is sufficient if such consent approves the substance of the proposed amendment.

After an amendment under the Indenture becomes effective, the Company is required to mail to holders of the Notes a notice briefly describing such amendment. However, the failure to give such notice to all holders of the Notes, or any defect therein, will not impair or affect the validity of the amendment.

Neither the Company nor any Affiliate of the Company may, directly or indirectly, pay or cause to be paid any consideration, whether by way of interest, fee or otherwise, to any Holder for or as an inducement to any consent, waiver or amendment of any of the terms or provisions of the Indenture or the Notes unless such consideration is offered to all Holders and is paid to all Holders that so consent, waive or agree to amend in the time frame set forth in solicitation documents relating to such consent, waiver or agreement.

Transfer

The Notes will be issued in registered form and will be transferable only upon the surrender of the Notes being transferred for registration of transfer and compliance with the terms and conditions of the Indenture, all legends affixed to the Notes and applicable law. The registrar of the Notes, the Trustee or the Company may require a Holder, among other things, to furnish appropriate endorsements, transfer and assignment documents and other certificates, and the Company may require a Holder to pay any taxes, assessment, governmental charges and fees required by applicable law and permitted by the Indenture. The Company is not required to transfer or exchange any Note selected for redemption, and for a period of up to fifteen (15) days prior to selection of Notes for redemption, the Company is not required to transfer or exchange any Note.

Satisfaction and Discharge

When we (1) deliver to the Trustee all notes outstanding for cancellation or (2) all notes outstanding have become due and payable, whether at maturity or on a redemption date as a result of the mailing of notice of redemption, and, in the case of clause (2), we irrevocably deposit with the Trustee funds sufficient to pay at maturity or upon redemption all notes outstanding, including interest thereon to maturity or such redemption date, and if in either case we pay all other sums payable under the Indenture by us, then the Indenture shall, subject to certain exceptions, cease to be of further effect.

Defeasance

At any time, we may terminate all our obligations under the Notes and the Indenture and have each Subsidiary Guarantor’s obligation discharged with respect to its Guarantee (“legal defeasance”), except for certain obligations, including the rights of Holders to receive payment of principal, interest and premium, if any, when due solely out of the defeasance trust, obligations to register the transfer or exchange of the Notes, to replace mutilated, destroyed, lost or stolen Notes and to maintain a registrar and paying agent in respect of the Notes, the rights, powers, duties and immunities of the Trustee, and the legal defeasance provisions of the Indenture.

In addition, at any time we may terminate our obligations under “— Change of Control” and under the covenants described under “— Certain Covenants” (other than the covenant described under “— Merger and Consolidation”), the operation of the cross acceleration provision, the bankruptcy provisions with respect to Subsidiary Guarantors and Significant Subsidiaries and the judgment default provision described under “— Defaults” above and the limitations contained in clause (3) of the first paragraph under “— Certain Covenants — Merger and Consolidation” above (“covenant defeasance”). After such covenant defeasance, any failure to comply with such obligations shall not constitute a Default or give rise to an Event of Default.

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We may exercise our legal defeasance option notwithstanding our prior exercise of our covenant defeasance option. If we exercise our legal defeasance option, payment of the Notes may not be accelerated because of an Event of Default with respect thereto. If we exercise our covenant defeasance option, payment of the Notes may not be accelerated because of an Event of Default specified in clause (4), (6), (7) (with respect only to Significant Subsidiaries and Subsidiary Guarantors) or (8) under “— Defaults” above or because of the failure of the Company to comply with clause (3) of the first paragraph under “— Certain Covenants — Merger and Consolidation” above. If we exercise our legal defeasance option or our covenant defeasance option, each Subsidiary Guarantor will be released from all of its obligations with respect to its Subsidiary Guaranty.

In order to exercise either of our defeasance options, we must irrevocably deposit in trust (the “defeasance trust”) with the Trustee money or U.S. Government Obligations for the payment of principal and interest on the Notes to redemption or maturity, as the case may be, and must comply with certain other conditions, including delivery to the Trustee of an Opinion of Counsel to the effect that holders of the Notes will not recognize income, gain or loss for federal income tax purposes as a result of such deposit and defeasance and will be subject to federal income tax on the same amounts and in the same manner and at the same times as would have been the case if such deposit and defeasance had not occurred (and, in the case of legal defeasance only, such Opinion of Counsel must be based on a ruling of the Internal Revenue Service or other change in applicable federal income tax law).

Concerning the Trustee

Wilmington Trust Company is the Trustee under the Indenture. We have appointed the Trustee as Registrar and Paying Agent with regard to the Notes.

The Indenture contains certain limitations on the rights of the Trustee, should it become a creditor of the Company, to obtain payment of claims in certain cases, or to realize on certain property received in respect of any such claim as security or otherwise. The Trustee will be permitted to engage in other transactions; provided, however, if it acquires any conflicting interest it must either eliminate such conflict within 90 days, apply to the SEC for permission to continue or resign.

The Holders of a majority in principal amount of the outstanding notes will have the right to direct the time, method and place of conducting any proceeding for exercising any remedy available to the Trustee, subject to certain exceptions. If an Event of Default occurs (and is not cured), the Trustee will be required, in the exercise of its power, to use the degree of care of a prudent person in the conduct of his own affairs. Subject to such provisions, the Trustee will be under no obligation to exercise any of its rights or powers under the Indenture at the request of any Holder of Notes, unless such Holder shall have offered to the Trustee security and indemnity satisfactory to it against any loss, liability or expense and then only to the extent required by the terms of the Indenture.

No Personal Liability of Directors, Officers, Employees and Stockholders

No director, officer, employee, incorporator or stockholder of the Company or any Subsidiary Guarantor will have any liability for any obligations of the Company or any Subsidiary Guarantor under the Notes, any Subsidiary Guaranty or the Indenture or for any claim based on, in respect of, or by reason of such obligations or their creation. Each Holder of the Notes by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Notes. Such waiver and release may not be effective to waive liabilities under the U.S. Federal securities laws, and it is the view of the SEC that such a waiver is against public policy.

Governing Law

The Indenture and the Notes will be governed by, and construed in accordance with, the laws of the State of New York.

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Certain Definitions

“Additional Assets” means:

(1) any property, plant or equipment used in a Related Business;

(2) the Capital Stock of a Person that becomes a Restricted Subsidiary as a result of the acquisition of such Capital Stock by the Company or another Restricted Subsidiary; or

(3) Capital Stock constituting a minority interest in any Person that at such time is a Restricted Subsidiary;

provided, however, that any such Restricted Subsidiary described in clause (2) or (3) above is primarily engaged in a Related Business.

“Adjusted EBITDA” means, for any period, Consolidated Net Income for such period plus (a) without duplication and to the extent deducted in determining such Consolidated Net Income, the sum of (i) Consolidated Interest Expense for such period, (ii) consolidated income tax expense for such period, (iii) all amounts attributable to depreciation and amortization for such period and (iv) any non-cash charges or expenses (other than the write-down of current assets) for such period, including (A) non-cash expenses associated with the recognition of the difference between the fair market value of the Junior Warrants and the exercise price of the Junior Warrants and (B) non-cash expenses with respect to the Junior Warrants and accretion of the Junior Warrants and minus (b) without duplication all cash payments made during such period on account of reserves, restructuring charges and other non-cash charges added to Consolidated Net Income pursuant to clause (a)(iv) above in a previous period.

“Affiliate” of any specified Person means any other Person, directly or indirectly, controlling or controlled by or under direct or indirect common control with such specified Person. For the purposes of this definition, “control” when used with respect to any Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative to the foregoing. For purposes of the covenants described under “— Certain Covenants — Limitation on Restricted Payments”, “— Certain Covenants — Limitation on Affiliate Transactions” and “— Certain Covenants — Limitation on Sales of Assets and Subsidiary Stock” only, “Affiliate” shall also mean any beneficial owner of Capital Stock representing 5% or more of the total voting power of the Voting Stock (on a fully diluted basis) of the Company or of rights or warrants to purchase such Capital Stock (whether or not currently exercisable) and any Person who would be an Affiliate of any such beneficial owner pursuant to the first sentence hereof.

“Asset Disposition” means any sale, lease, transfer or other disposition (or series of related sales, leases, transfers or dispositions) by the Company or any Restricted Subsidiary, including any disposition by means of a merger, consolidation or similar transaction (each referred to for the purposes of this definition as a “disposition”), of:

(1) any shares of Capital Stock of a Restricted Subsidiary (other than directors’ qualifying shares or shares required by applicable law to be held by a Person other than the Company or a Restricted Subsidiary);

(2) all or substantially all the assets of any division or line of business of the Company or any Restricted Subsidiary; or

(3) any other assets of the Company or any Restricted Subsidiary outside of the ordinary course of business of the Company or such Restricted Subsidiary

(other than, in the case of clauses (1), (2) and (3) above,

(A) a disposition by a Restricted Subsidiary to the Company or by the Company or a Restricted Subsidiary to a Restricted Subsidiary;

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(B) for purposes of the covenant described under “— Certain Covenants — Limitation on Sales of Assets and Subsidiary Stock” only, (i) a disposition that constitutes a Restricted Payment (or would constitute a Restricted Payment but for the exclusions from the definition thereof) and that is not prohibited by the covenant described under “— Certain Covenants — Limitation on Restricted Payments” and (ii) a disposition of all or substantially all the assets of the Company in accordance with the covenant described under “— Certain Covenants — Merger and Consolidation”;

(C) a disposition of assets with a Fair Market Value of less than $500,000;

(D) a disposition of cash or Temporary Cash Investments; and

(E) the creation of a Lien (but not the sale or other disposition of the property subject to such Lien)).

“Attributable Debt” in respect of a Sale/Leaseback Transaction means, as at the time of determination, the present value (discounted at the interest rate borne by the Notes, compounded annually) of the total obligations of the lessee for rental payments during the remaining term of the lease included in such Sale/Leaseback Transaction (including any period for which such lease has been extended); provided, however, that if such Sale/Leaseback Transaction results in a Capital Lease Obligation, the amount of Indebtedness represented thereby will be determined in accordance with the definition of “Capital Lease Obligation”.

“Average Life” means, as of the date of determination, with respect to any Indebtedness, the quotient obtained by dividing:

(1) the sum of the products of the numbers of years from the date of determination to the dates of each successive scheduled principal payment of or redemption or similar payment with respect to such Indebtedness multiplied by the amount of such payment by

(2) the sum of all such payments.

“Board of Directors” with respect to a Person means the Board of Directors of such Person or any committee thereof duly authorized to act on behalf of such Board. Unless otherwise specified, the board of directors refers to the Board of Directors of the Company.

“Business Day” means each day which is not a Legal Holiday.

“Capital Lease Obligation” means an obligation that is required to be classified and accounted for as a capital lease for financial reporting purposes in accordance with GAAP, and the amount of Indebtedness represented by such obligation shall be the capitalized amount of such obligation determined in accordance with GAAP; and the Stated Maturity thereof shall be the date of the last payment of rent or any other amount due under such lease prior to the first date upon which such lease may be terminated by the lessee without payment of a penalty. For purposes of the covenant described under “— Certain Covenants — Limitation on Liens”, a Capital Lease Obligation will be deemed to be secured by a Lien on the property being leased.

“Capital Stock” of any Person means any and all shares, interests (including partnership interests), rights to purchase, warrants, options, participations or other equivalents of or interests in (however designated) equity of such Person, including any Preferred Stock phantom stock and stock appreciation rights, but excluding any debt securities convertible into such equity.

“Code” means the Internal Revenue Code of 1986, as amended.

“Consolidated Coverage Ratio” for any period means the ratio of (a) the aggregate amount of Adjusted EBITDA for such period to (b) Consolidated Interest Expense for such period payable in cash.

“Consolidated Interest Expense” shall mean, for any period, the sum of (a) the interest expense (excluding fees and any interest expense attributable to any accretion in the value of the Junior Warrants but including imputed interest expense in respect of Capital Lease Obligations and Synthetic Lease Obligations) of the Company and the Restricted Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP, plus (b) any interest accrued during such period in respect of Indebtedness

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of the Company or any Restricted Subsidiary that is required to be capitalized rather than included in consolidated interest expense for such period in accordance with GAAP. For purposes of the foregoing, interest expense shall be determined after giving effect to any net payments made or received by the Company or any Restricted Subsidiary with respect to Interest Rate Agreements. Consolidated Interest Expense does not include cash contributions to any employee stock ownership plan or similar trust to the extent such contributions are used by such plan or trust to pay interest or fees to any Person (other than the Company) in connection with Indebtedness incurred by such plan or trust.

“Consolidated Net Income” shall mean, for any period, the net income or loss of the Company and the Restricted Subsidiaries for such period determined on a consolidated basis in accordance with GAAP; provided that (a) there shall be excluded, in each case to the extent included in determining the net income or loss of the Company and the Restricted Subsidiaries for such period on a consolidated basis under GAAP, (i) the income of any Restricted Subsidiary to the extent that the declaration or payment of dividends or similar distributions by the Restricted Subsidiary of that income is not at the time permitted by operation of the terms of its charter or any agreement, instrument, judgment, decree, statute, rule or governmental regulation applicable to such Restricted Subsidiary, (ii) the income or loss of any person accrued prior to the date it becomes a Restricted Subsidiary or is merged into or consolidated with the Company or any Restricted Subsidiary or the date that such person’s assets are acquired by the Company or any Restricted Subsidiary, (iii) any gains attributable to sales of assets out of the ordinary course of business and the transaction costs in connection with such sales and (iv) any extraordinary or non-recurring gains or other income items and (b) there shall be added back, in each case to the extent deducted in determining the net income or loss of the Company and the Restricted Subsidiaries for such period on a consolidated basis under GAAP, (i) any non-cash compensation charge or expense including any such charge or expense relating to stock appreciation rights and phantom stock plans, (ii) any non-cash contributions to the ESOP, (iii) amortization of goodwill and other intangible assets, (iv) any losses attributable to sales of assets out of the ordinary course of business and the transaction costs in connection with such sales and (v) any extraordinary or non-recurring losses or charges.

Notwithstanding the foregoing, for the purposes of the covenant described under “— Certain Covenants — Limitation on Restricted Payments” only, there shall be excluded from Consolidated Net Income any repurchases, repayments or redemptions of Investments, proceeds realized on the sale of Investments or return of capital to the Company or a Restricted Subsidiary to the extent such repurchases, repayments, redemptions, proceeds or returns increase the amount of Restricted Payments permitted under such covenant pursuant to clause (a)(3)(D) thereof.

“Currency Agreement” means any foreign exchange contract, currency swap agreement or other similar agreement with respect to currency values.

“Default” means any event which is, or after notice or passage of time or both would be, an Event of Default.

“Disqualified Stock” means, with respect to any Person, any Capital Stock which by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable at the option of the holder) or upon the happening of any event:

(1) matures or is mandatorily redeemable (other than redeemable only for Capital Stock of such Person which is not itself Disqualified Stock) pursuant to a sinking fund obligation or otherwise;

(2) is convertible or exchangeable at the option of the holder for Indebtedness or Disqualified Stock; or

(3) is mandatorily redeemable or must be purchased upon the occurrence of certain events or otherwise, in whole or in part;

in each case on or prior to the six-month anniversary of the Stated Maturity of the Notes; provided, however, that any Capital Stock that would not constitute Disqualified Stock but for provisions thereof giving holders thereof the right to require such Person to purchase or redeem such Capital Stock upon the

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occurrence of an “asset sale” or “change of control” occurring prior to the first anniversary of the Stated Maturity of the Notes shall not constitute Disqualified Stock if:

(1) the “asset sale” or “change of control” provisions applicable to such Capital Stock are not more favorable to the holders of such Capital Stock than the terms applicable to the Notes and described under “— Certain Covenants — Limitation on Sales of Assets and Subsidiary Stock” and “— Certain Covenants — Change of Control”; and

(2) any such requirement only becomes operative after compliance with such terms applicable to the Notes, including the purchase of any Notes tendered pursuant thereto.

The amount of any Disqualified Stock that does not have a fixed redemption, repayment or repurchase price will be calculated in accordance with the terms of such Disqualified Stock as if such Disqualified Stock were redeemed, repaid or repurchased on any date on which the amount of such Disqualified Stock is to be determined pursuant to the Indenture; provided, however, that if such Disqualified Stock could not be required to be redeemed, repaid or repurchased at the time of such determination, the redemption, repayment or repurchase price will be the book value of such Disqualified Stock as reflected in the most recent financial statements of such Person.

“Domestic Restricted Subsidiary” means any Restricted Subsidiary other than a Foreign Subsidiary.

“ESOP” means the employee benefit plan entitled “The Alion Science and Technology Corporation Employee Ownership, Savings and Investment Plan” adopted and maintained by the Company and as in effect on the Issue Date and as may be amended as required by a change in applicable law after the Issue Date.

“ESOP Plan Documents” means collectively, the governing agreements and other documents and instruments of the ESOP, in each case as in effect on the Issue Date and as may be amended as required by a change in applicable law after the Issue Date.

“ESOT” means the trust entitled “The Alion Science and Technology Corporation Employee Ownership, Savings and Investment Trust” and adopted and maintained by the Company pursuant to the applicable ESOP Plan Documents, as in effect on the Issue Date and as may be amended as required by a change in applicable law after the Issue Date.

“Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended.

“Fair Market Value” means, with respect to any asset or property, the price which could be negotiated in an arm’s length, free market transaction, for cash, between a willing seller and a willing and able buyer, neither of whom is under undue pressure or compulsion to complete the transaction. Fair Market Value will be determined in good faith by the Board of Directors, whose determination will be conclusive and evidenced by a resolution of such Board of Directors.

“Foreign Subsidiary” means any Restricted Subsidiary of the Company that is not organized under the laws of the United States of America or any State thereof or the District of Columbia.

“Former JSC Participant” means the employees of the Company or any of its Subsidiaries that primarily provided services under the Joint Spectrum Center (JSC) Engineering Support Services contract and were voluntarily or involuntarily terminated during the JSC Termination Period in connection with the Company’s failure to receive the follow-on support contract with respect to such contract.

“GAAP” means generally accepted accounting principles in the United States of America as in effect as of the Issue Date, including those set forth in:

(1) the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants;

(2) statements and pronouncements of the Financial Accounting Standards Board;

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(3) such other statements by such other entity as approved by a significant segment of the accounting profession; and

(4) the rules and regulations of the SEC governing the inclusion of financial statements (including pro forma financial statements) in periodic reports required to be filed pursuant to Section 13 of the Exchange Act, including opinions and pronouncements in staff accounting bulletins and similar written statements from the accounting staff of the SEC.

“Guarantee” means any obligation, contingent or otherwise, of any Person directly or indirectly guaranteeing any Indebtedness of any Person and any obligation, direct or indirect, contingent or otherwise, of such Person:

(1) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness of such Person (whether arising by virtue of partnership arrangements, or by agreements to keep-well, to purchase assets, goods, securities or services, to take-or-pay or to maintain financial statement conditions or otherwise); or

(2) entered into for the purpose of assuring in any other manner the obligee of such Indebtedness of the payment thereof or to protect such obligee against loss in respect thereof (in whole or in part);

provided, however, that the term “Guarantee” shall not include endorsements for collection or deposit in the ordinary course of business. The term “Guarantee” used as a verb has a corresponding meaning.

“Guaranty Agreement” means a supplemental indenture, in a form reasonably satisfactory to the Trustee, pursuant to which a Subsidiary Guarantor guarantees the Company’s obligations with respect to the Notes on the terms provided for in the Indenture.

“Hedging Obligations” of any Person means the obligations of such Person pursuant to any Interest Rate Agreement or Currency Agreement.

“Holder” or “Noteholder” means the Person in whose name a Note is registered on the Registrar’s books.

“IIT” means Illinois Institute of Technology, an Illinois not-for-profit corporation.

“IITRI” means IIT Research Institute, a not-for-profit Illinois corporation controlled by IIT.

“Incur” means issue, assume, Guarantee, incur or otherwise become liable for; provided, however, that any Indebtedness of a Person existing at the time such Person becomes a Restricted Subsidiary (whether by merger, consolidation, acquisition or otherwise) shall be deemed to be Incurred by such Person at the time it becomes a Restricted Subsidiary. The term “Incurrence” when used as a noun shall have a correlative meaning. Solely for purposes of determining compliance with “— Certain Covenants — Limitation on Indebtedness”:

(1) amortization of debt discount or the accretion of principal with respect to a non-interest bearing or other discount security;

(2) the payment of regularly scheduled interest in the form of additional Indebtedness of the same instrument or the payment of regularly scheduled dividends on Capital Stock in the form of additional Capital Stock of the same class and with the same terms; and

(3) the obligation to pay a premium in respect of Indebtedness arising in connection with the issuance of a notice of redemption or making of a mandatory offer to purchase such Indebtedness

will not be deemed to be the Incurrence of Indebtedness.

“Indebtedness” means, with respect to any Person on any date of determination (without duplication):

(1) the principal in respect of (A) indebtedness of such Person for money borrowed and (B) indebtedness evidenced by notes, debentures, bonds or other similar instruments for the payment

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of which such Person is responsible or liable, including, in each case, any premium on such indebtedness to the extent such premium has become due and payable;

(2) all Capital Lease Obligations of such Person and all Attributable Debt in respect of Sale/Leaseback Transactions entered into by such Person;

(3) all obligations of such Person issued or assumed as the deferred purchase price of property, all conditional sale obligations of such Person and all obligations of such Person under any title retention agreement (but excluding any accounts payable or other liability to trade creditors arising in the ordinary course of business);

(4) all obligations of such Person for the reimbursement of any obligor on any letter of credit, bankers’ acceptance or similar credit transaction (other than obligations with respect to letters of credit securing obligations (other than obligations described in clauses (1) through (3) above) entered into in the ordinary course of business of such Person to the extent such letters of credit are not drawn upon or, if and to the extent drawn upon, such drawing is reimbursed no later than the tenth Business Day following payment on the letter of credit);

(5) the amount of all obligations of such Person with respect to the redemption, repayment or other repurchase of any Disqualified Stock of such Person or, with respect to any Preferred Stock of any Subsidiary of such Person, the principal amount of such Preferred Stock to be determined in accordance with the Indenture (but excluding, in each case, any accrued dividends);

(6) all obligations of the type referred to in clauses (1) through (5) of other Persons and all dividends of other Persons for the payment of which, in either case, such Person is responsible or liable, directly or indirectly, as obligor, guarantor or otherwise, including by means of any Guarantee;

(7) all obligations of the type referred to in clauses (1) through (6) of other Persons secured by any Lien on any property or asset of such Person (whether or not such obligation is assumed by such Person), the amount of such obligation being deemed to be the lesser of the Fair Market Value of such property or assets and the amount of the obligation so secured; and

(8) to the extent not otherwise included in this definition, Hedging Obligations of such Person.

Notwithstanding the foregoing, in connection with the purchase by the Company or any Restricted Subsidiary of any business, the term “Indebtedness” will exclude post-closing payment adjustments to which the sellers may become entitled to the extent such payment is determined by reference to a final closing balance sheet or such payment depends on the performance of such business after the closing; provided, however, that, at the time of closing, the amount of any such payment is not determinable and, to the extent such payment thereafter becomes fixed and determined, the amount is paid within 30 days thereafter.

The amount of Indebtedness of any Person at any date shall be the outstanding balance at such date of all obligations as described above but without duplication or double-counting of any Indebtedness described in two or more clauses above; provided, however, that in the case of Indebtedness sold at a discount, the amount of such Indebtedness at any time will be the accreted value thereof at such time. The Junior Warrants shall constitute Indebtedness of the Company.

“Independent Qualified Party” means an investment banking firm, accounting firm or appraisal firm of national standing; provided, however, that such firm is not an Affiliate of the Company.

“Interest Rate Agreement” means any interest rate swap agreement, interest rate cap agreement or other financial agreement or arrangement with respect to exposure to interest rates.

“Investment” in any Person means any direct or indirect advance, loan (other than advances to customers in the ordinary course of business that are recorded as accounts receivable on the balance sheet of the lender) or other extensions of credit (including by way of Guarantee or similar arrangement) or capital contribution to (by means of any transfer of cash or other property to others or any payment for property or services for the account or use of others), or any purchase or acquisition of Capital Stock,

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Indebtedness or other similar instruments issued by such Person. If the Company or any Restricted Subsidiary issues, sells or otherwise disposes of any Capital Stock of a Person that is a Restricted Subsidiary such that, after giving effect thereto, such Person is no longer a Restricted Subsidiary, any Investment by the Company or any Restricted Subsidiary in such Person remaining after giving effect thereto will be deemed to be a new Investment at such time. The acquisition by the Company or any Restricted Subsidiary of a Person that holds an Investment in a third Person will be deemed to be an Investment by the Company or such Restricted Subsidiary in such third Person at such time. Except as otherwise provided for herein, the amount of an Investment shall be its Fair Market Value at the time the Investment is made and without giving effect to subsequent changes in value.

For purposes of the definition of “Unrestricted Subsidiary”, the definition of “Restricted Payment” and the covenant described under “— Certain Covenants — Limitation on Restricted Payments”:

(1) “Investment” shall include the portion (proportionate to the Company’s equity interest in such Subsidiary) of the Fair Market Value of the net assets of any Subsidiary of the Company at the time that such Subsidiary is designated an Unrestricted Subsidiary; provided, however, that upon a redesignation of such Subsidiary as a Restricted Subsidiary, the Company shall be deemed to continue to have a permanent “Investment” in an Unrestricted Subsidiary equal to an amount (if positive) equal to (A) the Company’s “Investment” in such Subsidiary at the time of such redesignation less (B) the portion (proportionate to the Company’s equity interest in such Subsidiary) of the Fair Market Value of the net assets of such Subsidiary at the time of such redesignation; and

(2) any property transferred to or from an Unrestricted Subsidiary shall be valued at its Fair Market Value at the time of such transfer, in each case as determined in good faith by the Board of Directors of the Company.

“Issue Date” means the date on which the outstanding notes are originally issued.

“JSC Termination Period” means the period beginning on July 1, 2006 and ending on December 31, 2006.

“Junior Subordinated Note” means the Company’s 6% Seller Subordinated Notes due December 20, 2010 in an outstanding aggregate principal amount on the Issue Date of approximately $39.9 million, together with additional Seller Subordinated Notes issued in lieu of cash interest thereon in accordance with the terms thereof.

“Junior Warrants” means an aggregate of 1,080,437 detachable redeemable common stock warrants issued to the holders of the Seller Subordinated Notes.

“Legal Holiday” means a Saturday, a Sunday or a day on which banking institutions are not required to be open in the State of New York.

“Lien” means any mortgage, pledge, security interest, encumbrance, lien or charge of any kind (including any conditional sale or other title retention agreement or lease in the nature thereof).

“Moody’s” means Moody’s Investors Service, Inc. and any successor to its rating agency business.

“Net Available Cash” from an Asset Disposition means cash payments received therefrom (including any cash payments received by way of deferred payment of principal pursuant to a note or installment receivable or otherwise and proceeds from the sale or other disposition of any securities received as consideration, but only as and when received, but excluding any other consideration received in the form of assumption by the acquiring Person of Indebtedness or other obligations relating to such properties or assets or received in any other non-cash form), in each case net of:

(1) all direct costs relating to such Asset Disposition including, without limitation, legal, investment banking, accounting, title and recording tax expenses, commissions and other fees and expenses incurred, and all Federal, state, provincial, foreign and local taxes required to be accrued as a liability under GAAP, as a consequence of such Asset Disposition;

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(2) all payments (whether principal, interest, premium or other) made on any Indebtedness which is secured by any assets subject to such Asset Disposition or required to be repaid as a result of the Asset Disposition, in accordance with the terms of any Lien upon or other security agreement of any kind with respect to such assets or other agreement with respect to such Indebtedness, or which must by its terms, or in order to obtain a necessary consent to such Asset Disposition, or by applicable law, be repaid out of the proceeds from such Asset Disposition;

(3) all distributions and other payments required to be made to minority interest holders in Restricted Subsidiaries as a result of such Asset Disposition;

(4) the deduction of appropriate amounts provided by the seller as a reserve, in accordance with GAAP, against any liabilities associated with the property or other assets disposed in such Asset Disposition and retained by the Company or any Restricted Subsidiary after such Asset Disposition including indemnification liabilities, purchase price adjustments, and employee benefit plan liabilities; and

(5) any portion of the purchase price from an Asset Disposition placed in escrow, whether as a reserve for adjustment of the purchase price, for satisfaction of indemnities in respect of such Asset Disposition or otherwise in connection with that Asset Disposition; provided, however, that upon the termination of that escrow, Net Available Cash will be increased by any portion of funds in the escrow that are released to the Company or any Restricted Subsidiary.

“Net Cash Proceeds”, with respect to any issuance or sale of Capital Stock or Indebtedness, means the cash proceeds of such issuance or sale net of attorneys’ fees, accountants’ fees, underwriters’ or placement agents’ fees, discounts or commissions and brokerage, consultant and other fees actually incurred in connection with such issuance or sale and net of taxes paid or payable as a result thereof.

“Obligations” means, with respect to any Indebtedness, all obligations for principal, premium, interest, penalties, fees, indemnifications, reimbursements, and other amounts payable pursuant to the documentation governing such Indebtedness.

“Officer” means the Chairman of the Board, the Chief Executive Officer, the President, the Chief Financial Officer, any Vice President, the Treasurer or the Secretary of the Company.

“Officers’ Certificate” means a certificate signed by an Officer.

“Opinion of Counsel” means a written opinion from legal counsel who is acceptable to the Trustee. The counsel may be an employee of or counsel to the Company or the Trustee.

“Permitted Acquisition” means the acquisition by the Company or any Restricted Subsidiary of all or substantially all of the assets of a Person, a line of business or division of a Person or not less than 100% of the Capital Stock of a Person (the “Acquired Entity”); provided that (a) such acquisition was not preceded by an unsolicited tender offer for such Capital Stock by, or proxy contest initiated by, the Company or any Subsidiary of the Company; (b) the Acquired Entity or the assets, line of business or division acquired shall be in a similar line of business as that of the Company and its Subsidiaries as conducted during the current and most recent calendar year; (c) (i) the Acquired Entity or division is located, and substantially all of its operations are conducted, in the United States of America or (ii) substantially all of the assets acquired are located in the United States; (d) at the time of such transaction both before and after giving effect thereto, no Default or Event of Default shall have occurred and be continuing; and (e) the Company shall have delivered to the Trustee a certificate of the chief financial officer of the Company confirming compliance with clauses (a) through (d) above, together with all relevant financial information for the Acquired Entity, acquired line of business or division or acquired assets and reasonably detailed calculations demonstrating satisfaction of the requirements set forth in clauses (a) through (d) above.

“Permitted ESOP Transactions” means the redemption or repurchase for value of any Capital Stock of the Company as a result of distributions by the ESOT to participants in the ESOP to satisfy diversification requirements under applicable law, including section 401(a)(28) of the Code.

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“Permitted Holder” means the Alion Science and Technology Corporation Employee Ownership, Savings and Investment Trust.

“Permitted Investment” means an Investment by the Company or any Restricted Subsidiary in:

(1) the Company, a Restricted Subsidiary or a Person that will, upon the making of such Investment, become a Restricted Subsidiary; provided, however, that the primary business of such Restricted Subsidiary is a Related Business;

(2) another Person if, as a result of such Investment, such other Person is merged or consolidated with or into, or transfers or conveys all or substantially all its assets to, the Company or a Restricted Subsidiary; provided, however, that such Person’s primary business is a Related Business;

(3) cash and Temporary Cash Investments;

(4) receivables owing to the Company or any Restricted Subsidiary if created or acquired in the ordinary course of business and payable or dischargeable in accordance with customary trade terms; provided, however, that such trade terms may include such concessionary trade terms as the Company or any such Restricted Subsidiary deems reasonable under the circumstances;

(5) payroll, travel and similar advances to cover matters that are expected at the time of such advances ultimately to be treated as expenses for accounting purposes and that are made in the ordinary course of business;

(6) loans or advances to employees made in the ordinary course of business consistent with past practices of the Company or such Restricted Subsidiary;

(7) stock, obligations or securities received in settlement of debts created in the ordinary course of business and owing to the Company or any Restricted Subsidiary or in satisfaction of judgments;

(8) any Person to the extent such Investment represents the non-cash portion of the consideration received for (A) an Asset Disposition as permitted pursuant to the covenant described under “— Certain Covenants — Limitation on Sales of Assets and Subsidiary Stock” or (B) a disposition of assets not constituting an Asset Disposition;

(9) any Person where such Investment was acquired by the Company or any of its Restricted Subsidiaries (A) in exchange for any other Investment or accounts receivable held by the Company or any such Restricted Subsidiary in connection with or as a result of a bankruptcy, workout, reorganization or recapitalization of the issuer of such other Investment or accounts receivable or (B) as a result of a foreclosure by the Company or any of its Restricted Subsidiaries with respect to any secured Investment or other transfer of title with respect to any secured Investment in default;

(10) any Person to the extent such Investments consist of prepaid expenses, negotiable instruments held for collection and lease, utility and workers’ compensation, performance and other similar deposits made in the ordinary course of business by the Company or any Restricted Subsidiary;

(11) any Person to the extent such Investments consist of Hedging Obligations otherwise permitted under the covenant described under “— Certain Covenants — Limitation on Indebtedness”; and

(12) any Person to the extent such Investment exists on the Issue Date, and any extension, modification or renewal of any such Investments existing on the Issue Date, but only to the extent not involving additional advances, contributions or other Investments of cash or other assets or other increases thereof (other than as a result of the accrual or accretion of interest or original issue discount or the issuance of pay-in-kind securities, in each case, pursuant to the terms of such Investment as in effect on the Issue Date,

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“Permitted Liens” means, with respect to any Person:

(1) Liens securing Indebtedness Incurred to finance the construction, purchase or lease of, or repairs, improvements or additions to, property, plant or equipment of such Person; provided, however, that the Lien may not extend to any other property owned by such Person or any of its Restricted Subsidiaries at the time the Lien is Incurred (other than assets and property affixed or appurtenant thereto), and the Indebtedness (other than any interest thereon) secured by the Lien may not be Incurred more than 180 days after the later of the acquisition, completion of construction, repair, improvement, addition or commencement of full operation of the property subject to the Lien;

(2) Liens to secure Indebtedness to the extent the principal amount of such Indebtedness, when added together with all other Secured Indebtedness of the Company and its Restricted Subsidiaries then outstanding, would not cause the Secured Indebtedness Ratio to exceed 3.5 to 1.0;

(3) Liens existing on the Issue Date;

(4) Liens on property or shares of Capital Stock of another Person at the time such other Person becomes a Subsidiary of such Person; provided, however, that the Liens may not extend to any other property owned by such Person or any of its Restricted Subsidiaries (other than assets and property affixed or appurtenant thereto), and the Indebtedness (other than any interest thereon) secured by the Lien may not be Incurred more than 180 days after the time such other Person becomes a Subsidiary of such Person;

(5) Liens on property at the time such Person or any of its Subsidiaries acquires the property, including any acquisition by means of a merger or consolidation with or into such Person or a Subsidiary of such Person; provided, however, that the Liens may not extend to any other property owned by such Person or any of its Restricted Subsidiaries (other than assets and property affixed or appurtenant thereto), and the Indebtedness (other than any interest thereon) secured by the Lien may not be Incurred more than 180 days after the acquisition of the property subject to such Lien;

(6) Liens securing Indebtedness or other obligations of a Subsidiary of such Person owing to such Person or a Restricted Subsidiary of such Person;

(7) Liens securing Hedging Obligations so long as such Hedging Obligations are permitted to be Incurred under the Indenture;

(8) Liens on specific items of inventory or other goods and proceeds of any Person securing such Person’s obligations in respect of bankers’ acceptances issued or created for the account of such Person to facilitate the purchase, shipment or storage of such inventory or other goods;

(9) Liens arising from Uniform Commercial Code financing statement filings regarding operating leases entered into by the Company and its Restricted Subsidiaries in the ordinary course of business;

(10) Liens in favor of the Company or any Subsidiary Guarantor or Liens on assets of a Restricted Subsidiary of the Company entered that is not a guarantor in favor solely of another Restricted Subsidiary of the Company that is not a Subsidiary Guarantor;

(11) Liens to secure any Refinancing (or successive Refinancings) as a whole, or in part, of any Indebtedness secured by any Lien referred to in the foregoing clause (1), (3), (4) or (5); provided, however, that:

(A) such new Lien shall be limited to all or part of the same property and assets that secured or, under the written agreements pursuant to which the original Lien arose, could secure the original Lien (plus improvements and accessions to, such property or proceeds or distributions thereof); and

(B) the Indebtedness secured by such Lien at such time is not increased to any amount greater than the sum of (i) the outstanding principal amount or, if greater, committed amount of the Indebtedness described under clause (1), (3), (4) or (5) at the time the original Lien became

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a Permitted Lien and (ii) an amount necessary to pay any fees and expenses, including premiums, related to such refinancing, refunding, extension, renewal or replacement;

(12) Liens securing Indebtedness of Foreign Subsidiaries permitted to be Incurred under the Indenture, to the extent such Liens relate only to assets and properties of Foreign Subsidiaries;

(13) zoning restrictions, easements, rights-of-way, restrictions on use of real property and other similar encumbrances incurred in the ordinary course of business which, in the aggregate, do not materially detract from the value of the property subject thereto or interfere with the ordinary conduct of the business of the Company or any Restricted Subsidiary;

(14) licenses, leases or subleases granted by the Company or any Restricted Subsidiary to third persons in the ordinary course of business not interfering in any material respect with the business of the Company or any Restricted Subsidiary;

(15) deposits to secure the performance of bids, trade contracts (other than for Indebtedness), leases (other than Capital Lease Obligations), statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature incurred in the ordinary course of business;

(16) Liens arising out of judgments or awards in respect of which the Company or any Restricted Subsidiary shall in good faith be prosecuting an appeal or proceedings for review in respect of which there shall be secured a subsisting stay of execution pending such appeal or proceedings; provided that the aggregate amount of all such judgments or awards (and any cash and the fair market value of any property subject to such Liens) does not exceed $30.0 million at any time outstanding;

(17) Liens for taxes not yet due or which are being contested in good faith by appropriate proceedings and with respect to which the Company shall have set aside on its books adequate reserves in accordance with GAAP and such contest operates to suspend collection of the contested tax and enforcement of the applicable Lien;

(18) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s or other like Liens arising in the ordinary course of business and securing obligations that are not due and payable or which are being contested in good faith by appropriate proceedings and with respect to which the Company shall have set aside on its books adequate reserves in accordance with GAAP and such contest operates to suspend collection of the contested obligations and enforcement of the applicable Lien;

(19) pledges and deposits made in the ordinary course of business in compliance with workmen’s compensation, unemployment insurance and other social security laws or regulations; and

(20) other Liens securing obligations incurred in the ordinary course of business which obligations, in the aggregate, do not exceed $5.0 million at any time.

For purposes of this definition, the term “Indebtedness” shall be deemed to include interest on such Indebtedness.

“Permitted Subordinated Indebtedness” means Indebtedness of the Company or any Restricted Subsidiary (a) that is not Secured Indebtedness, (b) that constitutes Subordinated Obligations, (c) that is not incurred while a Default exists, (d) the incurrence of which would not result in a Default and (e) that does not mature and does not require any payment of principal prior to the final maturity date of the Notes.

“Person” means any individual, corporation, partnership, limited liability company, joint venture, association, joint-stock company, trust, unincorporated organization, government or any agency or political subdivision thereof or any other entity.

“Preferred Stock”, as applied to the Capital Stock of any Person, means Capital Stock of any class or classes (however designated) which is preferred as to the payment of dividends or distributions, or as to the distribution of assets upon any voluntary or involuntary liquidation or dissolution of such Person, over shares of Capital Stock of any other class of such Person.

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“principal” of a Note means the principal of the Note plus the premium, if any, payable on the Note which is due or overdue or is to become due at the relevant time.

“Qualified Capital Stock” of a Person means Capital Stock of such Person other than Disqualified Capital Stock; provided, however, that such Capital Stock shall not be deemed Qualified Capital Stock to the extent sold to a Subsidiary of such Person or financed, directly or indirectly, using funds (1) borrowed from such Person or any Subsidiary of such Person or (2) contributed, extended, guaranteed or advanced by such Person or any Subsidiary of such Person (including, in respect of any employee stock ownership or benefit plan). Unless otherwise specified, Qualified Capital Stock refers to Qualified Capital Stock of the Company.

“Qualified Equity Offering” means any issuance and sale of common stock by the Company. Notwithstanding the foregoing, the term “Qualified Equity Offering” shall not include:

(1) any issuance and sale with respect to the Company’s common stock registered on Form S-4 or Form S-8; or

(2) any issuance and sale to any Subsidiary of the Company.

“Refinance” means, in respect of any Indebtedness, to refinance, extend, renew, refund, repay, prepay, purchase, redeem, defease or retire, or to issue other Indebtedness in exchange or replacement for, such Indebtedness. “Refinanced” and “Refinancing” shall have correlative meanings.

“Refinancing Indebtedness” means Indebtedness that Refinances any Indebtedness of the Company or any Restricted Subsidiary existing on the Issue Date or Incurred in compliance with the Indenture, including Indebtedness that Refinances Refinancing Indebtedness; provided, however, that:

(1) such Refinancing Indebtedness has a Stated Maturity no earlier than the Stated Maturity of the Indebtedness being Refinanced;

(2) such Refinancing Indebtedness has an Average Life at the time such Refinancing Indebtedness is Incurred that is equal to or greater than the Average Life of the Indebtedness being Refinanced;

(3) such Refinancing Indebtedness has an aggregate principal amount (or if Incurred with original issue discount, an aggregate issue price) that is equal to or less than the aggregate principal amount (or if Incurred with original issue discount, the aggregate accreted value) then outstanding (plus fees and expenses, including any premium and defeasance costs) under the Indebtedness being Refinanced; and

(4) if the Indebtedness being Refinanced is subordinated in right of payment to the Notes or a Subsidiary Guarantee, such Refinancing Indebtedness (a) if Refinancing the Junior Subordinated Note or the Junior Warrants, is subordinated in right of payment to the Notes and (b) if Refinancing any other Indebtedness, is subordinated in right of payment to the Notes at least to the same extent as the Indebtedness being Refinanced;

provided, further, however, that Refinancing Indebtedness shall not include (A) Indebtedness of a Subsidiary (other than a Subsidiary Guarantor) that Refinances Indebtedness of the Company or (B) Indebtedness of the Company or a Restricted Subsidiary that Refinances Indebtedness of an Unrestricted Subsidiary.

“Registration Rights Agreement” means the Registration Rights Agreement dated February 8, 2007, among the Company, the Subsidiary Guarantors and the initial purchaser.

“Related Business” means any business in which the Company or any of the Restricted Subsidiaries was engaged on the Issue Date, any business reasonably related, ancillary or complementary to such business and any business providing products or services to any government, governmental authority or agency, department or bureau thereof.

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“Restricted Payment” with respect to any Person means:

(1) the declaration or payment of any dividends or any other distributions of any sort in respect of its Capital Stock (including any payment in connection with any merger or consolidation involving such Person) or similar payment to the direct or indirect holders of its Capital Stock (other than (A) dividends or distributions payable solely in its Capital Stock (other than Disqualified Stock), (B) dividends or distributions payable solely to the Company or a Restricted Subsidiary and (C) pro rata dividends or other distributions made by a Subsidiary that is not a Wholly Owned Subsidiary to minority stockholders (or owners of an equivalent interest in the case of a Subsidiary that is an entity other than a corporation));

(2) the purchase, repurchase, redemption, defeasance or other acquisition or retirement for value of any Capital Stock of the Company held by any Person (other than by a Restricted Subsidiary) or of any Capital Stock of a Restricted Subsidiary held by any Affiliate of the Company (other than by a Restricted Subsidiary), including in connection with any merger or consolidation and including the exercise of any option to exchange any Capital Stock (other than into Capital Stock of the Company that is not Disqualified Stock);

(3) the purchase, repurchase, redemption, defeasance or other acquisition or retirement for value, prior to scheduled maturity, scheduled repayment or scheduled sinking fund payment of any Subordinated Obligations of the Company or any Subsidiary Guarantor (other than (A) from the Company or a Restricted Subsidiary or (B) the purchase, repurchase, redemption, defeasance or other acquisition or retirement of Subordinated Obligations purchased in anticipation of satisfying a sinking fund obligation, principal installment or final maturity, in each case due within one year of the date of such purchase, repurchase, redemption, defeasance or other acquisition or retirement); or

(4) the making of any Investment (other than a Permitted Investment) in any Person.

“Restricted Subsidiary” means any Subsidiary of the Company that is not an Unrestricted Subsidiary.

“Sale/Leaseback Transaction” means an arrangement relating to property owned by the Company or a Restricted Subsidiary on the Issue Date or thereafter acquired by the Company or a Restricted Subsidiary whereby the Company or a Restricted Subsidiary transfers such property to a Person and the Company or a Restricted Subsidiary leases it from such Person.

“SEC” means the U.S. Securities and Exchange Commission.

“Secured Indebtedness” means any Indebtedness of the Company and the Restricted Subsidiaries secured by a Lien.

“Securities Act” means the U.S. Securities Act of 1933, as amended.

“Senior Indebtedness” means with respect to any Person:

(1) Indebtedness of such Person, whether outstanding on the Issue Date or thereafter Incurred; and

(2) all other Obligations of such Person (including interest accruing on or after the filing of any petition in bankruptcy or for reorganization relating to such Person whether or not post-filing interest is allowed in such proceeding) in respect of Indebtedness described in clause (1) above

unless, in the case of clauses (1) and (2), in the instrument creating or evidencing the same or pursuant to which the same is outstanding, it is provided that such Indebtedness or other Obligations are subordinate in right of payment to the Notes or the Subsidiary Guaranty of such Person, as the case may be; provided, however, that Senior Indebtedness shall not include:

(1) any obligation of such Person to the Company or any Subsidiary;

(2) any liability for Federal, state, local or other taxes owed or owing by such Person;

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(3) any accounts payable or other liability to trade creditors arising in the ordinary course of business;

(4) any Indebtedness or other Obligation of such Person which is subordinate or junior in any respect to any other Indebtedness or other Obligation of such Person; or

(5) that portion of any Indebtedness which at the time of Incurrence is Incurred in violation of the Indenture.

“Significant Subsidiary” means any Restricted Subsidiary that would be a “Significant Subsidiary” of the Company within the meaning of Rule 1-02 under Regulation S-X promulgated by the SEC.

“Standard & Poor’s” means Standard & Poor’s, a division of The McGraw-Hill Companies, Inc., and any successor to its rating agency business.

“Stated Maturity” means, with respect to any security, the date specified in such security as the fixed date on which the final payment of principal of such security is due and payable, including pursuant to any mandatory redemption provision (but excluding any provision providing for the repurchase of such security at the option of the holder thereof upon the happening of any contingency unless such contingency has occurred).

“Subordinated Obligation” means, with respect to a Person, any Indebtedness of such Person (whether outstanding on the Issue Date or thereafter Incurred) which is subordinate or junior in right of payment to the Notes or a Subsidiary Guaranty of such Person, as the case may be, pursuant to a written agreement to that effect.

“Subsidiary” means, with respect to any Person, any corporation, association, partnership or other business entity of which more than 50% of the total voting power of shares of Voting Stock is at the time owned or controlled, directly or indirectly, by:

(1) such Person;

(2) such Person and one or more Subsidiaries of such Person; or

(3) one or more Subsidiaries of such Person.

“Subsidiary Guarantor” means and each other Subsidiary of the Company that executes the Indenture as a guarantor on the Issue Date and each other Subsidiary of the Company that thereafter guarantees the Notes pursuant to the terms of the Indenture.

“Subsidiary Guaranty” means a Guarantee by a Subsidiary Guarantor of the Company’s obligations with respect to the Notes.

“Synthetic Lease” means, as to any Person, any lease (including leases that may be terminated by the lessee at any time) of any property (whether real, personal or mixed) (a) that is accounted for as an operating lease under GAAP and (b) in respect of which the lessee retains or obtains ownership of the property so leased for U.S. federal income tax purposes, other than any such lease under which such Person is the lessor.

“Synthetic Lease Obligations” shall mean, as to any Person, an amount equal to the capitalized amount of the remaining lease payments under any Synthetic Lease that would appear on a balance sheet of such person in accordance with GAAP if such obligations were accounted for as Capital Lease Obligations.

“Temporary Cash Investments” means any of the following:

(1) any investment in direct obligations of the United States of America or any agency thereof or obligations guaranteed by the United States of America or any agency thereof;

(2) investments in demand and time deposit accounts, certificates of deposit and money market deposits maturing within 180 days of the date of acquisition thereof issued by a bank or trust company which is organized under the laws of the United States of America, any State thereof or any foreign

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country recognized by the United States of America, and which bank or trust company has capital, surplus and undivided profits aggregating in excess of $50.0 million (or the foreign currency equivalent thereof) and has outstanding debt which is rated “A” (or such similar equivalent rating) or higher by at least one nationally recognized statistical rating organization (as defined in Rule 436 under the Securities Act) or any money-market fund sponsored by a registered broker dealer or mutual fund distributor;

(3) repurchase obligations with a term of not more than 30 days for underlying securities of the types described in clause (1) above entered into with a bank meeting the qualifications described in clause (2) above;

(4) investments in commercial paper, maturing not more than 90 days after the date of acquisition, issued by a corporation (other than an Affiliate of the Company) organized and in existence under the laws of the United States of America or any foreign country recognized by the United States of America with a rating at the time as of which any investment therein is made of “P-1” (or higher) according to Moody’s or “A-1” (or higher) according to Standard and Poor’s;

(5) investments in securities with maturities of six months or less from the date of acquisition issued or fully guaranteed by any state, commonwealth or territory of the United States of America, or by any political subdivision or taxing authority thereof, and rated at least “A” by Standard & Poor’s or “A” by Moody’s; and

(6) investments in money market funds that invest substantially all their assets in securities of the types described in clauses (1) through (5) above.

“Term B Senior Credit Facility” means the Credit Agreement, dated as of August 4, 2004, by and among, the Company, the Subsidiaries of the Company identified therein as guarantors, the lenders from time to time party thereto, and Credit Suisse, as Administrative Agent and Collateral Agent, together with the related documents thereto (including the term loans and revolving loans thereunder, and any letters of credit and reimbursement obligations related thereto, any guarantees and security documents), as amended, extended, renewed, restated, refunded, replaced, refinanced, supplemented, modified or otherwise changed (in whole or in part, and without limitation as to amount (including incremental term loans), terms, conditions, covenants and other provisions) from time to time, and any one or more other agreements (and related documents) governing Indebtedness, including indentures, incurred to Refinance, substitute, supplement or add to (including increasing the amount available for borrowing or adding or removing any Person as a borrower or guarantor thereunder), in whole or in part, the borrowings and commitments then outstanding or permitted to be outstanding under such Credit Agreement or one or more successors to the Credit Agreement or one or more new credit agreements or other agreements.

“Total Assets” means the total assets of the Company and its Restricted Subsidiaries, determined on a consolidated basis in accordance with GAAP, as shown on the most recent balance sheet of the Company.

“Trustee” means Wilmington Trust Company until a successor replaces it and, thereafter, means the successor.

“Trust Indenture Act” means the Trust Indenture Act of 1939 (15 U.S.C. §§ 77aaa-77bbbb) as in effect on the Issue Date.

“Unrestricted Subsidiary” means:

(1) any Subsidiary of the Company that at the time of determination shall be designated an Unrestricted Subsidiary by the Board of Directors of the Company in the manner provided below; and

(2) any Subsidiary of an Unrestricted Subsidiary.

The Board of Directors of the Company may designate any Subsidiary of the Company (including any newly acquired or newly formed Subsidiary) to be an Unrestricted Subsidiary unless such Subsidiary or any of its Subsidiaries owns any Capital Stock or Indebtedness of, or holds any Lien on any property of, the Company or any other Subsidiary of the Company that is not a Subsidiary of the Subsidiary to be so

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designated; provided, however, that either (A) the Subsidiary to be so designated has total assets of $1,000 or less or (B) if such Subsidiary has assets greater than $1,000, such designation would be permitted under the covenant described under “— Certain Covenants — Limitation on Restricted Payments”.

The Board of Directors of the Company may designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided, however, that immediately after giving effect to such designation (A) the Company could Incur $1.00 of additional Indebtedness under paragraph (a) of the covenant described under “— Certain Covenants — Limitation on Indebtedness” and (B) no Default shall have occurred and be continuing. Any such designation by the Board of Directors of the Company shall be evidenced to the Trustee by promptly filing with the Trustee a copy of the resolution of the Board of Directors of the Company giving effect to such designation and an Officers’ Certificate certifying that such designation complied with the foregoing provisions.

“U.S. Dollar Equivalent” means with respect to any monetary amount in a currency other than U.S. dollars, at any time for determination thereof, the amount of U.S. dollars obtained by converting such foreign currency involved in such computation into U.S. dollars at the spot rate for the purchase of U.S. dollars with the applicable foreign currency as published in The Wall Street Journal in the “Exchange Rates” column under the heading “Currency Trading” on the date two Business Days prior to such determination.

Except as described under “— Certain Covenants — Limitation on Indebtedness”, whenever it is necessary to determine whether the Company has complied with any covenant in the Indenture or a Default has occurred and an amount is expressed in a currency other than U.S. dollars, such amount will be treated as the U.S. Dollar Equivalent determined as of the date such amount is initially determined in such currency.

“U.S. Government Obligations” means direct obligations (or certificates representing an ownership interest in such obligations) of the United States of America (including any agency or instrumentality thereof) for the payment of which the full faith and credit of the United States of America is pledged and which are not callable at the issuer’s option.

“Voting Stock” of a Person means all classes of Capital Stock of such Person then outstanding and normally entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof.

“Wholly Owned Subsidiary” means a Restricted Subsidiary all the Capital Stock of which (other than directors’ qualifying shares) is owned by the Company or one or more other Wholly Owned Subsidiaries.

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MATERIAL UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS

General

The following general discussion summarizes material U.S. federal income and estate tax aspects of the exchange of an outstanding note for an exchange note and the ownership and disposition of the exchange notes. This discussion is a summary for general information only and is limited in the following ways:

•  The discussion only covers holders that exchange outstanding notes for exchange notes in the exchange offer.

•  The discussion only covers holders of exchange notes that hold such notes as capital assets (that is, for investment purposes) and that do not have a special tax status.

•  The discussion covers only the general tax consequences to holders of the exchange notes. It does not cover tax consequences that depend upon a holder’s individual tax circumstances.

•  The discussion is based on current law. Changes in the law may change the tax treatment of the exchange notes on a prospective or retroactive basis.

•  The discussion does not cover state, local, or foreign law.

•  The discussion does not apply to holders owning 10% or more of our voting stock, or corporate holders that are controlled foreign corporations with respect to us.

We have not sought and will not seek any rulings or opinions from the U.S. Internal Revenue Service (IRS) or counsel with respect to the matters discussed below. There can be no assurance that the IRS will not take positions about the tax treatment of the exchange notes which are different from those that we discussed in the offering circular.

Exchange of an Outstanding Note for an Exchange Note Pursuant to the Exchange Offer

The exchange by any holder of an outstanding note for an exchange note will not constitute a taxable exchange for U.S. Federal income tax purposes because the exchange notes will not be considered to differ materially in kind or extent from the outstanding notes. Consequently, no gain or loss will be recognized by holders that exchange outstanding notes for exchange notes pursuant to the exchange offer. For purposes of determining gain or loss upon the subsequent sale or exchange of exchange notes, a holder’s tax basis in an exchange note will be the same as the holder’s adjusted tax basis in the outstanding note at the time of the exchange. Holders will be considered to have held the exchange notes from the time of their acquisition of the outstanding notes. The U.S. Federal income tax consequences of holding and disposing of an exchange note generally should be the same as the U.S. Federal income tax consequences of holding and disposing of an outstanding note.

The tax consequences depend upon whether you are a U.S. holder or a non-U.S. holder. A U.S. holder is:

•  a citizen or resident of the United States;

•  a corporation or other entity taxable as a corporation created or organized under U.S. law (federal or state);

•  an estate the income of which is subject to U.S. federal income taxation regardless of its sources;

•  a trust if a U.S. court is able to exercise primary jurisdiction over administration of the trust and one or more U.S. persons have authority to control all substantial decisions of the trust; or

•  any other person whose worldwide income and gain is otherwise subject to U.S. federal income taxation on a net basis.

A non-U.S. holder is a holder that is not a U.S. holder.

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If you are considering exchanging notes, you should consult your own tax advisor about the tax consequences of exchanging, holding, and disposing of the notes in your particular situation.

Tax Consequences to U.S. Holders

Interest.

•  If you are a cash method taxpayer (including most individual holders), you must report the interest on your income when it is received by you.

•  If you are an accrual method taxpayer, you must report the interest on your income as it accrues.

Registered Exchange Offer.  Under certain circumstances described above, we will be required to pay additional interest on the exchange notes if we fail to comply with certain of our obligations under the Registration Rights Agreement. See “Description of the Notes — Registration Rights.” Although the matter is not free from doubt, such additional interest should be treated as a payment of additional interest on the exchange notes for U.S. federal income tax purposes, with the following results:

•  If you are a cash method taxpayer (including most individual holders), such additional interest will be taxable to you as ordinary income when it is received by you.

•  If you are an accrual method taxpayer, such additional interest will be taxable to you as ordinary income as it accrues.

It is possible, however, that the IRS may take a different position, in which case you might be required to include such additional interest in income as it accrues or becomes fixed (regardless of your regular method of accounting).

Sale, Exchange, or Redemption of the Exchange Notes.  On a sale, exchange, retirement, or other disposition of an exchange note:

•  You will have taxable gain or loss equal to the difference between the tax basis of the exchange note and amount received on the sale, exchange, retirement, or other disposition.

•  Any gain or loss will generally be capital gain or loss, and will be long-term capital gain or loss if the exchange note was held for more than one year.

•  If you sell the exchange note between interest payment dates, a portion of the amount you receive reflects interest that has accrued on the exchange note but has not yet been paid by the sale date. That amount is treated as ordinary interest income and not as sale proceeds.

•  You should not have any taxable gain or loss if outstanding notes are exchanged for exchange notes in the Registered Exchange Offer. You should have the same basis and holding period in the exchange notes as you had in the outstanding notes.

Information Reporting and Backup Withholding.  Under the tax rules concerning information reporting to the IRS:

•  We are required to provide information to the IRS concerning interest and redemption proceeds we pay to you on exchange notes held by you, unless an exemption applies.

•  Similarly, unless an exemption applies, you are required to provide us with a correct taxpayer identification number for our use in reporting information to the IRS. If you are an individual, this is your social security number. You are also required to comply with other IRS requirements concerning information reporting.

•  If you are subject to these requirements but do not comply with them, we are required to withhold 28% of all amounts payable to you on the exchange notes (including principal payments). This is called backup withholding. If we do withhold part of a payment, you may use the withheld amount as a refund or credit against your U.S. federal income tax liability, provided that the required information is timely furnished to the IRS.

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•  All U.S. holders that are individuals are subject to these requirements. Certain U.S. holders, including all corporations, tax-exempt organizations and individual retirement accounts, are exempt from these requirements.

Tax Consequences to Non-U.S. Holders

Withholding Taxes.  Generally, payments of principal and interest on the exchange notes will not be subject to U.S. withholding taxes. With respect to interest, however, you must meet one of the following requirements for the exemption from withholding taxes to apply:

•  You provide a completed Form W-8BEN (or substitute form) to the bank, broker, or other intermediary through which you hold your exchange notes. The Form W-8BEN contains your name, address, and a statement that you are the beneficial owner of the exchange notes and that you are not a U.S. Holder.

•  You hold your exchange notes directly through a “qualified intermediary,” and the qualified intermediary has sufficient information in its files indicating that you are not a U.S. Holder. A qualified intermediary is a bank, broker, or other intermediary that (1) is either a U.S. or non-U.S. entity, (2) is acting out of a non-U.S. branch or office, and (3) has signed an agreement with the IRS providing that it will administer all or part of the U.S. tax withholding rules under specified procedures.

•  You are entitled to an exemption from withholding tax on interest under a tax treaty between the U.S. and your country of residence. To claim this exemption, you must generally complete Form W-8BEN and claim this exemption on the form. In some cases, you may instead be permitted to provide documentary evidence of your claim to the intermediary, or a qualified intermediary may already have some or all of the necessary evidence in its files.

•  The interest income on the exchange notes is effectively connected with the conduct of your trade or business in the U.S. and is not exempt from U.S. tax under a tax treaty. To claim this exemption, you must complete Form W-8ECI.

Non-U.S. holders that do not qualify for exemption from withholding generally will be subject to withholding of U.S. federal income tax at a rate of 30%, or lower applicable treaty rate.

Sale, Exchange, or Redemption of Notes.  If you sell an exchange note or it is redeemed, you will not be subject to U.S. federal income tax on any gain unless any of the following applies:

•  The gain is connected with a trade or business that you conduct in the U.S.

•  You are an individual and are present in the U.S. for at least 183 days during the year in which you dispose of the exchange note, and certain other conditions are satisfied.

•  The gain represents accrued interest in which case the rules for interest would apply.

U.S. Trade or Business.  If you hold an exchange note in connection with a trade or business that you are conducting in the U.S.:

•  Any interest on the exchange note, and any gain from disposing of the exchange note, generally will be subject to income tax as if you were a U.S. holder.

•  If you are a corporation, you may be subject to a branch profits tax on your earnings that are connected with your U.S. trade or business, including earnings from the exchange note. This tax is 30%, but may be reduced or eliminated by an applicable income tax treaty.

Estate Taxes.  If you are an individual non-U.S. holder, the exchange note will not be subject to U.S. estate tax when you die. However, this rule only applies if, at the time of your death, payments on the exchange note would not have been connected to a trade or business that you were conducting in the U.S.

171

Information Reporting and Backup Withholding.  U.S. rules concerning information reporting and backup withholding are described above. These rules apply to Non-U.S. Holders as follows:

•  Interest payments you receive will be automatically exempt from the usual rules if you are a Non-U.S. Holder exempt from withholding tax on interest, as described above. The exemption does not apply if the withholding agent or an intermediary knows or has reason to know that you should be subject to the usual information reporting or backup withholding rules. In addition, as described above, interest payments made to you may be reported to the IRS on Form 1042-S.

•  Proceeds you receive on a sale or redemption of your exchange notes through a broker may be subject to information reporting and/or backup withholding if you are not eligible for an exemption. In particular, information reporting and backup reporting may apply if you use the U.S. office of a broker, and information reporting (but not backup withholding) may apply if you use the foreign office of a broker that has certain connections to the U.S. In general, you may file Form W-8BEN to claim an exemption from information reporting and backup withholding.

We suggest that you consult your tax advisor concerning information reporting and backup withholding on a sale.

172

PLAN OF DISTRIBUTION

Under existing SEC interpretations, exchange notes will be freely transferable by a holder (other than a holder who is our affiliate) after the exchange offer without further registration under the Securities Act if the holder represents to us in the exchange offer that it is acquiring the exchange notes in the ordinary course of its business, that it has no arrangement or understanding with any person to participate in the distribution of the exchange notes and that it is not an affiliate of the Company, as such terms are interpreted by the SEC; provided, however, that broker-dealers receiving exchange notes in the exchange offer will have a prospectus delivery requirement with respect to resales of such exchange notes. The SEC has taken the position that broker-dealers may fulfill their prospectus delivery requirements with respect to exchange notes (other than a resale of an unsold allotment from the original sale of the notes) with the prospectus contained in the exchange offer registration statement.

Each broker-dealer that receives exchange notes for its own account pursuant to the exchange offer must acknowledge that it will deliver a prospectus in connection with any resale of such exchange notes. This prospectus, as it may be amended or supplemented from time to time, may be used by a broker-dealer in connection with resales of exchange notes received in exchange for outstanding notes where such outstanding notes were acquired as a result of market-making activities or other trading activities. The Company has agreed that, for a period of 180 days after the expiration date, it will make this prospectus, as amended or supplemented, available to any broker-dealer for use in connection with any such resale. In addition, until          , 2007, all dealers effecting transactions in the exchange notes may be required to deliver a prospectus.

The Company will not receive any proceeds from any sale of exchange notes by broker-dealers. Exchange notes received by broker-dealers for their own account pursuant to the exchange offer may be sold from time to time in one or more transactions in the over-the-counter market, in negotiated transactions, through the writing of options on the exchange notes or a combination of such methods of resale, at market prices prevailing at the time of resale, at prices related to such prevailing market prices or negotiated prices. Any such resale may be made directly to purchasers or to or through brokers or dealers who may receive compensation in the form of commissions or concessions from any such broker-dealer or the purchasers of any such exchange notes. Any broker-dealer that resells exchange notes that were received by it for its own account pursuant to the exchange offer and any broker or dealer that participates in a distribution of such exchange notes may be deemed to be an “underwriter” within the meaning of the Securities Act and any profit on any such resale of exchange notes and any commission or concessions received by any such persons may be deemed to be underwriting compensation under the Securities Act. The letter of transmittal states that, by acknowledging that it will deliver and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an “underwriter” within the meaning of the Securities Act.

For a period of 180 days after the expiration date the Company will promptly send additional copies of this prospectus and any amendment or supplement to this prospectus to any broker-dealer that requests such documents in the letter of transmittal. The Company has agreed to pay all expenses incident to the exchange offer (including the expenses of one counsel for the Holders of the securities) other than commissions or concessions of any brokers or dealers and will indemnify the Holders of the securities (including any broker-dealers) against certain liabilities, including liabilities under the Securities Act.

173

LEGAL MATTERS

Certain legal matters with respect to the validity of the exchange notes and guarantees offered hereby, as well as certain other legal matters, will be passed upon for us by Baker & McKenzie LLP, Washington, D.C.

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMS

Our financial statements as of and for the year ended September 30, 2006, included in this prospectus and the related financial statement schedule, included elsewhere in the registration statement, have been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their report appearing herein and elsewhere in the registration statement, and are included in reliance upon the report of such firm given upon their authority as experts in accounting and auditing.

Our consolidated financial statements as of September 30, 2005 and for the fiscal years ended September 30, 2005 and 2004 included in this prospectus and the related financial statement schedule, included elsewhere in the registration statement, have been audited by KPMG LLP, an independent registered public accounting firm, as stated in their report appearing herein, and are included in reliance upon the report of such firm given upon their authority as experts in accounting and auditing.

174

INDEX TO FINANCIAL STATEMENTS

Condensed Consolidated Financial Statements of Alion Science and Technology Corporation
Condensed Consolidated Balance Sheets as of December 31, 2006 and September 30, 2006	F-2
Condensed Consolidated Statements of Operations for the three months ended December 31, 2006 and 2005	F-3
Condensed Consolidated Statements of Cash Flows for the three months ended December 31, 2006 and 2005	F-4
Notes to Condensed Consolidated Financial Statements	F-5
Consolidated Financial Statements of Alion Science and Technology Corporation
Reports of Independent Registered Public Accounting Firms	F-31
Consolidated Financial Statements:
Consolidated Balance Sheets as of September 30, 2006 and 2005	F-33
Consolidated Statements of Operations for the years ended September 30, 2006, 2005, and 2004	F-34
Consolidated Statements of Shareholder’s Equity (Deficit) for the years ended September 30, 2006, 2005, and 2004	F-35
Consolidated Statements of Cash Flows for the years ended September 30, 2006, 2005, and 2004	F-36
Notes to Consolidated Financial Statements	F-37

F-1

ALION SCIENCE AND TECHNOLOGY CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

	December 31,			September 30,
	2006			2006
	(Unaudited)
	(In thousands, except share
	and per share information)
Current assets:
Cash and cash equivalents	$	340		$	2,755
Accounts receivable, less allowance of $4,277 and $3,961 at December 31, 2006 and September 30, 2006, respectively		183,092			150,412
Stock subscriptions receivable		—			8,990
Prepaid expenses and other current assets		6,449			6,028
Total current assets		189,881			168,185
Property, plant and equipment, net		14,238			14,644
Intangible assets, net		71,151			75,403
Goodwill		391,166			387,927
Other assets		6,050			4,810
Total assets		672,486			650,969
Current liabilities:
Book cash overdraft		3,261			—
Current portion, Term B Senior Credit Facility note payable		3,430			2,816
Current portion, acquisition obligations		9,172			11,457
Trade accounts payable and accrued liabilities		77,287			62,803
Accrued payroll and related liabilities		27,897			35,135
Billings in excess of costs and estimated earnings on uncompleted contracts		2,212			2,163
Total current liabilities		123,259			114,374
Acquisition obligations, excluding current portion		2,562			3,568
Notes payable to bank		32,550			12,300
Term B Senior Credit Facility note payable, excluding current portion		251,853			252,100
Bridge loan payable		163,830			164,680
Subordinated note payable		48,022			46,963
Accrued compensation, excluding current portion		26,446			21,026
Accrued postretirement benefit obligations		4,086			3,722
Non-current portion of lease obligations		4,114			4,292
Redeemable common stock warrants		37,258			35,234
Total liabilities		693,980			658,259
Shareholder’s deficit:
Common stock, $0.01 par value, 8,000,000 shares authorized, 5,207,883 and 5,210,126 shares issued and outstanding at December 31, 2006 and September 30, 2006		52			52
Additional paid-in capital		91,737			91,829
Accumulated deficit		(113,283	)		(99,171	)
Total shareholder’s deficit		(21,494	)		(7,290	)
Total liabilities and shareholder’s deficit	$	672,486		$	650,969

See accompanying notes to condensed consolidated financial statements.

F-2

ALION SCIENCE AND TECHNOLOGY CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

	Three Months Ended December 31,
	2006			2005
	(Unaudited)
	(In thousands, except share
	and per share information)
Contract revenue	$	181,139		$	101,289
Direct contract expense		140,101			76,305
Gross profit		41,038			24,984
Operating expenses:
Indirect contract expense		9,475			5,355
Research and development		654			245
General and administrative		16,613			12,359
Rental and occupancy expense		8,265			4,957
Depreciation and amortization		5,655			4,790
Bad debt expense		333			106
Total operating expenses		40,995			27,812
Operating income (loss)		43			(2,828	)
Other income (expense):
Interest income		116			372
Interest expense		(14,358	)		(5,445	)
Other		74			140
Loss before income taxes		(14,125	)		(7,761	)
Income tax benefit (expense)		13			(19	)
Net loss	$	(14,112	)	$	(7,780	)
Basic and diluted loss per share	$	(2.71	)	$	(1.52	)
Basic and diluted weighted average common shares outstanding		5,209,858			5,123,744

See accompanying notes to condensed consolidated financial statements.

F-3

ALION SCIENCE AND TECHNOLOGY CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

	Three Months Ended
	December 31,
	2006			2005
	(Unaudited)
	(In thousands)
Cash flows from operating activities:
Net loss	$	(14,112	)	$	(7,780	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		5,655			4,790
Accretion of debt to face value		234			221
Amortization of debt issuance costs		408			249
Decrease in value of interest rate cap agreement		76			50
Change in fair value of redeemable common stock warrants		2,024			1,800
Stock-based compensation		3,592			2,756
Gain on disposal of assets		(18	)		—
Gain on sale of investments, net		(10	)		(25	)
Changes in assets and liabilities, net of effect of acquisitions:
Accounts receivable, net		(32,536	)		(11,830	)
Other assets		(1,729	)		(149	)
Trade accounts payable and accruals		10,130			(3,950	)
Other liabilities		1,060			(787	)
Net cash used in operating activities		(25,226	)		(14,655	)
Cash flows from investing activities:
Cash paid for acquisitions, net of cash acquired		(6,560	)		—
Capital expenditures		(1,533	)		(1,605	)
Net cash used in investing activities		(8,093	)		(1,605	)
Cash flows from financing activities:
Book overdraft		3,261			—
Repayment of Term B Credit Facility note payable		(655	)		(360	)
Payment of debt issuance costs		(850	)		—
Borrowings under revolving credit facility		20,250			—
Purchase of shares of common stock from ESOP Trust		(92	)		(7,592	)
Cash received from issuance of common stock to ESOP Trust		8,990			1,693
Net cash provided by (used in) financing activities		30,904			(6,259	)
Net decrease in cash		(2,415	)		(22,519	)
Cash and cash equivalents at beginning of period		2,755			37,778
Cash and cash equivalents at end of period	$	340		$	15,259
Supplemental disclosure of cash flow information:
Cash paid for interest		10,038			2,375
Cash paid for taxes		156			19

See accompanying notes to condensed consolidated financial statements.

F-4

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(1)  Description and Formation of the Business

Alion Science and Technology Corporation and its subsidiaries (collectively, the Company or Alion) provides scientific and engineering expertise to research and develop technological solutions for problems relating to national defense, homeland security, and energy and environmental analysis. The Company provides these research services primarily to agencies of the federal government and, to a lesser extent, to commercial and international customers.

Alion, a for-profit S Corporation, was formed in October 2001 for the purpose of purchasing substantially all of the assets and certain of the liabilities of IITRI, a not-for-profit membership corporation affiliated with and controlled by Illinois Institute of Technology (IIT). On December 20, 2002, Alion acquired substantially all of the assets and liabilities of IITRI, excluding the assets and liabilities of IITRI’s Life Sciences Operation, for aggregate total proceeds of $127.3 million (the Transaction). Prior to that time, the Company’s activities were organizational in nature.

(2)  Summary of Significant Accounting Policies

Basis of Presentation and Principles of Consolidation

The accompanying unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (SEC) regarding interim financial reporting. Accordingly, they do not include all of the information and notes required by generally accepted accounting principles for complete financial statements and should be read in conjunction with the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended September 30, 2006, included herein.

The statements are prepared on the accrual basis of accounting and include the accounts of Alion and its wholly-owned subsidiaries from the date of acquisition. All inter-company accounts have been eliminated in consolidation.

•  Human Factors Application, Inc. (HFA) — acquired November 1998

•  Innovative Technology Solution Corporation (ITSC) — acquired October 2003

•  Alion — IPS Corporation — acquired February 2004

•  Alion — METI Corporation (METI) — acquired February 2005

•  Alion — CATI Corporation (CATI) — acquired February 2005

•  Alion Canada (US) Corporation — established February 2005

•  Alion Science and Technology (Canada) Corporation — established February 2005

•  Alion — JJMA Corporation (JJMA) — acquired April 2005

•  Alion Technical Services Corporation (Virginia) — established July 2005

•  Alion Technical Services Corporation (Delaware) — established May 2006

•  Alion — BMH Corporation (BMH) — acquired February 2006

•  Washington Consulting, Inc. (WCI) — acquired February 2006

•  Alion — MA&D Corporation (MA&D) — acquired May 2006

F-5

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Fiscal and Quarter Periods

The Company’s fiscal year ends on September 30. The Company operates based on a three-month quarter, four-quarter fiscal year. Quarter end dates: December 31, March 31, June 30, and September 30.

Use of Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of financial statements and operating results reported for a given period. Actual results are likely to differ from those estimates; however, we do not believe such differences will materially affect the Company’s financial position, results of operations, or cash flows.

Reclassifications

Certain items in the condensed consolidated financial statements have been reclassified to conform to the current presentation.

Revenue Recognition

The Company’s revenue results from technology services under a variety of contracts, some of which provide for payment for costs plus fees and others of which are fixed-price or time-and-material type contracts. The Company generally recognizes revenue when a contract has been executed, the contract price is fixed or determinable, delivery of the services or products has occurred and collectibility of the contract price is considered reasonably assured.

The Company recognizes revenue on cost-reimbursement contracts as it incurs costs and includes estimated fees earned. The Company recognizes time-and-material contract revenue at negotiated, fixed, contractually billable rates as it delivers labor hours and incurs other direct expenses. The Company uses various performance measures under the percentage of completion method to recognize revenue for fixed-price contracts. The process of estimating contract costs at completion and recognizing revenue appropriately involves significant management estimates. Actual costs may differ from estimated costs and affect estimated profitability and the timing of revenue recognition. From time to time, facts develop that require the Company to revise its estimated total costs or revenues expected. The Company records the cumulative effect of revised estimates in the period in which the facts requiring revised estimates become known. The Company recognizes the full amount of anticipated losses on any type of contract in the period in which they become known. For each of the periods presented, the cumulative effects of revised estimates were immaterial to the financial performance of the Company. Revised estimates did not generate any anticipated losses for any period presented. Further, the Company had no cost overruns on fixed price contracts that materially affected financial performance in any of the periods presented.

Contracts with agencies of the federal government are subject to periodic funding by the contracting agency concerned. A contract may be fully funded at its inception or ratably throughout its period of performance as services are provided. If the Company determines contract funding is not probable, it defers revenue recognition until realization is probable.

Contract costs on federal government contracts are subject to audit by the federal government and adjustment through negotiations between the Company and government representatives. The government considers Alion to be a major contractor and maintains an office on site to perform various audits. The government has audited all of the Company’s federal government contract indirect costs through fiscal year 2004. Indirect rates have been negotiated and settled through fiscal year 2003. The Company submitted its fiscal year 2005 indirect expense rates to the government in March 2006 and submitted its fiscal year 2006

F-6

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

indirect expense rates to the government in March 2007. The Company has recorded revenue on federal government contracts in amounts it expects to realize.

The Company recognizes revenue on unpriced change orders as it incurs expenses and only to the extent it is probable that the Company will recover such costs. The Company recognizes revenue in excess of costs on unpriced change orders only when management can also estimate beyond a reasonable doubt the amount of excess and experience provides a sufficient basis for recognition. The Company recognizes revenue on claims as expenses are incurred only to the extent it is probable that the Company will recover such costs and it can reliably estimate the amount it will recover.

The Company generates software revenue from licensing software and providing services. In general, professional services are essential to the functionality of the solution sold and the Company applies the percentage of completion method, as prescribed by AICPA SOP 81-1, Accounting for Performance on Construction-Type and Certain Production-Type Contracts, to recognize revenue.

Income Taxes

The Company is an S corporation under the provisions of the Internal Revenue Code of 1986, as amended. For federal and certain state income tax purposes, the Company is not subject to tax on its income. The Company’s income is allocated to its shareholder, Alion Science and Technology Corporation Employee Stock Ownership, Savings and Investment Trust (the Trust). The Company may be subject to state income taxes in those states that do not recognize S corporations and to additional types of taxes including franchise and business taxes. All of the Company’s wholly-owned operating subsidiaries are qualified subchapter S or disregarded entities which, for federal income tax purposes, are not treated as separate corporations.

Cash and Cash Equivalents

The Company considers cash in banks, and deposits with financial institutions with maturities of three months or less at time of purchase and that can be liquidated without prior notice or penalty, to be cash and cash equivalents.

Accounts Receivable and Billings in Excess of Costs and Estimated Earnings on Uncompleted Contracts

Accounts receivable include billed accounts receivable, amounts currently billable and costs and estimated earnings in excess of billings on uncompleted contracts that represent accumulated project expenses and fees which have not been billed or are not currently billable as of the date of the consolidated balance sheet. The costs and estimated earnings in excess of billings on uncompleted contracts are stated at estimated realizable value. Unbilled accounts receivable include revenue recognized for customer-related work performed by the Company on new and existing contracts for which the Company had not received contracts or contract modifications. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable losses in the Company’s existing billed and unbilled accounts receivable. The Company determines the allowance using specific identification and historical write-off experience based on the age of the receivables. Billings in excess of costs and estimated earnings and advance collections from customers represent amounts received from or billed to customers in excess of project revenue recognized to date.

Property, Plant and Equipment

Leasehold improvements, software and equipment are recorded at cost. Maintenance and repairs that do not add significant value or significantly lengthen an asset’s useful life are charged to current operations. Software and equipment are depreciated over their estimated useful lives (the lesser of 5 years or the life of

F-7

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

the lease) generally using the straight-line method. Leasehold improvements are amortized on the straight-line method over the shorter of the assets’ estimated useful life or the life of the lease. Upon sale or retirement of an asset, costs and related accumulated depreciation are deducted from the accounts, and the gain or loss is recognized in the consolidated statements of operations.

Goodwill and Other Intangibles

As required by SFAS 142, Goodwill and Other Intangible Assets, the Company reviews goodwill annually for impairment at the end of each fiscal year or if events or circumstances indicates potential impairment. The Company must recognize an impairment loss if, and to the extent that, goodwill exceeds fair value. The Company completed the fiscal year 2006 annual goodwill impairment analysis in the fourth quarter of fiscal year 2006. Based on this analysis, the Company concluded that no goodwill impairment existed as of September 30, 2006. For the three months ended December 31, 2006, there were no significant events that indicated the existence of goodwill impairment as of December 31, 2006. Intangible assets are amortized over their estimated useful lives of generally one to thirteen years primarily using the straight-line method.

Postretirement Benefits

The Company accounts for postretirement benefits other than pension in accordance with SFAS No. 106 Employers’ Accounting for Postretirement Benefits Other Than Pension which requires the cost to provide the benefits to be accrued over the employees’ period of active service. These costs are determined on an actuarial basis. The Company is amortizing its transition obligation for past service costs relating to these benefits over twenty years. Unrecognized actuarial gains and losses are amortized over the estimated average remaining service period for active employee plans and over the estimated average remaining life for retiree plans. The Company is currently analyzing the impact of adopting SFAS No. 158 Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans, which requires an employer to recognize the over- or under-funded status of its defined benefit plan as an asset or liability, and to recognize in income any change in funded status in the year it occurs.

Fair Value of Financial Instruments

The following methods and assumptions were used to estimate the fair value of each class of financial instrument for which it is practicable to estimate fair value. It is impracticable for the Company to estimate the fair value of its subordinated debt because the only market for this financial instrument consists of principal to principal transactions. For all of the following items, the fair value is not materially different than the carrying value.

Cash, cash equivalents, accounts payable and accounts receivable

The carrying amount approximates fair value because of the short maturity of those instruments.

Marketable securities

The fair values of these investments are estimated based on quoted or market prices for these or similar instruments.

Senior long-term debt

The carrying amount of the Company’s senior debt approximates fair value which is estimated on current rates offered to the Company for debt of the same remaining maturities.

F-8

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Interest rate caps

The fair value of the Company’s financial instruments is estimated based on current rates offered to the Company for contracts with similar terms and maturities.

Redeemable common stock warrants

The Company uses an option pricing model to estimate the fair value of its redeemable common stock warrants.

Alion Stock

The estimated fair value price per share is determined based upon a valuation performed by an independent, third-party firm.

(3)  Business Combinations

Fiscal Year 2006 Acquisitions

Acquisition of BMH Associates, Inc.  On February 10, 2006, the Company acquired 100 percent of the issued and outstanding stock of BMH, a provider of advanced software, systems engineering and distributed interactive simulations for military training and experimentation, for $20.0 million (less a $1.5 million hold back) plus additional contingent earn out obligations over a two year period which can not exceed $6.0 million. As of December 31, 2006, the Company has recorded approximately $19.2 million in goodwill relating to this acquisition. In the three months ended December 31, 2006, the Company recognized approximately $3.0 million in earn out obligations related to BMH. The purchase price allocation is preliminary and subject to change based upon the completion of the valuation of certain intangible assets and other items. The pro forma impact of this acquisition was not significant.

Acquisition of Washington Consulting, Inc.  On February 24, 2006, the Company acquired 100 percent of the issued and outstanding stock of WCI, a provider of enterprise IT and management consulting solutions and services to commercial and government customers, for $18.0 million (less a $1.5 million hold back) plus additional contingent earn out obligations over a two year period which can not exceed $2.5 million. As of December 31, 2006, the Company has recorded approximately $17.5 million in goodwill relating to this acquisition. In the three months ended December 31, 2006, the Company paid approximately $1.3 million in previously recognized earn out obligations related to WCI. The purchase price allocation is preliminary and subject to change based upon the completion of the valuation of certain intangible assets and other items. The pro forma impact of this acquisition was not significant.

Acquisition of Micro Analysis and Design, Inc.  On May 19, 2006, the Company acquired 100 percent of the issued and outstanding stock of MA&D, a provider of human factors engineering, modeling and simulation and software development for approximately $16.9 million (less a $2.0 million hold back) plus additional contingent earn out obligations over a two year period which can not exceed approximately $4.1 million. As of December 31, 2006, the Company has recorded approximately $16.1 million in goodwill relating to this acquisition. The purchase price allocation is preliminary and subject to change based upon the completion of the valuation of certain intangible assets and other items. The pro forma impact of this acquisition was not significant.

Acquisition of certain assets of Anteon Corporation.  On June 30, 2006, the Company acquired from Anteon a group of assets consisting primarily of customer contracts for approximately $221.4 million. As of December 31, 2006, the Company has recorded approximately $45.0 million for purchased contracts, net of accumulated amortization, and approximately $174.0 million in goodwill relating to this acquisition. The

F-9

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

purchase price allocation is preliminary and subject to change based upon the completion of the valuation of certain intangible assets and other items.

The acquired identifiable intangibles assets in these transactions were as follows:

					Weighted Average
					Remaining
	Estimated		Residual		Amortization
Amounts in Millions	Fair Value		Value		Period
Purchased contracts	$	54.7	$	—		4 years

(4)  Employee Stock Ownership Plan (ESOP) and Stock Ownership Trust

On December 19, 2001, the Company adopted the Alion Science and Technology Corporation Employee Ownership, Savings and Investment Plan (the Plan) and the Trust. The Plan, a tax qualified retirement plan, includes an ESOP component and a non-ESOP component. On August 9, 2005, the Internal Revenue Service issued a determination letter that the Trust and the Plan, as amended through the Ninth Amendment to the Plan, qualify under Sections 401(a) and 501(a) of the Internal Revenue Code of 1986 (the IRC), as amended. The Company believes that the Plan and Trust have been designed and are currently being operated in compliance with the applicable requirements of the IRC.

(5)  Postretirement Benefits

The Company sponsors a medical benefits plan providing certain medical, dental, and vision insurance benefits to eligible employees and former employees. The Company is self-insured and has a stop-loss limit under an insurance agreement. The Company also provides postretirement medical benefits for employees who meet certain age and service requirements. Retiring employees may become eligible for those benefits at age 55 if they have 20 years of service, or at age 60 with 10 years of service. The plan provides benefits until age 65 and requires employees to pay one-quarter of their health care premiums. A small, closed group of employees is eligible for coverage after age 65. These retirees contribute a fixed portion of their health care premium. The estimated annual contribution to premiums from retirees is approximately $125,000.

There were no plan assets as of December 31, 2006 and September 30, 2006. The Company uses an October 1 measurement date.

(6)  Loss Per Share

Basic and diluted loss per share is computed by dividing net loss by the weighted average number of common shares outstanding excluding the impact of warrants, phantom stock and stock appreciation rights described herein as this impact would be anti-dilutive for all periods presented.

(7)  Shareholder’s Equity

The Company’s outstanding common stock is held by the Trust for the benefit of participants in the Plan. The Company provides a put option to any participant or beneficiary who receives a distribution of common stock which permits the participant or beneficiary to sell such common stock to the Company during certain periods, at the estimated fair value per share, which was $41.02 per share as of December 31, 2006. The estimated fair value per share is determined based upon a valuation performed by an independent, third-party firm. The Company may allow the Trust to purchase shares of common stock tendered to the Company under the put option.

Participants have the right to sell the shares distributed from their accounts that were acquired on the closing date of the Transaction at a value per share equal to the greater of the original purchase price or the estimated fair value price per share of the common stock.

F-10

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(8)  Accounts Receivable

	December 31,			September 30,
	2006			2006
	(In thousands)
Billed receivables	$	114,717		$	106,310
Unbilled receivables:
Amounts currently billable		50,825			36,548
Revenues recorded in excess of milestone billings on fixed price contracts		5,881			5,591
Revenues recorded in excess of estimated contract value or funding		14,362			3,354
Retainages and other amounts billable upon contract completion		1,584			2,570
Allowance for doubtful accounts		(4,277	)		(3,961	)
Total Accounts Receivable	$	183,092		$	150,412

Revenues recorded in excess of milestone billings on fixed price contracts consist of amounts not expected to be billed within the next month. Amounts currently billable consist principally of amounts to be billed within the next month. Indirect cost rates in excess of provisional billing rates on U.S. government contracts are generally billable at actual rates shortly after the end of each fiscal year. Any remaining unbilled balance including retainage is billable upon contract completion or completion of Defense Contract Audit Agency audits. Revenues recorded in excess of contract value or funding are billable upon receipt of contractual amendments or other modifications. Costs and estimated earnings in excess of billings on uncompleted contracts totaled approximately $72.7 million as of December 31, 2006 and included approximately $14.4 million for customer-requested work for which the Company had not received contracts or contract modifications.

(9)  Property, Plant and Equipment

Property, Plant and Equipment consist of the following:

	December 31,		September 30,
	2006		2006
	(In thousands)
Leasehold improvements	$	3,266	$	2,709
Equipment and software		26,125		25,188
Total cost		29,391		27,897
Less accumulated depreciation and amortization		15,153		13,253
Net fixed assets	$	14,238	$	14,644

Depreciation and leasehold amortization expense for property, plant and equipment was approximately $1.4 million and $1.3 million for the three months ended December 31, 2006 and 2005, respectively.

F-11

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(10)  Goodwill and Intangible Assets

As of December 31, 2006, the Company has recorded goodwill of approximately $391.2 million. Changes in the carrying amount of goodwill during the three months ended December 31, 2006, in the aggregate, are summarized in the following table:

	Total
	(In thousands)
Balance as of September 30, 2006	$	387,927
Adjustment to initial allocation made during the three months ended December 31, 2006 (earnout obligations)		3,239
Balance as of December 31, 2006	$	391,166

For the acquisitions completed during the year ended September 30, 2006, the purchase price allocations are preliminary and subject to change based upon the completion of the valuation of certain intangible assets and other items. There were no acquisitions during the three-months ended December 31, 2006.

As of December 31, 2006, the Company has recorded gross intangible assets of approximately $118.1 million, accumulated amortization of $46.9 million and net intangible assets of approximately $71.2 million. Intangible assets consist primarily of contracts purchased in connection with the acquisitions of JJMA, IPS, METI, BMH, WCI and MA&D and the contracts the Company acquired from Anteon Corporation (Anteon Contracts).

			Accumulated
	Gross		Amortization		Net
	(In thousands)
Purchased contracts	$	115,246	$	45,986	$	69,260
Internal use software and engineering designs		2,155		498		1,657
Non-compete agreements		650		416		234
Total	$	118,051	$	46,900	$	71,151

The intangible assets have estimated useful lives of generally one to thirteen years and are being amortized primarily using the straight-line method. The weighted-average remaining amortization period of intangible assets was approximately six years at December 31, 2006. Amortization expense was approximately $4.3 million and $3.5 million for the three months ended December 31, 2006 and 2005, respectively. Estimated aggregate amortization expense for the remainder of fiscal year 2007 and for each of the next five years and thereafter is as follows:

	(In thousands)
For the remaining nine months:
2007	$	12,506
For the year ending September 30:
2008		16,457
2009		15,273
2010		14,504
2011		8,599
2012		1,049
and thereafter		2,763
Total:	$	71,151

F-12

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(11)  Long-Term Debt

The Company entered into various debt agreements (Senior Credit Agreement, Mezzanine Note, and Subordinated Note) on December 20, 2002 to fund its acquisition of substantially all the assets of the IIT Research Institute (IITRI), which was affiliated with and controlled by Illinois Institute of Technology (IIT). In August 2004, the Company entered into a new Term B senior secured credit facility (the Term B Senior Credit Facility) with a syndicate of financial institutions for which Credit Suisse serves as arranger, administrative agent and collateral agent, and for which LaSalle Bank National Association serves as syndication agent. In April 2005, the first amendment to the Term B Senior Credit Facility (Amendment One) added $72.0 million to the Company’s total Term B Senior Credit Facility debt. In March 2006, the second amendment to the Term B Senior Credit Facility (Amendment Two) increased the term loan commitment by $68.0 million, of which the full $68.0 million has been drawn down by the Company as of December 31, 2006, and increased the revolving credit commitment from $30.0 million to $50.0 million. On June 30, 2006, the third amendment to the Term B Senior Credit Facility (Amendment Three) added $50.0 million in Term B Senior Credit Facility debt.

Term B Senior Credit Facility

The Term B Senior Credit Facility consists of the following balances at December 31, 2006 and September 30, 2006:

	December 31,			September 30,
	2006			2006
	(In thousands)
Senior term loan	$	258,360		$	259,015
Less: Unamortized debt issuance costs		(3,077	)		(4,099	)
Term B Senior Credit Facility Note Payable	$	255,283		$	254,916
Less current maturities, net of unamortized debt issue costs		(3,430	)		(2,816	)
Term B Senior Credit Facility Note Payable, less current maturities	$	251,853		$	252,100

The Term B Senior Credit Facility as of December 31, 2006, consists of:

•  a senior term loan in the approximate amount of $258.4 million;

•  a $50.0 million senior revolving credit facility under which approximately $32.6 million was outstanding as of December 31, 2006, and approximately $4.5 million of which was allocated for letters of credit and as such is not available to be borrowed; and

•  a $150.0 million uncommitted incremental term loan “accordion” facility.

The Term B Senior Credit Facility requires the Company to repay one percent of the principal balance of the senior term loan during each of the first eight years (fiscal years 2005 through 2012) and the first quarter of fiscal year 2013 in equal quarterly principal installments and the remaining principal balance outstanding during the ninth and final year (2013) in one principal installment. Through the quarter ending December 31, 2012, the Company is currently obligated to pay quarterly principal installments of approximately $0.7 million. On February 6, 2013, the senior term loan maturity date, the Company is obligated to pay a principal installment of the outstanding balance. (See discussion of debt amendment in Subsequent Events, Note 18).

Under the senior revolving credit facility, the Company may request up to $40.0 million in letters of credit and may borrow up to $5.0 million in swing line loans for short-term borrowing needs. The Company

F-13

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

must pay all principal obligations under the senior revolving credit facility in full no later than August 2, 2009.

The Company may prepay all or any portion of its senior term loan in minimum increments of $1.0 million, generally without penalty or premium, except for customary breakage costs associated with pre-payment of Eurodollar-based loans. If the Company issues certain permitted debt, or sells, transfers or disposes of certain assets, it must use all net proceeds to repay any Term B loan amounts outstanding. If the Company has excess cash flow for any fiscal year, it must use 50% of the net proceeds or excess cash flow to repay Term B loan amounts outstanding. If the Company’s leverage ratio (which compares the Company’s total debt to its Consolidated EBITDA) is less than 2 to 1, it must use only 25% of net proceeds or excess cash flow to repay Term B loan amounts outstanding.

If the Company enters into an additional term loan, including under the uncommitted incremental term loan facility, and certain terms of such loan are more favorable to the new lenders than existing terms under the Term B Senior Credit Facility, the applicable interest rate spread on the senior term loans could increase. As a result, additional term loans could increase the Company’s interest expense under its existing term loans. The Company’s significant subsidiaries (HFA, CATI, METI, JJMA, BMH, WCI and MA&D) have guaranteed the Company’s obligations under the Company’s Term B Senior Credit Facility.

Use of Proceeds.  In March 2006, the Company borrowed $32.0 million, used approximately $16.5 million to pay part of the WCI acquisition price, and paid approximately $13.6 million to redeem the mezzanine warrants held by IIT and the Company’s Chief Executive Officer. In May 2006, the Company borrowed $15.0 million to pay part of the MA&D acquisition price. On June 30, 2006, the Company borrowed $71.0 million to pay part of the Anteon Contracts acquisition price.

The Term B Senior Credit Facility permits the Company to use the remainder of its senior revolving credit facility for working capital needs, other general corporate purposes, and to finance permitted acquisitions. The Term B Senior Credit Facility permits the Company to use any proceeds from the uncommitted incremental term loan facility to finance permitted acquisitions and for any other purpose permitted by any future incremental term loan.

Security.  The Term B Senior Credit Facility is secured by a security interest in all of the Company’s current and future tangible and intangible property, as well as all of the current and future tangible and intangible property of many of the Company’s subsidiaries.

Interest and Fees.  Under the Term B Senior Credit Facility, the senior term loan and the senior revolving credit facility can each bear interest at either of two floating rates. The Company was entitled to elect that the senior term loan bear interest at an annual rate equal to: 1) the applicable alternate base interest rate charged by Credit Suisse plus a 175 basis point spread or, 2) the Eurodollar rate plus a 275 basis point spread. The Company was also entitled to elect that the senior revolving credit facility bear interest at an annual rate dependent on the Company’s leverage ratio and whether the Company made a Eurodollar or an alternate base borrowing. The alternate base rate is the greater of Credit Suisse’s prime rate or the federal funds effective rate, plus additional basis points corresponding to the Company’s leverage ratio at the time.

On April 1, 2005, the Company chose to have the senior term loan bear interest at the Eurodollar rate and the senior revolving credit facility bear interest at the ABR rate based on Credit Suisse’s prime rate. As of December 31, 2006, the Eurodollar rate on the senior term loan was 8.11 percent (5.36 percent plus 2.75 percent Eurodollar spread) and the ABR rate was 10.0 percent (8.25 percent plus 1.75 percent spread).

Interest Rate Cap Agreements.  The Company has three interest rate cap agreements in place with its senior lenders. The interest rate cap agreements limit the floating component of the Company’s total

F-14

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

interest rate but do not affect leverage ratio based spreads. The Company’s effective interest rate on notional principal in each cap agreement is the sum of the floating component and the applicable spread, which is determined by the Term B Senior Credit Facility. The three interest rate cap agreements will expire on September 30, 2007.

Other Fees and Expenses.  Each quarter the Company is required to pay a commitment fee of 50 basis points per year on the prior quarter’s daily, unused balance of the revolving credit facility and senior term loan commitment. As of December 31, 2006, the Company had approximately $32.6 million outstanding on the revolving credit facility and approximately $4.5 million was allocated for letters of credit; and the senior term loan was fully utilized. For the three months ended December 31, 2006, the Company paid approximately $0.02 million in commitment fees for the revolving credit facility and nothing for the senior term loan.

The Company is also required to pay an annual agent’s fee and a fronting fee not to exceed 25 basis points for each letter of credit issued under the revolving credit facility. Interest is due quarterly in arrears at the applicable revolving credit facility rate for all outstanding letters of credit.

Financial Covenants.  The Term B Senior Credit Facility requires the Company to meet certain financial performance measures typical of commercial loans of this type including leverage and interest coverage ratios. The Term B Senior Credit Facility includes other covenants that restrict the Company’s ability to take certain actions without the prior consent of senior lenders who extended a majority of the outstanding Term B loans. As of December 31, 2006, the Company was in compliance with the Term B Senior Credit Facility covenants.

Subordinated Note

On December 20, 2002, the Company issued a $39.9 million note to IITRI (Subordinated Note) as part of the consideration for Alion’s acquisition of substantially all of IITRI’s assets. On July 1, 2004, IIT acquired all of IITRI’s rights and interests in the Subordinated Note and the related warrant agreement. On June 30, 2006, the Company and IIT entered into an agreement that increased the interest rate on the Subordinated Note for two years from December 21, 2006 through December 20, 2008.

The Subordinated Note bears interest at (i) 6% through December 20, 2006, (ii) approximately 6.4% from December 21, 2006 through December 20, 2007, and (iii) 6.7% from December 21, 2007 through December 20, 2008. Interest is payable quarterly by the issuance of paid-in-kind or PIK notes maturing at the same time as the Subordinated Note. The PIK notes have the effect of deferring the underlying cash interest expense on the Subordinated Note. Beginning in December 2008, the Subordinated Note will bear interest at 16% per year payable quarterly in cash until the note has been repaid in full. Principal on the Subordinated Note is payable in equal installments of $19.95 million in December 2009 and December 2010. The PIK notes are due in equal installments of approximately $7.4 million on these same dates.

Bridge Loan Agreement

On June 30, 2006, the Company entered into a Bridge Loan Agreement with Credit Suisse and borrowed $170.0 million (the Bridge Loan, also called the Initial Loan). Certain of the Company’s subsidiaries guaranteed the Bridge Loan. The Initial Loan is due December 31, 2007 and automatically converts to an Extended Loan maturing December 31, 2011, if not repaid by December 31, 2007. The Company expects to refinance the Bridge Loan Agreement before the end of February 2007 through the issuance of up to $250.0 million of senior unsecured notes expected to mature in 2015. (See discussion of debt amendment in Subsequent Events, Note 18).

Use of Proceeds.  The Company used the proceeds from the Bridge Loan to pay part of the cost of acquiring the Anteon Contracts.

F-15

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Interest and Prepayment.  The Bridge Loan bears interest at a floating rate based on the Eurodollar Rate plus an applicable spread that varies over time. The first interest payment was paid on September 30, 2006. Interest is payable quarterly in arrears in cash except that the Company can use PIK notes to pay any interest in excess of 700 basis points over the applicable Eurodollar floating rate, or it can add the excess to the Bridge Loan principal. The Company may prepay all or any portion of the Bridge Loan in minimum increments of $100,000, with an aggregate minimum of $1.0 million plus applicable premium (described below) and customary breakage costs associated with pre-payment of Eurodollar-based loans prior to the end of the interest period. Bridge Loan prepayments are subject to an applicable premium percentage based on the prepayment date and vary over the life of the Bridge Loan.

Financial Covenants.  The Bridge Loan Agreement requires the Company to meet certain financial performance measures based on our leverage and interest coverage calculated in the same manner as under the Term B Senior Credit Facility. As of December 31, 2006, the Company was in compliance with the covenants set forth in the Bridge Loan.

As of December 31, 2006, the remaining fiscal year principal repayments (at face amount before debt discount) for outstanding indebtedness are as follows:

	2007		2008		2009		2010		2011		2012		Thereafter		Total
	(In thousands)
Senior Secured Term B Loan(1)	$	1,965	$	2,620	$	2,620	$	2,620	$	2,620	$	2,620	$	243,295	$	258,360
Bridge Loan(2)		—		—		—		—		—		—		175,100		175,100
Subordinated Seller Note(3)		—		—		19,950		19,950		—		—		—		39,900
Subordinated Paid in Kind Note(4)		—		—		7,402		7,402		—		—		—		14,804
Total principal payments	$	1,965	$	2,620	$	29,972	$	29,972	$	2,620	$	2,620	$	418,395	$	488,164

(1)	The table does not reflect any prepayments of the Term B Senior Credit Facility based on excess cash flow or other conditions as the timing and amount of any such payments are uncertain. The approximate $255.3 million on the face of the balance sheet (current and long-term portion) includes, as of December 31, 2006, approximately $3.1 million of unamortized debt issue costs which totaled approximately $12.3 million. The Company expects that it will need to refinance the Term B Senior Credit Facility before the end of fiscal year 2012.
(2)	The principal amount of $175.1 million includes $170.0 million principal at par value plus prepayment premium of $5.1 million (3% of par). The approximate $163.8 million on the face of the balance sheet includes, as of December 31, 2006, approximately $6.2 million in unamortized debt issue costs. The Company expects to refinance the Bridge Loan Agreement before the end of February 2007 through the issuance of up to $250.0 million of senior unsecured notes expected to mature in 2015. The Company intends to use the net proceeds to repay the Bridge Loan and a portion of the senior term loan. (See discussion of debt amendment in Subsequent Events, Note 18).
(3)	Repayment of $39.9 million for the face value of the Subordinated Seller Note in two equal payments of $19.95 million in years 2009 and 2010. The $39.9 million includes, as of December 31, 2006, approximately $3.6 million of unamortized debt discount assigned to fair value of the detachable warrants. On December 20, 2002, approximately $7.1 million was assigned as the fair value of the warrants in accordance with Emerging Issues Task Force Issue No. 00-19, Accounting for Derivative Financial Instruments Indexed to, and Potentially settled in, a Company’s Own Stock.

F-16

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(4) During the eight-year term of the Subordinated Note, approximately $14.8 million of principal accretes to the note and is included in the principal payments in fiscal years 2009 and 2010. The principal, together with the outstanding balance of the PIK notes will be paid in equal amounts at the end of fiscal years 2009 and 2010.

(12)  Redeemable Common Stock Warrants

In connection with the issuance of the Subordinated Note and the Deferred Compensation Agreement described in Note 11, the Company issued 1,080,437 and 22,062, respectively, of detachable redeemable common stock warrants (the Warrants) to IITRI and Dr. Atefi. IITRI subsequently transferred all of its rights, title and interest in the warrants to IIT. The Subordinate Note Warrants have an exercise price of $10 per share and are exercisable until December 20, 2010. The Warrants permit the holders to sell warrants to the Company, at predetermined times, at the then current fair value of the common stock less the exercise price. The Warrants are classified as debt instruments in accordance with Emerging Issues Task Force Issue No. 00-19, Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock. The Company recorded the initial $10.3 million estimated fair value of the Warrants as a discount to the face value of the notes issued and as a liability. The outstanding estimated fair value of the Warrants had an estimated fair value of $37.3 million as of December 31, 2006. The Company recognizes interest expense for changes in the estimated fair value of the Warrants.

(13)  Leases

Future minimum lease payments under non-cancelable operating leases for buildings, equipment and automobiles at December 31, 2006 are set out below. Under these operating leases, the Company subleased some excess capacity to subtenants under non-cancelable operating leases. In connection with the IPS, METI, and JJMA acquisitions, the Company assumed operating leases at above-market rates and recorded a loss accrual of approximately $4.9 million based on the estimated fair value of the lease liabilities assumed. The loss is being amortized over the lease terms; the remaining unamortized balance was $2.1 million at December 31, 2006. In connection with the IPS acquisition, the Company also acquired a related sub-lease pursuant to which it receives above-market rates. Based on the estimated fair value of the sublease, the Company recognized an asset of $0.6 million which is being amortized over the lease term. The remaining asset value was $0.3 million at December 31, 2006.

Fiscal Years Ending	(In thousands)
2007 (for the remainder of fiscal year)	$	19,843
2008		25,488
2009		22,197
2010		16,453
2011		14,309
2012		9,743
and thereafter		22,829
Gross lease payments	$	130,862
Less: non-cancelable subtenant receipts		5,281
Net lease payments	$	125,581

Rent expense under operating leases was $7.5 million and $4.0 million for the three months ended December 31, 2006 and 2005, respectively. Sublease rental income under operating leases was $0.5 million for each of the three months ended December 31, 2006 and 2005, respectively.

F-17

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(14)  Stock Appreciation Rights

As of December 31, 2006, under the 2002 SAR Plan, the Company had granted 236,400 SARs to directors and employees. Under the 2004 SAR Plan, the Company had granted 534,775 SARs to directors and employees. For the three months ended December 31, 2006 and 2005, the Company recognized approximately $1.2 million and $0.8 million, respectively, in compensation expense associated with the two SAR plans.

The table below sets out the disclosures and the assumptions used to value a share of Alion common stock and the Company’s grants of stock appreciation rights as of December 31, 2006 and September 30, 2006. For grants issued prior to October 1, 2006, the Company uses the intrinsic value method to recognize compensation expense pursuant to SFAS No. 123 Accounting for Stock-Based Compensation. For grants issued on or after October 1, 2006, the Company uses a Black-Scholes-Merton option pricing model to recognize compensation expense pursuant to SFAS No. 123(R) Share-Based Payment. The Company uses the fair market value of a share of its common stock to recognize expense for grants covered by SFAS 123; therefore no additional disclosures are required for these grants. .There is no established public trading market for Alion’s common stock. The ESOP is the only holder of our common stock. The Company uses an independent third party valuation firm to determine the fair market value of a share of Alion common stock. Alion does not expect to pay any dividends on its common stock. The terms of the senior credit facility and the subordinated note prohibit us from paying dividends without the consent of the respective lenders. We currently intend to retain future earnings, if any, for use in the operation of our business.

F-18

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Alion Science and Technology Corporation
Stock-based Compensation Disclosures per FAS 123
Stock Appreciation Rights
As of December 31, 2006

	Shares		Shares		Total														Vested
	Granted to		Granted to		Shares		Exercise		Outstanding		Outstanding								at		Exercisable
Date of Grant	Employees		Directors		Granted		Price		at 9/30/06		at 12/31/06		Forfeited		Exercised		Expired		12/31/06		at 12/31/06
December 2002		64,250		—		64,250	$	10.00		47,785		43,060		1,060		3,665		—		33,750		18,960
December 2002		—		29,400		29,400	$	10.00		—		—		—		—		—		—		—
May 2003		300		—		300	$	11.13		240		150		—		90		—		30		30
June 2003		300		—		300	$	11.13		300		300		—		—		—		180		60
November 2003		129,550		—		129,550	$	14.71		100,466		91,786		1,520		7,160		—		51,418		19,250
November 2003		—		12,600		12,600	$	14.71		2,800		2,800		—		—		—		2,800		2,800
November 2004		—		12,600		12,600	$	19.94		12,600		12,600		—		—		—		8,400		8,400
February 2005		164,750		—		164,750	$	19.94		135,588		129,463		4,575		550		—		28,025		—
March 2005		2,000		—		2,000	$	19.94		2,000		2,000		—		—		—		500		—
April 2005		33,000		—		33,000	$	29.81		27,500		27,500		—		—		—		5,000		—
June 2005		2,000		—		2,000	$	29.81		2,000		2,000		—		—		—		500		—
December 2005		276,675		—		276,675	$	35.89		257,900		250,350		7,550		—		—		63,150		—
February 2006		13,000		—		13,000	$	35.89		10,250		10,250		—		—		—		—		—
February 2006		7,500		—		7,500	$	35.89		7,500		7,500		—		—		—		—		—
May 2006		7,000		—		7,000	$	37.06		7,000		7,000		—		—		—		—		—
July 2006		15,000		—		15,000	$	37.06		15,000		15,000		—		—		—		—		—
August 2006		1,250		—		1,250	$	37.06		1,250		1,250		—		—		—		—		—
Total		716,575		54,600		771,175				630,179		603,009		14,705		12,465		—		193,753		49,500
Wtd Avg Exercise Price	$	25.75	$	13.38	$	24.87			$	26.39	$	26.64	$	26.87	$	13.95	$	—	$	22.21	$	13.79

F-19

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Alion Science and Technology Corporation
Stock-based Compensation Disclosures per FAS 123
Stock Appreciation Rights
As of December 31, 2006

					Remaining
			Expected		Life
Date of Grant	Risk Free Interest Rate	Volatility	Life		(months)
December 2002	4.06% — 4.49%	60%		5 yrs		10.3
December 2002	4.06% — 4.49%	60%		3 yrs		0.0
May 2003	2.70% — 3.30%	55%		5 yrs		15.7
June 2003	2.70% — 3.30%	55%		5 yrs		16.5
November 2003	4.06% — 4.49%	60%		5 yrs		22.2
November 2003	4.06% — 4.49%	60%		3 yrs		0.0
November 2004	3.10% — 3.60%	45%		3 yrs		10.3
February 2005	3.10% — 3.60%	45%		4 yrs		24.7
March 2005	3.10% — 3.60%	45%		4 yrs		25.9
April 2005	4.10% — 4.20%	45%		4 yrs		26.7
June 2005	4.10% — 4.20%	45%		4 yrs		28.9
December 2005	4.20% — 4.20%	40%		4 yrs		35.5
February 2006	4.20% — 4.20%	40%		4 yrs		37.2
February 2006	4.20% — 4.20%	40%		4 yrs		37.7
May 2006	4.82% — 4.83%	35%		4 yrs		40.5
July 2006	4.82% — 4.83%	35%		4 yrs		41.9
August 2006	4.82% — 4.83%	35%		4 yrs		43.8
Wtd Avg Exercise Price						28.5

(15)  Phantom Stock Plans

As of December 31, 2006, under the Initial Phantom Stock Plan, the Company had granted 223,685 shares of phantom stock. Under the Second Phantom Stock Plan, the Company had granted 228,693 shares of retention phantom stock and 207,778 shares of performance phantom stock. Under the Director Phantom Stock Plan, the Company had granted 7,808 shares of phantom stock. For the three months ended December 31, 2006 and 2005, the Company recognized approximately $2.4 million and $1.9 million, respectively, in compensation expense associated with all three phantom stock plans.

The table below sets out the disclosures and the assumptions used to value a share of Alion common stock and the Company’s grants of phantom stock as of December 31, 2006 and September 30, 2006. For grants issued prior to October 1, 2006, the Company uses the intrinsic value method to recognize compensation expense pursuant to SFAS No. 123 Accounting for Stock-Based Compensation. For grants issued on or after October 1, 2006, the Company uses a Black-Scholes-Merton option pricing model to recognize compensation expense pursuant to SFAS No. 123(R) Share-Based Payment. The Company uses the fair market value of a share of its common stock to recognize expense for grants covered by SFAS 123; therefore no additional disclosures are required for these grants. There is no established public trading market for Alion’s common stock. The ESOP is the only holder of the Company’s common stock. The Company uses an independent third party valuation firm to determine the fair market value of a share of Alion common stock. Alion does not expect to pay any dividends on its common stock. The terms of the senior credit facility and the Subordinated Note prohibit paying dividends without the consent of the respective lenders. The Company intends to retain future earnings, if any, for use in the business.

F-20

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Alion Science and Technology Corporation
Stock-based Compensation Disclosures per FAS 123
Phantom Stock
as of December 31, 2006

	Shares		Shares		Total		Grant Date												Vested
	Granted to		Granted to		Shares		Price		Outstanding at		Outstanding at								at		Exercisable
Date of Grant	Employees		Directors		Granted		per Share		9/30/06		12/31/06		Forfeited		Exercised		Expired		12/31/06		at 12/31/06
February 2003		171,000		—		171,000	$	10.00		85,000		85,000		—		—		—		16,500		16,500
November 2003		52,685		—		52,685	$	14.71		32,971		26,513		—		6,458		—		8,158		8,158
February 2005		202,763		—		202,763	$	19.94		202,763		202,763		—		—		—		—		—
February 2005		103,414		—		103,414	$	19.94		103,414		103,414		—		—		—		—		—
February 2005		5,015		—		5,015	$	19.94		5,015		5,015		—		—		—		1,254		—
August 2005		2,960		—		2,960	$	33.78		2,960		2,960		—		—		—		987		—
November 2005		66,592		—		66,592	$	35.89		66,592		66,592		—		—		—		—		—
November 2005		—		7,808		7,808	$	35.89		6,832		6,832		—		—		—		2,277		2,277
November 2005		55,726		—		55,726	$	35.89		55,726		55,726		—		—		—		—		—
Total		660,156		7,808		667,964				561,274		554,816		—		6,458		—		29,176		26,935
Wtd Avg Grant Date Fair Value Price per Share	$	19.97	$	35.89	$	20.15			$	21.87	$	21.95	$	—	$	14.71	$	—	$	14.57	$	13.62

Alion Science and Technology Corporation
Stock-based Compensation Disclosures per FAS 123
Phantom Stock
as of December 31, 2006

					Remaining
			Expected		Life
Date of Grant	Risk Free Interest Rate	Volatility	Life		(months)
February 2003	4.06% — 4.49%	60%		5 yrs		12.7
November 2003	4.06% — 4.49%	60%		5 yrs		21.8
February 2005	3.10% — 3.60%	45%		3 yrs		12.7
February 2005	3.10% — 3.60%	45%		3 yrs		12.7
February 2005	3.10% — 3.60%	45%		4 yrs		24.7
August 2005	3.72% — 3.77%	45%		3 yrs		18.9
November 2005	4.20% — 4.20%	40%		3 yrs		22.1
November 2005	4.20% — 4.20%	40%		3 yrs		22.1
November 2005	4.20% — 4.20%	40%		5 yrs		46.1
Wtd Avg Grant Date Fair Value Price per Share						17.9

(16)  Segment Information and Customer Concentration

The Company operates in one segment, delivering a broad array of scientific and engineering expertise to research and develop technological solutions for problems relating to national defense, public health and safety, and nuclear safety and analysis under contracts with the federal government, state and local governments, and commercial customers. The Company’s federal government customers typically exercise independent contracting authority, and even offices or divisions within an agency or department may directly, or through a prime contractor, use the Company’s services as a separate customer so long as that customer has independent decision-making and contracting authority within its organization.

F-21

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Contract receivables from agencies of the federal government represented approximately $175.1 million, or 93.5%, of accounts receivable at December 31, 2006 and $91.3 million, or 94.7%, of accounts receivable at December 31, 2005. Contract revenues from agencies of the federal government represented approximately 94.3% of total contract revenues during the three months ended December 30, 2006 and 98.3% of total contract revenues during the three months ended December 31, 2005. Two prime contracts with the Department of Defense represented approximately 14.7% and 7.9% of revenue for the three months ended December 31, 2006. Two prime contracts with the Department of Defense represented approximately 17.4% and 11.6% of revenue for the three months ended December 31, 2005.

(17)  Commitments and Contingencies

Earn Out Commitments

The Company has earn out commitments related to the following acquisitions:

CATI — There is an earn out provision not to exceed $8.25 million based on the revenue of the business units that formerly comprised CATI. There is a second earn out provision not to exceed $1.5 million based on attaining certain revenue goals in the commercial aviation industry. The obligations continue until September 2007. In the three months ended December 31, 2006 and 2005, the Company recognized no earn out obligations for CATI.

BMH — There is an earn out provision not to exceed a total of $6.0 million based on the revenue of the business units that formerly comprised BMH. The obligation continues until December 2007. In the three months ended December 31, 2006, the Company recognized approximately $3.0 million in earn out obligation related to BMH.

WCI — There is an earn out provision not to exceed a total of $2.5 million based on the revenue of the business units that formerly comprised WCI. The obligation continues until September 2007. In the three months ended December 31, 2006, the Company paid approximately $1.3 million in previously recognized earn out obligations related to WCI.

MA&D — There is an earn out provision not to exceed a total of $2.5 million based on the revenue of the business units that formerly comprised MA&D. The obligation continues until September 2007. In the three months ended December 31, 2006, the Company recognized no earn out obligations related to MA&D.

In the opinion of management, the realization of the amounts due under these arrangements will not have a material adverse effect upon the financial position, results of operations, or the liquidity of the Company.

Legal Proceedings

Estate of Joseph Hudert vs. Alion Science and Technology Corporation; Estate of Frank Stotmeister vs. Alion Science and Technology Corporation.

On December 23, 2004, the estate of Joseph Hudert filed an action against Grunley-Walsh Joint Venture, L.L.C. (Grunley-Walsh) and the Company in the District of Columbia Superior Court for damages in excess of $80 million. On January 6, 2005, the estate of Frank Stotmeister filed an action against the Company in the same court on six counts, some of which are duplicate causes of action, claiming $30 million for each count. Several other potential defendants may be added to these actions in the future.

The suits arose in connection with a steam pipe explosion that occurred on or about April 23, 2004 on a construction site at 17th Street, N.W. in Washington, D.C. The plaintiffs died, apparently as a result of

F-22

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

the explosion. They were employees of the prime contractor on the site, Grunley-Walsh, and the subcontractor, Cherry Hill Construction Company Inc., respectively. Grunley-Walsh had a contract with the U.S. General Services Administration (GSA) for construction on 17th Street N.W. near the Old Executive Office Building in Washington, D.C. Sometime after the award of Grunley-Walsh’s construction contract, Alion was awarded a separate contract by GSA. Alion’s responsibilities on this contract were non-supervisory monitoring of Grunley-Walsh’s activities and reporting to GSA of any deviations from contract requirements.

The Company intends to defend these lawsuits vigorously. Based on the facts underlying the lawsuits known to the Company at this time, and the Company’s non-supervisory monitoring role at the project site, the Company’s management believes that the potential for Alion to incur a material loss as a result of the lawsuits is remote. Therefore, the Company’s management does not believe that these lawsuits will have a material adverse effect upon the Company, its operations or its financial condition.

Alion’s primary provider of general liability insurance, St. Paul Travelers, has assumed defense of these lawsuits. However, since there is some uncertainty as to whether St. Paul Travelers received timely notice of a potential claim by Alion in connection with these lawsuits under its general liability insurance policy, St. Paul Travelers indicated when it assumed defense of the lawsuits, that it was doing so subject to a reservation of rights to deny coverage. Nevertheless, even if St. Paul Travelers is ultimately able to properly deny coverage as a result of late notice of the lawsuits, the Company’s management does not believe that the lawsuits will have a materially adverse effect upon the Company, its operations or its financial condition. American International Group, the Company’s excess insurance carrier, has also been notified regarding these lawsuits.

The Company is involved in various claims and legal actions arising in the ordinary course of business. In the opinion of management, the ultimate disposition of these matters will not have a material adverse effect upon the Company’s business, financial position, operating results or ability to meet its financial obligations.

Government Audits

The amount of federal government contract revenue and expense reflected in the consolidated financial statements attributable to cost reimbursement contracts is subject to audit and possible adjustment by the Defense Contract Audit Agency (DCAA). The federal government considers the Company to be a major contractor and DCAA maintains an office on site to perform its various audits throughout the year. All of the Company’s federal government contract indirect costs have been audited through 2004. Indirect rates have been negotiated through fiscal year 2003. Contract revenue on federal government contracts has been recorded in amounts that are expected to be realized upon final settlement.

(18)  Subsequent Events

On January 4, 2007, the Company borrowed a total of $15.0 million in additional term loans under the Term B Senior Credit Facility. Those loan proceeds, less approximately $300,000 in fees associated with the borrowing, were immediately used to pay down the outstanding balance on the senior revolving credit facility.

On February 6, 2007, the Company entered into an amendment to the Term B Senior Credit Facility, pursuant to which: (i) the maturity date of the senior term loans borrowed under the Term B Senior Credit Facility was extended to February 6, 2013, (ii) the fixed component of the interest rate payable by the Company on the outstanding amounts of senior term loans was reduced by 25 basis points, (iii) the principal repayment schedule was adjusted to require one balloon principal repayment at maturity, (iv) the amount of debt the Company was allowed to incur in connection with the re-financing of the Bridge Loan

F-23

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

was increased from $200.0 million to $250.0 million; the additional proceeds were used to repay a portion of the amounts outstanding under the Term B Senior Credit Facility; and (v) an incurrence test was added as an additional condition to the Company’s ability to incur permitted indebtedness . The extension of the maturity date and the adjustment to the amortization of principal resulted in a change in the timing and the amount of principal of senior term loans the Company must repay. As of February 8, 2007, through the quarter ending December 31, 2012, the Company is obligated to pay quarterly principal installments of $555,900. On February 6, 2013, the senior term loan maturity date, the Company is obligated to pay a principal installment of approximately $209.6 million.

On February 8, 2007, the Company issued and sold $250.0 million of its 10.25% senior unsecured notes due February 1, 2015 (Senior Unsecured Notes) to Credit Suisse, which has informed the Company that it has resold most of the Senior Unsecured Notes to qualified institutional buyers. Interest on the Senior Unsecured Notes will accrue at the rate of 10.25% annually and will be payable semiannually in arrears on February 1 and August 1, commencing on August 1, 2007. The Senior Unsecured Notes rank the same in right of payment with all existing and future senior indebtedness of the Company, including indebtedness outstanding under and which may be borrowed pursuant to the Term B Senior Credit Facility. The proceeds of the Senior Unsecured Notes were used to pay off all outstanding amounts under the Bridge Loan Agreement and approximately $72.0 million of the amounts outstanding under the Term B Senior Credit Facility.

(19)  Guarantor/Non-guarantor Condensed Consolidated Financial Information

The Company’s senior unsecured notes are unsecured general obligations of Alion Science and Technology Corporation. Certain of the Company’s wholly-owned, domestic subsidiaries have jointly, severally, fully and unconditionally guaranteed the senior unsecured notes. The following information presents condensed consolidating balance sheets as of December 31, 2006 and September 30, 2006, condensed consolidating statements of operations for the three months ended December 31, 2006 and 2005, and condensed consolidating statements of cash flows for the three months ended December 31, 2006 and 2005 of the parent company issuer, the guarantor subsidiaries and the non-guarantor subsidiaries. Investments include investments in subsidiaries held by the parent company issuer and have been presented using the equity method of accounting.

F-24

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Condensed Consolidating Balance Sheet Information at December 31, 2006
(In thousands)

	Parent
	Company			Guarantor			Non-Guarantor
	Issuer			Subsidiaries			Subsidiaries			Eliminations			Consolidated
Current assets:
Cash and cash equivalents		$403		$	(115	)	$	52			—		$	340
Accounts receivable		178,037			5,051			4			—			183,092
Prepaid expenses and other current assets		6,385			59			5			—			6,449
Total current assets		184,825			4,995			61			—			189,881
Property, plant and equipment, net		13,623			266			349			—			14,238
Intangible assets, net		71,151			—			—			—			71,151
Goodwill		391,166			—			—			—			391,166
Investment in subsidiaries		8,223			—			—			(8,223	)		—
Intercompany receivables		—			8,209			—			(8,209	)		—
Other assets		6,037			13			—			—			6,050
Total assets		675,025			13,483			410			(16,432	)		672,486
Current liabilities:
Book cash overdraft		3,261			—			—			—			3,261
Current portion, Term B Senior Credit Facility note payable		3,430			—			—			—			3,430
Current portion, acquisition obligations		9,172			—			—			—			9,172
Trade accounts payable and accrued liabilities		74,346			2,942			(1	)		—			77,287
Accrued payroll and related liabilities		26,484			1,255			158			—			27,897
Billings in excess of costs and estimated earnings on uncompleted contracts		2,212			—			—			—			2,212
Total current liabilities		118,905			4,197			157			—			123,259
Acquisition obligations, excluding current portion		2,562			—			—			—			2,562
Intercompany payables		7,692			—			517			(8,209	)		—
Notes payable to bank		32,550			—			—			—			32,550
Term B Senior Credit Facility note payable, excluding current portion		251,853			—			—			—			251,853
Bridge loan payable		163,830			—			—			—			163,830
Subordinated note payable		48,022			—			—			—			48,022
Accrued compensation, excluding current portion		25,674			772			—			—			26,446
Accrued postretirement benefit obligations		4,086			—			—			—			4,086
Non-current portion of lease obligations		4,087			27			—			—			4,114
Redeemable common stock warrants		37,258			—			—			—			37,258
Total liabilities		696,519			4,996			674			(8,209	)		693,980
Shareholder’s deficit:
Common stock		52			1			—			(1	)		52
Additional paid-in capital		91,737			2,800			—			(2,800	)		91,737
Treasury stock		—			(2	)		—			2			—
Accumulated deficit		(113,283	)		5,688			(264	)		(5,424	)		(113,283	)
Total shareholder’s deficit		(21,494	)		8,487			(264	)		(8,223	)		(21,494	)
Total liabilities and shareholder’s deficit		$675,025		$	13,483		$	410		$	(16,432	)	$	672,486

F-25

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Condensed Consolidating Balance Sheet Information at September 30, 2006
(In thousands)

	Parent
	Company			Guarantor			Non-Guarantor
	Issuer			Subsidiaries			Subsidiaries			Eliminations			Consolidated
Current assets:
Cash and cash equivalents	$	2,728		$	(32	)	$	59			—		$	2,755
Accounts receivable		144,751			5,657			4			—			150,412
Stock subscriptions receivable		8,990			—			—			—			8,990
Other current assets		5,885			134			9			—			6,028
Total current assets		162,354			5,759			72			—			168,185
Property, plant and equipment, net		14,029			299			316			—			14,644
Intangible assets, net		75,403			—			—			—			75,403
Goodwill		387,927			—			—			—			387,927
Investment in subsidiaries		7,979			—			—			(7,979	)		—
Intercompany receivables		—			8,310			—			(8,310	)		—
Other assets		4,797			13			—			—			4,810
Total assets		652,489			14,381			388			(16,2889	)		650,969
Current liabilities:
Current portion, Term B Senior Credit Facility note payable		2,816			—			—			—			2,816
Current portion, acquisition obligations		11,457			—			—			—			11,457
Trade accounts payable and accrued liabilities		59,174			3,625			4			—			62,803
Accrued payroll and related liabilities		32,288			1,694			153			—			35,135
Billings in excess of costs and estimated earnings on uncompleted contracts		2,163			—			—			—			2,163
Total current liabilities		108,898			5,319			157			—			114,374
Acquisition obligations, excluding current portion		3,568			—			—			—			3,568
Intercompany payables		7,784			—			526			(8,310	)		—
Notes payable to bank		12,300			—			—			—			12,300
Term B Senior Credit Facility note payable, excluding current portion		252,100			—			—			—			252,100
Bridge loan payable		164,680			—			—			—			164,680
Subordinated note payable		46,963			—			—			—			46,963
Accrued compensation, excluding current portion		20,254			772			—			—			21,026
Accrued postretirement benefit obligations		3,722			—			—			—			3,722
Non-current portion of lease obligations		4,276			16			—			—			4,292
Redeemable common stock warrants		35,234			—			—			—			35,234
Total liabilities		659,779			6,107			683			(8,310	)		658,259
Shareholder’s equity (deficit):
Common stock		52			1			—			(1	)		52
Additional paid-in capital		91,829			2,800			—			(2,800	)		91,829
Treasury stock					(2	)		—			2			—
Accumulated deficit		(99,171	)		5,475			(295	)		(5,180	)		(99,171	)
Total shareholder’s equity (deficit)		(7,290	)		8,274			(295	)		(7,979	)		(7,290	)
Total liabilities and shareholder’s equity (deficit)	$	652,489		$	14,381		$	388		$	(16,289	)	$	650,969

F-26

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Condensed Consolidating Statement of Operations for the Three Months Ended December 31, 2006
(In thousands)

	Parent
	Company			Guarantor			Non-Guarantor
	Issuer			Subsidiaries			Subsidiaries			Eliminations			Consolidated
Contract revenue	$	174,133		$	6,924		$	82			—		$	181,139
Direct contract expense		135,043			4,996			62			—			140,101
Gross profit		39,090			1,928			20			—			41,038
Operating expenses:
Indirect contract expense		8,379			1,072			24			—			9,475
Research and development		604			—			50			—			654
General and administrative		16,258			347			8			—			16,613
Rental and occupancy expense		8,258			—			7			—			8,265
Depreciation and amortization		5,622			33			—			—			5,655
Bad debt expense		318			15			—			—			333
Total operating expenses		39,439			1,467			89			—			40,995
Operating income (loss)		(349	)		461			(69	)		—			43
Other income (expense):
Interest income		116			—			—			—			116
Interest expense		(14,358	)		—			—			—			(14,358	)
Other		235			(261	)		100			—			74
Equity in net income of subsidiaries		244			—			—			(244	)		—
Income (loss) before income taxes		(14,112	)		200			31			(244	)		(14,125	)
Income tax benefit		—			13			—			—			13
Net income (loss)	$	(14,112	)	$	213		$	31		$	(244	)	$	(14,112	)

F-27

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Condensed Consolidating Statement of Operations For the Three Months Ended
December 31, 2005
(In thousands)

	Parent
	Company			Guarantor			Non-Guarantor
	Issuer			Subsidiaries			Subsidiaries			Eliminations			Consolidated
Contract revenue	$	99,423		$	1,594		$	272			—		$	101,289
Direct contract expense		74,975			1,160			170			—			76,305
Gross profit		24,448			434			102			—			24,984
Operating expenses:
Indirect contract expense		5,253			85			17			—			5,355
Research and development		195			—			50			—			245
General and administrative		9,522			81			—			—			9,603
Rental and occupancy expense		4,949			—			8			—			4,957
Depreciation and amortization		4,788			2			—			—			4,790
Stock-based compensation		2,756			—			—			—			2,756
Bad debt expense		106			—			—			—			106
Total operating expenses		27,569			168			75			—			27,812
Operating income (loss)		(3,121	)		266			27			—			(2,828	)
Other income (expense):
Interest income		372			—			—			—			372
Interest expense		(5,445	)		—						—			(5,445	)
Other		319			(134	)		(45	)		—			140
Equity in net income of subsidiaries		114			—			—			(114	)		—
Income (loss) before income taxes		(7,761	)		132			(18	)		(114	)		(7,761	)
Income tax expense		(19	)		—			—			—			(19	)
Net income (loss)	$	(7,780	)	$	132		$	(18	)	$	(114	)	$	(7,780	)

F-28

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Condensed Consolidating Statement of Cash Flows Three Months Ended December 31, 2006
(In thousands)

	Parent
	Company			Guarantor			Non-Guarantor
	Issuer			Subsidiaries			Subsidiaries			Consolidated
Net cash provided by (used in) operating activities		(25,169	)		(83	)		26			(25,226	)
Cash flows from investing activities:
Cash paid for acquisitions, net of cash acquired		(6,560	)		—			—			(6,560	)
Capital expenditures		(1,500	)		—			(33	)		(1,533	)
Net cash used in investing activities		(8,060	)		—			(33	)		(8,093	)
Cash flows from financing activities:
Book overdraft		3,261			—			—			3,261
Repayment of Term B Credit Facility note payable		(655	)		—			—			(655	)
Payment of debt issuance costs		(850	)		—			—			(850	)
Borrowings under revolving credit facility		20,250			—			—			20,250
Purchase of shares of common stock from ESOP Trust		(92	)		—			—			(92	)
Cash received from issuance of common stock to ESOP Trust		8,990			—			—			8,990
Net cash provided by (used in) financing activities		30,904			—			—			30,904
Net decrease in cash and cash equivalents		(2,325	)		(83	)		(7	)		(2,415	)
Cash and cash equivalents at beginning of period		2,728			(32	)		59			2,755
Cash and cash equivalents at end of period	$	403		$	(115	)	$	52		$	340

F-29

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Condensed Consolidating Statement of Cash Flows for the Three Months Ended December 31, 2005
(In thousands)

	Parent
	Company			Guarantor			Non-Guarantor
	Issuer			Subsidiaries			Subsidiaries		Eliminations	Consolidated
Net cash provided by (used in) operating activities		(14,123	)		(533	)		1			(14,655	)
Cash flows from investing activities:
Cash paid for acquisitions, net of cash acquired		—			—			—			—
Capital expenditures		(1,605	)		—			—			(1,605	)
Net cash used in investing activities		(1,605	)		—			—			(1,605	)
Cash flows from financing activities:
Repayment of Term B Credit Facility note payable		(360	)		—			—			(360	)
Purchase of shares of common stock from ESOP Trust		(7,592	)		—			—			(7,592	)
Cash received from issuance of common stock to ESOP Trust		1.693			—			—			1,693
Net cash provided by (used in) financing activities		(6,259	)		—			—			(6,259	)
Net (decrease) increase in cash and cash equivalents		(21,987	)		(533	)		1			(22,519	)
Cash and cash equivalents at beginning of period		37,634			139			5			37,778
Cash and cash equivalents at end of period	$	15,647		$	(394	)	$	6		$	15,259

F-30

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors
Alion Science and Technology Corporation:

We have audited the accompanying consolidated balance sheet of Alion Science and Technology Corporation and subsidiaries (the “Company”) as of September 30, 2006, and the related consolidated statements of operations, shareholder’s equity (deficit), and cash flows for the year then ended. Our audit also included the financial statement schedule for the year ended September 30, 2006 listed in the Index at Item 21(b). These financial statements and financial statement schedule are the responsibility of the Company’s management. Our responsibility is to express an opinion on the financial statements and financial statement schedule based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, such consolidated financial statements present fairly, in all material respects, the financial position of Alion Science and Technology Corporation and subsidiaries as of September 30, 2006, and the results of their operations and their cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America. Also, in our opinion, such financial statement schedule, when considered in relation to the basic consolidated financial statements taken as a whole, present fairly in all material respects the information set forth therein.

/s/ DELOITTE & TOUCHE LLP

McLean, Virginia
November 29, 2006 (except for Note 20, as to which the date is April 27, 2007)

F-31

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors
Alion Science and Technology Corporation:

We have audited the accompanying consolidated balance sheet of Alion Science and Technology Corporation and subsidiaries (the Company) as of September 30, 2005, and the related consolidated statements of operations, shareholder’s equity (deficit), and cash flows for the years ended September 30, 2005 and 2004. In connection with our audits of the consolidated financial statements, we also have audited the consolidated financial statement schedule for the fiscal years ended September 30, 2005 and 2004. These consolidated financial statements and consolidated financial statement schedule are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements and consolidated financial statement schedule based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Alion Science and Technology Corporation and subsidiaries as of September 30, 2005, and the results of their operations and their cash flows for each of the years in the two-year period ended September 30, 2005, in conformity with U.S. generally accepted accounting principles. Also in our opinion, the related consolidated financial statement schedule, when considered in relation to the basic consolidated financial statements taken as a whole, presents fairly, in all material respects, the information set forth therein.

/s/ KPMG LLP

Chicago, Illinois
January 31, 2006 (except for Note 20, as
to which the date is April 27, 2007)

F-32

ALION SCIENCE AND TECHNOLOGY CORPORATION

CONSOLIDATED BALANCE SHEETS

	September 30,
	2006			2005
	(In thousands, except share and per share information)
Current assets:
Cash and cash equivalents	$	2,755		$	37,778
Accounts receivable, less allowance of $3,961 and $3,539 at September 30, 2006 and 2005, respectively		150,412			80,898
Stock subscriptions receivable		8,990			1,733
Prepaid expenses		3,422			1,944
Other current assets		2,606			2,802
Total current assets		168,185			125,155
Property, plant and equipment, net		14,644			11,174
Intangible assets, net		75,403			30,198
Goodwill		387,927			163,419
Other assets		2,067			1,860
Deferred compensation assets		2,743			2,443
Total assets		650,969			334,249
Current liabilities:
Current portion, Term B Senior Credit Facility note payable		2,816			1,404
Current portion, acquisition obligations		11,457			3,616
Trade accounts payable and accrued liabilities		61,902			27,312
Accrued payroll and related liabilities		34,955			29,161
ESOP liabilities		180			274
Current portion of accrued loss on operating leases		901			1,054
Billings in excess of costs and estimated earnings on uncompleted contracts		2,163			2,559
Total current liabilities		114,374			65,380
Acquisition obligations, excluding current portion		3,568			7,100
Notes payable to bank		12,300			—
Term B Senior Credit Facility note payable, excluding current portion		252,100			137,945
Bridge loan payable		164,680			—
Subordinated note payable		46,963			42,888
Deferred compensation liability		17,510			2,465
Accrued compensation, excluding current portion		3,516			6,356
Accrued postretirement benefit obligations		3,722			3,357
Non-current portion of lease obligations		4,292			3,694
Redeemable common stock warrants		35,234			44,590
Total liabilities		658,259			313,775
Shareholder’s equity (deficit):
Common stock, $0.01 par value, 8,000,000 shares authorized, 5,210,126 and 5,149,840 shares issued and outstanding at September 30, 2006 and September 30, 2005		52			51
Additional paid-in capital		91,829			88,479
Accumulated deficit		(99,171	)		(68,056	)
Total shareholder’s equity (deficit)		(7,290	)		20,474
Total liabilities and shareholder’s equity (deficit)	$	650,969		$	334,249

See accompanying notes to consolidated financial statements.

F-33

ALION SCIENCE AND TECHNOLOGY CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

	Year Ended September 30,
	2006			2005			2004
	(In thousands, except share and per share information)
Contract revenue	$	508,628		$	369,231		$	269,940
Direct contract expense		381,467			267,241			196,388
Gross profit		127,161			101,990			73,552
Operating expenses:
Indirect contract expense		29,907			29,017			17,647
Research and development		2,025			498			399
General and administrative		58,093			43,602			30,630
Rental and occupancy expense		22,208			12,542			10,990
Depreciation and amortization		16,566			17,771			13,447
Bad debt expense		667			651			590
Total operating expenses		129,466			104,081			73,703
Operating loss		(2,305	)		(2,091	)		(151	)
Other income (expense):
Interest income		590			475			27
Interest expense		(29,691	)		(38,696	)		(16,835	)
Other		317			140			1,865
Loss before income taxes		(31,089	)		(40,172	)		(15,094	)
Income tax expense		(26	)		(66	)		(17	)
Net loss	$	(31,115	)	$	(40,238	)	$	(15,111	)
Basic and diluted loss per share	$	(6.19	)	$	(9.50	)	$	(4.91	)
Basic and diluted weighted average common shares outstanding		5,029,670			4,235,947			3,074,709

See accompanying notes to consolidated financial statements.

F-34

ALION SCIENCE AND TECHNOLOGY CORPORATION

CONSOLIDATED STATEMENTS OF SHAREHOLDER’S EQUITY (DEFICIT)

							Additional
	Common			Common			Paid-in-			Treasury			Treasury			Accumulated
	Shares			Stock			Capital			Shares			Stock			Deficit			Total
Balances at October 1, 2003		2,973,813		$	29		$	30,578			—		$	—		$	(12,707	)	$	17,900
Purchase of common stock from ESOP Trust		(99,927	)		—			—			99,927			(1,562	)		—			(1,562	)
Release of treasury shares to ESOP Trust		99,927			—			—			(99,927	)		1,562			—			1,562
Issuance of common stock to ESOP Trust		402,384			5		$	6,954			—			—			—			6,959
Net loss for the year ended September 30, 2004		—			—			—			—			—			(15,111	)		(15,111	)
Balances at September 30, 2004		3,376,197		$	34		$	37,532		$	—		$	—		$	(27,818	)	$	9,748
Purchase of common stock from ESOP Trust		(52,507	)		—			—			52,507			(1,047	)		—			(1,047	)
Release of treasury shares to ESOP Trust		52,507			—			—			(52,507	)		1,047			—			1,047
Issuance of common stock to ESOP Trust		1,944,300			19			56,710			—			—			—			56,729
Retirement of common stock from ESOP Trust		(170,657	)		(2	)		(5,763	)		—			—			—			(5,765	)
Net loss for year ended September 30, 2005		—			—			—			—			—			(40,238	)		(40,238	)
Balances at September 30, 2005		5,149,840		$	51		$	88,479		$	—		$	—		$	(68,056	)	$	20,474
Issuance of common stock to ESOP Trust		579,739			6			22,348												22,354
Retirement of common stock from ESOP Trust		(519,453	)		(5	)		(18,998	)											(19,003	)
Net loss for year ended September 30, 2006		—			—			—			—			—			(31,115	)		(31,115	)
Balances at September 30, 2006		5,210,126		$	52		$	91,829		$	—		$	—		$	(99,171	)	$	(7,290	)

See accompanying notes to consolidated financial statements.

F-35

ALION SCIENCE AND TECHNOLOGY CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

Years Ended September 30, 2006, 2005, and 2004

ALION SCIENCE AND TECHNOLOGY CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

Years Ended September 30, 2006, 2005, and 2004 — (Continued)

	Year Ended September 30,
	2006			2005			2004
	(In thousands)
Cash flows from operating activities:
Net loss	$	(31,115	)	$	(40,238	)	$	(15,111	)
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
Depreciation and amortization		16,566			17,771			13,447
Accretion of debt to face value		922			3,056			1,449
Amortization of debt issuance costs		1,669			840			1,462
(Increase) decrease in value of interest rate cap agreement		(94	)		(118	)		204
Change in fair value of redeemable common stock warrants		4,287			23,730			6,015
Stock-based compensation		10,738			10,628			2,513
(Gain) Loss on disposal of assets		(1	)		27			—
Gain on sale of investments, net		(32	)		(72	)		(2,223	)
Changes in assets and liabilities, net of effect of acquisitions:
Accounts receivable, net		(59,687	)		12,078			(14,160	)
Other assets		(1,316	)		1,036			(3,810	)
Trade accounts payable and accruals		39,293			6,200			13,808
Other liabilities		3,093			202			2,081
Net cash (used in) provided by operating activities		(15,678	)		35,140			5,675
Cash flows from investing activities:
Cash paid for acquisitions, net of cash acquired		(279,196	)		(74,591	)		(21,678	)
Capital expenditures		(5,227	)		(2,233	)		(3,678	)
Proceeds from sale of investment securities		—			—			3,064
Purchase of investment securities		—			(1,193	)		(1,333	)
Net cash used in investing activities		(284,423	)		(78,017	)		(23,625	)
Cash flows from financing activities:
Proceeds from Term B Senior Credit Facility note payable		118,000			94,000			50,000
Proceeds from bridge loan		170,000			—			—
Payment of debt issuance costs		(7,758	)		(1,307	)		(3,280	)
Repayment of Term B Credit Facility note payable		(1,905	)		(1,080	)		—
Repayment of senior note payable		—			—			(29,250	)
Repayment of mezzanine note payable		—			(20,201	)		(750	)
Repayment of mezzanine warrants		(13,643	)
Proceeds from agreement with officer		—			—			750
Repayment of agreements with officers		—			(1,823	)		—
Borrowings under revolving credit facility		12,300			—			24,000
Repayment of LaSalle revolving credit facility		—			—			(24,000	)
Repayment of ITSC revolving credit facility		—			—			(375	)
Purchase of interest rate cap agreement		(44	)		—			(319	)
Purchase of shares of common stock from ESOP Trust		(19,003	)		(8,160	)		(1,562	)
Cash received from issuance of common stock to Trust		7,131			14,509			6,959
Net cash provided by financing activities		265,078			75,938			22,173
Net (decrease) increase in cash and cash equivalents		(35,023	)		33,061			4,223
Cash and cash equivalents at beginning of year		37,778			4,717			494
Cash and cash equivalents at end of year	$	2,755		$	37,778		$	4,717
Supplemental disclosure of cash flow information:
Cash paid for interest		19,349			9,328			7,563
Cash paid (received) for taxes		806			367			(29	)
Non-cash financing activities:
Common stock issued to ESOP Trust in satisfaction of employer contribution liability		7,871			5,707			4,330
Common stock issued for acquisitions		—			37,250			—

See accompanying notes to consolidated financial statements.

F-36

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(1)  Description and Formation of the Business

Alion provides scientific, engineering and information technology solutions for problems relating to national defense, homeland security, and energy and environmental analysis. The Company provides these services primarily to U.S. government agencies, in particular DoD, state and foreign governments, and other commercial customers.

Alion, a for-profit S Corporation, was formed in October 2001 for the purpose of purchasing substantially all of the assets and certain of the liabilities of IITRI, a not-for-profit membership corporation affiliated with and controlled by the Illinois Institute of Technology. Prior to the acquisition of substantially all of the assets and liabilities of IITRI (the Transaction), the Company’s activities had been organizational in nature. On December 20, 2002, Alion acquired substantially all of the assets and liabilities of IITRI (Business), excluding the assets and liabilities of IITRI’s Life Sciences Operation, for aggregate total proceeds of $127.3 million.

The acquisition was accounted for using the purchase method. The purchase price has been allocated to the acquired assets and assumed liabilities based on their estimated fair values at the date of acquisition. As a result of the Transaction, the Company recorded goodwill of approximately $63.6 million, which is subject to an annual impairment review, as discussed below. In addition, the Company recorded intangible assets of approximately $30.6 million, comprised of purchased contracts. The intangible assets have an estimated useful life of three years and are amortized using the straight-line method.

The total purchase consideration of approximately $127.3 million was allocated to the fair value of the net assets acquired as follows (in thousands):

Cash and restricted cash	$	1,187
Accounts receivable		47,485
Other current assets		3,784
Acquired contracts		30,645
Goodwill		63,610
Fixed assets		9,094
Liabilities assumed		(28,500	)
	$	127,305

(2)  Summary of Significant Accounting Policies

Basis of Presentation and Principles of Consolidation

The accompanying audited consolidated financial statements include the accounts of Alion Science and Technology Corporation and its subsidiaries (collectively, the “Company” or “Alion”) and have been prepared in accordance with U.S. generally accepted accounting principles. The consolidated financial statements are prepared on the accrual basis of accounting and include the accounts of Alion and its wholly-owned subsidiaries (see below) from date of formation or acquisition. All inter-company accounts have been eliminated in consolidation.

•  Human Factors Application, Inc. (HFA)

•  Innovative Technology Solution Corporation (ITSC) — acquired October 2003

•  Alion — IPS Corporation — acquired February 2004

•  Alion — METI Corporation (METI) — acquired February 2005

•  Alion — CATI Corporation (CATI) — acquired February 2005

F-37

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

•  Alion Canada (U.S.), Inc. — established February 2005

•  Alion Science and Technology (Canada) Corporation — established February 2005

•  Alion — JJMA Corporation (JJMA) — acquired April 2005

•  Alion Technical Services Corporation (ATSC) — incorporated in Virginia

•  Alion Technical Services Corporation (ATSC) — incorporated in Delaware

•  Alion — BMH Corporation (BMH) — acquired February 2006

•  Washington Consulting, Inc. (WCI) — acquired February 2006

•  Alion — MA&D Corporation (MA&D) — acquired May 2006.

Fiscal, Quarter and Interim Periods

The Company’s fiscal year ends on September 30. The Company operates based on a three-month quarter, four-quarter fiscal year with quarters ending December 31, March 31, June 30, and September 30.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of financial statements and the reported amounts of operating results during the reported period. Actual results are likely to differ from those estimates, but the Company’s management does not believe such differences will materially affect the Company’s financial position, results of operations, or cash flows.

Reclassifications

Certain items in the 2005 and 2004 financial statements have been reclassified to conform to the current presentation.

Revenue Recognition

The Company’s revenue results from technology services under a variety of contracts, some of which provide for payment for costs plus fees and others of which are fixed-price or time-and-material type contracts. The Company generally recognizes revenue when a contract has been executed, the contract price is fixed or determinable, delivery of the services or products has occurred and collectibility of the contract price is considered reasonably assured.

The Company recognizes revenue on cost-reimbursement contracts as it incurs costs and includes estimated fees earned. The Company recognizes time-and-material contract revenue at negotiated, fixed, contractually billable rates as it delivers labor hours and incurs other direct expenses. The Company uses various performance measures under the percentage of completion method to recognize revenue for fixed-price contracts. The process of estimating contract costs at completion and recognizing revenue appropriately involves significant management estimates. Actual costs may differ from estimated costs and affect estimated profitability and the timing of revenue recognition. From time to time, facts develop that require the Company to revise its estimated total costs or revenues expected. The Company records the cumulative effect of revised estimates in the period in which the facts requiring revised estimates become known. The Company recognizes the full amount of anticipated losses on any type of contract in the period in which they become known. For each of the periods presented, the cumulative effects of revised estimates were immaterial to the financial performance of the Company. Revised estimates did not generate any

F-38

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

anticipated losses for any period presented. Further, the Company had no cost overruns on fixed price contracts that materially affected financial performance in any of the periods presented.

Contracts with agencies of the federal government are subject to periodic funding by the contracting agency concerned. A contract may be fully funded at its inception or ratably throughout its period of performance as services are provided. If the Company determines contract funding is not probable, it defers revenue recognition until realization is probable.

Contract costs on federal government contracts are subject to audit by the federal government and adjustment through negotiations between the Company and government representatives. The government considers Alion to be a major contractor and maintains an office on site to perform various audits. The government has audited all of the Company’s federal government contract indirect costs through fiscal year 2004. Indirect rates have been negotiated and settled through fiscal year 2003. The Company submitted its fiscal year 2005 indirect expense rates to the government in March 2006 and submitted its fiscal year 2006 indirect expense rates to the government in March 2007. The Company has recorded revenue on federal government contracts in amounts it expects to realize.

The Company recognizes revenue on unpriced change orders as it incurs expenses and only to the extent it is probable that the Company will recover such costs. The Company recognizes revenue in excess of costs on unpriced change orders only when management can also estimate beyond a reasonable doubt the amount of excess and experience provides a sufficient basis for recognition. The Company recognizes revenue on claims as expenses are incurred only to the extent it is probable that the Company will recover such costs and it can reliably estimate the amount it will recover.

The Company generates software revenue from licensing software and providing services. In general, professional services are essential to the functionality of the solution sold and the Company applies the percentage of completion method, as prescribed by AICPA SOP 81-1, Accounting for Performance on Construction-Type and Certain Production-Type Contracts, to recognize revenue.

Income Taxes

The Company is an S corporation under the provisions of the Internal Revenue Code of 1986, as amended. For federal and certain state income tax purposes, the Company is not subject to tax on its income. The Company’s income is allocated to its shareholder, Alion Science and Technology Corporation Employee Stock Ownership, Savings and Investment Trust (the Trust). The Company may be subject to state income taxes in those states that do not recognize S corporations and to additional types of taxes including franchise and business taxes. All of the Company’s wholly-owned operating subsidiaries are qualified subchapter S or disregarded entities which, for federal income tax purposes, are not treated as separate corporations.

Cash and Cash Equivalents

The Company considers cash in banks, and deposits with financial institutions with maturities of three months or less at time of purchase and that can be liquidated without prior notice or penalty, to be cash and cash equivalents.

Accounts Receivable and Billings in Excess of Costs and Estimated Earnings on Uncompleted Contracts

Accounts receivable include billed accounts receivable, amounts currently billable and costs and estimated earnings in excess of billings on uncompleted contracts that represent accumulated project expenses and fees which have not been billed or are not currently billable as of the date of the consolidated balance sheet. The costs and estimated earnings in excess of billings on uncompleted contracts are stated at estimated realizable value. Unbilled accounts receivable include revenue recognized for customer-related

F-39

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

work performed by the Company on new and existing contracts for which the Company had not received contracts or contract modifications. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable losses in the Company’s existing billed and unbilled accounts receivable. The Company determines the allowance using specific identification and historical write-off experience based on the age of the receivables. Billings in excess of costs and estimated earnings and advance collections from customers represent amounts received from or billed to customers in excess of project revenue recognized to date.

Property, Plant and Equipment

Leasehold improvements, software and equipment are recorded at cost. Maintenance and repairs that do not add significant value or significantly lengthen an asset’s useful life are charged to current operations. Software and equipment are depreciated over their estimated useful lives (the lesser of 5 years or the life of the lease) generally using the straight-line method. Leasehold improvements are amortized on the straight-line method over the shorter of the assets’ estimated useful life or the life of the lease. Upon sale or retirement of an asset, costs and related accumulated depreciation are deducted from the accounts, and the gain or loss is recognized in the consolidated statements of operations.

Goodwill and Other Intangibles

As required by SFAS 142, Goodwill and Other Intangible Assets, the Company reviews goodwill annually for impairment at the end of each fiscal year or if events or circumstances indicates potential impairment. The Company must recognize an impairment loss if, and to the extent that, goodwill exceeds fair value. The Company completed the fiscal year 2006 annual goodwill impairment analysis in the fourth quarter of fiscal year 2006. Based on this analysis, the Company concluded that no goodwill impairment exists as of September 30, 2006. Intangible assets, generally representing purchased contracts, are amortized over their estimated useful lives, generally one to thirteen years primarily using the straight-line method.

Postretirement Benefits

The Company accounts for postretirement benefits other than pension in accordance with SFAS No. 106 Employers’ Accounting for Postretirement Benefits Other Than Pension which requires the cost to provide the benefits to be accrued over the employees’ period of active service. These costs are determined on an actuarial basis. The Company is amortizing its transition obligation for past service costs relating to these benefits over twenty years. Unrecognized actuarial gains and losses are amortized over the estimated average remaining service period for active employee plans and over the estimated average remaining life for retiree plans.

Fair Value of Financial Instruments

The following methods and assumptions were used to estimate the fair value of each class of financial instruments for which it is practicable to estimate fair value. It is impracticable for the Company to estimate the fair value of its subordinated debt because the only market for this financial instrument consists of principal to principal transactions. For each of the following items, the fair value is not materially different than the carrying value.

Cash, cash equivalents, accounts payable and accounts receivable.  The carrying amount approximates fair value because of the short maturity of those instruments.

Marketable securities.  The fair values of these investments are estimated based on quoted or market prices for these or similar instruments.

F-40

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Senior Long-term debt.  The carrying amount of the Company’s senior debt approximates fair value which is estimated on current rates offered to the Company for debt of the same remaining maturities.

Interest rate caps.  The fair value of the Company’s financial instruments is estimated based on current rates offered to the Company for contracts with similar terms and maturities.

Redeemable common stock warrants.  The Company uses an option pricing model to estimate the fair value of its redeemable common stock warrants.

Alion Stock.  The estimated fair value price per share is determined based upon a valuation performed by an independent, third-party firm.

Recently Issued Accounting Pronouncements

In December 2004, the Financial Accounting Standards board (FASB) issued SFAS No. 123 (revised 2004), Share-Based Payment, a revision of SFAS No. 123, Accounting for Stock-Based Compensation (SFAS 123(R)). SFAS 123(R) supersedes Accounting Principles Board Opinion No. 25, Accounting for Stock Issued to Employees. SFAS 123(R) requires all share-based payments to employees, including grants of employee stock options, to be recognized in the financial statements based on their fair value. SFAS 123(R) is effective in the first quarter of fiscal 2007. The Company determined that there will be no impact from adopting this statement, given the fact that the Company currently recognizes compensation expense associated with its stock appreciation rights and phantom stock.

In March 2005, the FASB issued Interpretation No. (FIN) 47, Accounting for Conditional Asset Retirement Obligations — an Interpretation of FASB Statement No. 143. FIN 47 clarifies the definition of a conditional asset retirement obligation, as used in SFAS No. 143, as a legal obligation to perform an asset retirement activity in which the timing and (or) method of settlement are conditional on a future event that may or may not be within the control of the entity. FIN 47 requires a liability to be recorded if the fair value of the obligation can be reasonably estimated. The adoption of this interpretation is effective no later than December 31, 2005. The adoption of this interpretation did not have a significant impact on the financial position or results of operations of the Company.

In June 2005, the FASB issued SFAS No. 154, Accounting Changes and Error Corrections — a replacement of APB Opinion No. 20 and FASB Statement No. 3. SFAS No. 154 provides guidance on the accounting for and reporting of accounting changes and error corrections. It established, unless impracticable, retrospective application as the required method for reporting a change in accounting principle in the absence of explicit transition requirements specific to the newly adopted accounting principle. SFAS No. 154 also provides guidance for determining whether retrospective application of a change in accounting principle is impracticable and for reporting a change when retrospective application is impracticable. The correction of an error in previously issued financial statements is not an accounting change. However, the reporting of an error correction involves adjustments to previously issued financial statements similar to those generally applicable to reporting an accounting change retrospectively. Therefore, the reporting of a correction of an error by restating previously issued financial statements is also addressed by SFAS No. 154. SFAS No. 154 shall be effective for accounting changes and correction of errors made in fiscal years beginning after December 15, 2005.

In June 2006, the FASB issued Interpretation No. (FIN) 48, Accounting for Uncertainty in Income Taxes. FIN 48 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements in accordance with FASB Statement No. 109, Accounting for Income Taxes. This interpretation prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. This interpretation also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. The interpretation is effective for fiscal years beginning after

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ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

December 15, 2006. The Company determined that adopting this interpretation will not have a significant impact on the financial position or results of operations of the Company.

In September 2006, the FASB issued SFAS No. 157, Fair Value Measurements, which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. Where applicable, this Statement simplifies and codifies related guidance within generally accepted accounting principles (GAAP). This statement is effective for financial statements issued for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years. The Company is currently analyzing the expected impact from adopting this statement on its financial statements, but currently does not believe its adoption will have a significant impact on the financial position or results of operations of the Company.

In September 2006, the FAS issued SFAS No. 158, Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans, which requires employers to recognize the overfunded or underfunded status of a defined benefit postretirement plan (other than a multiemployer plan) as an asset or liability in its statement of financial position and to recognize changes in that funded status in the year in which the changes occur through comprehensive income of a business entity. The Company is currently analyzing the expected impact of adoption of this Statement on its financial statements.

In September 2006, the Securities Exchange Commission (SEC) issued Staff Accounting Bulletin No. 108 (SAB 108), Financial Statements — Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements. SAB 108 requires companies to quantify the impact of all correcting misstatements, including both the carryover and reversing effects of prior year misstatements, on the current year financial statements. This pronouncement is effective for us in fiscal 2007. We do not believe SAB 108 will have a material effect on our financial statements and related disclosures.

(3)  Business Combinations

Fiscal Year 2006 Acquisitions

Acquisition of BMH Associates, Inc.  On February 10, 2006, the Company acquired 100 percent of the issued and outstanding stock of BMH, a provider of advanced software, systems engineering and distributed interactive simulations for military training and experimentation, for $20.0 million (less a $1.5 million hold back) plus additional contingent earn-out obligations over a two year period which can not exceed $6.0 million. As of September 30, 2006, the Company has recorded approximately $16.2 million in goodwill relating to this acquisition. The purchase price allocation is preliminary and subject to change based upon the completion of the valuation of certain intangible assets and other items.

Acquisition of Washington Consulting, Inc.  On February 24, 2006, the Company acquired 100 percent of the issued and outstanding stock of WCI, a provider of enterprise IT and management consulting solutions and services to commercial and government customers, for $18.0 million (less a $1.5 million hold back) plus additional contingent earn-out obligations over a two year period which can not exceed $2.5 million. As of September 30, 2006, the Company has recorded approximately $17.4 million in goodwill relating to this acquisition. The purchase price allocation is preliminary and subject to change based upon the completion of the valuation of certain intangible assets and other items.

Acquisition of Micro Analysis and Design, Inc.  On May 19, 2006, the Company acquired 100 percent of the issued and outstanding stock of MA&D, a provider of human factors engineering, modeling and simulation and software development for approximately $16.9 million (less a $2.0 million hold back) plus additional contingent earn-out obligations over a two year period which can not exceed approximately $4.1 million. As of September 30, 2006, the Company has recorded approximately $15.7 million in goodwill

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ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

relating to this acquisition. The purchase price allocation is preliminary and subject to change based upon the completion of the valuation of certain intangible assets and other items.

Acquisition of certain assets of Anteon Corporation.  On June 30, 2006, the Company acquired from Anteon a group of assets consisting primarily of customer contracts for approximately $221.4 million. As of September 30, 2006, the Company has recorded approximately $50.0 million for purchased contracts and approximately $174.0 million in goodwill relating to this acquisition. The purchase price allocation is preliminary and subject to change based upon the completion of the valuation of certain intangible assets and other items.

The unaudited pro forma information disclosed below for Anteon includes historical operating results and pro forma adjustments to reflect the effects of Alion’s acquisition of Anteon as if it occurred on October 1, 2004. The unaudited pro forma information does not purport to be indicative of the results of operations that would have actually been achieved if the transaction had occurred on the date indicated or the results of operations that will be reported in the future.

	Twelve Months Ended September 30, 2006									Twelve Months Ended September 30, 2005
				Anteon			Alion						Anteon			Alion
	Alion			Pro Forma			Pro Forma			Alion			Pro Forma			Pro Forma
Pro Forma Revenue	$	508,628		$	191,362		$	699,990		$	369,231		$	206,786		$	576,017
Pro Forma Loss	$	(31,115	)	$	(8,861	)	$	(39,976	)	$	(40,238	)	$	(15,952	)	$	(56,190	)
Weighted Average Shares Outstanding		5,029,670			—			5,029,670			4,235,947			—			4,235,947
Loss Per Share	$	(6.19	)	$	—		$	(7.95	)	$	(9.50	)	$	—		$	(13.27	)

The acquired identifiable intangibles assets in these transactions were as follows:

					Weighted Average
	Estimated		Residual		Remaining
Amounts in Millions	Fair Value		Value		Amortization Period
Purchased contracts	$	54.7	$	—		5 years

Fiscal Year 2005 Acquisitions

Acquisition of Assets of Countermeasures, Inc.  On October 28, 2004, Alion purchased substantially all of the assets of Countermeasures, Inc. for approximately $2.4 million. At the time of acquisition, Countermeasures, Inc. had two employees and was located in Hollywood, Maryland. As of September 30, 2006, the Company has recorded approximately $1.4 million in goodwill relating to this acquisition. The results of operations for Countermeasures, Inc. are included in Alion’s operations from the date of acquisition. The pro forma impact of this acquisition was not significant.

Acquisition of ManTech Environmental Technology, Inc.  On February 11, 2005, Alion acquired 100 percent of the outstanding stock of METI, an environmental and life sciences research and development company for approximately $7.0 million in cash. METI was headquartered in Research Triangle Park, NC. As of September 30, 2006, the Company has recorded $5.6 million in goodwill related to this acquisition and has remaining approximately $0.03 million of purchased contracts being amortized over three years. The results of operations for METI are included in Alion’s operations from the date of acquisition. The allocation of purchase price is preliminary as the Company completes its valuation of assets acquired and liabilities assumed. The pro forma impact of this acquisition was not significant.

Acquisition of Carmel Applied Technologies, Inc.  On February 25, 2005 Alion acquired 100 percent of the outstanding stock of CATI, a flight training software and simulator development company, for approximately $7.3 million in cash. The transaction is subject to an earn-out provision not-to-exceed a cumulative amount of $8.25 million based on attaining certain cumulative revenue goals for fiscal years

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ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

2005, 2006, and 2007, and a second earn-out provision not-to-exceed $1.5 million for attaining certain revenue goals in the commercial aviation industry. As of September 30, 2006, the Company has recorded $13.9 million in goodwill related to this acquisition. The results of operations for CATI are included in Alion’s operations from the date of acquisition The allocation of purchase price is preliminary as the Company completes its valuation of assets acquired and liabilities assumed. The pro forma impact of this acquisition was not significant.

Investment in VectorCommand Ltd.  On March 22, 2005, Alion acquired approximately 12.5 percent of the A ordinary shares in VectorCommand Ltd. for $1.5 million which investment is accounted for at cost.

Acquisition of John J. McMullen Associates, Inc. and Pro Forma Information.  On April 1, 2005, the Company acquired 100% of the issued and outstanding stock of JJMA pursuant to a Stock Purchase Agreement (the “Agreement”) by and among Alion, JJMA, Marshall & Ilsley Trust Company N.A. as trustee of the JJMA Employee Stock Ownership Trust, and holders of JJMA stock options and JJMA stock appreciation rights. The Company paid the equity holders of JJMA approximately $52.9 million, issued 1,347,197 shares of Alion common stock to the JJMA Trust valued at approximately $37.3 million, and agreed to make $8.3 million in future payments. The Company valued its common stock issued to the JJMA Trust at $27.65 per share, which price was determined based on an independent valuation. The acquisition was accounted for using the purchase method. The estimated total purchase price is as follows.

Form of Consideration	Fair Value
	(In millions)
Cash paid, net of cash acquired	$	52.9
Stock issued		37.3
Future payments		8.3
Acquisition costs		1.3
Total consideration	$	99.8

The Company has allocated the purchase price of JJMA to the estimated fair value of the assets acquired and liabilities assumed in the purchase. The purchase price allocation is final as the Company completed its determination of the fair values of the assets acquired and liabilities assumed and is as follows (in millions):

Accounts receivable	$	21.5
Property and equipment		1.0
Other assets		1.4
Identifiable intangible assets		25.6
Goodwill		61.8
Accounts payable and other accrued liabilities		(11.5	)

The table below sets out the unaudited pro forma effects of the JJMA acquisition on the Company’s revenue, net income and earnings per share as though the JJMA acquisition had taken place on the first day of each fiscal year presented. The unaudited pro forma information disclosed below for JJMA includes historical operating results and pro forma adjustments to reflect the effects of Alion’s acquisition of JJMA. The JJMA pro forma results for the year ended September 30, 2005, includes approximately $10.1 million of stock-based compensation expensed and recorded by JJMA due to accelerated vesting directly associated with this acquisition. The unaudited pro forma information does not purport to be indicative of the results of operations that would have actually been achieved if the transaction had occurred on the date indicated or the results of operations that will be reported in the future.

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ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

	Twelve Months Ended September 30, 2005
	Alion			JJMA Pro Forma			Alion Pro Forma
Pro Forma Revenue	$	369,231		$	51,103		$	420,334
Pro Forma Loss	$	(40,238	)	$	(17,524	)	$	(57,762	)
Weighted Average Shares Outstanding		4,235,947			671,753			4,907,700
Loss Per Share	$	(9.50	)	$	—		$	(11.77	)

The acquired identifiable intangibles assets in these fiscal year 2005 transactions were as follows:

					Weighted Average
	Estimated		Residual		Remaining
Amounts in Millions	Fair Value		Value		Amortization Period
Purchased contracts	$	28.0	$	—		5 years
Internal use software and designs		0.9		—		3 years
Not to Compete Agreements		0.7		—		1 years
Total	$	29.6	$	—		5 years

Fiscal Year 2004 Acquisitions

Acquisition of Innovative Technology Solutions Corporation.  On October 31, 2003, Alion acquired 100% of the outstanding stock of ITSC for $4.0 million. The transaction is subject to an earn-out provision not-to-exceed $1.5 million. As of September 30, 2006, the Company has recorded approximately $5.0 million of goodwill relating to this acquisition. ITSC’s results of operations are included in Alion’s operations from the date of acquisition.

Acquisition of Identix Public Sector, Inc.  On February 13, 2004, Alion acquired 100% of the outstanding stock of IPS for $8.0 million in cash. IPS, formerly ANADAC, was a wholly-owned subsidiary of Identix Incorporated. In the three months following the closing, the Company paid Identix approximately $2.6 million for intercompany payables. Subsequent payments totaled approximately $1.7 million for intercompany payables. Per the agreement, the Company placed a payment of $0.5 million in escrow contingent on the Company having the opportunity to compete or bid for services on certain government solicitations. As of September 30, 2006, the Company has recorded approximately $6.1 million of goodwill relating to this acquisition and approximately $0.8 million of intangible assets related to acquired contracts to be amortized over three years. The results of operations for IPS are included in Alion’s operations from the date of acquisition.

(4)  Employee Stock Ownership Plan (ESOP) and Stock Ownership Trust

On December 19, 2001, the Company adopted the Alion Science and Technology Corporation Employee Ownership, Savings and Investment Plan (the Plan) and the Alion Science and Technology Corporation Employee Ownership, Savings and Investment Trust (the ESOP Trust). The Plan, a tax-qualified retirement plan, includes an ESOP component and a non-ESOP component. On August 9, 2005, the Internal Revenue Service issued a determination letter that the ESOP Trust and the Plan, as amended through the Ninth Amendment, qualify under Sections 401(a) and 501(a) of the Internal Revenue Code of 1986 (the IRC) , as amended. The Company believes that the Plan and ESOP Trust have been designed and are currently being operated in compliance with the applicable requirements of the IRC.

(5)  Postretirement Benefits

The Company sponsors a medical benefits plan providing certain medical, dental, and vision coverage to eligible employees and former employees. The Company is self-insured with a stop-loss limit under an

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ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

insurance agreement. The Company provides postretirement medical benefits for employees who meet certain age and service requirements. Retiring employees may become eligible for those benefits at age 55 if they have 20 years of service, or at age 60 with 10 years of service. The plan provides benefits until age 65 and requires employees to pay one-quarter of their health care premiums. A small, closed group of employees is eligible for coverage after age 65. These retirees contribute a fixed portion of the health care premium. The estimated contribution to premiums from retirees is an aggregate of $125,000. There were no plan assets as of September 30, 2006 and 2005. The Company uses an October 1 measurement date.

Following is a reconciliation of the plan’s accumulated postretirement benefit obligation:

	2006		2005
	(In thousands)
Accumulated postretirement benefit obligation as of September 30:
Retirees	$	2,364	$	1,028
Fully eligible active plan participants		1,833		814
Other active plan participants		4,837		1,741
	$	9,034	$	3,583

	2006			2005
	(In thousands)
Reconciliation of beginning and ending benefit obligation:
Benefit obligation at beginning of period	$	3,583		$	3,602
Service cost		246			188
Interest cost		239			227
Actuarial loss		4,312			22
Plan amendment (acquisitions)		1,014			—
Benefits paid		(360	)		(456	)
Benefit obligation at September 30	$	9,034		$	3,583

Following is a reconciliation of the funded status of the plan:

	(In thousands)
Funded status of the plan:
Obligation at September 30	$	(9,034	)	$	(3,583	)
Unrecognized prior service cost		1,014			—
Unrecognized net loss		4,298			226
Accrued postretirement benefits included in the consolidated balance sheet	$	(3,722	)	$	(3,357	)

The components of net periodic postretirement benefit cost for the years ended September 30, 2006 and 2005 are as follows:

	2006		2005
	(In thousands)
Service cost	$	246	$	188
Interest cost		239		227
Amortization of net loss		40		—
Net periodic postretirement benefit cost	$	525	$	415

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ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

The weighted-average assumptions in the following table represent the rates used to develop the actuarial present value of the projected benefit obligation for the year listed and also the net periodic benefit costs.

	2006			2005
Accumulated post retirement benefit obligation at September 30		5.75	%		5.25	%
Service and interest cost portions of net periodic postretirement benefit costs		5.25	%		6.00	%

The following table displays the assumed health care trends used to determine the accumulated postretirement benefit obligation:

	2006			2005
Health care cost trend rate assumed for next year		11.0	%		10.0	%
Rate to which the cost trend rate is assumed to decline (ultimate trend rates)		5.0	%		5.0	%
Year the rate reaches the ultimate trend rate		2018			2015

A one-percentage-point change in assumed health care cost trend rates would have the following effect (in thousands)

	One-Percentage-		One-Percentage-
	Point Increase		Point Decrease
Total interest and service cost	$	95	$	(85	)
Accumulated postretirement benefit obligation		692		(627	)

Estimated future benefit payments-fiscal years ending September 30:

	(In thousands)
2007	$	567
2008		654
2009		693
2010		789
2011		884
2012-2016		5,897

In December 2003, the Medicare Prescription Drug, Improvement and Modernization Act of 2003 (the Act) was signed into law. The Act introduced a prescription drug benefit under Medicare Part D and a federal subsidy to sponsors of retirement health care plans that provide a benefit that is at least actuarially equivalent to Medicare Part D. The Company has elected to defer the recognition of the effect, if any, of the Act until such time when the authoritative guidance is issued. Any measures of the accumulated postretirement benefit obligation or net periodic postretirement benefit cost in the Company’s financial statements do not reflect the effect of the Act. The Company has a small, closed group of retirees covered for medical after age 65, thus the effect of the Act is not expected to be material.

(6)  Loss Per Share

Basic and diluted loss per share is computed by dividing net loss by the weighted average number of common shares outstanding which excludes the impact of warrants and stock appreciation rights described herein as this impact would be anti-dilutive for all periods presented.

(7)  Shareholder’s Equity (Deficit)

The Company’s common stock is owned by the ESOP Trust. The Company provides a put option to any participant or beneficiary who receives a distribution of common stock which permits the participant or

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ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

beneficiary to sell such common stock to the Company during certain periods, at the estimated fair value price per share, which was at $41.02 per share as of September 30, 2006. The estimated fair value price per share is determined based upon a valuation performed by an independent, third-party firm. The Company may allow the ESOP Trust to purchase shares of common stock tendered to the Company under the put option. Certain participants have the right to sell their shares distributed from their accounts that they acquired on December 22, 2002 at the greater of the original share purchase price ($10.00) or the estimated fair value price per share of common stock.

(8)  Accounts Receivable

Accounts receivable at September 30 consisted of the following:

	2006			2005
	(In thousands)
Billed receivables	$	106,310		$	65,156
Unbilled receivables:
Amounts currently billable		36,548			13,376
Revenues recorded in excess of milestone billings on fixed price contracts		5,591			3,707
Revenues recorded in excess of estimated contract value or funding		3,354			1,323
Retainages and other amounts billable upon contract completion		2,570			875
Less: Allowance for doubtful accounts		(3,961	)		(3,539	)
Total Accounts Receivable	$	150,412		$	80,898

Revenues recorded in excess of milestone billings on fixed price contracts consist of amounts not expected to be billed within the next month. Amounts currently billable consist principally of amounts to be billed within the next month. Indirect cost rates in excess of provisional billing rates on U.S. government contracts are generally billable at actual rates shortly after the end of each fiscal year. Any remaining unbilled balance including retainage is billable upon contract completion or completion of Defense Contract Audit Agency audits. Revenues recorded in excess of contract value or funding are billable upon receipt of contractual amendments or other modifications. Costs and estimated earnings in excess of billings on uncompleted contracts totaled approximately $48.1 million as of September 30, 2006 and included approximately $3.4 million for customer-requested work for which the Company had not received contracts or contract modifications.

(9)  Property, Plant and Equipment

Property, Plant and Equipment at September 30 consisted of the following:

	2006		2005
	(In thousands)
Leasehold improvements	$	2,709	$	2,302
Equipment and software		25,188		17,395
Total cost		27,897	$	19,697
Less-accumulated depreciation and amortization		13,253		8,523
Net Property, Plant and Equipment	$	14,644	$	11,174

Depreciation and leasehold amortization expense for fixed assets was approximately $5.8 million and $4.4 million for fiscal years ended September 30, 2006 and 2005, respectively.

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ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(10)  Goodwill and Intangible Assets

The Company accounts for goodwill and other intangible assets in accordance with the provisions of Statement of Financial Accounting Standards (SFAS) No. 142, “Goodwill and other Intangible Assets”, which requires that goodwill be reviewed at least annually for impairment. The Company performs this review at the end of each fiscal year.

Changes in the carrying amount of goodwill during the fiscal years ended September 30, 2006 and 2005, in the aggregate, are summarized in the following table:

	Total
	(In millions)
Balance as of October 1, 2004	$	83.1
Goodwill acquired during the year		77.6
Adjustment to initial allocation		2.7
Balance as of September 30, 2005	$	163.4
Goodwill acquired during the year		223.3
Adjustment to initial allocation		1.2
Balance as of September 30, 2006	$	387.9

Purchase price allocations for acquisitions completed during the year ended September 30, 2006, are preliminary and subject to change based upon completing valuations for certain intangible assets and other items, which should be finalized in the first quarter of fiscal year 2007.

As of September 30, 2006, the Company has recorded gross intangible assets of approximately $118.1 million and accumulated amortization of $42.7 million. Approximately $115.2 million of recorded gross intangible assets are comprised of the contracts purchased from acquisitions, approximately $0.7 million for non-compete agreements, $0.9 million from software acquired for internal use, and $1.3 million for designs and plans. The intangible assets have estimated useful lives of one to thirteen years and are primarily being amortized using the straight-line method. The weighted-average remaining amortization period for intangible assets was approximately four years at September 30, 2006. Amortization expense was approximately $10.8 million, $13.4 million, and $10.6 million for the years ended September 30, 2006, 2005, and 2004, respectively. Estimated aggregate amortization expense for each of the next five years and thereafter is as follows:

	(In thousands)
For the year ended September 30:
2007	$	16,760
2008		16,457
2009		15,273
2010		14,503
2011		8,599
Thereafter		3,813

As of September 30, 2006, the Company has recorded net intangible assets of approximately $75.4 million comprised primarily of contracts purchased in connection with the acquisitions of JJMA, IPS, BMH, WCI, MA&D, and the Anteon Contracts of approximately $21.8 million, $0.2 million, $1.8 million, $1.1 million, $0.9 million, and $47.5 million, respectively; approximately $0.3 million for non-compete agreements, $0.7 million for acquired internal use software, and $1.1 million for designs and plans.

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ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(11)  Long-Term Debt

The Company entered into various debt agreements (Senior Credit Agreement, Mezzanine Note, and Subordinated Note) on December 20, 2002 to fund its acquisition of substantially all the assets of the IIT Research Institute (IITRI), which was affiliated with and controlled by the Illinois Institute of Technology (IIT). In August 2004, the Company entered into a new Term B senior secured credit facility (the Term B Senior Credit Facility) with a syndicate of financial institutions for which Credit Suisse (CS) serves as arranger, administrative agent and collateral agent, and for which LaSalle Bank National Association serves as syndication agent. In April 2005, the first amendment to the Term B Senior Credit Facility (Amendment One) added $72.0 million to the Company’s total Term B Senior Credit Facility debt. In March 2006, the second amendment to the Term B Senior Credit Facility (Amendment Two) increased the term loan commitment by $68.0 million and increased the revolving credit commitment from $30.0 million to $50.0 million. On June 30, 2006, the third amendment to the Term B Senior Credit Facility (Amendment Three) added $50.0 million in Term B Senior Credit Facility debt.

Term B Senior Credit Facility

The Term B Senior Credit Facility expires August 2, 2009 and consists of the following balances at September 30, 2006 and 2005:

	2006			2005
Senior term loan	$	259.0		$	142.9
Less: Unamortized debt issuance costs		(4.1	)		(3.6	)
Term B Senior Credit Facility Note Payable	$	254.9		$	139.3
Less current maturities, net of unamortized debt issue costs		(2.8	)		(1.4	)
Term B Senior Credit Facility Note Payable, less current maturities	$	252.1		$	137.9

The Term B Senior Credit Facility as of September 30, 2006, consists of:

•  a senior term loan in the current approximate amount of $259.0 million;

•  a $50.0 million senior revolving credit facility under which approximately $12.3 million was outstanding as of September 30, 2006, and approximately $3.8 million of which was deemed borrowed for letters of credit; and

•  a $150.0 million uncommitted incremental term loan “accordion” facility.

The Term B Senior Credit Facility requires the Company to repay one percent of the principal balance of the senior term loan during each of the first four years (fiscal years 2005 through 2008) in equal quarterly principal installments and 96 percent of the principal balance outstanding during the fifth and final year (2009) in equal quarterly principal installments. Through the quarter ending September 30, 2008, the Company is obligated to pay quarterly principal installments of $655,000. On each of December 31, 2008, March 31, 2009, June 30, 2009 and August 2, 2009, the Company is obligated to pay principal installments of approximately $63.4 million.

Under the senior revolving credit facility, the Company may request up to $40.0 million in letters of credit and may borrow up to $5.0 million in swing line loans for short-term borrowing needs. The Company must pay all principal obligations under the senior revolving credit facility in full no later than August 2, 2009.

The Company may prepay all or any portion of its senior term loan in minimum increments of $1 million, generally without penalty or premium, except for customary breakage costs associated with pre-payment of Eurodollar-based loans. If the Company issues certain permitted debt, or sells, transfers or

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ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

disposes of certain assets, it must use all net proceeds to repay any Term B loan amounts outstanding. If the Company has excess cash flow for any fiscal year, it must use 50% of the net proceeds or excess cash flow to repay Term B loan amounts outstanding. If the Company’s leverage ratio (which compares the Company’s total debt to its Consolidated EBITDA) is less than 2 to 1, it must use only 25% of net proceeds or excess cash flow to repay Term B loan amounts outstanding. The Company also has mandatory prepayment obligations under the Bridge Loan Agreement, but the Bridge Loan Agreement permits the Company to use net cash proceeds from asset sales to prepay Term B Senior Credit Facility debt ahead of the Bridge Loan debt.

If the Company enters into an additional term loan, including under the uncommitted incremental term loan facility, and certain terms of such loan are more favorable to the new lenders than existing terms under the Term B Senior Credit Facility, the applicable interest rate spread on the senior term loans could increase. As a result, additional term loans could increase the Company’s interest expense under its existing term loans. The Company’s significant subsidiaries (HFA, CATI, METI, JJMA, BMH, WCI and MA&D) have guaranteed the Company’s obligations under the Company’s Term B Senior Credit Facility.

Use of Proceeds.  In March 2006, the Company borrowed $32 million, used approximately $16.5 million to pay part of the WCI acquisition price, and paid approximately $13.6 million to redeem the mezzanine warrants held by IIT and the Company’s Chief Executive Officer. In May 2006, the Company borrowed $15.0 million to pay part of the MA&D acquisition price. On June 30, 2006, the Company borrowed $71.0 million, of which $51 million was used to pay part of the Anteon Contracts acquisition price and the remaining $20 million was used for working capital needs.

The Term B Senior Credit Facility permits the Company to use the remainder of its senior revolving credit facility for working capital needs, other general corporate purposes, and to finance permitted acquisitions. The Term B Senior Credit Facility permits the Company to use any proceeds from the uncommitted incremental term loan facility to finance permitted acquisitions and for any other purpose permitted by any future incremental term loan.

Security.  The Term B Senior Credit Facility is secured by a security interest in all of the Company’s current and future tangible and intangible property, as well as all of the current and future tangible and intangible property of the Company’s subsidiaries, HFA, CATI, METI, JJMA, BMH, WCI and MA&D.

Interest and Fees.  Under the Term B Senior Credit Facility, the senior term loan and the senior revolving credit facility can each bear interest at either of two floating rates. The Company was entitled to elect that the $259.0 million senior term loan bear interest at an annual rate equal to: 1) the applicable alternate base interest rate charged by CS plus 175 basis points or, 2) the Eurodollar rate plus 275 basis points. The Company was also entitled to elect that the senior revolving credit facility bear interest at an annual rate dependent on the Company’s leverage ratio and either the Eurodollar or the alternate base rates. The alternate base rate is the greater of CS’s prime rate or the federal funds effective rate, plus additional basis points corresponding to the Company’s leverage ratio at the time.

On April 1, 2005, the Company chose to have the senior term loan bear interest at the Eurodollar rate and the senior revolving credit facility bear interest at the ABR rate based on CS’s prime rate. As of June 30, 2006, the Eurodollar rate on the senior term loan was 8.25 percent (5.50 percent plus 2.75 percent Eurodollar spread) and the ABR rate was 10.0 percent (8.25 percent plus 1.75 percent spread).

Interest Rate Cap Agreements.  The Company has three interest rate cap agreements in place with its senior lenders. The interest rate cap agreements limit the floating component of the Company’s total interest rate but do not affect leverage ratio based spreads. The Company’s actual effective interest rate on notional principal in each cap agreement is the sum of the floating component and the applicable spread, which is determined by the Term B Senior Credit Facility. The first interest rate cap agreement was put into place on August 16, 2004.

F-51

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Other Fees and Expenses.  Each quarter the Company is required to pay a commitment fee of 50 basis points per year on the prior quarter’s daily, unused balance of the revolving credit facility and senior term loan commitment. As of September 30, 2006, the Company has actually borrowed approximately $12.3 million was outstanding on the revolving credit facility and approximately $3.8 million was deemed borrowed for letters of credit; and the senior term loan was fully utilized. For the year ended September 30, 2006, the Company paid approximately $0.3 million in commitment fees for the revolving credit facility and nothing for the senior term loan.

The Company is also required to pay an annual agent’s fee and a fronting fee not to exceed 25 basis points for each letter of credit issued under the revolving credit facility. Interest is due quarterly in arrears at the applicable revolving credit facility rate for all outstanding letters of credit.

Financial Covenants.  The Term B Senior Credit Facility requires the Company to meet certain financial performance measures typical of commercial loans of this type including leverage and interest coverage ratios.

The Term B Senior Credit Facility includes other covenants that restrict the Company’s ability to take certain actions without the prior consent of senior lenders who extended a majority of the outstanding Term B loans. For the year ended September 30, 2006, the Company was in compliance with the Term B Senior Credit Facility financial covenants.

Subordinated Note

On December 20, 2002, the Company issued a $39.9 million note to IITRI (Subordinated Note) as part of the consideration for Alion’s acquisition of substantially all of IITRI’s assets. On July 1, 2004, IIT acquired all of IITRI’s rights and interests in the Subordinated Note and the related warrant agreement. On June 30, 2006, the Company and IIT entered into an agreement that increased the interest rate on the Subordinated Note for two years from December 21, 2006 through December 20, 2008.

The Subordinated Note bears interest at (i) 6% through December 20, 2006, (ii) approximately 6.4% from December 21, 2006 through December 20, 2007, and (iii) 6.7% from December 21, 2007 through December 20, 2008. Interest is payable quarterly by the issuance of paid-in-kind or PIK notes maturing at the same time as the Subordinated Note. The PIK notes have the effect of deferring the underlying cash interest expense on the Subordinated Note. Beginning in December 2008, the Subordinated Note will bear interest at 16% per year payable quarterly in cash until the note has been repaid in full. Principal on the Subordinated Note is payable in equal installments of $19.95 million in December 2009 and December 2010. The PIK notes are due in equal installments of approximately $7.4 million on these same dates.

Bridge Loan Agreement

On June 30, 2006, the Company entered into a Bridge Loan Agreement with Credit Suisse and borrowed $170.0 million (the Bridge Loan, also called the Initial Loan). Certain of the Company’s subsidiaries have guaranteed the Bridge Loan Agreement. The Initial Loan is due December 31, 2007 and automatically converts to an Extended Loan maturing December 31, 2011, if not repaid by December 31, 2007. Unless repaid earlier, outstanding principal under the Bridge Loan is due on December 31, 2011, along with accrued unpaid interest and applicable premiums.

The Company must use the net proceeds from certain permitted debt or equity issuances and proceeds from the sale, transfer or disposition of certain assets outside the normal course of business to repay the Bridge Loan, except the Bridge Loan Agreement permits the Company to use asset sale proceeds to repay all or part of the Term B Senior Credit Facility first.

F-52

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Use of Proceeds.  The Company used the proceeds from the Bridge Loan to pay part of the cost of acquiring the Anteon Contracts.

Interest and Prepayment.  The Bridge Loan bears interest at a floating rate based on the Eurodollar Rate plus an applicable spread that varies over time. The first interest payment was paid on September 30, 2006. Interest is payable quarterly in arrears in cash except that the Company can use PIK notes to pay any interest in excess of 700 basis points over the applicable Eurodollar floating rate or it can add the excess to the Bridge Loan principal. The Company may prepay all or any portion of the Bridge Loan in minimum increments of $100,000, with an aggregate minimum of $1.0 million plus applicable premium (described below) and customary breakage costs associated with pre-payment of Eurodollar-based loans prior to the end of the interest period. Bridge Loan prepayments are subject to an applicable premium percentage based on the prepayment date and vary over the life of the Bridge Loan.

Financial Covenants.  The Bridge Loan Agreement requires the Company to meet certain financial performance measures based on our leverage and interest coverage calculated in the same manner as the Bridge Loan financial covenants.

As of September 30, 2006, the Company was in compliance with the financial covenants set forth in the Bridge Loan Agreement.

Other Notes and Agreements

On December 20, 2002, the Company entered into a $0.9 million deferred compensation agreement with Dr. Bahman Atefi, its President, CEO and Chairman, as a condition to the IITRI asset acquisition, with payment terms equivalent to those of the Mezzanine Note. The Company issued detachable warrants representing the right to buy approximately 22,062 shares of Alion common stock at an exercise price of $10.00 per share, with put rights similar to those contained in the warrants accompanying the Mezzanine Note. On October 29, 2004, the Company paid Dr. Atefi approximately $1.1 million, including $0.2 million in accrued interest under his deferred compensation agreement.

As of September 30, 2006, the remaining fiscal year principal repayments (at face amount before debt discount) for outstanding indebtedness are as follows:

	2007		2008		2009		2010		2011		Total
Senior Secured Term B Loan(1)	$	2.6	$	2.6	$	253.8	$	—	$	—	$	259.0
Bridge Loan(2)		—		—		—		—	$	175.1		175.1
Subordinated Seller Note(3)		—		—		19.9		19.9	$	—		39.8
Subordinated Paid in Kind Note(4)		—		—		7.4		7.4	$	—		14.8
Total principal payments	$	2.6	$	2.6	$	281.1	$	27.3	$	175.1	$	488.7

(1)	The table does not reflect any prepayments of the Term B Senior Credit Facility based on excess cash flow or other conditions as the timing and amount of any such payments are uncertain. The approximate $252.1 million on the face of the balance sheet includes, as of September 30, 2006, approximately $4.1 million of unamortized debt issue costs which totaled approximately $12.3 million.
(2)	The Company expects that it will need to refinance the Term B Senior Credit Facility before the end of the fiscal year 2008.
(3)	The table reflects the balance drawn of $170.0 million as of September 30, 2006. The principal amount, plus applicable prepayment premium, is due and payable on December 31, 2011. The principal amount of $175.1 million includes $170.0 million principal at par value plus prepayment premium of $5.1 million (3% of par). The approximate $164.7 million on the face of the balance sheet includes, as of September 30, 2006, approximately $5.3 million in unamortized debt issue costs.

F-53

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(4)	The Company expects to refinance the Bridge Loan Agreement before the end of the calendar year 2006 through the issuance of up to $200.0 million of unsecured senior subordinated notes. The Company intends to use the net proceeds to repay the Bridge Loan and a portion of the senior term loan. The Company also expects that it will need to refinance the Term B loan. The Company also expects that it will need to refinance the Term B Senior Credit Facility before the end of fiscal year 2008.
(5)	Repayment of $39.9 million for the face value of the Subordinated Seller Note in two equal payments of $19.95 million in years 2009 and 2010. The $39.9 million includes, as of September 30, 2006, approximately $3.9 million of unamortized debt discount assigned to fair value of the detachable warrants. On December 20, 2002, approximately $7.1 million was assigned as the fair value of the warrants in accordance with Emerging Issues Task Force Issue No. 00-19, “Accounting for Derivative Financial Instruments Indexed to, and Potentially settled in, a Company’s Own Stock.”
(6)	During the eight-year term of the Subordinated Note, approximately $14.8 million of principal accretes to the note and is included in the principal payments in fiscal years 2009 and 2010. The principal, together with the outstanding balance of the PIK notes will be paid in equal amounts at the end of fiscal years 2009 and 2010.

(12)  Redeemable Common Stock Warrants

In connection with the issuance of the Subordinated Note and the Deferred Compensation Agreement described in Note 11, the Company issued 1,080,437 and 22,062, respectively, of detachable redeemable common stock warrants (the Warrants) to IITRI and Dr. Atefi, respectively. IITRI subsequently transferred all of its rights, title and interest in the warrants to IIT. On March 28, 2006, the Company redeemed the 504,902 outstanding Mezzanine Note warrants for approximately $13.1 million and the 22,062 Deferred Compensation Agreement warrants for approximately $0.57 million. The Subordinate Note Warrants have an exercise price of $10 per share and are exercisable until December 20, 2010. The Warrants permit the holders to sell warrants to the Company, at predetermined times, at the then current fair value of the common stock less the exercise price. The Warrants are classified as debt instruments in accordance with Emerging Issues Task Force Issue No. 00-19, “Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock.” The Company recorded the initial $10.3 million estimated fair value of the Warrants as a discount to the face value of the notes issued and as a liability. The outstanding estimated fair value of the Warrants had an estimated fair value of $35.2 million as of September 30, 2006. The Company recognizes interest expense for changes in the estimated fair value of the Warrants.

(13)  Leases

Future minimum lease payments under non-cancelable operating leases for buildings, equipment and automobiles at September 30, 2006 are set out below. Under these operating leases, the Company subleased some excess capacity to subtenants under non-cancelable operating leases.

In connection with the IPS, METI, and JJMA acquisitions, the Company assumed operating leases at above-market rates and recorded a loss accrual of approximately $4.9 million based on the estimated fair value of the lease liabilities assumed; which is being amortized over the lease terms. The remaining unamortized accrued loss related to these acquisitions was $2.4 million at September 30, 2006. In connection with the IPS acquisition, the Company also acquired a related sub-lease pursuant to which it receives above-market rates. Based on the estimated fair value of the sublease, the Company recognized an asset of $0.6 million which is being amortized over the lease term. The remaining asset value was $0.3 million at September 30, 2006.

F-54

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Lease Payments for Fiscal Years Ending	(In thousands)
2007	$	26,585
2008		23,191
2009		19,359
2010		13,608
2011		11,543
and thereafter		15,588
Gross lease payments		109,874
Less: non-cancelable subtenant receipts		6,124
Net lease payments	$	103,750

Rent expense under operating leases was $18.5 million, $15.1 million, and $10.5 million for the years ended September 30, 2006, 2005, and 2004, respectively. Sublease rental income under operating leases was $2.1 million, $1.8 million, and $0.8 million for the years ended September 30, 2006, 2005, and 2004, respectively.

(14)  Stock Appreciation Rights

In November 2002, the board of directors adopted the Alion Science and Technology Corporation 2002 Stock Appreciation Rights (SAR) Plan (the 2002 SAR Plan). In November 2004, the board of directors amended the 2002 SAR Plan to provide that, on or after October 3, 2004, there would be no further grants under the 2002 SAR Plan. Grants made prior to October 3, 2004 remain in force. From December 2002 through November 2003, the Company issued 236,400 SARs to directors, officers, and employees. Outstanding SAR awards cannot exceed the equivalent of 10% of the Company’s outstanding shares of common stock on a fully diluted basis. A grantee has the right to receive payment for vested SARs equal to the difference between the appraised value of a share of Alion common stock as of the grant date and the appraised value of a share of Alion common stock as of the exercise date based on the most recent valuation of common stock held by the ESOP Trust. Grants to employees vest at 20% per year; grants to members of the Company’s board of directors vest ratably over each member’s then-current term of office. In November 2005, the board of directors amended the 2002 SAR plan to eliminate the timely exercise requirement for an employee to receive payment for vested SARs and to permit employees to make two separate one-time elections, 1) to receive payment for SARs as they vest each year or when fully vested and 2) to receive payment for SARs already vested. As of September 30, 2006, the Company has granted 236,400 SARs under the 2002 SAR Plan.

On January 13, 2005, the Company’s board of directors adopted a second SAR plan, the Alion Science and Technology Corporation 2004 Stock Appreciation Rights Plan (the 2004 SAR Plan), to comply with the deferred compensation provisions of the American Jobs Creation Act of 2004. The 2004 SAR Plan has a 10-year term and permits grants to Alion directors, officers, employees and consultants. Under the 2004 SAR Plan, the chief executive officer has the authority to award SARs, as he deems appropriate; however, awards to executive officers are subject to the approval of the administrative committee of the Plan. Outstanding SAR awards cannot exceed the equivalent of 12% of the Company’s outstanding shares of common stock on a fully diluted basis. Awards to employees vest ratably over four years and awards to directors vest ratably over each director’s term of service. The 2004 SAR Plan contains a provision for accelerated vesting in the event of death, disability or a change in control of the Company.

A grantee has the right to receive payment for vested SARs equal to the difference between the appraised value of a share of Alion common stock as of the grant date and the appraised value of a share of Alion common stock as of the exercise date per the most recent valuation of the common stock held by the

F-55

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

ESOP Trust. For SARs granted under the 2004 SAR Plan before November 9, 2005 and outstanding when a change in control of the Company occurs, payment is based on the number of SARs multiplied by the share price at the date of the change in control (or earlier valuation, if higher).

In November 2005, the board of directors amended the 2004 SAR Plan to permit employees to make a one-time election to receive payment for SARs as they vest each year or when fully vested and to eliminate the timely exercise requirement for an employee to receive payment for vested SARs. As of September 30, 2006, the Company has granted 534,775 SARs under the 2004 SAR Plan.

For the years ended September 30, 2006, 2005, and 2004 the Company recognized approximately $3.0 million, $3.7 million, and $0.7 million, respectively, in compensation expense associated with the two SAR plans.

The table below sets out the disclosures required by SFAS No. 123 and the assumptions used to value a share of Alion common stock and the Company’s grants of stock appreciation rights as of September 30, 2006 and September 30, 2005. The Company uses the intrinsic value method to recognize stock-based compensation expense. There is no established public trading market for Alion’s common stock. The ESOP Trust is the only holder of our common stock. The Company uses an independent third party valuation firm to determine the fair market value of a share of Alion common stock. Alion does not expect to pay any dividends on its common stock. The terms of the Term B Senior Credit Facility, the Bridge Loan Agreement and the Subordinated Note prohibit us from paying dividends without the consent of the respective lenders. We currently intend to retain future earnings, if any, for use in the operation of our business.

F-56

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Alion Science and Technology Corporation
Stock-Based Compensation Disclosures per FAS 123
Stock Appreciation Rights
As of September 30, 2006

	Shares		Shares		Total
	Granted to		Granted to		Shares		Exercise		Outstanding		Outstanding								Vested		Exercisable
Date of Grant	Employees		Directors		Granted		Price		at 9/30/05		at 9/30/06		Forfeited		Exercised		Expired		9/30/06		at 9/30/06
December 2002		64,250		—		64,250	$	10.00		53,450		47,785		1,960		3,705		—		28,005		20,360
December 2002		—		29,400		29,400	$	10.00		8,400		—		—		8,400		—		—		—
May 2003		300		—		300	$	11.13		300		240		—		60		—		120		120
June 2003		300		—		300	$	11.13		300		300		—		—		—		180		60
November 2003		129,550		—		129,550	$	14.71		115,320		100,466		7,230		7,624		—		37,634		21,090
November 2003		—		12,600		12,600	$	14.71		12,600		2,800		1,400		8,400		—		—		—
November 2004		—		12,600		12,600	$	19.94		12,600		12,600		—		—		—		4,200		4,200
February 2005		164,750		—		164,750	$	19.94		152,400		135,588		9,350		7,463		—		29,575		—
March 2005		2,000		—		2,000	$	19.94		2,000		2,000		—		—		—		500		—
April 2005		33,000		—		33,000	$	29.81		33,000		27,500		2,750		2,750		—		5,000		—
June 2005		2,000		—		2,000	$	29.81		2,000		2,000		—		—		—		500		—
December 2005		276,675		—		276,675	$	35.89		—		257,900		18,775		—		—		—		—
February 2006		13,000		—		13,000	$	35.89		—		10,250		2,750		—		—		—		—
February 2006		7,500		—		7,500	$	35.89		—		7,500		—		—		—		—		—
May 2006		7,000		—		7,000	$	37.06		—		7,000		—		—				—		—
July 2006		15,000		—		15,000	$	37.06		—		15,000		—		—		—		—		—
August 2006		1,250		—		1,250	$	37.06		—		1,250		—		—		—		—		—
Total		716,575		54,600		771,175				392,370		630,179		44,215		38,402		—		105,714		45,830
Wtd Avg Exercise Price	$	25.75	$	13.38	$	24.87			$	17.54	$	26.39	$	26.86	$	15.32	$	—	$	15.93	$	13.08

F-57

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Alion Science and Technology Corporation
Stock-Based Compensation Disclosures per FAS 123
Stock Appreciation Rights
As of September 30, 2006

							Remaining
	Risk Free				Expected		Life
Date of Grant	Interest Rate		Volatility		Life		(months)
December 2002		4.06% - 4.49%		60%		5 yrs		13.4
December 2002		4.06% - 4.49%		60%		3 yrs		0.0
May 2003		2.70% - 3.30%		55%		5 yrs		18.8
June 2003		2.70% - 3.30%		55%		5 yrs		19.6
November 2003		4.06% - 4.49%		60%		5 yrs		25.2
November 2003		4.06% - 4.49%		60%		3 yrs		1.2
November 2004		3.10% - 3.60%		45%		3 yrs		13.4
February 2005		3.10% - 3.60%		45%		4 yrs		27.8
March 2005		3.10% - 3.60%		45%		4 yrs		28.9
April 2005		4.10% - 4.20%		45%		4 yrs		29.8
June 2005		4.10% - 4.20%		45%		4 yrs		32.0
December 2005		4.20% - 4.20%		40%		4 yrs		38.6
February 2006		4.20% - 4.20%		40%		4 yrs		40.3
February 2006		4.20% - 4.20%		40%		4 yrs		40.8
May 2006		4.82% - 4.83%		35%		4 yrs		43.6
July 2006		4.82% - 4.83%		35%		4 yrs		45.0
August 2006		4.82% - 4.83%		35%		4 yrs		46.9
Total Wtd Avg Exercise Price							$	31.4

(15)  Phantom Stock Plans

Phantom stock refers to hypothetical shares of Alion common stock. Recipients, upon vesting, are generally entitled to receive cash equal to the product of the number of hypothetical shares vested and the then-current value of Alion common stock, based on the most recent valuation of the shares of common stock held by the ESOP Trust. The compensation committee of the board of directors administers the Company’s phantom stock plans and is authorized to grant phantom stock to key management employees and outside directors. Grants of phantom stock do not confer voting or any other rights associated with common stock ownership. References to shares of common stock under the plan are for accounting and valuation purposes only. The Company is authorized to issue up to 2.0 million shares of phantom stock in total for all Phantom Stock plans.

Initial Phantom Stock Plan

In February 2003, the compensation committee of Alion’s board of directors approved, and the board of directors subsequently adopted, the Alion Science and Technology Phantom Stock Plan (the Initial Phantom Stock Plan). The Initial Phantom Stock plan has a term of ten years. The Initial Phantom Stock Plan contains provisions for acceleration of vesting and payouts in connection with an employee’s death, disability, involuntary termination of employment without cause or a change in control of the Company. As

F-58

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

of September 30, 2006, under the Initial Phantom Stock Plan, the Company had granted 223,685 shares of phantom stock. The phantom stock awards vest according to the following:

	The Vested Amount
	for Grant in
Anniversary from Grant Date	February 2003			November 2003
1st		—			20	%
2nd		—			20	%
3rd		50	%		20	%
4th		25	%		20	%
5th		25	%		20	%

Second Phantom Stock Plan

On November 9, 2004, the Company’s compensation committee approved, and the full board adopted, the Alion Science and Technology Corporation Performance Shares and Retention Phantom Stock Plan (the Second Phantom Stock Plan) to comply with the requirements of the American Jobs Creation Act. The Second Phantom Stock Plan permits awards of retention and performance share phantom stock. A retention award is for a fixed number of shares determined at the date of grant. A performance award is for an initial number of shares subject to change at the vesting date. Performance phantom shares are subject to forfeiture for failure to achieve a specified threshold value for a share of the Company’s common stock as of the vesting date. If the value of a share of the Company’s common stock equals the threshold value but does not exceed the target value, the number of performance shares in a given grant may be decreased by a specified percentage (generally up to 50%). If the value of a share of the Company’s common stock exceeds a pre-established target price on the vesting date, the number of performance shares in a given grant may be increased by a specified percentage (generally up to 20%).

Performance share awards vest three years from date of grant (unless otherwise provided in an individual award agreement) and retention share awards vest as specified in each individual award agreement, provided the grantee is still employed by the Company. Under limited circumstances, a grantee may defer an award payout beyond the original date. The Second Phantom Stock Plan contains provisions for acceleration of vesting and payouts in connection with an employee’s death, disability, involuntary termination of employment without cause or a change in control of the Company. In November 2005, the board of directors amended both the Initial Phantom Stock Plan and the Second Phantom Stock Plan to permit employees to make a one-time election for either or both plans to receive payment for phantom shares as they vest each year or when fully vested. As of September 30, 2006, the Company has granted 233,708 shares of retention phantom stock and 202,763 shares of performance phantom stock under the Second Phantom Stock Plan.

Director Phantom Stock Plan

On November 9, 2005, the Company’s compensation committee approved, and the full board adopted, the Alion Science and Technology Corporation Board of Directors Phantom Stock Plan (Director Phantom Stock Plan). The Director Phantom Stock Plan provides for annual awards of shares of phantom stock to non-employee directors of the Company. The number of shares of phantom stock granted each year to each non-employee director is equal to the quotient obtained by dividing $35,000 by the fair market value of one share of the Company’s stock as of the date of the award rounded up to the next highest whole number. Fair market value is determined by the Administrative Committee in its sole discretion using the most recent valuation of the Company’s common stock made by an independent appraisal that meets the requirements of IRC Section 401(a)(28)(C), as of a date that is no more than 12 months before the date of the award.

F-59

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Grants under the Director Phantom Stock Plan vest in one-third increments each year for three years from the date of the award. Vesting of an award accelerates upon a grantee’s death or disability or upon a change of control of the Company. Before each award is granted (or within 30 days of the grant date for individuals who become a director on the grant date), a director may elect whether to receive payment for phantom shares as they vest, or when the award is fully vested. A director who elects to receive payment when an award has fully vested may elect to defer the proceeds of the award into the Alion Science and Technology Director Deferred Compensation Plan provided the election is made no later than one year before the award fully vests. All payments made under the awards are required to be in cash. As of September 30, 2006, the Company had granted 7,808 shares of phantom stock under the Director Phantom Stock Plan.

For the years ended September 30, 2006, 2005, and 2004, the Company recognized approximately $7.8 million, $6.6 million, and $1.5 million, respectively, in compensation expense associated with all three phantom stock plans.

The table below sets out the disclosures required by SFAS No. 123 and the assumptions used to value a share of Alion common stock and the Company’s grants of phantom stock as of September 30, 2006 and September 30, 2005. The Company uses the intrinsic value method to recognize stock-based compensation expense. There is no established public trading market for Alion’s common stock. The ESOP Trust is the only holder of the Company’s common stock. The Company uses an independent third party valuation firm to determine the fair market value of a share of Alion common stock. Alion does not expect to pay any dividends on its common stock. The terms of the senior credit facility and the Subordinated Note prohibit paying dividends without the consent of the respective lenders. The Company intends to retain future earnings, if any, for use in the business.

Alion Science and Technology Corporation
Stock-Based Compensation Disclosures per FAS 123
Phantom Stock
As of September 30, 2006

	Shares		Shares		Total
	Granted to		Granted to		Shares		Exercise		Outstanding		Outstanding								Vested		Exercisable
Date of Grant	Employees		Directors		Granted		Price		at 9/30/05		at 9/30/06		Forfeited		Exercised		Expired		9/30/06		at 9/30/06
February 2003		171,000		—		171,000	$	10.00		171,000		85,000		6,232		79,768		—		16,500		16,500
November 2003		52,685		—		52,685	$	14.71		52,685		32,971		2,107		17,607		—		5,438		5,438
February 2005		202,763		—		202,763	$	19.94		202,763		202,763		—		—		—		—		—
February 2005		103,414		—		103,414	$	19.94		103,414		103,414		—		—		—		—		—
February 2005		5,015		—		5,015	$	19.94		5,015		5,015		—		—		—		1,254		—
August 2005		2,960		—		2,960	$	33.78		2,960		2,960		—		—		—		987		—
November 2005		66,592		—		66,592	$	35.89		—		66,592		—		—		—		—		—
November 2005		—		7,808		7,808	$	35.89		—		6,832		976		—		—		—		—
November 2005		55,726		—		55,726	$	35.89		—		55,726		—		—		—		—		—
Total		660,156		7,808		667,964				537,838		561,274		9,315		97,375		—		24,179		21,938
Wtd Avg Fair Value Price per Share	$	19.97	$	35.89	$	20.15			$	16.34	$	21.87	$	13.78	$	10.85	$	—	$	12.55	$	11.17

F-60

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Alion Science and Technology Corporation
Stock-Based Compensation Disclosures per FAS 123
Phantom Stock
As of September 30, 2006

							Remaining
	Risk Free				Expected		Life
Date of Grant	Interest Rate		Volatility		Life		(months)
February 2003		4.06% - 4.49%		60%		5 yrs		15.8
November 2003		4.06% - 4.49%		60%		5 yrs		24.9
February 2005		3.10% - 3.60%		45%		3 yrs		15.8
February 2005		3.10% - 3.60%		45%		3 yrs		15.8
February 2005		3.10% - 3.60%		45%		4 yrs		27.8
August 2005		3.72% - 3.77%		45%		3 yrs		22.0
November 2005		4.20% - 4.20%		40%		3 yrs		25.2
November 2005		4.20% - 4.20%		40%		3 yrs		25.2
November 2005		4.20% - 4.20%		40%		5 yrs		49.2
Total Wtd Avg Fair Value Price per Share							$	21.0

(16)  Segment Information and Customer Concentration

The Company operates in one segment, delivering a broad array of scientific and engineering expertise to research and develop technological solutions for problems relating to national defense, public health and safety, and nuclear safety and analysis under contracts with the federal government, state and local governments, and commercial customers. The Company’s federal government customers typically exercise independent contracting authority, and even offices or divisions within an agency or department may directly, or through a prime contractor, use the Company’s services as a separate customer so long as that customer has independent decision-making and contracting authority within its organization.

Contract receivables from agencies of the federal government represented approximately $143.8 million, or 93%, of accounts receivable at September 30, 2006 and $79.0 million, or 94%, of accounts receivable at September 30, 2005. Contract revenues from agencies of the federal government represented approximately 95%, 96% and 98% of total contract revenues during the years ended September 30, 2006, 2005 and 2004, respectively.

(17)  Related Party Transactions

On February 11, 2004, the Company borrowed $750,000 from an officer of the Company and, in exchange, the Company issued a Promissory Note in the principal amount of $750,000 with interest at a rate of 15 percent per annum, to be paid quarterly, until March 31, 2009 when the principal amount becomes due. The annual interest period was effective beginning February 11, 2004. On December 9, 2004, the Promissory Note with the officer was extinguished. An amount of $750,000 plus accrued interest of $21,635 was paid to the officer.

On October 29, 2004, Dr. Atefi elected to redeem the amount due under his Deferred Compensation Agreement with Alion. The Company paid Dr. Atefi approximately $1.1 million including accrued interest of approximately $0.2 million. Dr. Atefi’s related warrants were redeemed on March 28, 2006 as detailed in Footnote 11 Redeemable Common Stock Warrants.

F-61

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

(18)  Commitments and Contingencies

Earn-Out Commitments

The Company has earn-out commitments related to the following acquisitions:

CATI — There is an earn-out provision not to exceed $8.25 million based on the revenue of the business units that formerly comprised CATI. There is a second earn-out provision not to exceed $1.5 million based on attaining certain revenue goals in the commercial aviation industry. The obligations continue until September 2007. For the years ended September 30, 2006 and 2005, the Company recognized approximately $2.0 million and zero, respectively, in earn-out obligation related to CATI.

BMH — There is an earn-out provision not to exceed a total of $6.0 million based on the revenue of the business units that formerly comprised BMH. The obligation continues until December 2007. For the year ended September 30, 2006, the Company recognized no earn-out obligation related to BMH.

WCI — There is an earn-out provision not to exceed a total of $2.5 million based on the revenue of the business units that formerly comprised WCI. The obligation continues until September 2007. For the year ended September 30, 2006, the Company recognized approximately $1.3 million in earn-out obligation related to WCI.

MA&D — There is an earn-out provision not to exceed a total of $2.5 million based on the revenue of the business units that formerly comprised MA&D. The obligation continues until September 2007. For the year ended September 30, 2006, the Company recognized approximately $1.5 million in earn-out obligation related to MA&D.

Legal Proceedings

Estate of Joseph Hudert vs. Alion Science and Technology Corporation; Estate of Frank Stotmeister vs. Alion Science and Technology Corporation.

On December 23, 2004, the estate of Joseph Hudert filed an action against Grunley-Walsh Joint Venture, L.L.C. (Grunley-Walsh) and the Company in the District of Columbia Superior Court for damages in excess of $80 million. On January 6, 2005, the estate of Frank Stotmeister filed an action against the Company in the same court on six counts, some of which are duplicate causes of action, claiming $30 million for each count. Several other potential defendants may be added to these actions in the future.

The suits arose in connection with a steam pipe explosion that occurred on or about April 23, 2004 on a construction site at 17th Street, N.W. in Washington, D.C. The plaintiffs died, apparently as a result of the explosion. They were employees of the prime contractor on the site, Grunley-Walsh, and the subcontractor, Cherry Hill Construction Company Inc., respectively. Grunley-Walsh had a contract with the U.S. General Services Administration (GSA) for construction on 17th Street N.W. near the Old Executive Office Building in Washington, D.C. Sometime after the award of Grunley-Walsh’s construction contract, Alion was awarded a separate contract by GSA. Alion’s responsibilities on this contract were non-supervisory monitoring of Grunley-Walsh’s activities and reporting to GSA of any deviations from contract requirements.

The Company intends to defend these lawsuits vigorously. Based on the facts underlying the lawsuits known to the Company at this time, and the Company’s non-supervisory monitoring role at the project site, the Company’s management believes that the potential for Alion to incur a material loss as a result of the lawsuits is remote. Therefore, the Company’s management does not believe that these lawsuits will have a material adverse effect upon the Company, its operations or its financial condition.

F-62

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Alion’s primary provider of general liability insurance, St. Paul Travelers, has assumed defense of these lawsuits. However, since there is some uncertainty as to whether St. Paul Travelers received timely notice of a potential claim by Alion in connection with these lawsuits under its general liability insurance policy, St. Paul Travelers indicated when it assumed defense of the lawsuits, that it was doing so subject to a reservation of rights to deny coverage. Nevertheless, even if St. Paul Travelers is ultimately able to properly deny coverage as a result of late notice of the lawsuits, the Company’s management does not believe that the lawsuits will have a materially adverse effect upon the Company, its operations or its financial condition. American International Group, the Company’s excess insurance carrier, has also been notified regarding these lawsuits.

The Company is involved in various claims and legal actions arising in the ordinary course of business. In the opinion of management, the ultimate disposition of these matters will not have a material adverse effect upon the Company’s business, financial position, operating results or ability to meet its financial obligations.

Government Audits

The amount of federal government contract revenue and expense reflected in the consolidated financial statements attributable to cost reimbursement contracts is subject to audit and possible adjustment by the Defense Contract Audit Agency (DCAA). The federal government considers the Company to be a major contractor and DCAA maintains an office on site to perform its various audits throughout the year. All of the Company’s federal government contract indirect costs have been audited through 2004. Indirect rates have been negotiated through fiscal year 2003. Contract revenue on federal government contracts has been recorded in amounts that are expected to be realized upon final settlement.

(19)  Interim Period Information (Unaudited, in thousands)

	2006 Quarters
	1st			2nd			3rd			4th
Revenue	$	101,289		$	111,189		$	116,830		$	179,320
Gross profit		24,984			30,142			29,638			42,397
Net loss	$	(7,780	)	$	(920	)	$	(8,242	)	$	(14,173	)
Loss per share	$	(1.52	)	$	(0.19	)	$	(1.60	)	$	(3.26	)

	2005 Quarters
	1st			2nd			3rd			4th
Revenue	$	69,221		$	80,691		$	110,795		$	108,524
Gross profit		19,029			21,246			30,611			31,104
Net loss	$	(5,964	)	$	(17,366	)	$	(10,763	)	$	(6,145	)
Loss per share		(1.77	)	$	(5.21	)	$	(2.21	)	$	(1.18	)

(20)  Guarantor/Non-guarantor Condensed Consolidated Financial Information

The Company’s senior unsecured notes are unsecured general obligations of Alion Science and Technology Corporation. Certain of the Company’s wholly-owned, domestic subsidiaries have jointly, severally, fully and unconditionally guaranteed the senior unsecured notes. The following information presents condensed consolidating balance sheets as of September 30, 2006 and September 30, 2005, condensed consolidating statements of operations for the years ended September 30, 2006, 2005 and 2004, and condensed consolidating statements of cash flows for the years ended September 30, 2006, 2005 and 2004 of the parent company issuer, the guarantor subsidiaries and the non-guarantor subsidiaries. Investments include investments in subsidiaries held by the parent company issuer and have been presented using the equity method of accounting.

F-63

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Condensed Consolidating Balance Sheet Information at September 30, 2006

	Parent
	Company			Guarantor			Non-Guarantor
	Issuer			Subsidiaries			Subsidiaries			Eliminations			Consolidated
	(In thousands)
Current assets:
Cash and cash equivalents	$	2,728		$	(32	)	$	59			—		$	2,755
Accounts receivable		144,751			5,657			4			—			150,412
Stock subscriptions receivable		8,990			—			—			—			8,990
Other current assets		5,885			134			9			—			6,028
Total current assets		162,354			5,759			72			—			168,185
Property, plant and equipment, net		14,029			299			316			—			14,644
Intangible assets, net		75,403			—			—			—			75,403
Goodwill		387,927			—			—			—			387,927
Investment in subsidiaries		7,979			—			—			(7,979	)		—
Intercompany receivables		—			8,310			—			(8,310	)		—
Other assets		4,797			13			—			—			4,810
Total assets		652,489			14,381			388			(16,289	)		650,969
Current liabilities:
Current portion, Term B Senior Credit Facility note payable		2,816			—			—			—			2,816
Current portion, acquisition obligations		11,457			—			—			—			11,457
Trade accounts payable and accrued liabilities		59,174			3,625			4			—			62,803
Accrued payroll and related liabilities		32,288			1,694			153			—			35,135
Billings in excess of costs and estimated earnings on uncompleted contracts		2,163			—			—			—			2,163
Total current liabilities		108,898			5,319			157			—			114,374
Acquisition obligations, excluding current portion		3,568			—			—			—			3,568
Intercompany payables		7,784			—			526			(8,310	)		—
Notes payable to bank		12,300			—			—			—			12,300
Term B Senior Credit Facility note payable, excluding current portion		252,100			—			—			—			252,100
Bridge loan payable		164,680			—			—			—			164,680
Subordinated note payable		46,963			—			—			—			46,963
Accrued compensation, excluding current portion		20,254			772			—			—			21,026
Accrued postretirement benefit obligations		3,722			—			—			—			3,722
Non-current portion of lease obligations		4,276			16			—			—			4,292
Redeemable common stock warrants		35,234			—			—			—			35,234
Total liabilities		659,779			6,107			683			(8,310	)		658,259
Shareholder’s equity (deficit):
Common stock		52			1			—			(1	)		52
Additional paid-in capital		91,829			2,800			—			(2,800	)		91,829
Treasury stock					(2	)		—			2			—
Accumulated deficit		(99,171	)		5,475			(295	)		(5,180	)		(99,171	)
Total shareholder’s equity (deficit)		(7,290	)		8,274			(295	)		(7,979	)		(7,290	)
Total liabilities and shareholder’s equity (deficit)	$	652,489		$	14,381		$	388		$	(16,289	)	$	650,969

F-64

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Condensed Consolidating Balance Sheet Information at September 30, 2005

	Parent
	Company			Guarantor			Non-Guarantor
	Issuer			Subsidiaries			Subsidiaries		Eliminations			Consolidated
	(In thousands)
Current assets:
Cash and cash equivalents	$	37,634		$	139		$	5		—		$	37,778
Accounts receivable		78,715			2,180			3		—			80,898
Stock subscriptions receivable		1,733			—			—		—			1,733
Prepaid expenses and other current assets		2,802			—			—		—			2,802
Other current assets		1,797			145			2		—			1,944
Total current assets		122,681			2,464			10		—			125,155
Property, plant and equipment, net		11,139			30			5		—			11,174
Intangible assets, net		30,198			—			—		—			30,198
Goodwill		163,419			—			—		—			163,419
Investment in subsidiaries		6,105			—			—		(6,105	)		—
Intercompany receivables		—			4,015					(4,015	)		—
Other assets		4,303			—			—		—			4,303
Total assets		337,845			6,509			246		(10,351	)		334,249
Current liabilities:
Current portion, Term B Senior Credit Facility note payable		1,404			—			—		—			1,404
Current portion, acquisition obligations		3,616			—			—		—			3,616
Trade accounts payable and accrued liabilities		27,003			309			—		—			27,312
Accrued payroll and related liabilities		28,820			270			71		—			29,161
ESOP liabilities		274			—			—		—			274
Current portion of lease obligations		1,054			—			—		—			1,054
Billings in excess of costs and estimated earnings on uncompleted contracts		2,559			—			—		—			2,559
Total current liabilities		64,730			579			71		—			65,380
Acquisition obligations, excluding current portion		7,100			—			—		—			7,100
Intercompany payables		4,246			—			—		(4,246	)		—
Term B Senior Credit Facility note payable, excluding current portion		137,945			—			—		—			137,945
Bridge loan payable		—			—			—		—			—
Subordinated note payable		42,888			—			—		—			42,888
Deferred compensation liabilities		2,465			—			—		—			2,465
Accrued compensation, excluding current portion		6,356			—			—		—			6,356
Accrued postretirement benefit obligations		3,357			—			—		—			3,357
Non-current portion of lease obligations		3,694			—			—		—			3,694
Redeemable common stock warrants		44,590			—			—		—			44,590
Total liabilities		317,371			579			71		(4,246	)		313,775
Shareholder’s equity (deficit):
Common stock		51			1			—		(1	)		51
Additional paid-in capital		88,479			—			—		—			88,479
Treasury stock		—			(2	)		—		2			—
Accumulated deficit		(68,056	)		5,931			175		(6,106	)		(68,056	)
Total shareholder’s equity (deficit)		20,474			5,930			175		(6,105	)		20,474
Total liabilities and shareholder’s equity (deficit)	$	337,845		$	6,509		$	246	$	(10,351	)	$	334,249

F-65

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Condensed Consolidating Statement of Operations
Year Ended September 30, 2006

	Parent
	Company			Guarantor			Non-Guarantor
	Issuer			Subsidiaries			Subsidiaries			Eliminations			Consolidated
	(In thousands)
Contract revenue	$	489,013		$	19,146		$	469			—		$	508,628
Direct contract expense		367,585			13,590			292			—			381,467
Gross profit		121,428			5,556			177			—			127,161
Operating expenses:
Indirect contract expense		27,491			2,312			104			—			29,907
Research and development		1,884			—			141			—			2,025
General and administrative		56,931			894			268			—			58,093
Rental and occupancy expense		22,166			6			36			—			22,208
Depreciation and amortization		16,491			75			—			—			16,566
Bad debt expense		667			—			—			—			667
Total operating expenses		125,630			3,287			549			—			129,466
Operating income (loss)		(4,202	)		2,269			(372	)		—			(2,305	)
Other income (expense):
Interest income		590			—			—			—			590
Interest expense		(26,691	)		—			—			—			(29,691	)
Equity in operations of subsidiaries		766			—			—			(766	)		—
Other		1,448			(1,033	)		(98	)		—			317
Income (loss) before income taxes		(31,089	)		1,236			(470	)		(766	)		(31,089	)
Income tax expense		(26	)		—			—			—			(26	)
Net income (loss)	$	(31,115	)	$	1,236		$	(470	)	$	(766	)	$	(31,115	)

F-66

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Condensed Consolidating Statements of Operations
Year Ended September 30, 2005

	Parent
	Company			Guarantor			Non-Guarantor
	Issuer			Subsidiaries			Subsidiaries			Eliminations			Consolidated
	(In thousands)
Contract revenue	$	360,130		$	8,133		$	968			—		$	369,231
Direct contract expense		262,026			4,622			593			—			267,241
Gross profit		98,104			3,511			375			—			101,990
Operating expenses:
Indirect contract expense		28,367			618			32			—			29,017
Research and development		498			—			—			—			498
General and administrative		32,048			910			16			—			32,974
Rental and occupancy expense		12,475			47			20			0			12,542
Depreciation and amortization		17,763			8			—			—			17,771
Stock-based compensation		10,628												10,628
Bad debt expense		651			—			—			—			651
Total operating expenses		102,430			1,583			68			—			104,081
Operating income (loss)		(4,326	)		1,928			307			—			(2,091	)
Other income (expense):
Interest income		475			—			—			—			475
Interest expense		(38,696	)		—			—			—			(38,696	)
Equity in operations of subsidiaries		1,124			—			—			(1,124	)		—
Other		1,248			(976	)		(132	)		—			140
Income (loss) before income taxes		(40,175	)		952			175			(1,124	)		(40,172	)
Income tax expense		(63	)		(3	)		—			—			(66	)
Net income (loss)	$	(40,238	)	$	949		$	175		$	(1,124	)	$	(40,238	)

F-67

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Condensed Consolidating Statement of Operations
Year Ended September 30, 2004

	Parent
	Company			Guarantor			Non-Guarantor
	Issuer			Subsidiaries			Subsidiaries		Eliminations			Consolidated
	(In thousands)
Contract revenue	$	260,824		$	9,116			—		—		$	269,940
Direct contract expense		190,935			5,453			—		—			196,388
Gross profit		69,889			3,663			—		—			73,552
Operating expenses:								—		—
Indirect contract expense		16,971			676			—		—			17,647
Research and development		399			—			—		—			399
General and administrative		27,375			742			—		—			28,117
Rental and occupancy expense		10,952			38			—		—			10,990
Depreciation and amortization		13,440			7			—		—			13,447
Stock-based compensation		2,513			—			—		—			2,513
Bad debt expense		590			—			—		—			590
Total operating expenses		72,240			1,463			—		—			73,703
Operating income (loss)		(2,351	)		2,200			—		—			(151	)
Other income (expense):								—		—
Interest income		27			—			—		—			27
Interest expense		(16,835	)		—			—		—			(16,835	)
Equity in operations of subsidiaries		1,164			—			—		(1,164	)		—
Other		2,900			(1,035	)		—		—			1,865
Income (loss) before income taxes		(15,095	)		1,165			—		(1,164	)		(15,094	)
Income tax expense		(16	)		(1	)		—		—			(17	)
Net income (loss)	$	(15,111	)	$	1,164			—	$	(1,164	)	$	(15,111	)

F-68

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Condensed Consolidating Statement of Cash Flows
Year Ended September 30, 2006

	Parent
	Company			Guarantor			Non-Guarantor
	Issuer			Subsidiaries			Subsidiaries			Consolidated
	(In thousands)
Net cash (used in) provided by operating activities		(15,787	)		(256	)		366			(15,677	)
Cash flows from investing activities:
Cash paid for acquisitions, net of cash acquired		(279,196	)		—			—			(279,196	)
Capital expenditures		(4,878	)		(37	)		(312	)		(5,227	)
Proceeds from sale of investment securities		—			—			—			—
Purchase of investment securities		—			—			—			—
Net cash used in investing activities		(284,074	)		(37	)		(312	)		(284,423	)
Cash flows from financing activities:
Proceeds from Term B Senior Credit Facility note payable		118,000			—			—			118,000
Proceeds from bridge loan		170,000			—			—			170,000
Payment of debt issuance costs		(7,758	)		—			—			(7,758	)
Repayment of Term B Credit Facility note payable		(1,905	)		—			—			(1,905	)
Repayment of mezzanine warrants		(13,643	)		—			—			(13,643	)
Borrowings under revolving credit facility		12,300			—			—			12,300
Purchase of interest rate cap agreement		(44	)		—			—			(44	)
Purchase of shares of common stock from ESOP Trust		(19,003	)		—			—			(19,003	)
Cash received from issuance of common stock to Trust		7,131			—			—			7,131
Net cash provided by financing activities		265,078			—			—			265,078
Net (decrease) increase in cash and cash equivalents		(34,783	)		(293	)		54			(35,022	)
Cash and cash equivalents at beginning of year		37,512			261			5			37,778
Cash and cash equivalents at end of year	$	2,728		$	(32	)	$	59		$	2,755

F-69

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Condensed Consolidating Statement of Cash Flows
Year Ended September 30, 2005

	Parent
	Company			Guarantor			Non-Guarantor
	Issuer			Subsidiaries			Subsidiaries			Consolidated
	(In thousands)
Net cash provided by operating activities		35,093			37			10			35,140
Cash flows from investing activities:
Cash paid for acquisitions, net of cash acquired		(74,591	)		—			—			(74,591	)
Capital expenditures		(2,222	)		(6	)		(5	)		(2,233	)
Purchase of investment securities		(1,193	)		—			—			(1,193	)
Net cash used in investing activities		(78,006	)		(6	)		(5	)		(78,071	)
Cash flows from financing activities:
Proceeds from Term B Senior Credit Facility note payable		94,000			—			—			94,000
Payment of debt issuance costs		(1,307	)		—			—			(1,307	)
Repayment of Term B Credit Facility note payable		(1,080	)		—			—			(1,080	)
Repayment of mezzanine note payable		(20,201	)		—			—			(20,201	)
Repayment of agreements with officers		(1,823	)		—			—			(1,823	)
Purchase of shares of common stock from ESOP Trust		(8,160	)		—			—			(8,160	)
Cash received from issuance of common stock to Trust		14,509			—			—			14,509
Net cash provided by financing activities		75,938			—			—			75,938
Net increase in cash and cash equivalents		33,025			31			5			33,061
Cash and cash equivalents at beginning of year		4,609			108			—			4,717
Cash and cash equivalents at end of year	$	37,634		$	139		$	5		$	37,778

F-70

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

Condensed Consolidating Statement of Cash Flows
Year Ended September 30, 2004

	Parent
	Company			Guarantor			Non-Guarantor
	Issuer			Subsidiaries			Subsidiaries		Consolidated
	(In thousands)
Net cash provided by (used in) operating activities		6,178			(503	)		—		5,675
Cash flows from investing activities:
Cash paid for acquisitions, net of cash acquired		(21,678	)		—			—		(21,678	)
Capital expenditures		(3,666	)		(12	)		—		(3,678	)
Proceeds from sale of investment securities		3,064			—			—		3,064
Purchase of investment securities		(1,333	)		—			—		(1,333	)
Net cash used in investing activities		(23,613	)		(12	)		—		(23,625	)
Cash flows from financing activities:
Proceeds from Term B Senior Credit Facility note payable		50,000			—			—		50,000
Payment of debt issuance costs		(3,280	)		—			—		(3,280	)
Repayment of senior note payable		(29,250	)		—			—		(29,250	)
Repayment of mezzanine note payable		(750	)		—			—		(750	)
Proceeds from agreement with officer		750			—			—		750
Borrowings under revolving credit facility		24,000			—			—		24,000
Repayment of LaSalle revolving credit facility		(24,000	)		—			—		(24,000	)
Repayment of ITSC revolving credit facility		(375	)		—			—		(375	)
Purchase of interest rate cap agreement		(319	)		—			—		(319	)
Purchase of shares of common stock from ESOP Trust		(1,562	)		—			—		(1,562	)
Cash received from issuance of common stock to Trust		6,959			—			—		6,959
Net cash provided by financing activities		22,173			—			—		22,173
Net (decrease) increase in cash and cash equivalents		4,738			(515	)		—		4,223
Cash and cash equivalents at beginning of year		(129	)		623			—		494
Cash and cash equivalents at end of year	$	4,609		$	108			—	$	4,717

F-71

$250,000,000

Alion Science and Technology Corporation

EXCHANGE OFFER

for

All Outstanding

101/4% Senior Notes Due 2015

of

Alion Science and Technology Corporation

and

Related Subsidiary Guarantees

PROSPECTUS

   , 2007

Dealer Prospectus Delivery Obligation

Until          , 2007, all dealers that effect transactions in these securities, whether or not participating in this exchange offer, may be required to deliver a prospectus. This is in addition to the dealers’ obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.

PART II

INFORMATION NOT REQUIRED IN THE PROSPECTUS

ITEM 20.   Indemnification of Directors and Officers.

Subsection (a) of Section 145 of the Delaware General Corporation Law (the DGCL) empowers a corporation to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the corporation) by reason of the fact that such person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation (to include any service as a director, officer, or employee or agent of the corporation which imposes duties on, or involves services by such individual with respect to an employee benefit plan, its participants or beneficiaries) as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise (which includes employee benefit plans) (an agent), against expenses (including attorneys’ fees), judgments, fines (to include any excise taxes assessed on a person with respect to any employee benefit plan) and amounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit or proceeding if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the corporation (which includes if such person acted in good faith and in a manner he/she reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan) and, with respect to any criminal action or proceeding, had no reasonable cause to believe such person’s conduct was unlawful. A person who acted in good faith and in a manner such person reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner not opposed to the best interests of the corporation.

Subsection (b) of Section 145 of the DGCL empowers a corporation to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that such person acted as an agent of the corporation, against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection with the defense or settlement of such action or suit if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the corporation, except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to the corporation unless and only to the extent that the Court of Chancery or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Court of Chancery or such other court shall deem proper.

Section 145 of the DGCL further provides, among other things, that to the extent a present or former director or officer of a corporation has been successful on the merits or otherwise in the defense of any action, suit or proceeding referred to in subsections (a) and (b) of Section 145 of the DGCL or in defense of any claim, issue or matter therein, such person shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred in connection therewith. Indemnification provided for by Section 145 of the DGCL shall not be deemed exclusive of any other rights to which the indemnified party may be entitled.

Indemnification provided for by Section 145 of the DGCL shall, unless otherwise provided when authorized or ratified, continue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the benefit of such person’s heirs, executors and administrators. Section 145 of the DGCL also empowers the corporation to purchase and maintain insurance on behalf of an agent of the corporation against any liability asserted against him and incurred by him in any such capacity, or arising out of his status as such, whether or not the corporation would have the power to indemnify him against such liabilities under Section 145 of the DGCL.

II-1

Article Nine of our Third Amended and Restated Certificate of Incorporation and Article XII of our Amended and Restated Bylaws entitles our officers and directors to indemnification to the full extent permitted by Section 145 of the DGCL. Article XI of our Amended and Restated Bylaws allows us to purchase insurance for the benefit of our officers and directors.

We currently provide insurance from a commercial carrier against certain liabilities incurred by our directors and officers. Our director and officer insurance also covers the directors and officers of our subsidiaries, including Alion — METI Corporation, Washington Consulting, Inc., Alion — BMH Corporation, Human Factors Application, Inc., Alion — JJMA Corporation, Alion — MA&D Corporation and Alion — CATI Corporation. We have entered into indemnification agreements with our directions and with our named executive officers. The form of indemnification agreement provides that we generally will indemnify our directors and officers for expenses incurred by them in connection with their service to Alion to the fullest extent permitted by applicable law when:

•  the director or officer is, or is threatened to be made, a party to or a participant in any threatened, pending or completed action, suit, arbitration, administrative hearing, or other similar proceeding; and

•  the director or officer acted in good faith and in a manner reasonably believed to be in or not opposed to the best interests of our company.

Only in certain limited circumstances would a director or officer not be entitled to indemnification.

METI, BMH, WCI

Article 10 of Chapter 9 of Title 13.1 of the Code of Virginia, as amended (the Virginia Act), permits a Virginia corporation to indemnify any director or officer for reasonable expenses incurred in any legal proceeding in advance of final disposition of the proceeding, if the director or officer furnishes the corporation a written statement of his or her good faith belief that he or she has met the standard of conduct prescribed by the Virginia Act, and furnishes the corporation with a written undertaking to repay any funds advanced if it is ultimately determined that the director has not met the relevant standard of conduct. In addition, a corporation is permitted to indemnify a director or officer against liability incurred in a proceeding if a determination has been made by the disinterested members of the board of directors, special legal counsel or shareholders that the director or officer conducted himself or herself in good faith and otherwise met the required standard of conduct. In a proceeding by or in the right of the corporation, no indemnification shall be made in respect of any matter as to which a director or officer is adjudged to be liable to the corporation, except for reasonable expenses incurred in connection with the proceeding if it is determined that the director or officer has met the relevant standard of conduct. In any other proceeding, no indemnification shall be made if the director or officer is adjudged liable to the corporation on the basis that he or she improperly received a personal benefit. Corporations are given the power to make any other or further indemnity, including advance of expenses, to any director or officer that may be authorized by the articles of incorporation or any bylaw made by the shareholders, or any resolution adopted, before or after the event, by the shareholders, except an indemnity against willful misconduct or a knowing violation of the criminal law. Unless limited by its articles of incorporation, indemnification against the reasonable expenses incurred by a director or officer is mandatory when he or she entirely prevails in the defense of any proceeding to which he or she is a party because he or she is or was a director or officer.

Alion — METI Corporation’s (METI) First Amended and Restated Bylaws entitles its officers and directors to indemnification to the full extent permitted by the Virginia Act, except as otherwise required by law. METI’s Amended and Restated Articles of Incorporation and First Amended and Restated Bylaws are silent as to insurance for such indemnification.

Washington Consulting, Inc.’s (WCI) Bylaws entitles each director and officer who was or is a party or is threatened to be made a party to any threatened, pending, or completed action, suit or proceeding, whether civil, criminal, administrative, arbitrative, or investigative (including an action or suit by or in the right of the corporation to procure a judgment in its favor) by reason of the fact that he or she is or was a director or officer of the corporation or is or was serving at the request of the corporation in any capacity

II-2

for another corporation, partnership, joint venture, trust, or other entity, provided he or she acted or took no action in good faith and in a manner he or she believed to be in or not opposed to the best interests of the corporation, and with respect to any criminal action or proceeding, had no reasonable cause to believe such conduct was unlawful, except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable for gross negligence or willful misconduct in the performance of his or her duty to the corporation, unless, and only to the extent that, the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnification.

WCI’s Bylaws further provides, that to the extent a director or officer has been successful on the merits or otherwise in the defense of any action, suit or proceeding referred to in the proceeding paragraph, or in defense of any claim, issue or matter therein, he or she shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred in connection therewith. Indemnification provided for by WCI’s Bylaws shall not be deemed exclusive of any other rights to which the indemnified party may be entitled. WCI’s Bylaws further provide that WCI may purchase insurance for the benefit of its officers and directors.

Alion — BMH Corporation’s Articles of Incorporation and Bylaws are silent as to indemnification and insurance.

HFA

Subchapter D of Chapter 17 of the Pennsylvania Business Corporation Law of 1988, as amended, to which Human Factors Application, Inc. (HFA) is subject, provides that a business corporation has the power under certain circumstances to indemnify its directors, officers, employees and agents against certain expenses because of their holding or having held such positions with a corporation incurred by them in connection with any threatened, pending or completed action, suit or proceeding and provides for mandatory indemnification under certain circumstances when the indemnified person has been successful in defense of a claim. Section 1747 of the Pennsylvania Business Corporation Law authorizes a corporation to purchase and maintain insurance for such indemnification, unless otherwise restricted in its bylaws.

Article XII of HFA’s Amended and Restated Bylaws provides that HFA’s Board of Directors shall authorize the corporation to pay or reimburse any present or former director or officer of HFA any costs or expenses actually and necessarily incurred by him or her in any action, suit or proceeding to which he or she is made a party by reason of his or her holding such position if he or she acted in good faith and in a manner he or she reasonably believed to be in, and not opposed to, the best interests of the corporation, except that such director or officer shall not receive such indemnification if he or she is finally adjudicated to be liable for negligence or misconduct in the performance of his or her duty to the corporation. Such indemnification shall extend to good faith expenditures incurred in anticipation of, or preparation for, threatened or proposed litigation and, in proper cases, good faith settlement of any such action, suit or proceeding, whether formally instituted or not. HFA’s Amended and Restated Bylaws and Articles of Incorporation are silent as to insurance for each indemnification.

JJMA

The New York Business Corporation Law, to which Alion — JJMA Corporation (JJMA) is subject, restricts a corporation from indemnifying any person in an action or proceeding by or in the right of the corporation and further requires that such director or officer acted in good faith for a purpose which he reasonably believed to be in, or, in the case of service for any other corporation or any partnership, joint venture, trust, employee benefit plan or other enterprise, not opposed to, the best interests of the corporation and, in criminal actions or proceedings, in addition, had no reasonable cause to believe that his conduct was unlawful. The New York Business Corporation Law authorizes a corporation to purchase and maintain insurance for indemnification in certain circumstances.

II-3

JJMA’s Restated Certificate of Incorporation and Amended and Restated Bylaws are silent as to indemnification and insurance.

MA&D

Section 7-108-402 of the Colorado Business Corporation Act, to which Alion — MA&D Corporation (MA&D) is subject, provides, generally, that the articles of incorporation of a Colorado corporation may contain a provision eliminating or limiting the personal liability of a director to the corporation or its shareholders for monetary damages for breach of fiduciary duty as a director; except that any such provision may not eliminate or limit the liability of a director (i) for any breach of the director’s duty of loyalty to the corporation or its shareholders, (ii) acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) acts specified in Section 7-108-403 (concerning unlawful distributions), or (iv) any transaction from which a director directly or indirectly derived an improper personal benefit. Such provision may not eliminate or limit the liability of a director for any act or omission occurring prior to the date on which such provision becomes effective.

Article XI of MA&D’s Bylaws provides that MA&D shall indemnify its directors, subject to certain limitations and only to the extent of reasonable expenses incurred, against liability incurred in any proceeding to which he is a party because he is or was a director as long as he conducted himself in good faith and reasonably believed, in the case of conduct in his official capacity, that his conduct was in the best interests of MA&D, and, in all other cases, that his conduct was at least not opposed to the best interests of MA&D (which includes if such director acted in a manner he reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan). Such indemnification shall also extend to directors of any other corporation serving as such at the request of MA&D. Such indemnification shall not extend to a director where such director is adjudged to be liable to the corporation or to have received improper personal benefit, whether or not involving actions in an official capacity.

MA&D’s Bylaws provides for indemnification of its officers, employees and agents to the same extent as its directors, as long as such person was wholly successful on the merits or otherwise, in defense of any proceeding to which he was a party against reasonable expenses incurred by him in connection with the proceeding. MA&D’s Bylaws permits it to pay expenses incurred in defending a proceeding in advance of the final disposition of such proceeding if the person undertakes to repay the amount unless it is ultimately determined that he is entitled to such expenses.

CATI

Section 317 of the California General Corporation Law (the CGCL), to which Alion — CATI Corporation (CATI) is subject, authorizes a court to award, or a corporation’s board of directors to grant, indemnity to directors and officers in terms sufficiently broad to permit indemnification, including reimbursement of expenses incurred, under certain circumstances for liabilities arising under the Securities Act.

Article VIII of CATI’s Amended and Restated Bylaws provides the corporation with the power to (i) indemnify each of its directors and officers to the full extent permitted by CGCL and particularly but without limitation, Section 317, against expenses, judgments, fines, settlements and other amounts actually and reasonably incurred in connection with any proceeding by reason of the fact that any such person is or was an agent of the corporation and (ii) advance to each such agent expenses incurred in defending any such proceeding to the maximum extent permitted by that law. Such indemnification shall also extend to officers or directors of any other corporation serving as such at the request of CATI. Article VIII of CATI’s Amended and Restated Bylaws allows CATI to purchase insurance for the benefit of its officers and directors.

II-4

ITEM 21.   Exhibits and Financial Statement Schedule.

(a)  Exhibits

The following instruments and documents are included as Exhibits to this Registration Statement. Exhibits incorporated by reference are indicated below.

Exhibit
Number			Exhibit
	3	.2	Amended and Restated By-Laws of Alion Science and Technology Corporation.(1)
	3	.3	Third Amended and Restated Certificate of Incorporation of Alion Science and Technology Corporation.(2)
	3	.4	Amended and Restated Bylaws of Human Factors Applications, Inc.*
	3	.5	Certificate of Incorporation of Human Factors Application, Inc.*
	3	.6	Statement of Change of Registered Office of Human Factors Applications, Inc.*
	3	.7	Statement of Correction of Human Factors Application, Inc.*
	3	.8	Statement of Change of Registered Office of Human Factors Applications, Inc.*
	3	.9	First Amended and Restated Bylaws of ManTech Environmental Technology, Inc. (now known as Alion — METI Corporation).*
	3	.10	Amended and Restated Articles of Incorporation of Alion — METI Corporation.*
	3	.11	Amended and Restated Bylaws of Alion — CATI Corporation.*
	3	.12	Articles of Incorporation of Carmel Applied Technologies, Inc. (now known as Alion — CATI Corporation).*
	3	.13	Certificate of Amendment of Articles of Incorporation of Carmel Applied Technologies, Inc. (now known as Alion — CATI Corporation).*
	3	.14	Certificate of Amendment of the Articles of Incorporation of Carmel Applied Technologies, Inc. changing its name to Alion — CATI Corporation.*
	3	.15	Amended and Restated Bylaws of Alion — JJMA Corporation.*
	3	.16	Restated Articles of Incorporation of Alion — JJMA Corporation.*
	3	.17	Bylaws of Washington Consulting, Inc.*
	3	.18	Articles of Incorporation of Washington Consulting, Inc.*
	3	.19	Bylaws of BMH Associates, Inc. (now known as Alion — BMH Corporation).*
	3	.20	Articles of Incorporation of BMH Associates, Inc. (now known as Alion — BMH Corporation).*
	3	.21	Articles of Amendment to the Articles of Incorporation of BMH Associates, Inc. changing its name to Alion — BMH Corporation.*
	3	.22	Articles of Incorporation of Micro Analysis & Design, Inc. (now known as Alion — MA&D Corporation).*
	3	.23	Articles of Amendment to the Articles of Incorporation of Micro Analysis & Design, Inc. changing its name to Alion — MA&D Corporation.*
	3	.24	Bylaws of Micro Analysis & Design, Inc. (now known as Alion — MA&D Corporation).*
	4	.16	Indenture, dated February 8, 2007, among Alion Science and Technology Corporation, certain subsidiary guarantors of the Company and Wilmington Trust Company, as trustee.(3)
	4	.17	Form of 101/4% Note due 2015.(3)
	4	.18	Registration Rights Agreement, dated February 8, 2007, by and among the Company, HFA, METI, CATI, JJMA, BMH, WCI, MA&D and Credit Suisse Securities (USA) LLC.(4)
	4	.19	Amended and Restated Alion Science and Technology Corporation Employee Ownership Savings and Investment Plan.*
	5	.1	Opinion of Baker & McKenzie.*

II-5

Exhibit
Number			Exhibit
	10	.5	Seller Note Securities Purchase Agreement by and between IIT Research Institute and Alion Science and Technology Corporation.(5)
	10	.7	Seller Warrant Agreement by and among Alion Science and Technology Corporation, IIT Research Institute and Alion Science and Technology Employee Ownership, Savings and Investment Trust.(6)
	10	.8	Rights Agreement by and among Alion Science and Technology Corporation, IIT Research Institute and Alion Science and Technology Employee Ownership, Savings and Investment Trust.(5)
	10	.14	Employment Agreement between Alion Science and Technology Corporation and Bahman Atefi.(5)
	10	.15	Employment Agreement between Alion Science and Technology Corporation and Stacy Mendler.(5)
	10	.16	Employment Agreement between Alion Science and Technology Corporation and Randy Crawford.(5)
	10	.18	Employment Agreement between Alion Science and Technology Corporation and John Hughes.(5)
	10	.31	Agreement between Alion Science and Technology Corporation and James Fontana.(7)
	10	.32	Employment Agreement between Alion Science and Technology Corporation and Leroy R. Goff III.(7)
	10	.34	Addendum to Employment Agreement between Alion Science and Technology Corporation and James Fontana.(8)
	10	.36	Senior Secured Credit facility that includes a revolving credit facility and Term B note, by and among Credit Suisse First Boston as arranger, various lenders, and Alion Science and Technology Corporation.(9)
	10	.38	First Amendment to the Seller Warrant Agreement.(9)
	10	.46	Second Amendment to the Seller Warrant Agreement.(10)
	10	.49	Commitment letter agreement by and between Alion Science and Technology Corporation and Credit Suisse First Boston.(11)
	10	.50	Third Amendment to the Seller Warrant Agreement.(12)
	10	.53	Stock Purchase Agreement by and among Alion Science and Technology Corporation, John J. McMullen Associates, Inc., Marshall and Ilsley Trust Company, N.A. as Trustee to the John J. McMullen, Inc. Employee Stock Ownership Trust and P. Thomas Diamant, Anthony Serro, and David Hanafourde.(13)
	10	.54	Incremental Term Loan Assumption Agreement and Amendment Number One to existing Term Loan Facility with Credit Suisse First.(14)
	10	.57	Alion Science and Technology Corporation Board of Directors Phantom Stock Plan.(15)
	10	.58	Amended and Restated Alion Science and Technology Corporation Phantom Stock Plan.(15)
	10	.59	Amended and Restated Alion Science and Technology Corporation Performance Shares and Retention Phantom Stock Plan.(15)
	10	.60	Amended and Restated Alion Science and Technology Corporation 2002 Stock Appreciation Rights Plan.(15)
	10	.61	Amended and Restated Alion Science and Technology Corporation 2004 Stock Appreciation Rights Plan.(15)
	10	.62	Amended and Restated Alion Science and Technology Corporation Executive Deferred Compensation Plan.(15)
	10	.63	Amended and Restated Alion Science and Technology Corporation Director Deferred Compensation Plan.(15)
	10	.64	Commitment letter by and between Alion Science and Technology Corporation, Credit Suisse and Credit Suisse Securities (USA) LLC.(16)

II-6

Exhibit
Number			Exhibit
	10	.65	Incremental Term Loan Assumption Agreement and Amendment No. 2 dated as of March 24, 2006, by and among Alion Science and Technology Corporation, HFA, METI, CATI, JJMA, BMH, WCI, Credit Suisse, and the lenders party thereto.(17)
	10	.66	Fourth Amendment to the Seller Warrant Agreement by and among Alion Science and Technology Corporation, Illinois Institute of Technology and Alion Science and Technology Employee Ownership, Savings and Investment Trust.(18)
	10	.67	Mezzanine Warrant Redemption Agreement between Alion Science and Technology Corporation and Illinois Institute of Technology.(18)
	10	.68	Alion Mezzanine Warrant Redemption Agreement between Alion Science and Technology Corporation, and Bahman Atefi.(18)
	10	.69	Asset Purchase Agreement dated as of June 4, 2006, by and between Anteon Corporation, Alion Technical Services Corporation and Alion Science and Technology Corporation.(19)
	10	.70	Incremental Term Loan Assumption Agreement and Amendment No. 3 dated as of June 30, 2006, by and among Alion Science and Technology Corporation, HFA, METI, CATI, JJMA, BMH, WCI, MA&D, Credit Suisse, and the lenders party thereto.(20)
	10	.71	Bridge Loan Agreement dated as of June 30, 2006, by and among Alion Science and Technology Corporation, HFA, METI, CATI, JJMA, BMH, WCI, MA&D, Credit Suisse, and the lenders party thereto.(20)
	10	.72	Closing Letter Agreement dated as of June 30, 2006, by and among Alion Science and Technology Corporation, Alion Technical Services Corporation and Anteon Corporation.(21)
	10	.73	First Amendment to Seller Note Securities Purchase Agreement dated as June 30, 2006, by and between Alion Science and Technology Corporation and Illinois Institute of Technology.(22)
	10	.74	Separation Agreement between Alion Science and Technology Corporation and Barry Watson.(23)
	10	.75	Second Addendum to Employment Agreement between Alion Science and Technology Corporation and James Fontana.(24)
	10	.76	Commitment letter by and between Alion Science and Technology Corporation, Credit Suisse and Credit Suisse Securities (USA) LLC.(25)
	10	.77	Amendment to Offer of Promotion between Alion Science and Technology Corporation and Leroy R. Goff III.(26)
	10	.78	Offer Letter between Alion Science and Technology Corporation and Scott A. Fry.(27)
	10	.79	Addendum to Offer Letter between Alion Science and Technology Corporation and Scott A. Fry.(28)
	10	.80	Amendment No. 1 to the Bridge Loan Agreement dated as of December 11, 2006, by and among Alion Science and Technology Corporation, certain subsidiary guarantors, Credit Suisse, and the lenders party thereto.(29)
	10	.81	Incremental Term Loan Assumption Agreement dated as of January 4, 2007, by and among the Company, HFA, METI, CATI, JJMA, BMH, WCI, MA&D, Credit Suisse, and the lenders party thereto, related to the Credit Agreement (as amended from time to time) dated as of August 2, 2004, by and among the Company, HFA, METI, CATI, JJMA, BMH, WCI and MA&D, the lenders from time to time party to the Credit Agreement (the “Lenders”), and Credit Suisse, as administrative agent and as collateral agent for the Lenders.(30)
	10	.82	Purchase Agreement dated January 26, 2007, by and among the Company, HFA, METI, CATI, JJMA, BMH, WCI, MA&D and Credit Suisse Securities (USA) LLC.(3)
	10	.83	Amendment No. 4 dated as of February 6, 2007, by and among the Company, HFA, METI, CATI, JJMA, BMH, WCI, MA&D, Credit Suisse, and the lenders party thereto, related to the Credit Agreement (as amended from time to time) dated as of August 2, 2004, by and among the Company, HFA, METI, CATI, JJMA, BMH, WCI and MA&D, certain lenders from time to time party to the Credit Agreement (the “Lenders”), and Credit Suisse, as administrative agent and as collateral agent for the Lenders.(3)
	10	.84	Registration Rights Agreement dated February 8, 2007, by and among the Company, HFA, METI, CATI, JJMA, BMH, WCI, MA&D and Credit Suisse Securities (USA) LLC.(4)

II-7

Exhibit
Number			Exhibit
	10	.85	Form of Indemnification Agreement between the Company and each of its directors.*
	12	.1	Computation of ratio of earnings to fixed charges.*
	16	.1	Letter from KPMG LLP dated May 31, 2006.(31)
	21	.1	Subsidiaries of Alion Science and Technology Corporation are wholly-owned (either directly or indirectly) by Alion Science and Technology Corporation:
			(i) Human Factors Applications, Inc., incorporated in the Commonwealth of Pennsylvania,
			(ii) Innovative Technology Solutions Corporation, incorporated in the State of New Mexico,
			(iii) Alion — IPS Corporation, incorporated in the Commonwealth of Virginia,
			(iv) Alion — METI Corporation, incorporated in the Commonwealth of Virginia,
			(v) Alion — CATI Corporation, incorporated in the State of California,
			(vi) Alion — JJMA Corporation, incorporated in the State of New York,
			(vii) Alion Technical Services Corporation, incorporated in the Commonwealth of Virginia,
			(viii) Alion Technical Services Corporation, incorporated in the State of Delaware,
			(ix) Alion Canada (US) Corporation, incorporated in the State of Delaware,
			(x) Alion Science and Technology (Canada) Corporation, incorporated in the Province of Nova Scotia,
			(xi) Alion — BMH Corporation, incorporated in the Commonwealth of Virginia,
			(xii) Washington Consulting, Inc., incorporated in the Commonwealth of Virginia, and
			(xiii) Alion — MA&D Corporation, incorporated in the State of Colorado
	23	.1	Consent of KPMG LLP. *
	23	.2	Consent of Deloitte & Touche LLP.*
	23	.3	Consent of Baker & McKenzie (contained in Exhibit 5.1).*
	24	.1	Power of Attorney (included on the signature page of the Registration Statement).*
	25	.1	Statement of Eligibility and Qualification under the Trust Indenture Act of 1939, as amended, of Wilmington Trust Company, as trustee under the Indenture on Form T-1.*
	99	.1	Form of Letter of Transmittal.*
	99	.2	Form of Notice of Guaranteed Delivery.*
	99	.3	Form of Letter to Registered Holders and Depository Trust Company Participants.*
	99	.4	Form of Letter to Holders.*
	99	.5	Form of Exchange Agent Agreement.*

*	Filed herewith.
(1)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s annual report on Form 10-K for the fiscal year ended September 30, 2006, filed with the Securities and Exchange Commission on December 1, 2006.
(2)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s quarterly report on Form 10-Q for the quarterly period ended March 31, 2005, filed with the Securities and Exchange Commission on May 13, 2005.
(3)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K, filed with the Securities and Exchange Commission on February 8, 2007.
(4)	Incorporated by reference to exhibit 10.84 previously filed as an exhibit to the Company’s Form 8-K, filed with the Securities and Exchange Commission on February 8, 2007.
(5)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Post-Effective Amendment No. 3 to the Registration Statement on Form S-1, filed with the Securities and Exchange Commission on March 24, 2003.

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(6)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s quarterly report on Form 10-Q for the quarterly period ended December 12, 2002, filed with the Securities and Exchange Commission on February 3, 2003.
(7)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s quarterly report on Form 10-Q for the quarterly period ended March 31, 2004, filed with the Securities and Exchange Commission on May 17, 2004.
(8)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s quarterly report on Form 10-Q for the quarterly period ended June 30, 2004, filed with the Securities and Exchange Commission on August 13, 2004.
(9)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s annual report on Form 10-K for the fiscal year ended September 30, 2004, filed with the Securities and Exchange Commission on December 28, 2004.
(10)	Company’s Post-effective Amendment No. 5 to the Registration Statement on Form S-1, filed with the Securities and Exchange Commission on January 24, 2005.
(11)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K, filed with the Securities and Exchange Commission on March 9, 2005.
(12)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K, filed with the Securities and Exchange Commission on March 14, 2005.
(13)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K/A,filed with the Securities and Exchange Commission on April 6, 2005.
(14)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K, filed with the Securities and Exchange Commission on April 6, 2005.
(15)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K, filed with the Securities and Exchange Commission on December 2, 2005.
(16)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K, filed with the Securities and Exchange Commission on February 23, 2006.
(17)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K, filed with the Securities and Exchange Commission on March 29, 2006.
(18)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K, filed with the Securities and Exchange Commission on March 31, 2006.
(19)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K, filed with the Securities and Exchange Commission on June 7, 2006.
(20)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K, filed with the Securities and Exchange Commission on July 7, 2006 (0000950133-06-003209).
(21)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K, filed with the Securities and Exchange Commission on July 7, 2006 (0000950133-06-003212).
(22)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K, filed with the Securities and Exchange Commission on July 7, 2006 (0000950133-06-003210).
(23)	Incorporated by reference to exhibit 10.73 previously filed as an exhibit to the Company’s quarterly report on Form 10-Q for the quarterly period ended June 30, 2006, filed with the Securities and Exchange Commission on August 14, 2006.
(24)	Incorporated by reference to exhibit 10.74 previously filed as an exhibit to the Company’s quarterly report on Form 10-Q for the quarterly period ended June 30, 2006, filed with the Securities and Exchange Commission on August 14, 2006.

II-9

(25)	Incorporated by reference to exhibit 10.75 previously filed as an exhibit to the Company’s quarterly report on Form 10-Q for the quarterly period ended June 30, 2006, filed with the Securities and Exchange Commission on August 14, 2006.
(26)	Incorporated by reference to exhibit 10.76 previously filed as an exhibit to the Company’s quarterly report on Form 10-Q for the quarterly period ended June 30, 2006, filed with the Securities and Exchange Commission on August 14, 2006.
(27)	Incorporated by reference to exhibit 10.77 previously filed as an exhibit to the Company’s quarterly report on Form 10-Q for the quarterly period ended June 30, 2006, filed with the Securities and Exchange Commission on August 14, 2006.
(28)	Incorporated by reference to exhibit 10.78 previously filed as an exhibit to the Company’s quarterly report on Form 10-Q for the quarterly period ended June 30, 2006, filed with the Securities and Exchange Commission on August 14, 2006.
(29)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K, filed with the Securities and Exchange Commission on December 14, 2006.
(30)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K, filed with the Securities and Exchange Commission on January 10, 2007.
(31)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K/A, filed with the Securities and Exchange Commission on June 1, 2006.

(b)   Financial Statement Schedules

Consolidated Financial Statement Schedule

Schedule II — Valuation and Qualifying Accounts (in thousands)

Allowance for
Doubtful	Balance at		Charged to								Balance
Accounts	Beginning		Costs and								at End of
Receivable	of Year		Expenses		Deductions(1)			Acquisitions			Year
Fiscal year ended 2004	$	2,484	$	659	$	(791	)	$	544	(2)	$	2,896
Fiscal year ended 2005	$	2,896	$	700	$	(970	)	$	913	(3)	$	3,539
Fiscal year ended 2006	$	3,539	$	667	$	(462	)	$	217	(4)	$	3,961

(1)	Accounts receivable written off against the allowance for doubtful accounts.
(2)	Adjustments pursuant to the allocation of purchase price to assets acquired and liabilities assumed in Alion’s acquisitions of ITSC and IPS.
(3)	Adjustments pursuant to the allocation of purchase price to assets acquired and liabilities assumed in Alion’s acquisitions of CATI, METI, and JJMA.
(4)	Adjustments pursuant to the allocation of purchase price to assets acquired and liabilities assumed in Alion’s acquisitions of BMH, WCI, and MA&D.

ITEM 22.   Undertakings.

(a) The undersigned registrant hereby undertakes:

(1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:

(i) To include any prospectus required by section 10(a)(3) of the Securities Act of 1933;

(ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any

II-10

deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Securities and Exchange Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement; and

(iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement;

Provided, however, That:

(A) Paragraphs (a)(1)(i) and (a)(1)(ii) of this section do not apply if the registration statement is on Form S-8, and the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the Commission by the registrant pursuant to section 13 or section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement; and

(B) Paragraphs (a)(1)(i), (a)(1)(ii) and (a)(1)(iii) of this section do not apply if the registration statement is on Form S-3 or Form F-3 and the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the Commission by the registrant pursuant to section 13 or section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement, or is contained in a form of prospectus filed pursuant to Rule 424(b) that is part of the registration statement.

(C) Provided further, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the registration statement is for an offering of asset-backed securities on Form S-1 or Form S-3, and the information required to be included in a post-effective amendment is provided pursuant to Item 1100(c) of Regulation AB.

(2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

(3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

(4) That, for purposes of determining liability under the Securities Act of 1933 to any purchaser:

If the registrant is subject to Rule 430C, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.

(5) That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities:

The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means

II-11

of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:

(i) Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;

(ii) Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;

(iii) The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and

(iv) Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.

(b) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

(c) The undersigned registrant hereby undertakes to respond to requests for information that is incorporated by reference into the prospectus pursuant to Items 4, 10(b), 11, or 13 of this Form, within one business day of receipt of such request, and to send the incorporated documents by first class mail or other equally prompt means. This includes information contained in documents filed subsequent to the effective date of the registration statement through the date of responding to the request.

(d) The undersigned registrant hereby undertakes to supply by means of a post-effective amendment all information concerning a transaction, and the company being acquired involved therein, that was not the subject of and included in the registration statement when it became effective.

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the city of McLean, state of Virginia, on April 25, 2007.

ALION SCIENCE AND TECHNOLOGY CORPORATION

By:  /s/  Bahman Atefi

Bahman Atefi

Chairman, Chief Executive Officer and Director

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Bahman Atefi and James Fontana, and each of them severally, his or her true and lawful attorney or attorneys-in-fact and agents, with full power to act with or without the others and with full power of substitution and resubstitution, to execute in his or her name, place and stead, in any and all capacities, any or all amendments (including pre-effective or post-effective amendments) to this Registration Statement and any registration statement for the same offering filed pursuant to Rule 462 under the Securities Act of 1933, as amended, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting to said attorneys-in-fact and agents and each of them, full power and authority to do and perform in the name and on behalf of the undersigned, in any and all capacities, each and every act and thing necessary or desirable to be done in and about the premises, to all intents and purposes and as fully as they might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or their substitutes may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities indicated.

Signature	Title	Date
/s/  Bahman Atefi Bahman Atefi	Chairman, Chief Executive Officer and Director	April 25, 2007
/s/  Jack Hughes Jack Hughes	Chief Financial Officer (Principal Financial Officer)	April 25, 2007
/s/  Gary Amstutz Gary Amstutz	Senior Vice President and Executive Director of Finance (Principal Accounting Officer)	April 25, 2007
/s/  Edward C. Aldridge, Jr. Edward C. Aldridge, Jr.	Director	April 26, 2007

II-14

Signature	Title	Date
/s/  Lewis Collens Lewis Collens	Director	April 28, 2007
/s/  Admiral (Ret.) Harold W. Gehman, Jr. Admiral (Ret.) Harold W. Gehman, Jr.	Director	April 27, 2007
/s/  Donald E. Goss Donald E. Goss	Director	April 26, 2007
/s/  Leslie Armitage Leslie Armitage	Director	April 26, 2007
General (Ret.) George A. Joulwan	Director	April   , 2007
/s/  General (Ret.) Michael E. Ryan General (Ret.) Michael E. Ryan	Director	April 25, 2007

II-15

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the city of McLean, state of Virginia, on April 24, 2007.

ALION — BMH CORPORATION

By:  /s/  Rob Goff

Rob Goff

President

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Bahman Atefi and James Fontana, and each of them severally, his or her true and lawful attorney or attorneys-in-fact and agents, with full power to act with or without the others and with full power of substitution and resubstitution, to execute in his or her name, place and stead, in any and all capacities, any or all amendments (including pre-effective or post-effective amendments) to this Registration Statement and any registration statement for the same offering filed pursuant to Rule 462 under the Securities Act of 1933, as amended, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting to said attorneys-in-fact and agents and each of them, full power and authority to do and perform in the name and on behalf of the undersigned, in any and all capacities, each and every act and thing necessary or desirable to be done in and about the premises, to all intents and purposes and as fully as they might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or their substitutes may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities indicated.

Signature	Title	Date
/s/  Rob Goff Rob Goff	President and Director	April 24, 2007
/s/  Jack Hughes Jack Hughes	Treasurer and Director (Principal Financial Officer)	April 25, 2007
/s/  James Fontana James Fontana	Secretary and Director	April 25, 2007

II-16

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the city of McLean, state of Virginia, on April 24, 2007.

ALION — CATI CORPORATION

By:  /s/  Rob Goff

Rob Goff

President

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Bahman Atefi and James Fontana, and each of them severally, his or her true and lawful attorney or attorneys-in-fact and agents, with full power to act with or without the others and with full power of substitution and resubstitution, to execute in his or her name, place and stead, in any and all capacities, any or all amendments (including pre-effective or post-effective amendments) to this Registration Statement and any registration statement for the same offering filed pursuant to Rule 462 under the Securities Act of 1933, as amended, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting to said attorneys-in-fact and agents and each of them, full power and authority to do and perform in the name and on behalf of the undersigned, in any and all capacities, each and every act and thing necessary or desirable to be done in and about the premises, to all intents and purposes and as fully as they might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or their substitutes may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities indicated.

Signature	Title	Date
/s/  Rob Goff Rob Goff	President and Director	April 24, 2007
/s/  Jack Hughes Jack Hughes	Treasurer and Director (Principal Financial Officer)	April 25, 2007
/s/  James Fontana James Fontana	Secretary and Director	April 25, 2007

II-17

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the city of McLean, state of Virginia, on April 24, 2007.

ALION — JJMA CORPORATION

By:  /s/  Rob Goff

Rob Goff

President

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Bahman Atefi and James Fontana, and each of them severally, his or her true and lawful attorney or attorneys-in-fact and agents, with full power to act with or without the others and with full power of substitution and resubstitution, to execute in his or her name, place and stead, in any and all capacities, any or all amendments (including pre-effective or post-effective amendments) to this Registration Statement and any registration statement for the same offering filed pursuant to Rule 462 under the Securities Act of 1933, as amended, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting to said attorneys-in-fact and agents and each of them, full power and authority to do and perform in the name and on behalf of the undersigned, in any and all capacities, each and every act and thing necessary or desirable to be done in and about the premises, to all intents and purposes and as fully as they might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or their substitutes may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities indicated.

Signature	Title	Date
/s/  Rob Goff Rob Goff	President and Director	April 24, 2007
/s/  Jack Hughes Jack Hughes	Treasurer and Director (Principal Financial Officer)	April 25, 2007
/s/  James Fontana James Fontana	Secretary and Director	April 25, 2007

II-18

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the city of McLean, state of Virginia, on April 25, 2007.

ALION — MA&D CORPORATION

By:  /s/  Stacy Mendler

Stacy Mendler

President

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Bahman Atefi and James Fontana, and each of them severally, his or her true and lawful attorney or attorneys-in-fact and agents, with full power to act with or without the others and with full power of substitution and resubstitution, to execute in his or her name, place and stead, in any and all capacities, any or all amendments (including pre-effective or post-effective amendments) to this Registration Statement and any registration statement for the same offering filed pursuant to Rule 462 under the Securities Act of 1933, as amended, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting to said attorneys-in-fact and agents and each of them, full power and authority to do and perform in the name and on behalf of the undersigned, in any and all capacities, each and every act and thing necessary or desirable to be done in and about the premises, to all intents and purposes and as fully as they might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or their substitutes may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities indicated.

Signature	Title	Date
/s/  Stacy Mendler Stacy Mendler	President and Director	April 25, 2007
/s/  Jack Hughes Jack Hughes	Treasurer and Director (Principal Financial Officer)	April 25, 2007
/s/  James Fontana James Fontana	Secretary and Director	April 25, 2007

II-19

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the city of McLean, state of Virginia, on April 25, 2007.

ALION — METI CORPORATION

By:  /s/  Stacy Mendler

Stacy Mendler

President

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Bahman Atefi and James Fontana, and each of them severally, his or her true and lawful attorney or attorneys-in-fact and agents, with full power to act with or without the others and with full power of substitution and resubstitution, to execute in his or her name, place and stead, in any and all capacities, any or all amendments (including pre-effective or post-effective amendments) to this Registration Statement and any registration statement for the same offering filed pursuant to Rule 462 under the Securities Act of 1933, as amended, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting to said attorneys-in-fact and agents and each of them, full power and authority to do and perform in the name and on behalf of the undersigned, in any and all capacities, each and every act and thing necessary or desirable to be done in and about the premises, to all intents and purposes and as fully as they might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or their substitutes may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities indicated.

Signature	Title	Date
/s/  Stacy Mendler Stacy Mendler	President and Director	April 25, 2007
/s/  Jack Hughes Jack Hughes	Treasurer and Director (Principal Financial Officer)	April 25, 2007
/s/  James Fontana James Fontana	Secretary and Director	April 25, 2007

II-20

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the city of McLean, state of Virginia, on April 25, 2007.

HUMAN FACTORS APPLICATIONS, INC.

By:  /s/  Randy Crawford

Randy Crawford

President

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Bahman Atefi and James Fontana, and each of them severally, his or her true and lawful attorney or attorneys-in-fact and agents, with full power to act with or without the others and with full power of substitution and resubstitution, to execute in his or her name, place and stead, in any and all capacities, any or all amendments (including pre-effective or post-effective amendments) to this Registration Statement and any registration statement for the same offering filed pursuant to Rule 462 under the Securities Act of 1933, as amended, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting to said attorneys-in-fact and agents and each of them, full power and authority to do and perform in the name and on behalf of the undersigned, in any and all capacities, each and every act and thing necessary or desirable to be done in and about the premises, to all intents and purposes and as fully as they might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or their substitutes may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities indicated.

Signature	Title	Date
/s/  Randy Crawford Randy Crawford	President and Director	April 25, 2007
/s/  Chris Amos Chris Amos	Vice President and Director	April 25, 2007
/s/  Jack Hughes Jack Hughes	Treasurer (Principal Financial Officer)	April 25, 2007
/s/  James Fontana James Fontana	Director	April 25, 2007
/s/  Bahman Atefi Bahman Atefi	Director	April 25, 2007
/s/  Stacy Mendler Stacy Mendler	Director	April 25, 2007

II-21

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the city of McLean, state of Virginia, on April 24, 2007.

WASHINGTON CONSULTING, INC.

By:  /s/  JP Foley

JP Foley

President

POWER OF ATTORNEY

KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Bahman Atefi and James Fontana, and each of them severally, his or her true and lawful attorney or attorneys-in-fact and agents, with full power to act with or without the others and with full power of substitution and resubstitution, to execute in his or her name, place and stead, in any and all capacities, any or all amendments (including pre-effective or post-effective amendments) to this Registration Statement and any registration statement for the same offering filed pursuant to Rule 462 under the Securities Act of 1933, as amended, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting to said attorneys-in-fact and agents and each of them, full power and authority to do and perform in the name and on behalf of the undersigned, in any and all capacities, each and every act and thing necessary or desirable to be done in and about the premises, to all intents and purposes and as fully as they might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or their substitutes may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities indicated.

Signature	Title	Date
/s/  JP Foley JP Foley	President	April 24, 2007
/s/  Jack Hughes Jack Hughes	Vice President, Treasurer and Director (Principal Financial Officer)	April 25, 2007
/s/  James Fontana James Fontana	Secretary and Director	April 25, 2007
/s/  Stacy Mendler Stacy Mendler	Director	April 25, 2007

II-22

EXHIBITS INDEX

Exhibit
Number			Exhibit
	3	.2	Amended and Restated By-Laws of Alion Science and Technology Corporation.(1)
	3	.3	Third Amended and Restated Certificate of Incorporation of Alion Science and Technology Corporation.(2)
	3	.4	Amended and Restated Bylaws of Human Factors Applications, Inc.*
	3	.5	Certificate of Incorporation of Human Factors Application, Inc.*
	3	.6	Statement of Change of Registered Office of Human Factors Applications, Inc.*
	3	.7	Statement of Correction of Human Factors Application, Inc.*
	3	.8	Statement of Change of Registered Office of Human Factors Applications, Inc.*
	3	.9	First Amended and Restated Bylaws of ManTech Environmental Technology, Inc. (now known as Alion — METI Corporation).*
	3	.10	Amended and Restated Articles of Incorporation of Alion — METI Corporation.*
	3	.11	Amended and Restated Bylaws of Alion — CATI Corporation.*
	3	.12	Articles of Incorporation of Carmel Applied Technologies, Inc. (now known as Alion — CATI Corporation).*
	3	.13	Certificate of Amendment of Articles of Incorporation of Carmel Applied Technologies, Inc. (now known as Alion — CATI Corporation).*
	3	.14	Certificate of Amendment of the Articles of Incorporation of Carmel Applied Technologies, Inc. changing its name to Alion — CATI Corporation.*
	3	.15	Amended and Restated Bylaws of Alion — JJMA Corporation.*
	3	.16	Restated Articles of Incorporation of Alion — JJMA Corporation.*
	3	.17	Bylaws of Washington Consulting, Inc.*
	3	.18	Articles of Incorporation of Washington Consulting, Inc.*
	3	.19	Bylaws of BMH Associates, Inc. (now known as Alion — BMH Corporation).*
	3	.20	Articles of Incorporation of BMH Associates, Inc. (now known as Alion — BMH Corporation).*
	3	.21	Articles of Amendment to the Articles of Incorporation of BMH Associates, Inc. changing its name to Alion — BMH Corporation.*
	3	.22	Articles of Incorporation of Micro Analysis & Design, Inc. (now known as Alion — MA&D Corporation).*
	3	.23	Articles of Amendment to the Articles of Incorporation of Micro Analysis & Design, Inc. changing its name to Alion — MA&D Corporation.*
	3	.24	Bylaws of Micro Analysis & Design, Inc. (now known as Alion — MA&D Corporation).*
	4	.16	Indenture, dated February 8, 2007, among Alion Science and Technology Corporation, certain subsidiary guarantors of the Company and Wilmington Trust Company, as trustee.(3)
	4	.17	Form of 101/4% Note due 2015.(3)
	4	.18	Registration Rights Agreement, dated February 8, 2007, by and among the Company, HFA, METI, CATI, JJMA, BMH, WCI, MA&D and Credit Suisse Securities (USA) LLC.(4)
	4	.19	Amended and Restated Alion Science and Technology Corporation Employee Ownership Savings and Investment Plan.*
	5	.1	Opinion of Baker & McKenzie.*
	10	.5	Seller Note Securities Purchase Agreement by and between IIT Research Institute and Alion Science and Technology Corporation.(5)
	10	.7	Seller Warrant Agreement by and among Alion Science and Technology Corporation, IIT Research Institute and Alion Science and Technology Employee Ownership, Savings and Investment Trust.(6)
	10	.8	Rights Agreement by and among Alion Science and Technology Corporation, IIT Research Institute and Alion Science and Technology Employee Ownership, Savings and Investment Trust.(5)

Exhibit
Number			Exhibit
	10	.14	Employment Agreement between Alion Science and Technology Corporation and Bahman Atefi.(5)
	10	.15	Employment Agreement between Alion Science and Technology Corporation and Stacy Mendler.(5)
	10	.16	Employment Agreement between Alion Science and Technology Corporation and Randy Crawford.(5)
	10	.18	Employment Agreement between Alion Science and Technology Corporation and John Hughes.(5)
	10	.31	Agreement between Alion Science and Technology Corporation and James Fontana.(7)
	10	.32	Employment Agreement between Alion Science and Technology Corporation and Leroy R. Goff III.(7)
	10	.34	Addendum to Employment Agreement between Alion Science and Technology Corporation and James Fontana.(8)
	10	.36	Senior Secured Credit facility that includes a revolving credit facility and Term B note, by and among Credit Suisse First Boston as arranger, various lenders, and Alion Science and Technology Corporation.(9)
	10	.38	First Amendment to the Seller Warrant Agreement.(9)
	10	.46	Second Amendment to the Seller Warrant Agreement.(10)
	10	.49	Commitment letter agreement by and between Alion Science and Technology Corporation and Credit Suisse First Boston.(11)
	10	.50	Third Amendment to the Seller Warrant Agreement.(12)
	10	.53	Stock Purchase Agreement by and among Alion Science and Technology Corporation, John J. McMullen Associates, Inc., Marshall and Ilsley Trust Company, N.A. as Trustee to the John J. McMullen, Inc. Employee Stock Ownership Trust and P. Thomas Diamant, Anthony Serro, and David Hanafourde.(13)
	10	.54	Incremental Term Loan Assumption Agreement and Amendment Number One to existing Term Loan Facility with Credit Suisse First.(14)
	10	.57	Alion Science and Technology Corporation Board of Directors Phantom Stock Plan.(15)
	10	.58	Amended and Restated Alion Science and Technology Corporation Phantom Stock Plan.(15)
	10	.59	Amended and Restated Alion Science and Technology Corporation Performance Shares and Retention Phantom Stock Plan.(15)
	10	.60	Amended and Restated Alion Science and Technology Corporation 2002 Stock Appreciation Rights Plan.(15)
	10	.61	Amended and Restated Alion Science and Technology Corporation 2004 Stock Appreciation Rights Plan.(15)
	10	.62	Amended and Restated Alion Science and Technology Corporation Executive Deferred Compensation Plan.(15)
	10	.63	Amended and Restated Alion Science and Technology Corporation Director Deferred Compensation Plan.(15)
	10	.64	Commitment letter by and between Alion Science and Technology Corporation, Credit Suisse and Credit Suisse Securities (USA) LLC.(16)
	10	.65	Incremental Term Loan Assumption Agreement and Amendment No. 2 dated as of March 24, 2006, by and among Alion Science and Technology Corporation, HFA, METI, CATI, JJMA, BMH, WCI, Credit Suisse, and the lenders party thereto.(17)
	10	.66	Fourth Amendment to the Seller Warrant Agreement by and among Alion Science and Technology Corporation, Illinois Institute of Technology and Alion Science and Technology Employee Ownership, Savings and Investment Trust.(18)
	10	.67	Mezzanine Warrant Redemption Agreement between Alion Science and Technology Corporation and Illinois Institute of Technology.(18)
	10	.68	Alion Mezzanine Warrant Redemption Agreement between Alion Science and Technology Corporation, and Bahman Atefi.(18)

Exhibit
Number			Exhibit
	10	.69	Asset Purchase Agreement dated as of June 4, 2006, by and between Anteon Corporation, Alion Technical Services Corporation and Alion Science and Technology Corporation.(19)
	10	.70	Incremental Term Loan Assumption Agreement and Amendment No. 3 dated as of June 30, 2006, by and among Alion Science and Technology Corporation, HFA, METI, CATI, JJMA, BMH, WCI, MA&D, Credit Suisse, and the lenders party thereto.(20)
	10	.71	Bridge Loan Agreement dated as of June 30, 2006, by and among Alion Science and Technology Corporation, HFA, METI, CATI, JJMA, BMH, WCI, MA&D, Credit Suisse, and the lenders party thereto.(20)
	10	.72	Closing Letter Agreement dated as of June 30, 2006, by and among Alion Science and Technology Corporation, Alion Technical Services Corporation and Anteon Corporation.(21)
	10	.73	First Amendment to Seller Note Securities Purchase Agreement dated as June 30, 2006, by and between Alion Science and Technology Corporation and Illinois Institute of Technology.(22)
	10	.74	Separation Agreement between Alion Science and Technology Corporation and Barry Watson.(23)
	10	.75	Second Addendum to Employment Agreement between Alion Science and Technology Corporation and James Fontana.(24)
	10	.76	Commitment letter by and between Alion Science and Technology Corporation, Credit Suisse and Credit Suisse Securities (USA) LLC. (25)
	10	.77	Amendment to Offer of Promotion between Alion Science and Technology Corporation and Leroy R. Goff III.(26)
	10	.78	Offer Letter between Alion Science and Technology Corporation and Scott A. Fry.(27)
	10	.79	Addendum to Offer Letter between Alion Science and Technology Corporation and Scott A. Fry.(28)
	10	.80	Amendment No. 1 to the Bridge Loan Agreement dated as of December 11, 2006, by and among Alion Science and Technology Corporation, certain subsidiary guarantors, Credit Suisse, and the lenders party thereto.(29)
	10	.81	Incremental Term Loan Assumption Agreement dated as of January 4, 2007, by and among the Company, HFA, METI, CATI, JJMA, BMH, WCI, MA&D, Credit Suisse, and the lenders party thereto, related to the Credit Agreement (as amended from time to time) dated as of August 2, 2004, by and among the Company, HFA, METI, CATI, JJMA, BMH, WCI and MA&D, the lenders from time to time party to the Credit Agreement (the “Lenders”), and Credit Suisse, as administrative agent and as collateral agent for the Lenders.(30)
	10	.82	Purchase Agreement dated January 26, 2007, by and among the Company, HFA, METI, CATI, JJMA, BMH, WCI, MA&D and Credit Suisse Securities (USA) LLC.(3)
	10	.83	Amendment No. 4 dated as of February 6, 2007, by and among the Company, HFA, METI, CATI, JJMA, BMH, WCI, MA&D, Credit Suisse, and the lenders party thereto, related to the Credit Agreement (as amended from time to time) dated as of August 2, 2004, by and among the Company, HFA, METI, CATI, JJMA, BMH, WCI and MA&D, certain lenders from time to time party to the Credit Agreement (the “Lenders”), and Credit Suisse, as administrative agent and as collateral agent for the Lenders.(3)
	10	.84	Registration Rights Agreement dated February 8, 2007, by and among the Company, HFA, METI, CATI, JJMA, BMH, WCI, MA&D and Credit Suisse Securities (USA) LLC.(4)
	10	.85	Form of Indemnification Agreement between the Company and each of its directors.*
	12	.1	Computation of ratio of earnings to fixed charges.*
	16	.1	Letter from KPMG LLP dated May 31, 2006.(31)

Exhibit
Number			Exhibit
	21	.1	Subsidiaries of Alion Science and Technology Corporation are wholly-owned (either directly or indirectly) by Alion Science and Technology Corporation:
			(i) Human Factors Applications, Inc., incorporated in the Commonwealth of Pennsylvania,
			(ii) Innovative Technology Solutions Corporation, incorporated in the State of New Mexico,
			(iii) Alion — IPS Corporation, incorporated in the Commonwealth of Virginia,
			(iv) Alion — METI Corporation, incorporated in the Commonwealth of Virginia,
			(v) Alion — CATI Corporation, incorporated in the State of California,
			(vi) Alion — JJMA Corporation, incorporated in the State of New York,
			(vii) Alion Technical Services Corporation, incorporated in the Commonwealth of Virginia,
			(viii) Alion Technical Services Corporation, incorporated in the State of Delaware,
			(ix) Alion Canada (US) Corporation, incorporated in the State of Delaware,
			(x) Alion Science and Technology (Canada) Corporation, incorporated in the Province of Nova Scotia,
			(xi) Alion — BMH Corporation, incorporated in the Commonwealth of Virginia,
			(xii) Washington Consulting, Inc., incorporated in the Commonwealth of Virginia, and
			(xiii) Alion — MA&D Corporation, incorporated in the State of Colorado.
	23	.1	Consent of KPMG LLP.*
	23	.2	Consent of Deloitte & Touche LLP.*
	23	.3	Consent of Baker & McKenzie (contained in Exhibit 5.1).*
	24	.1	Power of Attorney (included on the signature page of the Registration Statement).*
	25	.1	Statement of Eligibility and Qualification under the Trust Indenture Act of 1939, as amended, of Wilmington Trust Company, as trustee under the Indenture on Form T-1.*
	99	.1	Form of Letter of Transmittal.*
	99	.2	Form of Notice of Guaranteed Delivery.*
	99	.3	Form of Letter to Registered Holders and Depository Trust Company Participants.*
	99	.4	Form of Letter to Holders.*
	99	.5	Form of Exchange Agent Agreement.*

*	Filed herewith.
(1)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s annual report on Form 10-K for the fiscal year ended September 30, 2006, filed with the Securities and Exchange Commission on December 1, 2006.
(2)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s quarterly report on Form 10-Q for the quarterly period ended March 31, 2005, filed with the Securities and Exchange Commission on May 13, 2005.
(3)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K, filed with the Securities and Exchange Commission on February 8, 2007.
(4)	Incorporated by reference to exhibit 10.84 previously filed as an exhibit to the Company’s Form 8-K, filed with the Securities and Exchange Commission on February 8, 2007.
(5)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Post-Effective Amendment No. 3 to the Registration Statement on Form S-1, filed with the Securities and Exchange Commission on March 24, 2003.
(6)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s quarterly report on Form 10-Q for the quarterly period ended December 12, 2002, filed with the Securities and Exchange Commission on February 3, 2003.

(7)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s quarterly report on Form 10-Q for the quarterly period ended March 31, 2004, filed with the Securities and Exchange Commission on May 17, 2004.
(8)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s quarterly report on Form 10-Q for the quarterly period ended June 30, 2004, filed with the Securities and Exchange Commission on August 13, 2004.
(9)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s annual report on Form 10-K for the fiscal year ended September 30, 2004, filed with the Securities and Exchange Commission on December 28, 2004.
(10)	Company’s Post-effective Amendment No. 5 to the Registration Statement on Form S-1, filed with the Securities and Exchange Commission on January 24, 2005.
(11)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K, filed with the Securities and Exchange Commission on March 9, 2005.
(12)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K, filed with the Securities and Exchange Commission on March 14, 2005.
(13)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K/A,filed with the Securities and Exchange Commission on April 6, 2005.
(14)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K, filed with the Securities and Exchange Commission on April 6, 2005.
(15)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K, filed with the Securities and Exchange Commission on December 2, 2005.
(16)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K, filed with the Securities and Exchange Commission on February 23, 2006.
(17)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K, filed with the Securities and Exchange Commission on March 29, 2006.
(18)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K, filed with the Securities and Exchange Commission on March 31, 2006.
(19)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K, filed with the Securities and Exchange Commission on June 7, 2006.
(20)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K, filed with the Securities and Exchange Commission on July 7, 2006 (0000950133-06-003209).
(21)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K, filed with the Securities and Exchange Commission on July 7, 2006 (0000950133-06-003212).
(22)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K, filed with the Securities and Exchange Commission on July 7, 2006 (0000950133-06-003210).
(23)	Incorporated by reference to exhibit 10.73 previously filed as an exhibit to the Company’s quarterly report on Form 10-Q for the quarterly period ended June 30, 2006, filed with the Securities and Exchange Commission on August 14, 2006.
(24)	Incorporated by reference to exhibit 10.74 previously filed as an exhibit to the Company’s quarterly report on Form 10-Q for the quarterly period ended June 30, 2006, filed with the Securities and Exchange Commission on August 14, 2006.
(25)	Incorporated by reference to exhibit 10.75 previously filed as an exhibit to the Company’s quarterly report on Form 10-Q for the quarterly period ended June 30, 2006, filed with the Securities and Exchange Commission on August 14, 2006.
(26)	Incorporated by reference to exhibit 10.76 previously filed as an exhibit to the Company’s quarterly report on Form 10-Q for the quarterly period ended June 30, 2006, filed with the Securities and Exchange Commission on August 14, 2006.

(27)	Incorporated by reference to exhibit 10.77 previously filed as an exhibit to the Company’s quarterly report on Form 10-Q for the quarterly period ended June 30, 2006, filed with the Securities and Exchange Commission on August 14, 2006.
(28)	Incorporated by reference to exhibit 10.78 previously filed as an exhibit to the Company’s quarterly report on Form 10-Q for the quarterly period ended June 30, 2006, filed with the Securities and Exchange Commission on August 14, 2006.
(29)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K, filed with the Securities and Exchange Commission on December 14, 2006.
(30)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K, filed with the Securities and Exchange Commission on January 10, 2007.
(31)	Incorporated by reference to the corresponding exhibit previously filed as an exhibit to the Company’s Form 8-K/A, filed with the Securities and Exchange Commission on June 1, 2006.

EX-3.4

Exhibit 3.4

AMENDED AND RESTATED
BY-LAWS
OF
HUMAN FACTORS APPLICATIONS, INC.

ARTICLE I – OFFICES

     1. The registered office of the corporation shall be at 8 Jay Gould Court, Unit D, Waldorf, Maryland 20602.

     2. The corporation may also have offices at such other places as the Board of Directors may from time to time appoint or the business of the corporation may require.

ARTICLE II – SEAL

     1. The corporation seal shall have inscribed thereon the name of the corporation, the year of its organization and the words “Corporate Seal, Pennsylvania”.

ARTICLE III — SHAREHOLDERS’ MEETING

     1. Meetings of the shareholders shall be held at the registered office of the corporation or at such other place or places, either within or without the Commonwealth of Pennsylvania, as may from time to time be selected.

     2. The annual meeting of the shareholders shall be held at least once per year at such time as is specified in the notice of annual meeting, when they shall elect a Bard of Directors, and transact such other business as may properly be brought before the meeting. If the annual meeting shall not be called and held during any calendar year, any shareholder may call such meeting at any time thereafter.

     3. The presence, in person or by proxy, of shareholders entitled to cast at least a majority of the votes which all shareholders are entitled to cast on the particular matter shall constitute a quorum for the purpose of considering such matter, and, unless otherwise provided by statute the acts, at a duly organized meeting, of the shareholders present, in person or by proxy, entitled to cast at least a majority of the votes which all shareholders present are entitled to cast shall be the acts of the shareholders. The shareholders present at a duly organized meeting can continue to do business until adjournment, not-withstanding the withdrawal of enough shareholders to leave less than a quorum. Adjournment or adjournments of any annual or special meeting may be taken, but any meeting at which directors are to be elected shall be adjourned only from day to day, or for such longer periods not exceeding fifteen days each, as may be

directed by shareholders who are present in person or by proxy and who are entitled to cast at least a majority of the votes which all such shareholders would be entitled to cast at an election of directors until such directors have been elected. If a meeting cannot be organized because a quorum has not attended, those present may, except as otherwise provided by statute, adjourn the meeting to such time and place as they may determine, but in the case of any meeting called for the election of directors, those who attend the second of such adjourned meetings, although less than a quorum, shall nevertheless constitute a quorum for the purpose of electing directors.

     4. Every shareholder entitled to vote at a meeting of shareholders, or to express consent or dissent to corporate action in writing without a meeting, may authorize another person or persons to act for him by proxy. Every proxy shall be executed in writing by the shareholders, or by his duly authorized attorney in fact, and filed with the Secretary of the corporation. A proxy, unless coupled with an interest, shall be revocable at will, notwithstanding any other agreement or any provision in the proxy to the contrary, but the revocation of a proxy shall not be effective until notice thereof has been given to the Secretary of the corporation. No unrevoked proxy shall be valid after eleven months from the date of its execution, unless a longer time is expressly provided therein, but in no event shall a proxy, unless coupled with an interest, be voted on after three years from the date of its execution. A proxy shall not be revoked by the death or incapacity of the maker unless before the vote is counted or the authority is exercised, written notice of such death or incapacity is given to the Secretary of the corporation. A shareholder shall not sell his vote or execute a proxy to any person for any sum of money or anything of value. A proxy coupled with an interest shall include an unrevoked proxy in favor of a creditor of a shareholder and such proxy shall be valid so long as the debt owed by him to the creditor remains unpaid. Elections for directors need not be by ballot, except upon demand made by a shareholder at the election and before the voting begins. Except as otherwise provided in the Articles, in each election of directors cumulative voting shall be allowed. No share shall be voted at any meeting upon which any installment is due and unpaid.

     5. Written notice of the annual meeting shall be given to each shareholder entitled to vote thereat, at least ten days prior to the meeting.

     6. In advance of any meeting of shareholders, the Board of Directors may appoint judges of election, who need not be shareholders, to act at such meeting or any adjournment thereof. If judges of election be not so appointed, the chairman of any such meeting may, and on the request of any shareholder or his proxy shall, make such appointment at any meeting. The number of judges shall be one or three. If appointed at a meeting on the request of one or more shareholders or proxies, the majority of shares present and entitled to vote shall determine whether one or three judges are to be appointed. On request of the chairman of the meeting, or

of any shareholder or his proxy, the judges shall make a report in writing of any challenge or question or matter determined by them, and execute a certificate of any fact found by them. No person who is ,a candidate for office shall act as a judge.

     7. Special meetings of the shareholders may be called at any time by the President, or the Board of Directors, or shareholders entitled to cast at least one-fifth of the votes which all shareholders are entitled to cast at the particular meeting. At any time, upon written request of any person or persons who have duly called a special meeting, it shall be the duty of the Secretary to fix the date of the meeting, to be held not more than sixty days after the receipt of the request, and to give due notice thereof. If the Secretary shall neglect or refuse to fix the date of the meeting and give notice thereof, the person or persons calling the meeting may do so.

     8. Business transacted at all special meetings shall be confined to the objects stated in the call and matters germane thereto, unless all shareholders entitled to vote are present and consent.

     9. Written notice of a special meeting of the shareholders stating the time and place and object thereof, shall be given to each shareholder entitled to vote thereat at least ten days before such meeting, unless a greater period of notice is required by statute in a particular case.

     10. The officer or agent having charge of the transfer books shall make at least five days before each meeting of shareholders, a complete list of the shareholders entitled to vote at the meeting, arranged in alphabetical order, with the address of and the number of shares held by each, which list shall be subject to inspection by any shareholder at any time during usual business hours. Such list shall also be produced and kept open at the time and place of the meeting, and shall be subject to the inspection of any shareholder during the whole time of the meeting. The original share ledger or transfer book, or a duplicate thereof kept in this Commonwealth, shall be prima facie evidence as to who are the shareholders entitled to examine such list or share ledger or transfer book, or to vote in person or by proxy at any meeting of shareholders.

ARTICLE IV — DIRECTORS

     1. The business of this corporation shall be managed by its Board of Directors, not less than three in number. The directors need not be residents of this Commonwealth or shareholders in the corporation. They shall be elected by the shareholders at the annual meeting of shareholders of the corporation, and each director shall be elected for the term of one year, and until his successor shall be elected and shall qualify. Whenever all of the shares of the corporation are owned beneficially and of record by either one or two shareholders, the number

of directors may be less than three but not less than the number of shareholders. Whenever there are three or more shareholders, there must be at least three directors.

     2. In addition to the powers and authorities by these ByLaws expressly conferred upon them, the Board may exercise all such powers of the corporation and do all such lawful acts and things as are not by statute or by the Articles or by these By-Laws directed or required to be exercised or done by the shareholders.

     3. The meetings of the Board of Directors may be held at such place within this Commonwealth, or elsewhere, as a majority of the directors may from time to time appoint, or as may be designated in the notice calling the meeting.

     4. Each newly elected Board may meet at such place and time as shall be fixed by the shareholders at the meeting at which such directors are elected and no notice shall be necessary to the newly elected directors in order legally to constitute the meeting, or they may meet at such place and time as may be fixed by the consent in writing of all the directors.

     5. Regular meetings of the Board shall be held without notice at the registered office of the corporation, or at such other time and place as shall be determined by the Board.

     6. Special meetings of the Board may be called by the President on two days’ notice to each director, either personally or by mail or by telegram; special meetings shall be called by the President or Secretary in like manner and on like notice on the written request of a majority of the directors in office.

     7. A majority of the directors in office shall be necessary to constitute a quorum for the transaction of business, and the acts of a majority of the directors present at a meeting at which a quorum is present shall be the acts of the Board of Directors. Any action which may be taken at a meeting of the directors may be taken without a meeting if a consent or consents in writing, setting forth the action so taken, shall be signed by all of the directors and shall be filed with the Secretary of the corporation.

     8. Directors as such, shall not receive any stated salary for their services, but by resolution of the Board, a fixed sum and expenses of attendance, if any, may be allowed for attendance at each regular or special meeting of the Board PROVIDED, that nothing herein contained shall be construed to preclude any director from serving the corporation in any other capacity and receiving compensation therefor.

ARTICLE V — OFFICERS

     1. The executive officers of the corporation shall be chosen by the directors and shall be a President, Secretary and Treasurer. The Board of Directors may also choose a Vice President, and such other officers and agents as it shall deem necessary, who shall hold their

offices for such terms and shall have such authority and shall perform such duties as from time to time shall be prescribed by the Board. Any number of offices may be held by the same person. It shall not be necessary for the officers to be directors.

     2. The salaries of all officers and agents of the corporation shall be fixed by the Board of Directors.

     3. The officers of the corporation shall hold office for one year and until their successors are chosen and have qualified. Any officer or agent elected or appointed by the Board may be removed by the Board of Directors whenever in its judgment the best interests of the corporation will be served thereby.

     4. The President shall be the chief executive officer of the corporation; he shall preside at all meetings of the shareholders and directors; he shall have general and active management of the business of the corporation, shall see that all orders and resolutions of the Board are carried into effect, subject, however, to the right of the directors to delegate any specific powers, except such as may be by statute exclusively conferred on the President, to any other officer or officers of the corporation. He shall execute bonds, mortgages and other contracts requiring a seal, under the seal of the corporation. He shall be EX-OFFICIO a member of all committees, and shall have the general powers and duties of supervision and management usually vested in the office of the President of a corporation.

     5. The Secretary shall attend all sessions of the Board and all meetings of the shareholders and act as clerk thereof, and record all the votes of the corporation and the minutes of all its transactions in a book to be kept for that purpose; and shall perform like duties for all committees of the Board of Directors when required. He shall give, or cause to be given, notice of all meetings of the shareholders and of the Board of Directors, and shall perform such other duties as may be prescribed by the Board of Directors or President, and under whose supervision he shall be. He shall keep in safe custody the corporate seal of the corporation, and when authorized by the Board, affix the same to any instrument requiring it.

     6. The Treasurer shall have custody of the corporate funds and securities and shall keep full and accurate accounts of receipts and disbursements in books belonging to the corporation, and shall keep the moneys of the corporation in a separate account to the credit of the corporation. He shall disburse the funds of the corporation as may be ordered by the Board, taking proper vouchers for such disbursements, and shall render to the President and directors, at the regular meetings of the Board, or whenever they may require it, an account of all his transactions as Treasurer and of the financial condition of the corporation.

ARTICLE VI — VACANCIES

     1. If the office of any officer or agent, one or more, becomes vacant for any reason, the Board of Directors may choose a successor or successors, who shall hold office for the unexpired term in respect of which such vacancy occurred.

     2. Vacancies in the Board of Directors, including vacancies resulting from an increase in the number of directors, shall be filled by a majority of the remaining members of the Board though less than a quorum, and each person so elected shall be a director until his successor is elected by the shareholders, who may make such election at the next annual meeting of the shareholders or at any special meeting duly called for that purpose and held prior thereto.

ARTICLE VII — CORPORATE RECORDS

     1. There shall be kept at principal place of business or such other place(s) as the officers may from time to time deem expedient and in the best interests of the Corporation and shareholders, an original or duplicate record of the proceedings of the shareholders and of the directors, and the original or a copy of its By-Laws, including all amendments or alterations thereto to date, certified by the Secretary of the corporation. An original or duplicate share register shall also be kept giving the names of the shareholders, their respective addresses and the number and classes of shares held by each.

     2. Every shareholder shall, upon written demand under oath stating the purpose thereof, have a right to examine, in person or by agent or attorney, during the usual hours for business for any proper purpose, the share register, books or records of account, and records of the proceedings of the shareholders and directors, and make copies or extracts therefrom. A proper purpose shall mean a purpose reasonably related to such person’s interest as a shareholder. In every instance where an attorney or other agent shall be the person who seeks the right to inspection, the demand under oath shall be accompanied by a power of attorney or such other writing which authorizes the attorney or other agent to so act on behalf of the shareholder. The demand under oath shall be directed to the corporation at its registered office in this Commonwealth or at its principal place of business.

ARTICLE VIII — SHARE CERTIFICATES, DIVIDENDS, ETC.

     1. The share certificates of the corporation shall be numbered and registered in the share ledger and transfer books of the corporation as they are issued. They shall bear the corporate seal and shall be signed by the President & Secretary.

     2. Transfer of shares shall be made on the books of the corporation upon surrender of the certificates therefor, endorsed by the person named in the certificate or by attorney, lawfully constituted in writing. No transfer shall be made which is inconsistent with law.

     3. The Board of Directors may fix a time, not more than fifty days, prior to the date of any meeting of shareholders, or the date fixed for the payment of any dividend or distribution, or the date for the allotment of rights, or the date when any change or conversion or exchange of shares will be made or go into effect, as a record date for the determination of the shareholders entitled to notice of, or to vote at, any such the directors, from time to time, in their absolute discretion, think proper as a reserve fund to meet contingencies, or for equalizing dividends, or for repairing or maintaining any property of the corporation, or for such other purpose as the directors shall think conducive to the interests of the corporation, and the directors may abolish any such reserve in the manner in which it was created.

ARTICLE IX — MISCELLANEOUS PROVISIONS

     1. All checks or demands for money and notes of the corporation shall be signed by such officer or officers as the Board of Directors may from time to time designate.

     2. The fiscal year of the corporation shall begin on the first day of October.

     3. Whenever written notice is required to be given to any person, it may be given to such person, either personally or by sending a copy thereof through the mail, or by telegram, charges prepaid, to his address appearing on the books of the corporation, or supplied by him to the corporation for the purpose of notice. If the notice is sent by mail or by telegraph, it shall be deemed to have been given to the person entitled thereto when deposited in the United States mail or with a telegraph office for transmission to such person. Such notice shall specify the place, day and hour of the meeting and, in the case of a special meeting of shareholders, the general nature of the business to be transacted.

     4. Whenever any written notice is required by statute, or by the Articles or By-Laws of this corporation, a waiver thereof in writing, signed by the person or persons entitled to such notice, whether before or after the time stated therein, shall be deemed equivalent to the giving of such notice. Except in the case of a special meeting of shareholders, neither the business to be transacted at nor the purpose of the meeting need be specified in the waiver of notice of such meeting. Attendance of a person, either in person or by proxy, at any meeting shall constitute a

waiver of notice of such meeting, except where a person attends a meeting for the express purpose of objecting to the transaction of any business because the meeting was not lawfully called or convened.

     5. One or more directors or shareholders may participate in a meeting of the Board, or a committee of the Board or of the shareholders, by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other.

     6. Except as otherwise provided in the Articles or By-Laws of this corporation, any action which may be taken at a meeting of the shareholders or of a class of shareholders may be taken without a meeting, if a consent or consents in writing, setting forth the action so taken, shall be signed by all of the shareholders who would be entitled to vote at a meeting for such purpose and shall be filed with the Secretary of the corporation.

     7. Any payments made to an officer or employee of the corporation such as a salary, commission, bonus, interest, rent, travel or entertainment expense incurred by him, which shall be disallowed in whole or in part as a deductible expense by the Internal Revenue Service, shall be reimbursed by such officer or employee to the corporation to the full extent of such disallowance. It shall be the duty of the directors, as a Board, to enforce payment of each such amount disallowed. In lieu of payment by the officer or employee, subject to the determination of the directors, proportionate amounts may be withheld from his future compensation payments until the amount owed to the corporation has been recovered.

ARTICLE X — ANNUAL STATEMENT

     1. The President and Board of Directors shall present at each annual meeting a full and complete statement of the business and affairs of the corporation for the preceding year. Such statement shall be prepared and presented in whatever manner the Board of Directors shall deem advisable and need not be verified by a certified public accountant.

ARTICLE XI – AMENDMENTS

     1. These By-Laws may be amended or repealed by the vote of shareholders entitled to cast at least a majority of the votes which all shareholders are entitled to cast thereon, at any regular or special meeting of the shareholders, duly convened after notice to the shareholders of that purpose.

ARTICLE XII — INDEMNIFICATION
OF DIRECTORS AND OFFICERS

     1. The Board of Directors shall authorize the corporation to pay or reimburse any present or former Director or officer of the corporation any costs or expenses actually and necessarily incurred by him or her in any action, suit or proceeding to which he or she is made a party by reason of his or her holding such position if he or she acted in good faith and in a manner he or she reasonably believed to be in, and not opposed to, the best interests of the corporation; provided, however, that he or she shall not receive such indemnification if he or she be finally adjudicated therein to be liable for negligence or misconduct in the performance of his or her duty to the corporation. The indemnification herein provided shall also extend to good faith expenditures incurred in anticipation of, or preparation for, threatened or proposed litigation. The Board of Directors may, in proper cases, extend the indemnification to cover the good faith settlement of any such action, suit, or proceeding, whether formally instituted or not.

ARTICLE XIII – CERTIFICATION

1. I hereby certify that the foregoing are the true and correct By-Laws of HUMAN FACTORS APPLICATIONS, INC., a Pennsylvania corporation.

DATED: Effective May 11, 2004.

EX-3.5

Exhibit 3.5

APPLICANTS ACCT NO.
DSCB:BCL—204 (Rev.8-72)
	(Line for numbering)
Filing Fee: $75 AI8-7
Articles of	COMMONWEALTH OF PENNSYLVANIA
Incorporation—	DEPARTMENT OF STATE
Domestic Business Corporation	CORPORATION BUREAU
		(Box for Certification)

          In compliance with the requirements of section 204 of the Business Corporation Law, act of May 5, 1933 (P. L. 364) (15 P. S. §1204) the undersigned, desiring to be incorporated as a business corporation, hereby certifies (certify) that:

1. The name of the corporation is:

          HUMAN FACTORS APPLICATIONS, INC.

2. The location and post office address of the initial registered office of the corporation in this Commonwealth is:

1966	Brooke Drive
(NUMBER)	(STREET)
Buckingham	Pennsylvania	18912
(CITY)		(ZIP CODE)

3. The corporation is incorporated under the Business Corporation Law of the Commonwealth of Pennsylvania for the following purpose or purposes:

The corporation shall have unlimited power to engage in and do any lawful act concerning any or all lawful acts of business for which corporations may be incorporated under the Pennsylvania Business Corporation Law of 1933, as amended.

4. The term for which the corporation is to exist is: Perpetual                                                                                                                      

5. The aggregate number of shares which the corporation shall have authority to issue is:

1000 shares at $1.00 par value

6. The name(s) and post office address(es) of each incorporator(s) and the number and class of shares subscribed by such incorporator(s) is (are):

NAME	ADDRESS	NUMBER AND CLASS OF SHARES
	(including street and number if any)
R. Barry McAndrews	320 W. Street Road	One (1) share
	Warminster, PA 18974	Common Stock

IN TESTIMONY WHEREOF, the incorporator(s) has (have) signed and sealed these Articles of Incorporation 8th day of June, 1982

(SEAL)	/s/ R. Barry McAndrews	(SEAL)
	R. BARRY MCANDREWS
		(SEAL)

INSTRUCTIONS FOR COMPLETION OF FORM:

A.	For general instructions relating to the incorporation of business corporations see 19 Pa. Code Ch. 35 (relating to business corporations generally). These instructions relate to such matters as corporate name, stated purposes, term of existence, authorized share structure and related authority of the board of directors, inclusion of names of first directors in the Articles of Incorporation, optional provisions on cumulative voting for election of directors, etc. B. One or more corporations or natural persons of full age may incorporate a business corporation. C. Optional provisions required or authorized by law may be added as Paragraphs 7, 8, 9 . . . etc.
B.	One or more corporations or natural persons of full age may incorporate a business corporation.
C.	Optional provisions required or authorized by law may be added as Paragraphs 7, 8, 9 . . . etc.
D.	The following shall accompany this form:

(1)	Three copies of Form DSCB:BCL—206 (Registry Statement Domestic or Foreign Business Corporation.)
(2)	Any necessary copies of Form DSCB:17.2 (Consent to Appropriation of Name) or Form DSCB:17.3 (Consent to Use of Similar Name).
(3)	Any necessary governmental approvals.

E. BCL §205 (15 Pa. S. §1205) requires that the incorporators shall advertise their intention to file or the corporation shall exercise the filing of articles of incorporation. Proofs of publication of such advertising should not be delivered to the Department, but should be filed with the minutes of the corporation.

EX-3.6

Exhibit 3.6

Microfilm Number		Filed with the Department of State on
Entity Number	753993
		Secretary of the Commonwealth

STATEMENT OF CHANGE OF REGISTERED OFFICE
DSCB:15-1507/4144/5507/6144/8506 (Rev 90)

Indicate type of entity (check one):

þ	Domestic Business Corporation (15 Pa.C.S. § 1507)	o	Foreign Nonprofit Corporation (15 Pa.C.S. § 6144)
o	Foreign Business Corporation (15 Pa.C.S. § 4144)	o	Domestic Limited Partnership (15 Pa.C.S. § 8506)
o	Domestic Nonprofit Corporation (15 Pa.C.S. § 5507)	o

          In compliance with the requirements of the applicable provisions of 15 Pa.C.S. (relating to corporations and unincorporated associations) the undersigned corporation or limited partnership, desiring to effect a change of registered office, hereby states that:

1. The name of the corporation or limited partnership is: Human Factors Applications, Inc.

2. The (a) address of this corporation’s or limited partnership’s current registered office in this Commonwealth or (b) name of its commercial registered office provider and the county of venue is: (the Department is hereby authorized to correct the following information to conform to the records of the Department):

(a)		1966 Brooke Drive	Buckingham	PA		18912	Bucks
		Number and Street	City	State	Zip		County
(b)	c/o:
		Name of Commercial Registered Office Provider					County
For a corporation or a limited partnership represented by a commercial registered office provider, the county in (b) shall be deemed the county in which the corporation or limited partnership is located for venue and official publication purposes.

3.	(Complete part (a) or (b)):
	(a)	The address to which the registered office of the corporation or limited partnership in this Commonwealth is to be changed is:
		Buckingham Green, 4950 Route 202, Building 1 – Suite 2A, Holicong, PA 18928-0615
		Number and Street		City	State	Zip	Bucks County
	(b)	The registered office of the corporation or limited partnership shall be provided by:
		c/o:
			Name of Commercial Registered Office Provider				County
	For a corporation or a limited partnership represented by a commercial registered office provider, the county in (b) shall be deemed the county in which the corporation or limited partnership is located for venue and official publication purposes.

4. (Strike out if a limited partnership): Such change was authorized by the Board of Directors of the corporation.

          IN TESTIMONY WHEREOF, the undersigned corporation or limited partnership has caused this statement to be signed by a duly authorized officer this 05th day of March, 1996

Human Factors Applications, Inc.
	Name of Corporation/Limited Partnership
BY:	/s/ Elizabeth H. Theisen
	Elizabeth H. Theisen (Signature)
TITLE:	President

EX-3.7

Exhibit 3.7

Microfilm Number		Filed with the Department of State on
Entity Number	753993
		Secretary of the Commonwealth

STATEMENT OF CORRECTION
DSCB:15-138 (Rev 90)

          In compliance with the requirements of 15 Pa.C.S. § 138 (relating to statement of correction) the undersigned association or other person, desiring to correct an inaccurate record of corporate or other action or correct defective or erroneous execution of a document, hereby states that:

1.	The name of the association or other person is: Human Factors Application, Inc.
2.	The (a) address of this association’s current registered office in this Commonwealth or (b) name of its commercial registered office provider and the county of venue is (the Department is hereby authorized to correct the following information to conform to the records of the Department):
	(a)		1966 Brooke Drive	Buckingham	PA		18912	Bucks
			Number and Street	City	State	Zip		County
	(b)	c/o:
			Name of Commercial Registered Office Provider					County
	For an association represented by a commercial registered office provider, the county in (b) shall be deemed the county in which the association is located for venue and official publication purposes.
3.	The statute by or under which it was incorporated or the preceding filing was made, in the case of a filing that does not constitute a part of the articles of incorporation of a corporation, is: Act of May 5, 1933
4.	The inaccuracy or defect, which appears in Department of State form BCL—204 filed on 6/10/82 and recorded in Roll and Film Number 82-29 1104 et seq., is: The name of the corporation is inaccurately stated as “Human Factors Application, Inc.”
5.	(Check one of the following):
þ	The portion of the document requiring correction in corrected form is set forth in Exhibit A attached hereto and made a part hereof.
o	The original document to which this statement relates shall be deemed reexecuted.
o	The original document to which this statement relates shall be deemed stricken from the records of the Department.

          IN TESTIMONY WHEREOF, the undersigned association or other person has caused this statement to be signed by a duly authorized officer thereof or otherwise in its name this 05th day of March, 1996.

Human Factors Application, Inc.
	(Name)
BY:	/s/ Elizabeth H. Theisen
	Elizabeth H. Theisen (Signature)
TITLE:	President

Exhibit A

The correct name of the Corporation is:

Human Factors Applications, Inc.

EX-3.8

Exhibit 3.8

Microfilm Number		Filed with the Department of State on
Entity Number	753993
		Secretary of the Commonwealth

STATEMENT OF CHANGE OF REGISTERED OFFICE
DSCB:15-1507/4144/5507/6144/8506 (Rev 90)

Indicate type of entity (check one):
þ	Domestic Business Corporation (15 Pa.C.S. § 1507)	o	Foreign Nonprofit Corporation (15 Pa.C.S. § 6144)
o	Foreign Business Corporation (15 Pa.C.S. § 4144)	o	Domestic Limited Partnership (15 Pa.C.S. § 8506)
o	Domestic Nonprofit Corporation (15 Pa.C.S. § 5507)	o

          In compliance with the requirements of the applicable provisions of 15 Pa.C.S. (relating to corporations and unincorporated associations) the undersigned corporation or limited partnership, desiring, to effect a change of registered office, hereby states that:

1.	The name of the corporation or limited partnership is: Human Factors Applications, Inc.
2.	The (a) address of this corporation’s or limited partnership’s current registered office in this Commonwealth or (b) name of its commercial registered office provider and the county of venue is: (the Department is hereby authorized to correct the following information to conform to the records of the Department):
	(a)		Buckingham Green, 4950 Route 202, Building 1 – Suite 2A, Holicong, PA 18928-0615						(Bucks County)
			Number and Street		City	State	Zip		County
	(b)	c/o:
			Name of Commercial Registered Office Provider						County
	For a corporation or a limited partnership represented by a commercial registered office provider, the county in (b) shall be deemed the county in which the corporation or limited partnership is located for venue and official publication purposes.
3.	(Complete part (a) or (b)):
	(a)		The address to which the registered office of the corporation or limited partnership in this Commonwealth is to be changed is:
			1635 Market Street,		Philadelphia,	PA		19103	Philadelphia
			Number and Street		City	State	Zip		County
	(b)		The registered office of the corporation or limited partnership shall be provided by:
			c/o:	C T CORPORATION SYSTEM
			Name of Commercial Registered Office Provider						County
	For a corporation or a limited partnership represented by a commercial registered office provider, the county in (b) shall be deemed the county in which the corporation or limited partnership is located for venue and official publication purposes.

4. (Strike out if a limited partnership): Such change was authorized by the Board of Directors of the corporation.

          IN TESTIMONY WHEREOF, the undersigned corporation or limited partnership has caused this statement to be signed by a duly authorized officer this 25th day of November, 1998.

Human Factors Applications, Inc.
Name of Corporation
By:	/s/ Michael S. Ables
	(Signature)
TITLE:	Secretary

EX-3.9

Exhibit 3.9

Effective as of April 24, 2004

FIRST AMENDED AND RESTATED BYLAWS

of

ManTech Environmental Technology. Inc.

ARTICLE I

Offices

     Section 1. The Principal Office. The principal office of ManTech Environmental Technology, Inc. (hereinafter called the “Corporation”) shall be located in the Commonwealth of Virginia, or such other location and with such additional offices in such location(s) as may from time to time be established by the Board of Directors.

     Section 2. Registered Office. The registered office of the Corporation shall be maintained in the State of Virginia at the location specified in the Articles of Incorporation of the Corporation or as may be designated from time to time by the Board of Directors.

ARTICLE II

Meetings of Shareholders

     Section 1. Time and Place of Meetings. Meetings of the shareholders shall be in or out of the Commonwealth of Virginia on such date and at such time as shall be designated by the Board of Directors from time to time and stated in the notice of any such meeting, or in a duly executed waiver of notice thereof.

     Section 2. Annual Meetings. There shall be an annual meeting of the shareholders on such date and time as shall be designated from time to time by the Board of Directors and stated in the notice of the meeting, for the election of the Board of Directors and for the transaction of such other business as may come before the meeting.

     Section 3. Special Meetings. Special meetings of the shareholders, for any purposes, unless otherwise prescribed by statute or by the Articles of Incorporation, may be called by the Board of Directors or by the President or the Secretary, and shall be called by the President or Secretary at the request in writing of the holders of not less than one-fifth of all the issued and outstanding shares entitled to vote. Such request shall include a statement of the purposes of the proposed meeting.

     Section 4. Notices. Written or printed notice stating the place, day and hour of the meeting, and, in case of a special meeting, the purpose or purposes for which the meeting is

called, shall be delivered not less than ten nor more than sixty days before the meeting, either personally or by mail, by or at the direction of the President, the Secretary, or the officer calling the meeting to each shareholder of record entitled to vote at such meeting. If mailed, such notice shall be deemed to be delivered when deposited in the United States mail addressed to the shareholder at his address as it appears on the records of the Corporation, with the postage thereon prepaid.

     Section 5. Business at Special Meetings. Business transacted at any special meeting of shareholders shall be confined to the purposes stated in the notice thereof; except that a majority of shareholders present at a special meeting at which a quorum is present may take action on any other item of business not specified in the notice.

     Section 6. List of Shareholders. The officer who has charge of the stock ledger of the Corporation shall prepare and make, at least ten days before every meeting of shareholders, a complete list of the shareholders entitled to vote at the meeting, arranged by voting group and in alphabetical order showing the address of each shareholder and the number of shares registered in the name of each shareholder. Such list shall be open to the examination of any shareholder, for any purpose germane to the meeting, during ordinary hours, for a period of at least ten days prior to the meeting, either at a place within the city where the meeting is to be held, which place shall be specified in the notice of the meeting, or, if not so specified, at the place where the meeting is to be held. The list also shall be produced and kept at the time and place of the meeting during the whole time thereof, and may be inspected by any shareholder who is present. The stock ledger shall be the only evidence as to who are the shareholders entitled to examine the stock ledger, the list required by this section or the books of the Corporation, or to vote in person or by proxy at any meeting of shareholders.

     Section 7. Quorum. A majority of the outstanding shares having voting power, represented in person or by proxy, shall constitute a quorum at meetings of the shareholders except as otherwise provided by statute or by the Certificate of Incorporation. If a quorum shall not be present or represented, those shareholders present and entitled to vote may adjourn the meeting from time to time until a quorum is present or represented. At such adjourned meeting at which a quorum is present or represented, any business may be transacted that might have been transacted at the meeting as originally called.

     Section 8. Voting. When a quorum is present at any meeting, the vote of the holders of a majority of the shares having voting power present in person or represented by proxy shall decide any question brought before such meeting, unless the question is one upon which by express provision of law or of the Certificate of Incorporation a different vote is required, in which case such express provision shall govern and control the decision of such question; and, except that in election of directors, those receiving the greatest number of votes (a plurality) shall be deemed elected even though not receiving a majority. Each outstanding share shall be entitled to one vote on each matter submitted to vote at a meeting of shareholders unless otherwise provided in the Certificate of Incorporation.

     Section 9. Proxies. A shareholder may vote either in person or by proxy executed in

2

writing by the shareholder or by his duly authorized attorney-in-fact. No proxy shall be valid after eleven months from the date of its execution, unless the proxy provides for a longer period. A duly executed proxy shall be irrevocable if it states that it is irrevocable and if, and only as long as, it is coupled with an interest sufficient in law to support an irrevocable power.

     Section 10. Waiver of Notice. Whenever any notice of any meeting of shareholders is required to be given under provisions of law or under the provisions of the Certificate of Incorporation or these Bylaws, a waiver thereof in writing, signed by the person or persons entitled to such notice and filed with the records of the meeting, whether before or after the time stated therein, shall be equivalent to the giving of such notice.

     Section 11. Informal Action. Any action required by the law to be taken at a meeting of the shareholders, or any other action which may be taken at a meeting of the shareholders, may be taken without a meeting if a consent in writing, setting forth the action so taken, shall be signed by the shareholders having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted; and, if such written consent is filed with the minutes of proceedings of the shareholders. Signatures by means of facsimile transmission shall be acceptable for purposes of this Section 11.

     Section 12. Action by Conference Call. Shareholders may participate in a meeting of the shareholders by means of a conference telephone or similar communications equipment whereby all persons participating in the meeting can hear each other, and participation by such means shall constitute presence in person at such meeting. When such a meeting is conducted by means of a conference telephone or similar communications equipment, a written record shall be made of the action taken at such meeting.

ARTICLE III

Board of Directors

     Section 1. Powers and Duties. The business and affairs of the Corporation shall be managed by or under the direction of the Board of Directors, which may exercise all such powers of the Corporation and do such lawful acts as are not required to be exercised or done by the shareholders pursuant to statute or by the Certificate of Incorporation or the Bylaws. The Board of Directors may delegate certain of its duties to the officers of the Corporation, but such delegation shall not relieve the Board of the responsibility for any action so taken.

     Section 2. Number, Term of Office and Election. The board of directors shall consist of not less than one (1), nor more than seven (7) members and shall be fixed from time to time by the affirmative vote of a majority of all directors of the corporation then holding office at any special or regular meeting of the Board of Directors. The Board of Directors shall be elected by a plurality of the votes cast at each annual meeting (or a special meeting in lieu thereof) of stockholders, and each director so elected shall hold office until his successor is duly elected and

3

qualified, or until his earlier resignation or removal. Directors need not be stockholders. Unless otherwise provided in the Certificate of Incorporation, newly created Directorships resulting from an increase in the number of Directors and vacancies occurring in the Board for any other reason, including the removal of Directors without cause, may be filled only by the affirmative vote of a majority of the remaining directors. The person or persons chosen to fill any such vacancies shall serve until the next annual meeting of the shareholders, or until his successor shall have been elected and qualified or until his death, resignation or removal.

     Any director or the entire Board of Directors may be removed either with or without cause at any time by the affirmative vote of the holders of a majority in voting power of the capital stock issued and outstanding and entitled to vote for the election of directors at any annual or special meeting of the stockholders called for that purpose.

     Section 3. Meetings.

     (a) Time, Place and Notice. The annual meetings of the Board of Directors shall be held after the annual meeting of shareholders and additional regular meetings of the Board shall be held, at such time as may be fixed by a resolution of the Board, and at such place, within or without the Commonwealth of Virginia, as may be fixed by such resolution or by the notice of meeting, which notice, in the event of a special meeting, shall be given to all Directors not less than twenty-four (24) hours prior to the time of said meeting. The notice need not state the purpose of nor the business to be transacted at such meeting. Special meetings of the Board of Directors shall be held whenever called, in writing, by the Chairman, by a majority of the Directors, or by a majority of the Executive Committee, if any, or by the President.

     (b) Waiver of Notice. Whenever any notice of any meeting of the Board of Directors is required to be given under provisions of law or under the provisions of the Certificate of Incorporation or these Bylaws, a waiver thereof in writing, signed by the person or persons entitled to such notice and filed with the records of the meeting, whether before or after the time stated herein, shall be equivalent to the giving of such notice. Attendance of a Director at a meeting shall constitute a waiver of notice of such meeting, except where a Director attends a meeting for the express purpose of objecting to the transaction of business because the meeting is not lawfully called or convened.

     (c) Quorum and Voting. At any meeting of the Board of Directors, a majority of the number of Directors fixed by these Bylaws shall be necessary and sufficient to constitute a quorum for the transaction of all business. A majority of the votes cast at a meeting of the Board of Directors, duly called and at which a quorum is present, shall be sufficient to take or authorize action upon any matter which may properly come before the meeting, unless the concurrence of a greater proportion is required for such action by statute or by the Certificate of Incorporation.

     (d) Action without Meeting. Any action required or permitted to be taken at a meeting of the Board of Directors may be taken without a meeting if consent in writing, setting forth such action, is signed by all of the Directors, and such written consent is filed with the minutes of proceedings of the Board. Such consent shall have the same force and effect as a

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unanimous vote. Signatures by means of facsimile transmission shall be acceptable for purposes of this Section 3(d).

     (e) Action by Conference Call. Members of the Board of Directors may participate in a meeting of the Board of Directors by means of a conference telephone or similar communications equipment whereby all persons participating in the meeting can hear each other, and participation by such means shall constitute presence in person at such meeting. When such a meeting is conducted by means of a conference telephone or similar communications equipment, a written record shall be made of the action taken at such meeting.

     Section 4. Resignation of Directors. Any Director or member of a committee may resign at any time. Such resignation shall be made in writing and shall take effect at the time specified therein, or if no time be specified, at the time of its receipt by an officer or director of the Corporation. The acceptance of a resignation shall not be necessary to make it effective. Directors may be removed, with or without cause, at any meeting of the shareholders duly called and at which a quorum is present, by a majority of votes cast at such meeting.

     Section 5. Compensation and Reimbursement. Directors and members of any committee of the Board of Directors shall not be entitled to compensation for their services as Directors or committee members; provided that the foregoing shall not prevent a Director or committee member from serving the Corporation in any other capacity and receiving reasonable compensation for such other services. Directors and members of any committee of the Board of Directors shall be entitled to reimbursement for any reasonable expenses incurred in attending meetings of the Board or any committee of the Board, as the case may be.

ARTICLE IV

Committees

     Section 1. Executive Committee. The Board of Directors, by resolution adopted by a majority of the number of Directors fixed by these Bylaws, may appoint two or more Directors as an Executive Committee, to act in the name of and with the full power of the Board during the intervals between meetings of the Board on any matters requiring action by the Directors.

     Section 2. Other Committees. The Board of Directors may appoint from among its members one or more other committees, to consist of not fewer than two (2) members.

     Section 3. Procedures. All Committees appointed by the Board of Directors pursuant to this Article IV shall serve at the pleasure of the Board. Each such committee may make its own rules of procedure and shall meet where and as provided by such rules or by resolution of the Board of Directors. A majority shall constitute a quorum, and in every case the affirmative vote of a majority of all the members of such committee shall be necessary for the adoption of any resolution.

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ARTICLE V

Officers

     Section 1. Number, Qualification, Election and Term of Office.

     (a) The officers of the Corporation shall consist of a President, one or more Vice Presidents, a Secretary, and such number of other officers and assistant officers as the Board of Directors may from time to time deem advisable. Except as otherwise permitted by law, any two or more offices may be held by the same person.

     (b) The officers of the Corporation shall be elected by the Board of Directors at the regular annual meeting of the Board following the annual meeting of shareholders. If the election of officers shall not be held at such meeting, such election shall be held as soon thereafter as may be convenient.

     (c) Each officer shall hold office until the next annual meeting of the Board of Directors next succeeding his election and until his successor shall have been elected and qualified, or until his death, resignation or removal.

     Section 2. Resignation. Any officer may resign at any time by giving written notice of such resignation to the Board of Directors or to a named officer of the Corporation. Unless otherwise specified in such written notice, such resignation shall take effect upon receipt thereof by the Board of Directors or by such officer and the acceptance of such resignation shall not be necessary to make it effective.

     Section 3. Removal.

     (a) Any officer specifically designated in Section 1 of this Article V may be removed, either with or without cause, and a successor elected, by a majority vote of the Board of Directors, regularly convened at a regular or special meeting.

     (b) The officers and agents appointed in accordance with the provisions of Section 10 of this Article V may be removed, either with or without cause, by a majority vote of the Board of Directors, regularly convened at a regular or special meeting or by any superior officer or agent upon whom such power of removal shall have been conferred by the Board of Directors.

     Section 4. Vacancies.

     (a) A vacancy in any office specifically designated in Section 1 of the Article V, by reason of death, resignation, inability to act, disqualification, removal or any other cause, shall be filled for the remaining portion of the term by an affirmative majority vote of the Board of Directors regularly convened at any regular or special meeting.

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     (b) In the case of a vacancy occurring in the office of an officer or agent appointed in accordance with the provisions of Section 10 of this Article V, such vacancy may be filled by vote of the Board of Directors or by any officer or agent upon whom such power shall have been conferred by the Board of Directors.

     Section 5. President. The President shall be the principal executive officer of the Corporation and, subject to the direction of the Board of Directors, shall in general supervise and control all of the business, affairs and property of the Corporation and have general supervision over its officers and agents. He shall, if present, preside at all meetings of the shareholders. In general, he shall perform all duties incident to the office of President and shall see that all orders and resolutions of the Board of Directors are carried into effect.

     Section 6. Vice Presidents. During the absence or disability of the President, the Vice President, or, if there be more than one, the Vice President designated by the Board of Directors as Executive Vice President, shall exercise all the functions of the President and, when so acting, shall have all the powers of and be subject to all the restrictions upon the President. Each Vice President shall have such powers and discharge such duties as may be assigned to him from time to time by the Board of Directors.

     Section 7. Secretary. The Secretary shall:

     (a) Record all the proceedings of the meetings of the shareholders and Board of Directors in a book to be kept for that purpose;

     (b) Cause all notices to be duly given in accordance with the provisions of these Bylaws and as required by statute;

     (c) Be custodian of the records and of the seal of the Corporation and cause such seal to be affixed to all certificates representing stock of the Corporation prior to their issuance and to all instruments, the execution of which on behalf of the Corporation under its seal shall have been duly authorized in accordance with these Bylaws;

     (d) Keep a register of the post office address of each shareholder which shall be furnished to the Secretary by such shareholder;

     (e) Sign with the President, certificates for shares of the Corporation, the issuance of which shall have been authorized by resolution of the Board of Directors;

     (f) If called upon to do so, prepare or cause to be prepared and submit at each meeting of the shareholders a certified list in alphabetical order of the names of the shareholders entitled to vote at such meeting, together with the number of shares of the respective class held by each;

     (g) See that the books, reports, statements, certificates, stock transfer books and all other documents and records of the Corporation required by statute are properly kept and filed;

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     (h) In general, perform all duties incident to the office of Secretary and such other duties as are given to him by these Bylaws or as from time to time may be assigned to him by the Board of Directors or the President.

     Section 8. Assistant Secretaries. Whenever requested by or in the absence or disability of the Secretary, the Assistant Secretary designated by the Secretary (or in the absence of such designation, the Assistant Secretary designated by the Board of Directors) shall perform all the duties of the Secretary and when so acting shall have all the power of, and be subject to all the restrictions upon, the Secretary.

     Section 9. Subordinate Officers and Agents. The Board of Directors may from time to time appoint such other officers and agents as it may deem necessary or advisable, to hold office for such period, have such authority and perform such duties as the Board of Directors may from time to time determine. The Board of Directors may delegate to any officer or agent the power to appoint any such subordinate officers or agents and to prescribe their respective terms of office, authorities and duties.

     Section 10. Compensation. The salaries or other compensation of the officers shall be fixed from time to time by the Board of Directors and no officer shall be prevented from receiving such salary or any compensation by reason of the fact that he is also a Director of the Corporation. The Board of Directors may delegate to any officer or agent the power to fix from time to time the salaries or other compensation of officers or agents appointed in accordance with the provisions of Section 12 of this Article V.

     Section 11. Sureties and Bonds. In case the Board of Directors shall so require, any officer or agent of the Corporation shall execute and deliver to the Corporation bond in such sum and with such surety or sureties as the Board of Directors may direct, conditioned upon the faithful performance of his duties to the Corporation, including responsibility for negligence and for the accounting for all property, funds or securities of the Corporation which may come into his hands.

ARTICLE VI

Stock Provisions

     Section 1. Certificates for Shares. The shares of the Corporation shall be represented by certificates signed by the President or a Vice President and the Secretary or an Assistant Secretary and sealed with the seal of the Corporation. Such signature and seal may be a facsimile. No certificate shall be issued for any share until such share is fully paid. Each certificate representing shares shall state that the Corporation is organized under the laws of the Commonwealth of Virginia, the name of the person to whom issued, the number and class of shares which such certificate represents and the par value of each share represented by such certificate or a statement that the shares are without par value. If the Corporation shall be authorized to issue shares of more than one class, each certificate shall have set forth on the face

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or back thereof, or shall state that the Corporation will furnish to any stockholder upon request and without charge, a full or summary statement of the designations, preferences, limitations and relative rights of the shares of each class authorized to be issued.

     Section 2. Lost Certificates. The Board of Directors may direct a new certificate or certificates to be issued in place of any certificate or certificates theretofore issued by the Corporation alleged to have been lost or destroyed, upon the making of an affidavit of that fact by the person claiming the certificates for shares to be lost or destroyed. When authorizing such issue of a new certificate or certificates, the Board of Directors may, in its discretion and as a condition precedent to the issuance thereof, require the owner of such lost or destroyed certificate or certificates, or his legal representative, to advertise the same in such manner as it shall require an/or to give the Corporation a bond in such sum as it may direct as indemnity against any claim that may be made against the Corporation with respect to the certificate alleged to have been lost or destroyed.

     Section 3. Transfers of Shares.

     (a) Transfers of shares of the capital stock of the Corporation shall be made on the transfer books of the Corporation upon the request of the holder of record thereof, in person or by his duly authorized attorney, upon surrender and cancellation of the certificate or certificates representing such shares.

     (b) The Corporation shall be entitled to treat the holder of record of any share or shares of stock as the absolute owner thereof for all purposes and, accordingly, shall not be bound to recognize any legal, equitable or other claim to, or interest in, such share or shares on the part of any person whether or not it or they shall have express or other notice thereof, except as otherwise expressly provided by law.

     Section 4. Closing of Transfer Books and Fixing Record Date. For the purpose of determining shareholders entitled to notice of or to vote at any meeting of shareholders, or shareholders entitled to receive payment of any dividend, or in order to make a determination of shareholders for any proper purpose, the Board of Directors may provide that the stock transfer books shall be closed for a stated period but not to exceed, in any case, twenty days. If the stock transfer books shall be closed for the purpose of determining shareholders entitled to notice of or to vote at a meeting of shareholders, such books shall be closed for at least ten days immediately preceding such meeting. In lieu of closing the stock transfer books, the Board of Directors may fix in advance a date as the record date for any determination of shareholders, such date in any case to be not more than sixty days and, in case of a meeting of shareholders, not less than ten days prior to the date on which the particular action requiring such determination of shareholders is to be taken. If the stock transfer books are not closed and no record date is fixed for the determination of shareholders or shareholders entitled to receive payment of a dividend, the date on which notice of the meeting is mailed or the date on which the resolution of the Board of Directors declaring such dividend is adopted, as the case may be, shall be the record date for such determination of shareholders.

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     Section 5. Registered Shareholders. The Corporation shall be entitled to recognize the exclusive right of a person registered on its books as the owner of shares to receive dividends, and notice of all meetings as such owner, and shall not be bound to recognize any equitable or other claim to or interest in such share or shares on the part of any other person, whether or not it shall have express or other notice thereof, except as otherwise provided by the laws of the Commonwealth of Virginia.

ARTICLE VII

General Provisions

     Section 1. Dividends. The Board of Directors may declare and the Corporation may pay dividends on its outstanding shares in cash, property, or its own shares, subject to the provisions of the laws of the Commonwealth of Virginia.

     Section 2. Checks. All checks or other orders or demands for the payment of money of the Corporation shall be signed by an officer of the Corporation or by an employee of the Corporation designated and authorized to do so by the Board of Directors.

     Section 3. Fiscal Year. The fiscal year of the Corporation shall be fixed by resolution of the Board of Directors.

     Section 4. Corporate Seal. The corporate seal shall have inscribed thereon the name of the Corporation, the year of its organization and the words “Corporate Seal, Virginia.” The seal may be used by causing it or a facsimile thereof to be impressed or affixed or reproduced.

     Section 5. Indemnification. Except as otherwise required by law, every Director, Officer, employee or authorized agent of the Corporation will be indemnified by the Corporation to the fullest extent permitted under Article 10, Chapter 9, Title 13 of the Code of Virginia, as such laws may be amended from time to time, or any successor law or provision, and such indemnification provisions are by reference, incorporated as a part of these Bylaws.

     Section 6. Amendments. These Bylaws may be altered, amended, or repealed by a majority vote of the Board at any regular meeting of the Board of Directors or at any special meeting of the Board of Directors if notice of such proposed action be contained in the notice of such special meeting.

     Section 7. Gender. The use of the masculine gender herein includes feminine and neuter, and the singular numbers includes the plural, where applicable and whenever the context so requires.

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EX-3.10

Exhibit 3.10

COMMONWEALTH OF VIRGINIA
STATE CORPORATION COMMISSION

SCC711	GUIDE FOR ARTICLES OF RESTATEMENT
(08/06)	OF A VIRGINIA STOCK CORPORATION

ARTICLES OF RESTATEMENT OF

Alion – METI Corporation

     The undersigned corporation, pursuant to Title 13.1, Chapter 9, Article 11 of the Code of Virginia, hereby executes the following articles of restatement and sets forth:

1.	The name of the corporation immediately prior to restatement is Alion – METI Corporation.
2.	The restatement contains an amendment to the articles of incorporation.
3.	The text of the amended and restated articles of incorporation is attached hereto.
4.	The restatement was adopted by the corporation on April (date), 2007.
5.	The restatement was adopted by unanimous consent of shareholders.

Executed in the name of the corporation by:

(signature)	(date)
Stacy Mendler (printed name)	President (corporate title)
0367098-1 (corporation’s SCC ID no.)

AMENDED AND RESTATED

ARTICLES OF INCORPORATION

OF

ALION – METI CORPORATION

The undersigned, pursuant to Chapter 9 of Title 13.1 of the Code of Virginia, states as follows:

     FIRST: The name of the Corporation is Alion – METI Corporation.

     SECOND: The purpose or purposes for which the Corporation is organized is as follows:

     1. To perform environmental sciences testing and analysis and other technical services.

     2. To engage in, promote, and carry on any lawful act or activity for which corporations may be organized under the Virginia Stock Corporation Act and the Code of Virginia.

     THIRD: The Corporation shall have one class of stock. The total amount of authorized capital stock of the Corporation is one thousand (1,000) shares of common stock having a par value of One Dollar ($1.00) per share.

     FOURTH: The name of the Corporation’s registered agent is CT Corporation System. The registered agent is a foreign stock corporation authorized to transact business in Virginia.

     FIFTH: The Corporation’s registered office address is:

4701 Cox Road
Suite 301
Glen Allen, VA 23060-6802

     SIXTH: The Corporation shall have and exercise any and all powers and privileges now or hereafter conferred by the laws of the Commonwealth of Virginia upon corporations formed under the Virginia Stock Corporation Act, or under any Act amendatory or supplemental thereto or in substitution therefore; and, further, the Corporation may carry out all or any part of the aforesaid and above-referenced objects and purposes, and conduct its business in all or any of its branches, and in any or all states, territories, districts, and possessions of the United Stated of America and maintain offices and agencies in any or all states, territories, districts, and possessions of the United Stated of America.

     The foregoing enumeration of the purposes, objects and business of the Corporation is made in furtherance and not in limitation of the powers conferred upon the Corporation by law, and it is not intended by the mention of any particular purpose, object, or business in any manner

to limit or restrict the generality of any other purposes, object, or business mentioned, or to limit or restrict any of the powers of the Corporation. The Corporation shall have, and exercise all of the powers and rights now or hereafter conferred by statute upon corporations or a similar character, it being the intention that the purposes, objects, and powers specified in each of the paragraphs of these Articles of these Amended and Restated Articles of Incorporation shall, except as otherwise expressly provided, in no way be limited to, restricted by reference to or inference from, the terms of any other clause or paragraph of this or any other Articles of these Amended and Restated Articles of Incorporation, or of any amendment thereof; and, shall each be regarded as independent, and construed as powers as well as objects and purposes; provided, however, that nothing herein contained shall be deemed to authorize or permit the Corporation to carry on any business or exercise any power, or do any act which a corporation formed under the laws of the Commonwealth of Virginia may not at the time lawfully carry on or do.

     SEVENTH: (A) The Corporation reserves the right to amend, alter, change or repeal any provisions contained in these Articles of Incorporation, in the manner now or hereafter prescribed by statute, and all rights conferred upon stockholders herein are granted subject to this reservation.

                          (B) The Board of Directors is authorized and directed to adopt, and from time to time to amend and/or repeal, the Bylaws of this Corporation.

EX-3.11

Exhibit 3.11

AMENDED AND RESTATED

BYLAWS

OF

ALION – CATI CORPORATION,

A CALIFORNIA CORPORATION

(the “Corporation”)

ARTICLE I

OFFICES

     Section 1. Principal Offices.

     The Board of Directors of the Corporation (the “Board” or the “Board of Directors”) shall fix the location of the principal executive office of the Corporation at any place within or outside the State of California.

     Section 2. Other Offices.

     The Board of Directors may at any time establish branch or subordinate offices at any place or places where the Corporation is qualified to do business.

ARTICLE II

MEETINGS OF SHAREHOLDERS

     Section 1. Place of Meetings.

     Meetings of shareholders shall be held at any place within or outside the State of California designated by the Board of Directors. In the absence of any such designation, shareholders’ meetings shall be held at the principal executive office of the Corporation.

     Section 2. Annual Meeting.

     The annual meeting of shareholders of the Corporation shall be held at such time as designated by the Board of Directors.

     Section 3. Special Meetings.

     Special meetings of the shareholders of the Corporation shall be held at such time and at such location as may be designated in the call therefore and may be called by: (1) the president, (2) the vice president, in the event of absence, disability or death of the president; (3) the

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directors by action at a meeting, (4) a majority of the directors acting without a meeting or (5) persons who own in the aggregate not less than ten (10%) percent of the voting shares outstanding.

     Section 4. Notice of Meeting of Shareholders.

     (a) Written notice of all annual and special meetings of shareholders shall be given, no less than 10 nor more than 60 days before the date of the meeting to each shareholder entitled to vote there at. Such notice shall state the place, date and hour of the meeting and (1) in the case of a special meeting, the general nature of the business to be transacted and no other business may be transacted or (2) in the case of the annual meeting, those matters which the Board of Directors, at the time of the mailing of the notice, intends to present for action by the shareholders. The notice of any meeting at which directors are to be elected shall include the names of nominees intended at the time of the notice to be presented by management for election.

     (b) Notice of a shareholders’ meeting or any report shall be given either personally or by mail or other means of written communication, addressed to the shareholder at the address of such shareholder appearing on the books of the Corporation or given by the shareholder to the Corporation for the purpose of notice. The notice or report shall be deemed to have been given at the time when delivered personally or deposited in the mail or sent by other means of written communication. An affidavit of mailing of any notice or report in accordance with the provisions of this bylaw, executed by the secretary, assistant secretary or any transfer agent, shall be prima facie evidence of the giving of the notice or report.

     Section 5. Quorum.

     The presence in person or by proxy of the holders of a majority of the shares entitled to vote at any meeting of shareholders shall constitute a quorum for the transaction of business. The shareholders present at a duly called or held meeting at which a quorum is present may continue to do business until adjournment, notwithstanding the withdrawal of enough shareholders to leave less than a quorum, if any action taken (other than adjournment) is approved by at least a majority of the shares required to constitute a quorum.

     Section 6. Adjourned Meeting; Notice.

     Any shareholders’ meeting, annual or special, whether or not a quorum is present, may be adjourned from time to time by the vote of the majority of the shares represented at that meeting, either in person or by proxy, but in the absence of a quorum, no other business may be transacted at that meeting, except as provided in Section 5 of this Article.

     When any meeting of shareholders, either annual or special, is adjourned to another time of place, notice need not be given of the adjourned meeting if the time and place are announced at a meeting at which the adjournment is taken, unless the adjournment is for more than forty-five (45) days from the date set for the original meeting, in which case the Board of Directors shall set a new record date. Notice of any such adjourned meeting shall be given to each shareholder of record entitled to vote at the adjourned meeting in accordance with the provisions

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of Section 4 of this ARTICLE II. At any adjourned meeting the Corporation may transact any business which might have been transacted at the original meeting.

     Section 7. Shareholders Action by Written Consent.

     (a) Any action which may be taken at any annual or special meeting of shareholders may be taken without a meeting and without prior notice, if a consent in writing, setting forth the action so taken, shall be signed by the holders of outstanding shares having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted, subject to paragraph (b) of this section.

     (b) The election of a director by the shareholders by written consent to fill a vacancy (other than one created by removal) not filled by the Board of Directors required the written consent of a majority of the outstanding shares entitled to vote. Any other election of directors by written consent requires the unanimous written consent of all shares entitled to vote for the election of directors.

     (c) Any shareholder giving a written consent or the shareholder’s proxy holders or a transferror of the shares or a personal representative of the shareholder or their respective proxy holders, may revoke the consent by a writing received by the Corporation prior to the time that written consents of the number of shares required to authorize the proposed action have been filed with the secretary of the Corporation, but may not do so thereafter. Such revocation is effective upon its receipt by the secretary of the Corporation.

     (d) Unless the consents of all shareholders entitled to vote have been solicited in writing, notice of any shareholder approval without a meeting by less than unanimous written consent shall be given as provided in subdivision (b) of Section 603 of the Corporations Code.

     Section 8. Record Date.

     (a) In order that the corporation may determine the shareholders entitled to notice of any meeting or to vote or entitled to receive payment of any divided or other distribution or allotment of any rights or entitled to exercise any rights in respect of any other lawful action, the Board of Directors may fix, in advance, a record date, which shall not be more than 60 nor less than 10 days prior to any other action.

     (b) If no record date is fixed:

          (1) The record date for determining shareholder entitled to notice of or to vote at a meeting of shareholders shall be at the close of business on the business day next preceding

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the day on which notice is given or, if notice is waived, at the close of business day next preceding the day on which the meeting is held.

          (2) The record date for determining shareholders entitled to give consent to corporate action in writing without a meeting, when no prior action by the Board has been taken, shall be the day on which the first written consent is given.

          (3) The record date for determining shall be at the close of business on the day on which the Board adopts the resolution relating thereto or the 60th day prior to the date of such other action, whichever is later.

     (c) A determination of shareholders of record entitled to notice of or to vote at a meeting of shareholders shall apply to any adjournment of the meeting unless the Board fixes a new record date for the adjourned meeting, but the Board shall fix a new record date if the meeting is adjourned for more than 45 days from the date set for the original meeting.

     (d) Shareholders on the record date are entitled to notice and to vote or to receive the dividend, distribution or allotment of rights or to exercise the rights, as the case may be, notwithstanding any transfer of any shares on the books of the Corporation after the record date.

     Section 9. Proxies.

     Every person entitled to vote for directors or on any other matter shall have the right to do so either in person or by one or more agents authorized by a written proxy signed by the person and filed with the secretary of the Corporation. A proxy shall be deemed signed if the shareholder’s name is placed on the proxy (whether by manual signature, typewriting, telegraphic transmission or otherwise) by the shareholder or the shareholder’s attorney in fact. A validly executed proxy which does not state that it is irrevocable shall continue in full force and effect unless (i) revoked by the person executing it before the vote pursuant to that proxy, by a writing delivered to the Corporation stating that the proxy is revoked or by a subsequent proxy executed by or attendance at the meeting and voted in person by the person executing the proxy; or (ii) written notice of the death or incapacity of the maker of that proxy is received by the Corporation before the vote pursuant to that proxy is counted; provided, however, that no proxy shall be valid after the expiration of eleven (11) months from the date of the proxy, unless otherwise provided in the proxy. The revocability of a proxy that states on its fact that it is irrevocable shall be governed by the provisions of Sections 705(e) and 705(f) of the Corporations Code of California.

     Section 10. Action Without a Meeting.

     Any action which may be taken at a meeting of shareholders may be taken without a meeting by a writing executed by all the shareholders entitled to vote, such writing shall be made a part of the permanent records of the Corporation.

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ARTICLE III

BOARD OF DIRECTORS

     Section 1. Powers.

     Except as otherwise provided by law, all the capacity of the Corporation shall be vested in, all its powers and authority exercised and its business managed and conducted by, the Board of Directors.

     Section 2. Number of Directors.

     (a) The authorized number of directors of the Corporation shall be not less than one (1) nor more than three (3). The exact number of directors shall otherwise be fixed by the Board.

     (b) The authorized number of directors may be changed only by an amendment of this section by the bylaws approved by the holders of a majority of the outstanding voting shares.

     Section 3. Election of Directors.

     At each annual meeting of shareholders, directors shall be elected to hold office until the next annual meeting. Each director, including a director elected to fill a vacancy, shall hold office until the expiration of the term for which elected and until a successor has been elected and qualified.

     Section 4. Tenure of Office.

     Each director shall hold office until the annual meeting of shareholders following his election and until his successor is elected and qualified, or until his earlier resignation, removal from office or death. A director not re-elected at any meeting of shareholders called for that purpose shall be deemed to have been removed from office.

     Section 5. Resignation and Removal of Directors.

     (a) Any director may resign effective upon receipt of written notice thereof by the Chairman of the Board, the President, the Secretary or the Board of Directors, unless the notice specifies a later time for the effectiveness of such resignation. If the resignation is effective at a future time, a successor may be elected to take office when the resignation becomes effective.

     (b) Any reduction of the authorized number of directors does not remove any director prior to the expiration of such director’s term of office.

     Section 6. Vacancies.

     A vacancy or vacancies in the Board of Directors shall be deemed to exist in the event of the death, resignation or removal of any director or if the Board of Directors by resolution declares vacant the office of a director who has been declared of unsound mind by an order of court or convicted of a felony or if the authorized number of directors is increased or if the

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shareholders fail, at any meeting of shareholders at which any director or directors to be voted for at that meeting.

     The shareholders may elect a director or directors at any time to fill any vacancy or vacancies not filled by the directors, but any such election by written consent shall require the consent of a majority of the outstanding shares entitled to vote.

     Vacancies in the Board of Directors may be filled by a majority of the remaining directors, except that a vacancy created by removal of a director by the vote or written consent of the shareholders or by court order may be filled only by the vote of a majority of the shares entitled to vote represented at a duly held meeting at which a quorum is present or by the written consent of holders of a majority of the outstanding shares entitled to vote. Each director elected to fill a vacancy shall hold office until the next annual meeting of the shareholders and until a successor has been elected and qualified.

     Section 7. Place of Meeting.

     Regular or special meetings of the Board shall be held at any place within or outside the State of California which has been designated from time to time by the Board. In the absence of such designation, regular meetings shall be held at the principal executive office of the Corporation.

     Section 8. Regular Meetings.

     Immediately following each annual meeting of the shareholders, the Board shall hold a regular meeting for the purpose of organization, election of officers and the transaction of other business.

     Section 9. Special Meetings.

     Special meetings of the Board for any purposes may be called at any time by the Chairman of the Board, the President, any Vice-President, the Secretary or by any two directors.

     Special meetings of the Board shall be held upon four days written notice or 48 hours notice given personally or by telephone, telegraph, telex, facsimile (fax) or other similar means of communication. Any such notice shall be addressed or delivered to each director at such director’s address as it is shown upon the records of the Corporation or as may have been given to the Corporation by the director for purposes of notice or, if such address is not shown on such records or is not readily ascertainable, at the place in which the meetings of the directors are regularly held.

     Notice by mail shall be deemed to have been given at the time a written notice is deposited in the United States mails, postage prepaid. Any other written notice shall be deemed to have been given at the time it is personally delivered to the recipient or is delivered to a common carrier for transmission or actually transmitted by the person giving the notice by electronic means, to the recipient. Oral notice shall be deemed to have been given at the time it is communicated, in person or by telephone or wireless, to the recipient or to a person at the

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office of the recipient who the person giving the notice has reason to believe will promptly communicate it to the recipient.

     Section 10. Quorum.

     A majority of the authorized number of directors constitutes a quorum of the Board for the transaction of business, except to adjourn as provided in Section 12 of this Article. Every act or decision done or made by a majority of the directors present at a meeting duly held at which a quorum is present shall be regarded as the act of the Board, unless a greater number be required by law or by the Articles. A meeting at which a quorum is initially present may continue to transact business notwithstanding the withdrawal of directors, provided that any act or decision taken shall be made by the required quorum for such meeting.

     Section 11. Waiver of Notice.

     Notice of a meeting need not be given to any director who signs a waiver of notice or a consent to holding the meeting or an approval of the minutes thereof whether before or after the meeting or who attends the meeting without protesting, prior thereto or at its commencement, the lack of notice of such director. All such waivers, consents and approvals shall be filed with the corporate records or made a part of the minutes of the meeting.

     Section 12. Adjournment.

     A majority of the directors present, whether or not a quorum is present, may adjourn any directors’ meeting to another time and place. Notice of the time and place of holding an adjourned meeting need not be given to absent directors if the time and place be fixed at the meeting adjourned, except as provided in the next sentence. If the meeting is adjourned for more than 24 hours, notice of any adjournment to another time or place shall be given prior to the time of the adjourned meeting to the directors who were not present at the time of the adjournment.

     Section 13. Fees and Compensation of Directors.

     Directors and members of committees may receive such compensation for their services and such reimbursement of expenses, as may be fixed or determined by the Board of Directors. This Section shall not be construed to preclude any director from serving the Corporation in any other capacity as an officer, agent, employee or otherwise and receiving compensation for those services.

ARTICLE IV

OFFICERS

     Section 1. Officers Designated.

     The Officers of the Corporation shall consist of a Chairman of the Board, a President, a Vice President, a Secretary, a Treasurer and such other officers as the directors may deem appropriate.

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     Section 2. Election.

     The officers shall be elected by the directors. An officer need not be a director or shareholder of the Corporation.

     Section 3. Tenure of Office.

     Each officer shall hold office until the first meeting of directors following the annual meeting of shareholders next following his election and until his successor is elected and qualified or until his earlier resignation, removal from office or death.

     Section 4. Authority and Duties of Officers.

     The officers of the Corporation shall have such authority and shall perform such duties as are customarily incident to their respective offices or as may be specified from time to time by the directors regardless of whether such authority and duties are customarily incident to such office.

ARTICLE V

SHARES

     Section 1. Certificates.

     Certificates evidencing ownership of the shares of the Corporation shall be issued to those entitled to them by subscription, transfer or otherwise. Each certificate for shares shall bear a distinguishing number, the signature of the President or Vice President and of the Secretary and such recitals as may be required by law. No fractional shares shall be issued. .

     Section 2. Transfer.

     Such certificates shall be transferable in person or by attorney, but no transfer of shares shall be entered upon the records of the Corporation until the previous certificate, if any, given for the same shall have been surrendered and canceled; provided, however, that the Board of Directors shall have power and authority to make such rules and regulation as they deem expedient from time to time concerning the issue, registration or transfer of share certificates of this Corporation and to take such actions in specific cases as they deem proper concerning lost, destroyed or mutilated certificates.

ARTICLE VI

DISPENSING WITH ANNUAL REPORT

Section 1. Annual Report to Shareholders.

     The annual report to shareholders referred to in Section 1501 of the California General Corporation Law is expressly dispensed with, but nothing herein shall be interpreted as prohibiting the Board of Directors from issuing annual or other periodic reports to the shareholders of the Corporation as they consider appropriate.

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ARTICLE VII

CORPORATE SEAL

     The corporate seal shall be circular in form and shall have inscribed thereon the name of the Corporation, the date of its incorporation and the word of California.

ARTICLE VIII

INDEMNIFICATION

     Section 1. Indemnification of Directors, Officers, Employees and Other Agents.

     (a) The Corporation shall, to the maximum extent permitted by the California General Corporation Law and particularly but without limitation, Section 317 thereof, have power to indemnify each of its agents against expenses, judgments, fines, settlements and other amounts actually and reasonably incurred in connection with any proceeding arising by reason of the fact any such person is or was an agent of the Corporation and shall have power to advance to each such agent expenses incurred in defending any such proceeding to the maximum extent permitted by that law. For purposes of this Article, an “agent” of the Corporation includes any person who is or was a director, officer, employee or other agent of the Corporation or is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise or was a director, officer, employee or agent of a corporation that was a predecessor corporation of the Corporation or of another enterprise at the request of such predecessor corporation.

     (b) The Corporation may purchase and maintain insurance on behalf of any agent (as defined herein) of the Corporation against any liability asserted against or incurred by the agent in such capacity or arising out of the agent’s status as such, whether or not the Corporation would have the power to indemnify the agent against such liability under the provisions of Section 317 of the Corporations Code.

ARTICLE IX

AMENDMENTS

     Section 1. Amendment by Shareholders.

     New bylaws may be adopted or these bylaws may be amended or repealed by the vote or written consent of holders of a majority of the outstanding shares entitled to vote; provided, however, that if these bylaws contain an Article restricting transfers of stock of the Corporation, such Article may be amended or deleted only by unanimous vote or consent of all shareholders.

     Section 2. Amendment by Directors.

     Subject to the rights of the shareholders as provided in Section 1 of this Article IX, bylaws, other than a bylaw or an amendment of a bylaw changing the authorized number of

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directors or the Article, if any, restricting transfers of stock of the Corporation, may be adopted, amended or repealed by the Board of Directors.

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EX-3.12

Exhibit 3.12

ARTICLES OF INCORPORATION

OF

CARMEL APPLIED TECHNOLOGIES, INC.

FIRST

     The name of this corporation shall be:

CARMEL APPLIED TECHNOLOGIES, INC.

SECOND

     The purpose of the corporation is to engage in any lawful act or activity for which a corporation may be organized under the General Corporation Law of California, other than the banking business, the trust company business, or the practice of a profession permitted to be incorporated by the California Corporations Code.

THIRD

     The initial agent of the corporation for the purpose of service of process shall be:

Robert James Koontz
Attorney at Law
631 Abrego Street
Monterey, CA 93940
 

FOURTH

     The total number of shares which this corporation is authorized to issue is twenty thousand (20,000), all of the same class.

     IN WITNESS WHEREOF, the undersigned incorporator has executed these Articles of Incorporation this 19 day of November, 1992.

/s/ Robert James Koontz

Robert James Koontz

     The undersigned declares that he is the incorporator who has executed these Articles of Incorporation and hereby declares that this instrument is his act and deed.

/s/ Robert James Koontz

      Robert James Koontz

EX-3.13

Exhibit 3.13

CERTIFICATE OF AMENDMENT OF

ARTICLES OF INCORPORATION

The undersigned certify that:

1.	They are the president and the secretary, respectively, of Carmel Applied Technologies, Inc., a California corporation.
2.	Article 4 of the Articles of Incorporation is amended to read in its entirety as follow:

This corporation is authorized to issue 200,000 shares of capital stock, all of the same class. On the amendment of this article, each outstanding share of capital stock is split up and converted into one thousand (1000) shares of capital stock.

3.

The foregoing amendment of Articles of Incorporation has been duly approved by the board of directors.

4.

The foregoing amendment of Articles of Incorporation has been duly approved by the required vote of shareholders in accordance with Section 902 of the California Corporation Code. The total number of outstanding shares of the corporation is One Hundred Fifty (150). The foregoing amendment of Articles of Incorporation was approved by the unanimous vote of shareholders. The number of shares voting in favor of the amendment exceeded the vote required. The percentage vote required was more than 50%.

     We further declare under penalty of perjury under the laws of the State of California that the matters set forth in this certificate are true and correct of our own knowledge.

DATE: July 14, 2003	/s/ Robert Edward Hayner
	Robert Edward Hayner, President
	/s/ Robert Thomas
	Robert Thomas, Secretary

EX-3.14

Exhibit 3.14

CERTIFICATE OF AMENDMENT

OF

ARTICLES OF INCORPORATION

OF

CARMEL APPLIED TECHNOLOGIES, INC.

     We, James C. Fontana, the Secretary, and Rob Goff, the President, of Carmel Applied Technologies, Inc., a corporation duly organized and existing under the laws of the State of California, do hereby certify:

     1. That they are the Secretary and President, respectively, of Carmel Applied Technologies, Inc., a California corporation (the “Corporation”).

     2. That an amendment to the articles of incorporation of this Corporation has been approved by the board of directors.

     3. The amendment so approved by the board of directors of the Corporation is as follows:

     Article First of the articles of incorporation of this Corporation is amended to read as follows:

     The name of this corporation shall be:

ALION – CATI CORPORATION

     4. That the sole shareholder of this Corporation has adopted said amendment by written consent. That the wording of said amendment as approved by written consent of the sole shareholder is the same as that set forth above. That said written consent was signed by the holders of outstanding shares having not less than the minimum number of required votes of shareholders necessary to approve said amendment in accordance with Section 902 of the California Corporation Code.

     5. That the designation and total number of outstanding shares entitled to vote on or give written consent to said amendment and the minimum percentage vote required of each class or series entitled to vote on or give written consent to said amendment for approval thereof are as follows:

	Number of shares	Minimum
	outstanding entitled	percentage vote
Designation	to vote	required to approve
Shares	176,471	more than 50%

     6. That the number of shares of each class which gave written consent in favor of said amendment equaled or exceeded the minimum percentage vote required of each class entitled to vote, as set forth above.

     7. That this certificate shall become effective on the day of filing.

     Each of the undersigned declares under penalty of perjury under the laws of the State of California that the statements contained in the foregoing certificate are true of their own knowledge.

Executed at McLean, VA on April 20^th, 2005.

/s/ Rob Goff

Rob Goff

President

/s/ James C. Fontana

James C. Fontana

Secretary

EX-3.15

Exhibit 3.15

AMENDED AND RESTATED BY — LAWS

OF

ALION-JJMA CORPORATION

(a New York corporation)

ARTICLE I

SHAREHOLDERS

     1. CERTIFICATES REPRESENTING SHARES. Certificates representing shares shall set forth thereon the statements prescribed by Section 508, and, where applicable, by Sections 505, 616, 620, 709, and 1002, of the Business Corporation Law and by any other applicable provision of law and shall be signed by the Chairman of the Board of Directors, if any, or by the President or a Vice-President and by the Secretary or an Assistant Secretary or the Treasurer or an Assistant Treasurer and may be sealed with the corporate seal or a facsimile thereof. The signatures of the officers upon a certificate may be facsimiles if the certificate is countersigned by a transfer agent or registered by a registrar other than the corporation itself or its employee, or if the shares are listed on a registered national security exchange. In case any officer who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer before such certificate is issued, it may be issued by the corporation with the same effect as if he were such officer at the date of its issue.

     A certificate representing shares shall not be issued until the full amount of consideration therefor has been paid except as Section 504 of the Business Corporation Law may otherwise permit.

     The corporation may issue a new certificate for shares in place of any certificate theretofore issued by it, alleged to have been lost or destroyed, and the Board of Directors may require the owner of any lost or destroyed certificate, or his legal representative, to give the corporation a bond sufficient to indemnify the corporation against any claim that may be made against it on account of the alleged loss or destruction of any such certificate or the issuance of any such new certificate.

     2. FRACTIONAL SHARE INTERESTS. The corporation may issue certificates for fractions of a share which shall entitle the holder, in proportion to his fractional holdings, to exercise voting rights, receive dividends, and participate in liquidating distributions; or it may pay in cash the fair value of fractions of a share as of the time when those entitled to receive such fractions are determined; or it may issue scrip in registered or bearer form over the manual or facsimile signature of an officer of the corporation or of its agent, exchangeable as therein provided for full shares, but such scrip shall not entitle the holder to any rights of a shareholder except as therein provided.

     3. SHARE TRANSFERS. Upon compliance with provisions restricting the transferability of shares, if any, transfers of shares of the corporation shall be made only on the share record of the corporation by the registered holder thereof, or by his attorney thereunto authorized by power of attorney duly executed and filed with the Secretary of the corporation or with a transfer agent or a registrar, if any, and on surrender of the certificate or certificates for such shares properly endorsed and the payment of all taxes due thereon.

     4. RECORD DATE FOR SHAREHOLDERS. For the purpose of determining the shareholders entitled to notice of or to vote at any meeting of shareholders or any adjournment thereof, or to express consent to or dissent from any proposal without a meeting, or for the purpose of determining shareholders entitled to receive payment of any dividend or the allotment of any rights, or for the purpose of any other action, the directors may fix, in advance, a date as the record date for any such determination of shareholders. Such date shall not be more than sixty days nor less than ten days before the date of such meeting, nor more than sixty days prior to any other action. If no record date is fixed, the record date for the determination of shareholders entitled to notice of or to vote at a meeting of shareholders shall be at the close of the business on the day next preceding the day on which notice is given, or, if no notice is given, the day on which the meeting is held; the record date for determining shareholders for any purpose other than that specified in the preceding clause shall be at the close of business on the day on which the resolution of the directors relating thereto is adopted. When a determination of shareholders of record entitled to notice of or to vote at any meeting of shareholders has been made as provided in this paragraph, such determination shall apply to any adjournment thereof, unless directors fix a new record date under this paragraph for the adjourned meeting.

     5. MEANING OF CERTAIN TERMS. As used herein in respect of the right to notice of a meeting of shareholders or a waiver thereof or to participate or vote thereat or to consent or dissent in writing in lieu of a meeting, as the case may be, the term “share” or “shares” or “shareholder” or “shareholders” refers to an outstanding share or shares and to a holder or holders of record of outstanding shares when the corporation is authorized to issue only one class of shares, and said reference is also intended to include any outstanding share or shares and any holder or holders of record of outstanding shares of any class upon which or upon whom the Certificate of Incorporation confers such rights where there are two or more classes or series of shares or upon which or upon whom the Business Corporation Law confers such rights notwithstanding that the Certificate of Incorporation may provide for more than one class or series of shares, one or more of which are limited or denied such rights thereunder.

     6. SHAREHOLDER MEETINGS.

     - TIME. The annual meeting shall be held on the date fixed, from time to time, by the directors, provided, that each successive annual meeting shall be held on a date within thirteen months after the date of the preceding annual meeting. A special meeting shall be held on the date fixed by the directors except when the Business Corporation Law confers the right to fix the date upon shareholders.

     - PLACE. Annual meetings and special meetings shall be held at such place, within or without the State of New York, as the directors may, from time to time, fix.

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     - CALL. Annual meetings may be called by the directors or by any officer instructed by the directors to call the meeting. Special meetings may be called in like manner except when the directors are required by the Business Corporation Law to call a meeting, or except when the shareholders are entitled by said Law to demand the call of a meeting.

     - NOTICE OR ACTUAL OR CONSTRUCTIVE WAIVER OF NOTICE. Written notice of all meetings shall be given, stating the place, date, and hour of the meeting, and, unless it is an annual meeting, indicating that it is being issued by or at the direction of the person or persons calling the meeting. The notice of an annual meeting shall state that the meeting is called for the election of directors and for the transaction of other business which may properly come before the meeting, and shall (if any other action which could be taken at a special meeting is to be taken at such annual meeting) state the purpose or purposes. The notice of a special meeting shall in all instances state the purpose or purposes for which the meeting is called; and, at any such meeting, only such business may be transacted which is related to the purpose or purposes set forth in the notice. If the directors shall adopt, amend, or repeal a By-Law regulating an impending election of directors, the notice of the next meeting for election of directors shall contain the statements prescribed by Section 602(d) of the Business Corporation Law. If any action is proposed to be taken which would, if taken, entitle shareholders to receive payment for their shares, the notice shall include a statement of that purpose and to that effect and shall be accompanied by a copy of Section 623 of the Business Corporation Law or an outline of its material terms. A copy of the notice of any meeting shall be given, personally or by first class mail, not fewer than ten days nor more than sixty days before the date of the meeting, unless the lapse of the prescribed period of time shall have been waived, to each shareholder at his record address or at such other address which he may have furnished by request in writing to the Secretary of the corporation. In lieu of giving a copy of such notice personally or by first class mail as aforesaid, a copy of such notice may be given by third class mail not fewer than twenty-four nor more than sixty days before the date of the meeting. Notice by mail shall be deemed to be given when deposited, with postage thereon prepaid, in a post office or official depository under the exclusive care and custody of the United States post office department. If a meeting is adjourned to another time or place, and, if any announcement of the adjourned time or place is made at the meeting, it shall not be necessary to give notice of the adjourned meeting unless the directors, after adjournment, fix a new record date for the adjourned meeting. Notice of a meeting need not be given to any shareholder who submits a signed waiver of notice before or after the meeting. Waiver of notice may be written or electronic. If written, the waiver must be executed by the shareholder or the shareholder’s authorized officer, director, employee or agent by signing such waiver or causing his or her signature to be affixed to such waiver by any reasonable means, including, but not limited to, facsimile signature. If electronic, the transmission of the waiver must either set forth or be submitted with information form which it can reasonably be determined that the transmission was authorized by the shareholder. The attendance of a shareholder at a meeting without protesting prior to the conclusion of the meeting the lack of notice of such meeting shall constitute a waiver of notice by him.

     - SHAREHOLDER LIST AND CHALLENGE. A list of shareholders as of the record date, certified by the Secretary or other officer responsible for its preparation or by the transfer agent, if any, shall be produced at any meeting of shareholders upon the request thereat or prior thereto of any shareholder. If the right to vote at any meeting is challenged, the inspectors of

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election, if any, or the person presiding thereat, shall require such list of shareholders to be produced as evidence of the right of the persons challenged to vote at such meeting, and all persons who appear from such list to be shareholders entitled to vote thereat may vote at such meeting.

     - CONDUCT OF MEETING. Meetings of the shareholders shall be presided over by one of the following officers in the order of seniority and if present and acting — the Chairman of the Board, if any, , the President, a Vice-President, or, if none of the foregoing is in office and present and acting, by a chairman to be chosen by the shareholders. The Secretary of the corporation, or in his absence, an Assistant Secretary, shall act as secretary of every meeting, but if neither the Secretary nor an Assistant Secretary is present the chairman of the meeting shall appoint a secretary of the meeting.

     - PROXY REPRESENTATION. Every shareholder may authorize another person or persons to act for him by proxy in all matters in which a shareholder is entitled to participate, whether by waiving notice of any meeting, voting or participating at a meeting, or expressing consent or dissent without a meeting. No proxy shall be valid after the expiration of eleven months from the date thereof unless otherwise provided in the proxy. Every proxy shall be revocable at the pleasure of the shareholder executing it, except as otherwise provided by the Business Corporation Law.

     - INSPECTORS — APPOINTMENT. Inspectors may be appointed in the manner prescribed by the provisions of Section 610 of the Business Corporation Law, but need not be appointed except as otherwise required by those provisions.

     - QUORUM. Except for a special election of directors pursuant to Section 603(b) of the Business Corporation Law, and except as herein otherwise provided, the holders of a majority of the votes of outstanding shares shall constitute a quorum at a meeting of shareholders for the transaction of any business. When a quorum is once present to organize a meeting, it is not broken by the subsequent withdrawal of any shareholders. The shareholders present may adjourn the meeting despite the absence of a quorum.

     - VOTING. Each share shall entitle the holder thereof to one vote. In the election of directors, a plurality of the votes cast shall elect. Any other action shall be authorized by a majority of the votes cast in favor of or against such action except where the Business Corporation Law provides otherwise.

     7. SHAREHOLDER ACTION WITHOUT MEETINGS. Whenever under the provisions of the Business Corporation Law shareholders are required or permitted to take any action by vote, such action may be taken without a meeting on written consent, signed by the holders of all outstanding shares entitled to vote thereon or, if the Certificate of Incorporation so permits, signed by the holders of outstanding shares having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted, in accordance with the provisions of Section 615 of the Business Corporation Law.

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ARTICLE II

BOARD OF DIRECTORS

     1. FUNCTIONS AND DEFINITIONS. The business of the corporation shall be managed under the direction of a governing board, which is herein referred to as the “Board of Directors” or “directors” notwithstanding that the members thereof may otherwise bear the titles of trustees, managers, or governors or any other designated title, and notwithstanding that only one director legally constitutes the Board. The word “director” or “directors” likewise herein refers to a member or to members of the governing board notwithstanding the designation of a different official title or titles. The use of the phrase “entire board” herein refers to the total number of directors which the corporation would have if there were no vacancies.

     2. QUALIFICATIONS AND NUMBER. Each director shall be at least eighteen years of age. A director need not be a shareholder, a citizen of the United States, or a resident of the State of New York. The number of directors constituting the board shall be at least three and no more than five.

     3. ELECTION AND TERM. Directors who are elected at an annual meeting of shareholders, and directors who are elected in the interim by the shareholders to fill vacancies and newly created directorships, shall hold office until the next annual meeting of shareholders and until their successors have been elected and qualified; and directors who are elected in the interim by the directors to fill vacancies and newly created directorships shall hold office until the next meeting of shareholders at which the election of directors is in the regular order of business and until their successors have been elected and qualified. In the interim between annual meetings of shareholders or of special meetings of shareholders called for the election of directors, newly created directorships and any vacancies in the Board of Directors, including vacancies resulting from the removal of directors for cause or without cause, may be filled by the vote of the remaining directors then in office, although less than a quorum exists.

     4. MEETINGS.

     - TIME. Meetings shall be held at such time as the Board shall fix, except that the first meeting of a newly elected Board shall be held as soon after its election as the directors may conveniently assemble.

     - PLACE. Meetings shall be held at such place within or without the State of New York as shall be fixed by the Board.

     - CALL. No call shall be required for regular meetings for which the time and place have been fixed. Special meetings may be called by or at the direction of the Chairman of the Board, if any, of the President, or of a majority of the directors in office.

     - NOTICE OR ACTUAL OR CONSTRUCTIVE WAIVER. No notice shall be required for regular meetings for which the time and place have been fixed. Written, oral, or any other mode of notice of the time and place shall be given for special meetings in sufficient time for the convenient assembly of the directors thereat. The notice of any meeting need not specify the

5

purpose of the meeting. Any requirement of furnishing a notice shall be waived by any director who signs a waiver of notice before or after the meeting, or who attends the meeting without protesting, prior thereto or at its commencement, the lack of notice to him.

     - QUORUM AND ACTION. A majority of the entire Board shall constitute a quorum except when a vacancy or vacancies prevents such majority, whereupon a majority of the directors in office shall constitute a quorum, provided such majority shall constitute at least one-third of the entire Board. A majority of the directors present, whether or not a quorum is present, may adjourn a meeting to another time and place. Except as herein otherwise provided, the act of the Board shall be the act, at a meeting duly assembled, by vote of a majority of the directors present at the time of the vote, a quorum being present at such time.

     Any one or more members of the Board of Directors or of any committee thereof may participate in a meeting of said Board or of any such committee by means of a conference telephone or similar communications equipment allowing all persons participating in the meeting to hear each other at the same time, and participation by such means shall constitute presence in person at the meeting.

     - CHAIRMAN OF THE MEETING. The Chairman of the Board, if any and if present and acting, shall preside at all meetings. Otherwise, the President, if present and acting, or any other director chosen by the Board, shall preside.

     5. REMOVAL OF DIRECTORS. Any or all of the directors may be removed for cause or without cause by the shareholders. One or more of the directors may be removed for cause by the Board of Directors.

     6. COMMITTEES. The Board of Directors, by resolution adopted by a majority of the entire Board of Directors, may designate from their number one or more directors to constitute an Executive Committee and other committees, each of which, to the extent provided in the resolution designating it, shall have the authority of the Board of Directors with the exception of any authority the delegation of which is prohibited by Section 712 of the Business Corporation Law.

     7. WRITTEN ACTION. Any action required or permitted to be taken by the Board of Directors or by any committee thereof may be taken without a meeting if all of the members of the Board of Directors or of any committee thereof consent in writing to the adoption of a resolution authorizing the action. The resolution and the written consents thereto by the members of the Board of Directors or of any such committee shall be filed with the minutes of the proceedings of the Board of Directors or of any such committee.

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ARTICLE III

OFFICERS

     The directors may elect or appoint a Chairman of the Board of Directors, a President, one or more Vice-Presidents, a Secretary, one or more Assistant Secretaries, a Treasurer, one or more Assistant Treasurers, and such other officers as they may determine. The President may but need not be a director. Any two or more offices may be held by the same person. When all of the issued and outstanding shares of the corporation are owned by one person, such person may hold all or any combination of offices.

     Unless otherwise provided in the resolution of election or appointment, each officer shall hold office until the meeting of the Board of Directors following the next annual meeting of shareholders and until his successor has been elected or appointed and qualified.

     Officers shall have the powers and duties defined in the resolutions appointing them.

     The Board of Directors may remove any officer for cause or without cause.

ARTICLE IV

STATUTORY NOTICES TO SHAREHOLDERS

     The directors may appoint the Treasurer or other fiscal officer and/or the Secretary or any other officer to cause to be prepared and furnished to shareholders entitled thereto any special financial notice and/or any financial statement, as the case may be, which may be required by any provision of law, and which, more specifically, may be required by Sections 511, 515, 516, 517, 519, and 520 of the Business Corporation Law.

ARTICLE V

BOOKS AND RECORDS

     The corporation shall keep correct and complete books and records of account and shall keep minutes of the proceedings of the shareholders, of the Board of Directors,

     and of any committee which the directors may appoint.

ARTICLE VI

CORPORATE SEAL

     The corporate seal, if any, shall be in such form as the Board of Directors shall prescribe.

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ARTICLE VII

FISCAL YEAR

     The fiscal year of the corporation shall be fixed, and shall be subject to change from time to time, by the Board of Directors.

ARTICLE VIII

CONTROL OVER BY-LAWS

     The shareholders entitled to vote in the election of directors or the directors upon compliance with any statutory requisite may amend or repeal the By-Laws and may adopt new By-Laws, except that the directors may not amend or repeal any By-Law or adopt any new By-Law, the statutory control over which is vested exclusively in the said shareholders or in the incorporators. By-Laws adopted by the incorporators or directors may be amended or repealed by the said shareholders.

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EX-3.16

Exhibit 3.16

RESTATED CERTIFICATE OF INCORPORATION

OF

ALION – JJMA CORPORATION

(Pursuant to Section 807 of the New York Business Corporation Law)

IT IS HEREBY CERTIFIED THAT:

FIRST:	The name of the Corporation is:
	Alion-JJMA Corporation (hereinafter the “Corporation”). The name under which the corporation was formed was John J. McMullen Associates, Inc.
SECOND:	The original Certificate of Incorporation was filed by the Department of State on the 18th day of September, 1959.
THIRD:	The following amended and restated Certificate of Incorporation amends the following Articles of the Corporation’s original Certificate of Incorporation as modified by the Certificate of Change of the Corporation, which was filed with the Secretary of State of the State of New York (the “Secretary”) on October 4, 1988, the Certificate of Amendment of the Certificate of Incorporation of the Corporation, which was filed with the Secretary on October 8, 1998, the Certificate of Change of the Corporation, which was filed with the Secretary on September 14, 1999, and the Certificate of Amendment of the Certificate of Incorporation of the Corporation, which was filed with the Secretary on May 2, 2005:

1.	Article 2 is amended to change the purpose of the Corporation to any lawful purpose under the Business Corporation Law of the State of New York;
2.	Article 4 is amended to change the address of the Corporation’s Registered Agent;
3.	Article 7 is deleted;
4.	Article 8 is deleted;
5.	Article 9 is deleted;
6.	Article 10 is renumbered as Article 7 and amended to include the post office address within the State of New York to which the Secretary shall mail a copy of any process against the Corporation served upon the Secretary; and

7. Article 11 is deleted.

FOURTH:	The restatement of the Certificate of Incorporation herein provided for was authorized, pursuant to sections 803 and 615(a) of the New York Business Corporation Law, by the unanimous written consent of the Board of Directors of the Corporation, followed by the unanimous written consent, setting forth the action so taken, signed by the holders of all outstanding shares entitled to vote thereon.
FIFTH:	To accomplish the amendment described above, Articles 2 and 4 are each hereby amended to read as set forth in the same numbered Article of the Certificate of Incorporation of the Corporation as hereafter restated, Article 10 is hereby renumbered and amended to read as set forth in Article 7 of the Certificate of Incorporation of the Corporation as hereafter restated, and Articles 7, 8, 9 and 11 are hereby deleted.
SIXTH:	The text of the Certificate of Incorporation of the Corporation is hereby restated as further amended or changed herein to read as follows:

                 1. The name of the Corporation shall be Alion – JJMA Corporation.

                 2. The purpose of the Corporation is to engage in any lawful act or activity for which Corporations may be organized under the Business Corporation Law, provided that the Corporation is not formed to engage in any act or activity requiring the consent or approval of any state official, department, board, agency or other body without such consent or approval first being obtained.

                 3. The total number of shares that may be issued is 5,000,000 shares, $0.01 par value per share.

                 4. CT Corporation System is hereby designated as the Corporation’s Registered Agent, the agent upon whom process may be served. The registered agent is a foreign stock corporation authorized to transact business in New York.

                 CT Corporation System’s post office address is:

111 Eighth Avenue

New York, NY 10011

                 5. The duration of the Corporation shall be perpetual.

                 6. The number of Directors shall be not less than three nor more than five.

                 7. The Secretary of State is hereby designated as the agent of the Corporation upon whom process in any action or proceeding against it may be served. The post office address to

2

which the Secretary of State shall mail a copy of any process against the Corporation served upon him is:

CT Corporation System

111 Eighth Avenue

New York, NY 10011

     IN WITNESS WHEREOF, we have subscribed this document as the date set forth below and do hereby affirm, under the penalties of perjury, that the statements contained therein have been examined by us and are true and correct.

Executed in the name of the Corporation by:

(signature)	(date)
Leroy R. Groff (printed name)	President (corporate title)

3

EX-3.17

Exhibit 3.17

BYLAWS
OF
WASHINGTON CONSULTING, INC.

ARTICLE I — OFFICES

     1. Registered Office. The registered office of the Corporation shall be in the County of Fairfax, Virginia.

     2. Other Offices. The Corporation may have its principal office and other offices at such places both within and without the Commonwealth of Virginia as the Board of Directors may from time to time determine or the business of the Corporation may require.

ARTICLE II — MEETINGS OF SHAREHOLDERS

     1. Place and Time of Meetings. All meetings of the shareholders for the election of directors shall be held at such place either within or without the Commonwealth of Virginia as shall be stated in the notice of the meeting or in a duly executed waiver of notice thereof.

     2. Annual Meetings. Annual meetings of shareholders, commencing with the year 2003, shall be held at such date and time as shall be designated from time to time by the Board of Directors and stated in the notice of the meeting, at which they shall elect by a plurality vote a Board of Directors and transact such other business as may properly be brought before the meeting.

     3. Notice of Annual Meetings. Written notice of the annual meeting stating the place, date, and hour of the meeting shall be given to each shareholder entitled to vote at such meeting not less than 10 nor more than 60 days before the date of the meeting.

     4. Special Meetings. Special meetings of the shareholders, for any purpose or purposes, unless otherwise prescribed by statute or by the Articles of Incorporation, may be called by the president and shall be called by the president or secretary at the request in writing

of a majority of the Board of Directors. Such request shall state the purpose or purposes of the proposed meeting.

     5. Notice of Social Meetings. Written notice of a special meeting stating the place, date, and hour of the meeting and the purpose or purposes for which the meeting is called, shall be given not less than 10 nor more than 60 days before the date of the meeting, either personally or by mail, by or at the direction of the president, the secretary, or the officer or persons calling the meeting, to each shareholder entitled to vote at such meeting.

     6. Quorum. Any number of shareholders together holding at least a majority of the outstanding shares of capital stock entitled to vote with respect to the business to be transacted, who shall be present in person or represented by proxy at any meeting duly called, shall constitute a quorum for the transaction of business. If less than a quorum shall be in attendance at the time for which a meeting shall have been called, the meeting may be adjourned from time to time by a majority of the shareholders present or represented by proxy without notice other than by announcement at the meeting.

     7. Voting. At any meeting of the shareholders each shareholder of a class entitled to vote on any matter coming before the meeting shall, as to such matter, have one vote, in person or by proxy, for each share of capital stock of such class standing in his name on the books of the Corporation on the date, not more than 70 days before such meeting, fixed by the Board of Directors as the record date for the purpose of determining shareholders entitled to vote. Every proxy shall be in writing, dated and signed by the shareholder entitled to vote or his or her duly authorized attorney-in-fact.

     8. Waiver of Notice. Notice of a meeting need not be given to any shareholder who submits a signed waiver of notice, whether before or after the meeting, or who attends the meeting without protesting, before or at its commencement, the lack of notice. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the shareholders need be specified in the waiver of notice of such meeting.

     9. Business Transacted. Business transacted at any special meeting of shareholders shall be limited to the purpose or purposes stated in the notice.

ARTICLE III — DIRECTORS

     1. Number and Term. The number of directors that shall constitute the whole board shall be no less than one and no more than four, as determined initially by the incorporators and, after the issuance of stock, by the shareholders at the annual or any special meeting. Except as provided in section (2) of this Article III, each director elected shall hold office until his or her successor is elected and qualified. Directors shall be at least 18 years of age and need not be residents of Virginia or shareholders of the Corporation, however, at no time shall the number of male directors exceed the number of female directors except as determined after the issuance of stock, by the shareholders at the annual meeting or any special meeting. The directors, other than the first Board of Directors, shall be elected at the annual meeting of the shareholders, except as hereinafter provided. Each director shall hold office until his or her successor has been elected and qualified or until his or her earlier resignation or removal.

     2. Vacancies. Vacancies and newly-created directorships resulting from an increase in the Board of Directors and all vacancies occurring in the Board of Directors, including vacancies caused by removal without cause, may be filled by a majority of the directors then in office, though less than a quorum, by a sole remaining director, or by the shareholders, and the directors so chosen shall hold office until the next annual election and until their successors are duly elected and qualified, unless sooner displaced. If there are no directors in office, then an election of directors may be held in the manner provided by statute.

     3. Functions of the Board. The business and affairs of the Corporation shall be managed by its Board of Directors, which may exercise all such powers of the Corporation and do all such lawful acts and things as are not by statute or by the Articles of Incorporation or by these bylaws directed or required to be exercised or done by the shareholders.

     4. Performance by the Directors. Each member of the Board of Directors and each member of any committee designated by the Board of Directors shall, in the performance of such director’s duties, be fully protected in relying in good faith upon the records of the Corporation and upon such information, opinions, reports, or statements presented to the Corporation by any of the Corporation’s officers or employees or committees of the Board of Directors, or by any other person as to matters such member reasonably believes are within such other person’s

professional or expert competence and who has been selected with reasonable care by or on behalf of the Corporation.

     5. Meetings of the Board of Directors.

          (a) The Board of Directors of the Corporation may hold meetings, both regular and special, either within or without the Commonwealth of Virginia.

          (b) Except as provided in section (6) of this Article III, the first meeting of each newly-elected Board of Directors shall be held at such time and place as shall be fixed by the vote of the shareholders at the annual meeting, and no notice of such meeting, shall be necessary to the newly-elected directors in order legally to constitute the meeting, provided a quorum shall be present. In the event of the failure of the shareholders to fix the time or place of such first meeting, or in the event such meeting is not held at the time and place so fixed by the shareholders, the meeting may be held at such time and place as shall be specified in a notice given as hereinafter provided for special meetings of the Board of Directors, or as shall be specified in a written waiver signed by all of the directors.

          (c) Regular meetings of the Board of Directors may be held without notice at such time and at such place as shall from time to time be determined by the board.

          (d) Special meetings of the board may be called by the president on 30 days notice to each director; special meetings shall be called by the president or secretary on like notice to each director on the written request of two directors or, if the board shall consist of one director, on the written request of the sole director.

          (e) Notice of a meeting need not be given to any director who submits a signed waiver of notice, whether before or after the meeting, or who attends the meeting without protesting, before at its commencement, the lack of notice. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the Board of Directors need be specified in the waiver of notice of such meeting.

     6. Quorum of Directors. At all meetings of the Board of Directors, two of the directors in office shall constitute a quorum for the transaction of business unless a greater or

lesser number is required by law or the Articles of Incorporation. The act of a majority of the directors present at any meeting at which there is a quorum shall be the act of the Board of Directors, except as may be otherwise specifically provided by statute or by the Articles of Incorporation. Except as provided by Article IX, if a quorum shall not be present at any meeting of directors, the directors present may adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum is present.

     7. Written Consent of Directors. Any action required or permitted to be taken at any meeting of the Board of Directors or of any committee thereof may be taken without a meeting, if all members of the Board of Directors or such committee, as the case may be, consent thereto in writing, and the writing or writings are filed with the minutes of proceedings of the Board of Directors or such committee.

     8. Meetings by Conference Telephone. Members of the Board of Directors or any committee designated by the Board of Directors may participate in a meeting of the Board of Directors or any committee by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other, and such participation in a meeting shall constitute presence in person at the meeting.

     9. Committees of Directors.

          (a) The Board of Directors may, by resolution passed by a majority of the whole board, designate one or more committees, each committee to consist of one or more of the directors of the Corporation. Such committee or committees shall have such powers as may be determined from time to time by resolution adopted by the Board of Directors subject to any statutory limitations.

          (b) Meetings of each committee may be called by any member of the committee upon notice given to each member of the committee not later than the day before the day on which the meeting is to be held. Notice of any meeting may be waived by all members of the committee.

          (c) A majority of each committee shall constitute a quorum for transaction of business, and the act of a majority of those present at a meeting at which a quorum is present shall be the act of such committee.

          (d) Any member of any committee may be removed with or without cause, at any time, by the Board of Directors. Any vacancy on any committee shall be filled by the Board of Directors.

          (e) Each committee shall keep regular minutes of its meetings and report the same to the Board of Directors when required.

     10. Compensation of Directors. Unless otherwise restricted by the Articles of Incorporation, the Board of Directors may be paid their reasonable expenses, if any, of attendance at each meeting of the Board of Directors and may be paid a fixed sum for attendance at such meeting of the Board of Directors or a stated salary as director. No such payment shall preclude any director from serving the Corporation in any other capacity and receiving compensation therefor. Members of special or standing committees may be allowed like compensation for attending committee meetings or such compensation as the Board of Directors may fix.

     11. Removal of Directors. Any or all of the directors may be removed with or without cause, at any time, by the vote of the shareholders at a special meeting called for that purpose. Any director may be removed for cause by the action of the directors at a special meeting called for that purpose.

     12. Corporate Records. The directors may keep the books of the Corporation, except those as are required by law to be kept within the state, outside the Commonwealth of Virginia, at such place or places as they may from time to time determine.

ARTICLE IV — NOTICES

     1. Form and Time of Notice. Whenever, under the provisions of the laws of the Commonwealth of Virginia or of the Articles of Incorporation or of these bylaws, notice is

required to be given to any director or shareholder, it shall not be construed to mean personal notice, but such notice shall be in writing and shall be delivered in person or sent by mail, telefax, telegram, telex, or cable addressed to such director or shareholder at his or her address as it appears on the records of the Corporation.

     2. Waiver of Notice. Whenever any notice is required to be given under the provisions of the laws of Virginia or of the Articles of Incorporation or of these bylaws, a waiver thereof in writing, signed by the person or persons entitled to notice, whether before or after the time stated therein, shall be deemed equivalent thereto. Attendance of a person at a meeting shall constitute waiver of notice of that meeting, except when the person attends a meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened.

ARTICLE V — OFFICERS

     1. Officers. The primary officers of the Corporation shall be chosen by the Board of Directors and shall be a president, a vice-president, a secretary, a treasurer. The Board of Directors may also choose one or more vice presidents (any one or more of whom may be designated “executive vice president” or “senior vice president” or “managing principal” or “principal”), one or more assistant secretaries and assistant treasurers, as well as other officers and agents, with such titles, duties, and powers as the Board of Directors may from time to time determine. Any number of offices may be held by the same person, unless the Articles of Incorporation otherwise provides.

     2. Appointment of Officers. The Board of Directors, at its first meeting after each annual meeting of shareholders, shall choose the officers of the Corporation.

     3. Salaries of Officers. The salaries of all officers and agents of the Corporation shall be fixed by the Board of Directors.

     4. Term, Removal, and Vacancies. Each officer of the Corporation shall hold office until his or her successor is chosen and qualified or until he or she resigns or is removed. Any

officer may be removed at any time by the affirmative vote of a majority of the Board of Directors. Any vacancy occurring in any office of the Corporation shall be filled by the Board of Directors.

     5. President. The president shall be the chief executive officer of the Corporation. It shall be the president’s duty to supervise generally the management of the business of the Corporation. Without limiting the generality of the foregoing, the president shall preside at all meetings of the shareholders and the Board of Directors, shall see that all orders and resolutions of the Board of Directors are carried into effect, and shall have the power to sign contracts, powers of attorney, and other instruments on behalf of the Corporation.

     6. Vice Presidents. In the absence of the president or in the event of the president’s inability or refusal to act, the vice president, if any, shall perform the duties of the president, and when so acting, shall have all the powers of and be subject to all the restrictions upon the president. In the event there is more than one vice president, the vice presidents shall perform such duties and have such powers in the following order of seniority: executive vice president, senior vice president, and vice president; within each category, the vice presidents in the order designated by the directors, or in the absence of any designation, in the order of their selection. The vice presidents shall have the power to sign contracts, powers of attorney, and other instruments on behalf of the Corporation and shall perform such other duties and have such other powers as the Board of Directors may from time to time prescribe.

     7. Secretary. The secretary shall attend all meetings of the Board of Directors and all meetings of the shareholders and record all the proceedings of the meetings of the shareholders and of the Board of Directors in a book to be kept for that purpose and shall perform like duties for the standing committees when required. The secretary shall give, or cause to be given, notice of all meetings of the shareholders and special meetings of the Board of Directors and shall perform such other duties as may be prescribed by, and shall be under the supervision of, the Board of Directors or president. The secretary shall have custody of the corporate seal of the Corporation and the secretary or an assistant secretary shall have authority to affix the same to any instrument requiring it, and when so affixed, it may be attested by the signature of the secretary or assistant secretary. The Board of Directors may give general

authority to any other officer to affix the seal of the Corporation and to attest the affixing by his or her signature.

     8. Assistant Secretary. The assistant secretary (or if there is more than one, the assistant secretaries in the order determined by the Board of Directors or, if there is no such determination, in the order of their selection) shall, in the absence of the secretary or in the event of the secretary’s disability or inability or refusal to act, perform the duties and exercise the powers of the secretary and shall perform such other duties and have such other powers as the Board of Directors may from time to time prescribe.

     9. Treasurer.

          (a) The treasurer shall have the custody of the corporate funds and securities and shall keep full and accurate accounts of receipts and disbursements in books belonging to the Corporation and shall deposit all monies and other valuable effects in the name and to the credit of the Corporation in such depositories as may be designated by the Board of Directors.

          (b) The treasurer shall disburse the funds of the Corporation as may be ordered by the Board of Directors, taking proper vouchers for such disbursements, and shall render to the president and the Board of Directors, at its regular meetings, or when the Board of Directors so requires, an account of all transactions as treasurer and of the financial condition of the Corporation.

          (c) If required by the Board of Directors, the treasurer shall give the Corporation a bond in such sum and with such surety or sureties as shall be satisfactory to the Board of Directors for the faithful performance of the duties of his or her office and for the restoration to the Corporation, in case of the treasurer’s death, resignation, retirement, or removal from office of all books, papers, vouchers, money, and other property belonging to the Corporation of whatever kind that is in the possession or under the control of the treasurer.

     10. Assistant Treasurer. The assistant treasurer (or if there is more than one, the assistant treasurers in the order determined by the Board of Directors or, if there is no such determination, then in the order of their selection) shall, in the absence of the treasurer or in the event of the treasurer’s disability or inability or refusal to act, perform the duties and exercise the

powers of the treasurer and shall perform such other duties and have such other powers as the Board of Directors may from time to time prescribe.

ARTICLE VI — INDEMNIFICATION

     1. General. The corporation shall indemnify against judgments, fines, amounts paid in settlement, and expenses (including attorney fees) actually and reasonably incurred by each director or officer who was or is a party or is threatened to be made a party to any threatened, pending, or completed action, suit or proceeding, whether civil, criminal, administrative, arbitrative, or investigative (including an action or suit by or in the right of the corporation to procure a judgment in its favor) by reason of the fact that he or she is or was a director or officer of the corporation or is or was serving at the request of the corporation in any capacity for another corporation, partnership, joint venture, trust, or other entity, provided he or she acted or took no action in good faith and in a manner he or she believed to be in or not opposed to the best interests of the corporation, and with respect to any criminal action or proceeding, had no reasonable cause to believe such conduct was unlawful. The termination of any action, suit, or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent shall not of itself create a presumption that the person did not act in good faith and in a manner he or she believed to be in or not opposed to the best interest of the corporation and, with respect to any criminal action or proceeding, had reasonable cause to believe that his or her conduct was unlawful.

     2. Suits by the Corporation. Notwithstanding the provisions of Section 1 of this Article, no indemnification shall be made in any action, suit, or proceeding referred to in that Section by or in the right of the corporation to procure a judgment in its favor in respect of any claim, issue, or matter as to which such person shall have been finally adjudged to be liable for gross negligence or willful misconduct in the performance of his or her duty to the corporation unless, and only to the extent that, the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all circumstances of the case, such person is fairly and reasonably entitled to indemnification.

     3. Successful Defense. To the extent that a director or officer has been successful on the merits or otherwise in defense of any action, suit, or proceeding referred to in Section l of this Article, or in defense of any claim, issue, or matter therein, he or she shall be indemnified against expenses (including attorney fees) actually and reasonably incurred by him or her in connection therewith.

     4. Determination. Any indemnification under Sections 1 and 2 of this Article (unless ordered by a court) shall be made by the corporation only as authorized in the specific case upon a determination that indemnification of the director or officer is proper in the circumstances because he or she has met the applicable standard of conduct set forth in Sections 1 and 2. Such determination shall be made (i) by the Board of Directors by a majority vote of a quorum consisting of directors who were not parties to such action, suit, or proceeding; or (ii) if such quorum is not obtainable, or even if obtainable, a majority of disinterested directors so directs by independent legal counsel in a written opinion; or (iii) by the stockholders. If the determination is to be made by the directors, they may rely, as to all questions of law, on the advice of independent counsel. Any person seeking indemnification may apply to a court before or after any determination by the directors, independent legal counsel, or the stockholders, for a determination that he or she is entitled to indemnification because he or she has met the standard of conduct specified in Sections 1 and 2 of this Article.

     5. Advances. Expenses (including attorney fees) incurred in defending an action, suit, or proceeding, whether civil, criminal, administrative, arbitrative, or investigative, shall be paid by the corporation in advance of the final disposition of such action, suit, or proceeding as authorized in the manner provided by Section 4 of this Article, upon receipt of any undertaking by or on behalf of the director or officer to repay such amount unless it ultimately shall be determined that he or she is entitled to be indemnified by the corporation as authorized in this Article.

     6. Insurance. The corporation may purchase and maintain insurance to indemnify it against the whole or any portion of the liability imposed upon it in accordance with this Article and may also purchase and maintain insurance on behalf of any person who is or was a director, officer, or agent of the corporation or who was serving at the request of the corporation in any

capacity for another corporation, partnership, joint venture, trust, or other entity, against any liability asserted against him or her and incurred by him or her in any such capacity or arising out of his or her status as such, whether or not the corporation would have the power to indemnify him or her under the provisions of this Article.

     7. Miscellaneous. Every reference herein to director, officer, employee, or agent shall include former directors, officers, employees, and agents and their respective heirs, executors, and administrators. The indemnification provided pursuant to the power conferred on the Board of Directors shall not be exclusive of any other indemnification to which any director, officer, employee, or agent may be entitled, including any right under any policies of insurance that may be purchased and maintained by the corporation or others, with respect to claims, issues, or matters in relation to which the corporation would not have the power to indemnify such director, officer, employee, or agent under the provisions of this Article.

ARTICLE VII — CERTIFICATES OF STOCK

     1. Certificates. Every holder of stock in the Corporation shall be entitled to have a certificate of the shares of the Corporation, signed by the president or vice president and either the treasurer, an assistant treasurer, the secretary, or an assistant secretary of the Corporation, certifying the number of shares owned by him or her in the Corporation.

     2. Signatures. Any or all of the signatures of the officers of the Corporation upon a certificate may be facsimiles. In case any officer who has signed or whose facsimile signature has been placed upon a certificate no longer holds that office before the certificate is issued, it may be issued by the Corporation with the same effect as if he or she still held that office at the date of issue.

     3. Lost Certificates. The Board of Directors may direct a new certificate to be issued in place of any certificate previously issued by the Corporation alleged to have been lost or destroyed. When authorizing the issue of a new certificate, the Board of Directors, in its discretion and as a condition precedent to its issuance, may prescribe such terms and condition as it deems expedient and may require such indemnities as it deems adequate to protect the

Corporation from any claim that may be made against it with respect to the certificate alleged to have been lost or destroyed.

     4. Transfers of Shares. Upon surrender to the Corporation or the transfer agent of the Corporation of a certificate representing shares duly endorsed or accompanied by proper evidence of succession, assignment, or authority to transfer, it shall be the duty of the Corporation to issue a new certificate to the person entitled thereto, cancel the old certificate, and record the transaction upon its books.

     5. Authority to Fix Rights of Preferred Stock. The Board of Directors shall have authority, by resolution or resolutions, at any time and from time to time, to divide and establish any or all of the unissued shares of Preferred Stock not then allocated to any series of Preferred Stock into one or more series and, without limiting the generality of the foregoing, to fix and determine the designation of each such series, the number of shares that shall constitute such series, and the following relative rights and preferences of the shares of each series so established:

          (a) The annual or other periodic dividend rate payable on shares of such series, the time of payment thereof, whether such dividends shall be cumulative or non-cumulative, and the date or dates from which any cumulative dividends shall commence to accrue;

          (b) the price or prices at which and the terms and conditions, if any, on which shares of such series may be redeemed;

          (c) the amounts payable upon shares of such series in the event of the voluntary or involuntary dissolution, liquidation, or winding-up of the affairs of the Corporation;

          (d) the sinking fund provisions, if any, for the redemption or purchase of shares of such series;

          (e) the extent of the voting powers, if any, of the shares of such series;

          (f) the terms and conditions, if any, on which shares of such series may be converted into shares of stock of the Corporation of any other class or classes or into shares of any other series of the same or any other class or classes;

          (g) whether, and if so the extent to which, shares of such series may participate with the Common Stock in any dividends in excess of the preferential dividend fixed for shares of such series or in any distribution of the assets of the Corporation, upon a liquidation, dissolution, or winding-up thereof, in excess of the preferential amount fixed for shares of such series; and

          (h) any other preferences and relative, optional, or other special rights and qualifications, limitations, or restrictions of such preferences or rights of shares of such series not fixed and determined by law or in this Article VII.

     6. Registered Shareholders. The Corporation shall be entitled to recognize the exclusive right of a person registered on its books as the owner of shares to receive dividends, to vote as owner of the shares, and to hold liable for calls and assessments a person registered on its books as the owner of shares, and shall not be bound to recognize any equitable or other claim to or interest in such share or shares on the part of any other person, whether or not it shall have express or other notice thereof, except as otherwise provided by the laws of Virginia.

ARTICLE VIII — GENERAL PROVISIONS

     1. Dividends.

          (a) Dividends upon the capital stock of the Corporation, subject to the provisions of the Articles of Incorporation, if any, may be declared by the Board of Directors at any regular or special meeting, pursuant to law. Dividends may be paid in cash, in shares of the capital stock, or in the Corporation’s bonds or property, including the shares or bonds of other Corporations, subject to any provisions of law and of the Articles of Incorporation.

          (b) Before payment of any dividend, there may be set aside out of any funds of the Corporation available for dividends such sum or sums as the directors from time to time,

in their absolute discretion, think proper as a reserve or reserves to meet contingencies, for equalizing dividends, for repairing or maintaining any property of the Corporation, or for such other purpose as the directors shall think conducive to the interest of the Corporation, and the directors may modify or abolish any such reserve in the manner in which it was created.

     2. Annual Statement. The Board of Directors shall present at each annual meeting, and at any special meeting of the shareholders when called for by vote of the shareholders, a full and clear statement of the business and condition of the Corporation.

     3. Checks. All checks or demands for money and notes of the Corporation shall be signed by such officer or officers or such other person or persons as the Board of Directors may from time to time designate.

     4. Fiscal Year. The fiscal year of the Corporation shall be the calendar year.

     5. Seal. The Board of Directors, in its discretion, may adopt a corporate seal for the Corporation. The seal may be used by causing it or a facsimile thereof to be impressed or affixed or in any manner reproduced.

     6. Gender and Number. Whenever used in these bylaws, the use of either gender shall include the other, and the use of the singular shall include the plural and vice-versa.

ARTICLE IX — EMERGENCY BYLAWS

     The Emergency Bylaws provided in this Article IX shall be operative during any emergency, notwithstanding any different provision in the preceding Articles of these Bylaws or in the Articles of Incorporation of the Corporation or in the Virginia Stock Corporation Act (other than those provisions relating to emergency bylaws). An emergency exists if a quorum of the Corporation’s Board of Directors cannot readily be assembled because of some catastrophic event. To the extent not inconsistent with these Emergency Bylaws, the Bylaws provided in the preceding Articles shall remain in effect during the emergency, and upon the termination of the emergency, the Emergency Bylaws shall cease to be operative unless and until another emergency shall occur. During any emergency:

     1. Meetings. Any meeting of the Board of Directors may be called by any officer of the Corporation or by any Director. The notice of meeting shall specify the time and place of the meeting. To the extent feasible, notice shall be given in accord with section (5) of Article III above, but notice may be given only to those Directors as it may be feasible to reach at the time, by such means as may be feasible at the time, including publication or radio, and at a time less than 24 hours before the meeting if deemed necessary by the person giving notice. Notice shall be similarly given, to the extent feasible, to the other persons referred to in (2)(b) below.

     2. Quorum. At any meeting of the Board of Directors, a quorum shall consist of a majority of the number of Directors fixed at the time by Article II of the Bylaws. If the Directors present at any particular meeting shall be fewer than the number required for a quorum, other persons present at the meeting and holding the positions referred to below shall be deemed Directors for that particular meeting in such numbers as may be necessary to constitute a quorum, as determined by the following provisions and in the following order of priority:

          (a) Vice Presidents not already serving as Directors in the order of their seniority of first selection to such offices, or if two or more shall have been first selected to such offices on the same day, in the order of their seniority in age;

          (b) All other officers of the Corporation in the order of their seniority of first selection to such offices, or if two or more shall have been first selected to such offices on the same day, in the order of their seniority in age; and

          (c) Any other persons that are designated on a list approved by the Board of Directors before the emergency, such persons to be taken in the order of priority and subject to conditions as may be provided in the resolution approving the list.

     3. Succession. The Board of Directors, during as well as before any emergency, may provide, and from time to time modify, lines of succession in the event that, during an emergency, any or all officers or agents of the Corporation shall for any reason be rendered incapable of discharging their duties.

     4. Principal Office. The Board of Directors, during as well as before any emergency may, effective in the emergency, change the principal office or designate several alternative offices or authorize the officers to do so.

     No officer, Director, or employee shall be liable for action taken in good faith in accordance with these Emergency Bylaws.

     These Emergency Bylaws shall be subject to repeal or change by further action of the Board of Directors or by action of the shareholders, except that no such repeal or change shall modify the standard of conduct set forth in the immediately preceding paragraph for purposes of establishing the liability of an officer, Director, or employee for action or inaction occurring before the time of such repeal or change. Any amendment of these Emergency Bylaws may make any further or different provision that may be practical and necessary for the circumstances of the emergency.

ARTICLE X — AMENDMENTS

     These bylaws may be altered, amended, or repealed and new bylaws may be adopted by the shareholders or by the Board of Directors, when such power is conferred upon the Board of Directors by the Articles of Incorporation, at any regular meeting of the shareholders or of the Board of Directors or at any special meeting of the shareholders or of the Board of Directors if notice of such alteration, amendment, repeal, or adoption of new bylaws is contained in the notice of such special meeting. If the power to adopt, amend, or repeal bylaws is conferred upon the Board of Directors by the Articles of Incorporation, it shall not divest or limit the power of the shareholders to adopt, amend, or repeal bylaws.

EX-3.18

Exhibit 3.18

COMMONWEALTH OF VIRGINIA
STATE CORPORATION COMMISSION

ARTICLES OF INCORPORATION
OF A VIRGINIA STOCK CORPORATION

The undersigned, pursuant to Chapter 9 of Title 13.1 of the Code of Virginia, state(s) as follows:

1.      The name of the corporation is Washington Consulting, Inc.

2.      The number of shares the corporation is authorized to issue is 50,000 shares of common stock with all voting rights and the right to receive distrubition of the assets of the corporation upon liquidation.

3.	A.	The name of the corporation’s initial registered agent is Chris L. Campbell.
	B.	The initial registered agent is an individual who is a resident of Virginia and an initial director of the corporation. usiness in Virginia.
4.	A.	The corporation’s initial registered office address, which is the business office of the initial registered agent, is 2638 Babcock Road, Vienna, VA 22181.
		The registered office is physically located in the Country of Fairfax.
5.	The initial directors are
	Chris L. Campbell		2638 Babcock Road, Vienna, VA 22181
	John Patrick Foley		26170 Murrey Drive, South Riding, VA 20152
6.	INCORPORATOR (SEAL) Dated this 3rd Day of March, 2003:
	/s/ Chris L. Campbell
	Chris L. Campbell, Director

EX-3.19

Exhibit 3.19

BY-LAWS
OF
BMH ASSOCIATES, INC.

ARTICLE I — STOCK

          1. Certificates of stock shall be issued in numerical order; they shall be signed by the president and the corporation’s seal shall be affixed thereto and attested by the secretary. A record of each certificate shall be kept on the stub thereof.

          2. Transfers of stock shall be made only upon the books of the corporation, and before a new certificate is issued, the old certificate shall be surrendered for cancellation, and marked cancelled, with the date of cancellation, by the secretary; provided that, in the event a certificate is lost or destroyed, a duplicate may be issued upon receipt of satisfactory indemnity against loss. The stock books of the corporation may be closed for transfers 30 days before general elections and 10 days before dividend days, at the discretion of the board of directors.

ARTICLE II — STOCKHOLDERS

          1. All meetings of the stockholders may be held at the principal office of the corporation or at such other place as the notice of the meeting shall state.

          2. The regular annual meeting of the stockholders shall be held at noon on the first Monday in October, or as soon thereafter as a quorum can be mustered, beginning in October, 1986.

          3. Notice of the annual meeting or of a special meeting of the stockholders shall be served personally or mailed to each stockholder entitled to vote thereat at such address as appears on the books of the corporation not less than 10 nor more than 60 days prior to the meeting. However, anything to the contrary in these By-Laws notwithstanding, notice may be waived in accordance with Section 13.1-659 of the Code of Virginia, and action may be taken by the stockholders without a meeting in accordance with Section 13.1-657 of said Code. Special meetings of the stockholders may be called by the president, the secretary, a majority of the directors, or by the holders of one-fifth (1/5) of all the shares entitled to vote at the meeting. A quorum at any meeting of the stockholders shall consist of a majority of the voting stock of the corporation, represented in person or by proxy; a majority of such quorum shall decide any question that may come before the meeting, except as otherwise required by statute.

          4. The order of business at the annual meeting, and as far as appropriate at other meetings of the stockholders, shall be:

a.	Calling of roll;
b.	Proof of due notice of meeting or waiver thereof;
c.	Reading and disposal of any unapproved minutes;

d.	Annual reports of officers and committees;
e.	Election of directors;
f.	Unfinished business;
g.	New business; and
h.	Adjournment.

Departure from said order of business shall in no way affect the validity of any action otherwise duly taken.

ARTICLE III — DIRECTORS

          1. Commencing with the first annual meeting of the stockholders, there shall be a Board of at least one (1) but not more than five (5) Directors who shall be elected annually by the stockholders to serve until the next annual meeting, and who shall serve until the election and acceptance of their duly qualified successors.

          2. The regular annual meeting of the Board of Directors shall be held at the principal office of the corporation or other such place as the notice of the meeting shall state immediately following the adjournment of the annual stockholders meeting. Special meetings of the directors may be held at the principal office of the corporation, or such other place as the notice of the meeting shall state, and may be called at any time by the president, or any Board member.

          3. Notices of regular and special meetings shall me mailed by the secretary to each member of the Board not less than 5 days before any such meeting and notice of special meetings shall state the purpose thereof.

          4. A quorum at any meeting shall consist of 50% of the membership of the Board and may decide any question that may properly come before the meeting. The directors may act by unanimous written consent without a meeting pursuant to Section 13.1-685 of the Code of Virginia.

          5. Any member of the Board of Directors may participate in a meeting of the Board by means of conference telephone or similar communications equipment pursuant to Section 13.1-684 of the Code of Virginia. Participation by such means shall constitute presence in person at such meeting.

          6. The order of business at any meeting of the Board of Directors, other than the annual meeting at which the new officers shall be elected, shall be as follows:

a.	Reading and disposal of any unapproved minutes
b.	Reports of officers and committees

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c.	Unfinished business
d.	New business
e.	Adjournment

At the annual meeting, officers shall be elected for the ensuing year immediately prior to adjournment. Departure from said order of business shall in no way affect the validity of any action otherwise duty taken.

ARTICLE IV — OFFICERS

          1. The officers of the corporation shall be a president, as many vice-presidents as the Board of Directors may from time to time determine, a secretary and as many assistant secretaries as the Board of Directors may from time to time determine, who shall each be elected to serve until the next annual meeting of the Board of Directors, and shall hold office until their successors are elected and qualify. Any two or more offices may be held by the same person.

          2. The president shall preside at all meetings, shall have supervision of the company, shall sign all certificates of stock, shall make reports to the directors and stockholders, and perform all such other duties as are incident to his office or are properly required of him by the Board of Directors.

          3. The vice-presidents shall, in the order of precedence determined by the Board of Directors, execute the duties of the president during his absence or inability to act, and shall discharge such other duties as may be assigned them by the Board of Directors.

          4. The secretary shall issue all notices of meetings, shall keep their minutes and shall have charge of the corporate seal, minute book and stock book. The assistant secretary shall perform the duties of the secretary in the latter’s absence or inability to act. The Board of Directors may appoint an acting secretary to serve temporarily when neither the secretary nor any assistant secretary is available.

ARTICLE V — DIVIDENDS

          Dividends may not be declared if, after giving effect to such dividend, (1) the corporation would not be able to pay its debts as they become due in the usual course of business; or (2) the corporation’s total assets would be less than the sum of its total liabilities. The propriety of a distribution under the foregoing language shall be determined under Section 13.1-653 of the Code of Virginia, or such statute of similar imports as may be in effect from time to time in the State of Virginia.

ARTICLE VI — SEAL

          The Board of Directors of the corporation may adopt a corporate seal, which said seal shall consist of two concentric circles between which is the name of the corporation and in the center shall be inscribed the word “SEAL”.

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EX-3.20

Exhibit 3.20

ARTICLES OF INCORPORATION

OF

BMH ASSOCIATES, INC.

     The undersigned hereby forms a stock corporation under the provisions of Chapter 1 of Title 13.1 of the Code of Virginia of 1950, as amended, and to that end sets forth the following:

     (a) The name of the corporation is BMH Associates, Inc.

     (b) The purpose for which the corporation is formed is to transact any or all businesses, permitted by law, and not required to be specifically stated in these Articles of Incorporation.

     (c) The aggregate number of shares which the corporation shall have authority to issue, all of which shall be of no par value, is as follows:

Class	Number of Shares
Common	5,000

     (d) The post office address of the initial registered office of the corporation is 177 West Bay Avenue, Norfolk, Virginia 23503. The name of the registered agent is John P. McGinn, Jr., who is a resident of Virginia, whose business office is identical with the registered office, and who is a director of the corporation. The registered office of the corporation is located in the City of Norfolk, Virginia.

     (e) The number of directors constituting the initial Board of Directors is three and the names and addresses of the persons who are to serve as the initial directors are Peter A. Bonnani, John P. McGinn, Jr., and Edward P. Harvey.

     (f) No holder of shares in this corporation shall have a preemptive right to acquire any authorized but unissued shares of the corporation.

/s/ Robert C. Miller

Robert C. Miller, Incorporator

Dated at Norfolk, Virginia
this 3^rd day of September, 1986

EX-3.21

Exhibit 3.21

COMMONWEALTH OF VIRGINIA
STATE CORPORATION COMMISSION
ARTICLES OF AMENDMENT

CHANGING THE NAME OF A VIRGINIA STOCK CORPORATION
By Unanimous Consent of the Shareholders

     The undersigned, pursuant to § 13.1-710 of the Code of Virginia, executes these articles and states as follows:

1.	The current name of the corporation is BMH Associates, Inc.
2.	The name of the corporation is changed to
	Alion — BMH Corporation.
3.	The foregoing amendment was adopted by unanimous consent of the shareholders on       February 13, 2006 .

(date)

Executed in the name of the corporation by:

/s/ James C. Fontana	3/29/06
(signature)	(date)
James C. Fontana	Secretary
(printed name)	(corporate title)
(telephone number (optional))	(corporation’s SCC corporate ID no.)

(The execution must be by the chairman or any vice-chairman of the board of directors, the president, or any other of its officers authorized to act on behalf of the corporation.)

See instructions on the reverse.

EX-3.22

Exhibit 3.22

ARTICLES OF INCORPORATION
OF
MICRO ANALYSIS & DESIGN, INC.

     KNOW ALL MEN BY THESE PRESENTS: That the undersigned incorporator being a natural person of the age of eighteen years or more and desiring to form a body corporate under the laws of the State of Colorado does hereby sign, verify and deliver in duplicate to the Secretary of State of the State of Colorado these Articles of Incorporation.

ARTICLE I
Name

     The name of the corporation shall be:

MICRO ANALYSIS & DESIGN, INC.

ARTICLE II
Capital

     The aggregate number of shares which this corporation shall have authority to issue is 50,000 shares, of $0.01 par value, which shares shall be designated “Common Stock.”

     1. Dividends. Dividends in cash, property or shares of the corporation may be paid upon the Common Stock, as and when declared by the Board of Directors, out of funds of the corporation to the extent and in the manner permitted by law.

     2. Distribution in Liquidation. Upon any liquidation, dissolution or winding up of the corporation, and after paying or adequately providing for the payment of all its obligations, the remainder of the assets of the corporation shall be distributed, either in cash or in kind, pro rata to the holders of the Common Stock. The Board of Directors may, from time to time, distribute to the shareholders in partial liquidation, out of stated capital or capital surplus of the corporation, a portion of its assets, in cash or property, in the manner permitted and upon compliance with limitations imposed by law.

     3. Voting Rights; Cumulative Voting. Each outstanding share of Common Stock shall be entitled to one vote and each fractional share of Common Stock shall be entitled to a corresponding fractional vote on each matter submitted to a vote of shareholders. Cumulative voting shall not be allowed in the election of directors of the corporation.

     4. Preemptive Rights. Holders of shares of the corporation, whether now or hereafter outstanding, shall not have a preemptive right to acquire any unissued or treasury shares or securities of the corporation, or securities convertible into such shares or carrying a right to subscribe to or acquire shares.

ARTICLE III
Registered Office and Registered Agent

     The address of the initial registered office of the corporation is 1877 Broadway, Suite 504, Boulder, Colorado 80302, and the name of the initial registered agent at such address is

Gary D. Berg. Either the registered office or the registered agent may be changed in the manner permitted by law.

ARTICLE IV
Limitations of Directors’ Liability

     No director shall have personal liability to the corporation or to its shareholders for monetary damages for breach of fiduciary duty as a director except for (1) any breach of the director’s duty of loyalty to the corporation or to its shareholders; (2) acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law; (3) acts specified in Section 7-5-114 of the Colorado Corporation Code; or (4) any transaction from which the director derived an improper personal benefit.

ARTICLE V
Initial Board of Directors

     The initial board of directors of the corporation shall consist of two directors, and the names and addresses of the persons who shall serve as directors until the first annual meeting of shareholders or until their successors have been elected and shall qualify are as follows:

Name	Address
Kenneth R. Laughery	9132 Thunderhead Drive
	Boulder, CO 80302
Mary B. Laughery	9132 Thunderhead Drive
	Boulder, CO 80302

ARTICLE VI
Incorporator

     The name and address of the incorporator is as follows:

Name	Address
Gary D. Berg	P.O. Box 1530
	Boulder, CO 80306

     IN WITNESS WHEREOF, the above-named incorporator has signed these Articles of Incorporation this 1st of June, 1990.

/s/ Gary D. Berg

Gary D. Berg

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EX-3.23

Exhibit 3.23

		Colorado Secretary of State
		Date and Time: 05/22/2006 07:49 AM
Document processing fee		Entity Id: 19901061842
If document is filed on paper	$125.00
If document is filed electronically	$25.00	Document number: 20061203064
Fees & forms/cover sheets are subject to change.
To file electronically, access instructions for this form/cover sheet and other information or print copies of filed documents, visit www.sos.state.co.us and select Business Center.

Paper documents must be typewritten or machine printed. ABOVE SPACE FOR OFFICE USE ONLY

Articles of Amendment
filed pursuant to §7-90-301, et seq. and §7-110-106 of the Colorado Revised Statutes (C.R.S.)

ID number:		19901061842
1.	Entity name:	MICRO ANALYSIS & DESIGN, INC.
		(If changing the name of the corporation, indicate name BEFORE the name change)
2.	New Entity name:	Alion — MA&D Corporation
	(if applicable)
3.	Use of Restricted Words (if any of these terms are contained in an entity name, true name of an entity, trade name or trademark stated in this document, mark the applicable box):	o“bank” or “trust” or any derivative thereof o“credit union” o “savings and loan” o“insurance”, “casualty”, “mutual”, or “surety”

4.	Other amendments, if any, are attached.
5.	If the amendment provides for an exchange, reclassification or cancellation of issued shares, the attachment states the provisions for implementing the amendment.
6.	If the corporation’s period of duration as amended is less than perpetual, state the date on which the period of duration expires:

	(mm/dd/yyyy)
OR

If the corporation’s period of duration as amended is perpetual, mark this box:

7.	(Optional) Delayed effective date:
		(mm/dd/yyyy)

Notice:

Causing this document to be delivered to the secretary of state for filing shall constitute the affirmation or acknowledgment of each individual causing such delivery, under penalties of perjury, that the document is the individual’s act and deed, or that the individual in good faith

Page 1 of 2

believes the document is the act and deed of the person on whose behalf the individual is causing the document to be delivered for filing, taken in conformity with the requirements of part 3 of article 90 of title 7, C.R.S., the constituent documents, and the organic statutes, and that the individual in good faith believes the facts stated in the document are true and the document complies with the requirements of that Part, the constituent documents, and the organic statutes.

This perjury notice applies to each individual who causes this document to be delivered to the secretary of state, whether or not such individual is named in the document as one who has caused it to be delivered.

8.	Name(s) and address(es) of the individual(s) causing the document to be delivered for filing:	Fontana	James
		(Last)	(First)	(Middle)	(Suffix)
		1750 Tysons Blvd.
		(Street name and number or Post Office information)
		Suite 1300
		McLean		VA	22102
		(City)		(State)	(Postal/Zip Code)
				United States
		(Province – if applicable)		(Country – If not US)

(The document need not state the true name and address of more than one individual. However, if you wish to state the name and address of any additional individuals causing the document to be delivered for filing, mark this box o and include an attachment stating the name and address of such individuals.)

Disclaimer:

This form, and any related instructions, are not intended to provide legal, business or tax advice, and are offered as a public service without representation or warranty. While this form is believed to satisfy minimum legal requirements as of its revision date, compliance with applicable law, as the same may be amended from time to time, remains the responsibility of the user of this form. Questions should be addressed to the user’s attorney.

Page 2 of 2

EX-3.24

Exhibit 3.24

BYLAWS
OF
MICRO ANALYSIS & DESIGN, INC.

ARTICLE I
Principal Office and Corporate Seal

     Section 1. The principal office and place of business of the Corporation in the State of Colorado shall be at 9132 Thunderhead Drive, Boulder, Colorado, 80302. Other offices and places of business may be established from time to time by resolution of the board of directors.

     Section 2. The seal of the Corporation shall have inscribed thereon the name of the Corporation and the words “Colorado” and “Seal” and shall be in such form as may be approved by the board of directors, which shall have the power to alter the same at pleasure.

ARTICLE II
Shares and Transfer Thereof

     Section 1. Except as provided in Section 5, the shares of this Corporation shall be represented by certificates signed by the president and secretary of the Corporation and may be sealed with the seal of the Corporation or a facsimile thereof. The signatures of the president and secretary upon a certificate may be facsimile if the certificate is countersigned by a transfer agent or registered by a registrar both of which may be the Corporation itself or an employee of the Corporation. In case any officer who has signed a certificate shall have ceased to be such officer before such certificate is issued, it may be issued by the Corporation with the same effect as if he were such officer at the date of its issue.

     Section 2. No new certificates evidencing shares shall be issued unless and until the old certificate or certificates in lieu of which the new certificate is issued shall be surrendered for cancellation except as provided in Section 3 of this Article II.

     Section 3. In case of loss or destruction of any certificate of shares, another certificate may be issued in its place upon satisfactory proof of such loss or destruction and, at the discretion of the board of directors, upon giving to the Corporation a satisfactory bond of indemnity issued by a corporate surety in an amount and for a period satisfactory to the board of directors.

     Section 4. For the purpose of determining shareholders entitled to notice of or to vote at any meeting of shareholders or any adjournment thereof, or entitled to receive payment of any dividend, or in order to make a determination of shareholders for any other proper purpose, the board of directors may provide that the stock transfer books shall be closed for a stated period not to exceed in any case fifty (50) days. If the stock transfer books shall be closed for the purpose of determining shareholders entitled to notice of or to vote at a meeting of shareholders,

such books shall be closed for at least ten (10) days immediately preceding such meeting. In lieu of closing the stock transfer books, the board of directors may fix in advance a date as the record date for any such determination of shareholders, such date in any case to be not more than fifty days and, in the case of a meeting of shareholders, not less than ten days prior to the date on which the particular action requiring such determination of shareholders is to be taken. If the board of directors does not order the stock transfer books closed or fix in advance a record date as above provided, then the record date for the determination of shareholders entitled to notice of or to vote at any meeting of shareholders or any adjournment thereof, or entitled to receive payment of any dividend, or for the determination of shareholders for any proper purpose shall be thirty (30) days prior to the date on which the particular action requiring such determination of shareholders is to be taken.

     Section 5. The board of directors of the Corporation may authorize the issuance of any of its classes or series of shares without certificates. Such authorization shall not affect shares already represented by certificates until they are surrendered to the Corporation. Within a reasonable time following the issue or transfer of shares without certificates, the Corporation shall send the shareholder a complete written statement of the following information:

     (a) If the Corporation is authorized to issue more than one class of stock, a full statement of the designations, preferences, limitations, and relative rights of the shares of each class authorized to be issued and, if the Corporation is authorized to issue any preferred or special class in series, the variations in the relative rights and preferences between the shares of each such series, so far as the same have been fixed and determined, and the authority of the board of directors to fix and determine the relative rights and preference of subsequent series.

     (b) The Corporation is organized under the laws of Colorado; the name of the person in whom the shares are registered; the number and class of shares and the designation of the series, if any, which are registered in such person’s name; and the par value of each share or a statement that the shares are without par value.

ARTICLE III
Shareholders and Meetings Thereof

     Section 1. Only shareholders of record on the books of the Corporation shall be entitled to be treated by the Corporation as holders in fact of the shares standing in their respective names, and the Corporation shall not be bound to recognize any equitable or other claim to or interest in any shares on the part of any other person, firm or corporation, whether or not it shall have express or other notice thereof, except as expressly provided by the laws of Colorado.

     Section 2. Meetings of shareholders shall be held at the principal office of the Corporation in Boulder, Colorado.

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     Section 3. In the absence of a resolution of the board of directors providing otherwise, the annual meeting of shareholders of the Corporation for the election of directors and for the transaction of such other business as may properly come before the meeting shall be held in the first week in March of each year if the same be not a legal holiday, and if a legal holiday, then on the next succeeding business day, at 1:00 p.m. If a quorum be not present, the meeting may be adjourned from time to time, but no single adjournment shall exceed sixty days. The first annual meeting of shareholders shall be on March 6, 1991.

     Section 4. Special meetings of shareholders may be called by the president (or in his absence by a vice president), the board of directors, or the holders of not less than one-tenth of all shares entitled to vote on the subject matter for which the meeting is called.

     Section 5. Written notice stating the place, day and hour of the shareholders’ meeting, and in case of a special meeting of shareholders the purpose or purposes for which the meeting is called, shall be delivered not less than ten days nor more than fifty days before the date of the meeting, either personally or by mail at the direction of the president, the secretary, the board of directors or the officer or person calling the meeting, to each shareholder of record entitled to vote at such meeting, except that if the authorized shares are to be increased, at least thirty days notice shall be given. If mailed, such notice shall be deemed to be delivered when deposited in the United States mail addressed to the shareholder at his address as it appears on the stock transfer books of the Corporation with postage thereon prepaid, but if three successive letters mailed to the last-known address of any shareholder of record are returned as undeliverable, no further notices to such shareholder shall be necessary, until another address for such shareholder is made known to the Corporation.

     Section 6. When any notice is required to be given to any shareholder of the Corporation, a waiver thereof in writing signed by the person entitled to such notice, whether in writing signed by the person entitled to such notice, whether before, at, or after the time stated therein, shall be equivalent to the giving of such notice.

     Section 7. By attending a meeting, a shareholder:

     (a) waives objection to lack of notice or defective notice of such meeting unless the shareholder, at the beginning of the meeting, objects to the holding of the meeting or the transacting of business at the meeting; and

     (b) waives objection to consideration at such meeting of a particular matter not within the purpose or purposes described in the meeting notice unless the shareholder objects to considering the matter when it is presented.

     Section 8. The officer or agent having charge of the stock transfer books for shares of this Corporation shall make, at least ten (10) days before each meeting of shareholders, a complete record of the shareholders entitled to vote at such meeting or any adjournment thereof, arranged in alphabetical order, with the address of and the number of shares held by each, which record, for a period of ten days prior to such meeting shall be kept on file at the principal office of the Corporation, whether within or outside Colorado, and shall be subject to inspection by any shareholder for any purpose germane to the meeting at any time during usual business hours.

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Such record shall also be produced and kept open at the time and place of the meeting and shall be subject to the inspection of any shareholder during the whole time of the meeting. The original stock transfer books shall be prima facie evidence as to who are the shareholders entitled to examine such record or transfer books or to vote at any meeting of shareholders.

     Section 9. A quorum at any meeting of shareholders shall consist of a majority of the shares of the Corporation entitled to vote thereat, represented in person or by proxy. If a quorum is present, the affirmative vote of a majority of the shares represented at the meeting and entitled to vote on the subject matter shall be the act of the shareholders unless the vote of a greater number or voting by classes is required by law or the Articles of Incorporation.

     Section 10. A shareholder may vote either in person or by proxy executed in writing by the shareholder or by his duly authorized attorney in fact. No proxy shall be valid after eleven months from the date of its execution unless otherwise provided in the proxy.

     Section 11. When a meeting is adjourned to another time or place, notice need not be given of the adjourned meeting if the time and place thereof are announced at the meeting at which the adjournment is taken. At the adjourned meeting the Corporation may transact any business which might have been transacted at the original meeting. If the adjournment is for more than thirty days, or if after the adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each shareholder of record entitled to vote at the meeting.

     Section 12. If shares or other securities having voting power stand of record in the names of two or more persons, whether fiduciaries, members of a partnership, joint tenants, tenants in common, tenants by the entirety, or otherwise, or if two or more persons having the same fiduciary relationship respecting the same shares, voting with respect to the shares shall have the following effect:

     (a) if only one person votes, his act binds all;

     (b) if two or more persons vote, the act of the majority so voting binds all;

     (c) if two or more persons vote, but the vote is evenly split on any particular matter, each faction may vote the securities in question proportionately, or any person voting the shares of a beneficiary, if any, may apply to any court of competent jurisdiction in the State of Colorado to appoint an additional person to act with the persons so voting the shares. The shares shall then be voted as determined by a majority of such persons and the person appointed by the court. If a tenancy is held in unequal interests, a majority or even split for the purpose of this subsection (iii) shall be a majority or even split in interest.

     The effects of voting stated in this Section 12, shall not be applicable if the secretary of the Corporation is given written notice of alternate voting provisions and is furnished with a copy of the instrument or order wherein the alternate voting provisions are stated.

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ARTICLE IV
Directors, Powers and Meetings

     Section 1. The business and affairs of the Corporation shall be managed by not less than one, but no more than three directors; provided, that at any time, there are three or fewer shareholders, the number of directors shall not be fewer than the number, of shareholders. Such directors shall be of the age eighteen (18) years or older, but need not be a shareholder or a resident of the State of Colorado. Directors shall be elected at the annual meeting of shareholders or some adjournment thereof. Directors shall hold office until the next succeeding annual meeting of shareholders or until their successors shall have been elected and shall qualify; however, no provision of this Section shall be restrictive upon the right of the board of directors to fill vacancies or upon the right of shareholders to remove directors as is hereinafter provided.

     Section 2. The annual meeting of the board of directors shall be held at the same place as and immediately after the annual meeting of shareholders and no notice shall be required in connection therewith. The annual meeting of the board of directors shall be for the purpose of electing officers and the transaction of such other business as may come before the meeting.

     Section 3. Regular meetings of the board of directors may be held without notice if scheduled at a previous meeting of the board of directors, which shall be not less than ten (10) days prior to such regular meeting. Special meetings of the board of directors may be called at any time by the president (or in his absence by a vice president) or by any director and may be held within or outside the State of Colorado at such time and place as the notice or waiver thereof may specify. Notice of such meetings shall be mailed or telegraphed to the last-known address of each director in person or by telephone at least forty-eight hours prior to the date or time fixed for the meeting. When any notice is required to be given to any director of the Corporation, a waiver thereof in writing signed by the person entitled to such notice, whether before, at, or after the time stated therein, shall be equivalent to the giving of such notice. Regular or special meetings of the board of directors may be held at any time that all directors are present in person. By attending or participating in a regular or special meeting, a director waives any required notice of such meeting unless the director at the beginning of the meeting, objects to the holding of the meeting or the transacting of business at the meeting. Unless specifically required by law, the Articles of Incorporation or these Bylaws, neither the business to be transacted at, nor the purpose of, any meeting of the board of directors need be specified in the notice or waiver of notice of such meeting.

     Section 4. A quorum at all meetings of the board of directors shall consist of a majority of the number of directors then fixed by these Bylaws, but a smaller number may adjourn from time to time without further notice until a quorum be secured. The act of a majority of the directors present at a meeting at which a quorum is present shall be the act of the board of directors unless the act of a greater number is required by the Colorado Corporation Code, the Articles of Incorporation, or these Bylaws.

     Section 5. Any vacancy occurring in the board of directors may be filled by the affirmative vote of a majority of the remaining directors. A director elected to fill a vacancy shall be elected for the unexpired term of his predecessor in office and shall hold such office

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until his successor is duly elected and shall qualify. Any directorship to be filled by reason of an increase in the number of directors shall be filled by the affirmative vote of a majority of the directors then in office or by an election at an annual meeting or at a special meeting of shareholders called for that purpose. A director chosen to fill a position resulting from an increase in the number of directors shall hold office until the next annual meeting of shareholders and until his successor shall have been elected and shall qualify.

     Section 6. Directors may receive such fees as may be established by appropriate resolution of the board of directors for attendance at meetings of the board and in addition thereto shall receive reasonable traveling expense, if any is required, for attendance at such meetings.

     Section 7. The board of directors may by resolution adopted by a majority of the number of directors, designate from among its members an executive committee, and one or more other committees each of which, to the extent provided in the resolution or in the Articles of Incorporation or the Bylaws of the Corporation, shall have all of the authority of the board of directors; but no such committee shall have the authority of the board of directors in reference to amending the Articles of Incorporation, adopting a plan of merger or consolidation, recommending to the shareholders the sale, lease, exchange, or other disposition of all or substantially all of the property and assets of the Corporation otherwise than in the usual and regular course of its business, recommending to the shareholders a voluntary dissolution of the Corporation or a revocation thereof, or amending the Bylaws of the Corporation. The designation of such committees and the delegation thereto of authority shall not operate to relieve the board of directors, or any member thereof, of any responsibility imposed by law.

     Section 8. The shareholders may, at a meeting called for the express purpose of removing directors, by a majority vote of the shares entitled to vote at an election of directors, remove the entire board of directors or any lesser number with or without cause.

     Section 9. Members of the board of directors or any committee designated by the board may participate in a meeting of the board or committee by means of conference telephone or similar communications equipment by which all persons participating in the meeting can hear each other at the same time. Such participation shall constitute presence in person at the meeting.

     Section 10. No contract or other transaction between a corporation and one or more of its directors or any other corporation, firm, association, or other organization in which one or more of its directors are directors or officers or have a financial interest shall be either void or voidable solely for that reason or solely because such director or officer is present at or participates in the meeting of the board of directors or a committee thereof which authorizes, approves, or ratifies such contract or transaction or solely because his or their votes are counted for such purpose if:

     (a) the material facts as to his relationship or interest and as to the contract or transaction are disclosed or are known to the board of directors or the committee, and the board or committee in good faith authorizes, approves, or ratifies the contract or transaction by the affirmative vote of a majority of the

- 6 -

disinterested directors, even though the disinterested directors are less than a quorum; or

     (b) the material facts as to his relationship or interest and as to the contract or transaction are as disclosed or are known to the shareholders entitled to vote thereon, and the contract or transaction is specifically authorized, approved, or ratified in good faith by vote of the shareholders; or

     (c) the contract or transaction is fair as to the Corporation as of the time it is authorized, approved, or ratified by the board of directors, a committee thereof, or the shareholders.

     Common or interested directors may be counted in determining the presence of a quorum at a meeting of the board of directors or a committee thereof which authorizes, approves, or ratifies such contract or transaction.

ARTICLE V

Officers

     Section 1. The elective officers of the Corporation shall be a president, one or more vice presidents, a secretary and a treasurer, who shall be at least eighteen years old and who shall be elected by the board of directors at its first meeting after the annual meeting of shareholders. Unless removed in accordance with procedures established by law and these Bylaws, the said officers shall serve until the next succeeding annual meeting of the board of directors and until their respective successors are elected and shall qualify. Any two or more offices, may be held by the same person at the same time, except that one person may not simultaneously hold the offices of president and secretary. The election of one or more vice presidents of the Corporation shall be optional with the board of directors.

     Section 2. The board may elect or appoint a general manager, one or more assistant secretaries and one or more assistant treasurers, as it may deem advisable, who shall hold office during the pleasure of the board and shall be paid such compensation as may be directed by the board.

     Section 3. The officers of the Corporation shall respectively exercise and perform the respective powers, duties and functions as are stated below, and as may be assigned.

     (a) The president shall be the chief executive officer of the Corporation and shall, subject to the control of the board of directors, have general supervision, direction and control of the business and officers of the corporation. He shall preside at all meetings of the shareholders and of the board of directors. The president or a vice president, unless some other person is specifically authorized by the board of directors, shall sign all stock certificates, bonds, deeds, mortgages, leases and contracts of the Corporation. The president shall perform all the duties commonly incident to his office and such other duties as the board of directors shall designate.

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     (b) In the absence or disability of the president, the vice president or vice presidents in order of their rank as fixed by the board of directors, and if not ranked the vice presidents in the order designated by the board of directors, shall perform all the duties of the president and when so acting shall have all the powers of and be subject to all the restrictions on the president. Each vice president shall have such other powers and perform such other duties as may from time to time be assigned to him by the president.

     (c) The secretary shall keep accurate minutes of all meetings of the shareholders and the board of directors. He shall keep or cause to be kept a register of the shareholders of the Corporation and shall be responsible for the giving of notice of meetings of the shareholders or of the board of directors. The secretary shall be the custodian of the records and of the seal of the Corporation and shall attest the affixing of the seal of the Corporation when so authorized. The secretary shall perform all duties commonly incident to his office and such other duties as may from time to time be assigned to him by the president.

     (d) An assistant secretary may at the request of the secretary or in the absence or disability of the secretary perform all of the duties of the secretary. He shall perform such other duties as may be assigned to him by the president or by the secretary.

     (e) The treasurer, subject to the order of the board of directors, shall have the care and custody of the money, funds, valuable papers and documents of the corporation. He shall keep accurate books of accounts of the corporation’s transactions which shall be the property of the Corporation, and shall render financial reports and statements of condition of the Corporation when so requested by the board of directors or president. The treasurer shall perform all duties commonly incident to his office and such other duties as may from time to time be assigned to him by the president.

     (f) An assistant treasurer may at the request of the treasurer or in the absence or disability of the treasurer perform all of the duties of the treasurer. He shall perform such other duties as may be assigned to him by the president or by the treasurer.

     Section 4. All officers of the Corporation may receive salaries or other compensation if so ordered and fixed by the board of directors. The board shall have authority to fix salaries in advance for stated periods or render the same retroactive as the board may deem advisable.

     Section 5. In the event of absence or inability of any officer to act, the board of directors may delegate the powers or duties of such officer to any other officer, director or person whom it may select.

     Section 6. Any officer or agent may be removed by the board of directors at a meeting called for that purpose whenever in its judgment the best interests of the Corporation will be served thereby, but such removal shall be without prejudice to the contract rights, if any,

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of the person so removed. Election or appointment of an officer or agent shall not of itself create contract rights.

ARTICLE VI
Finance

     Section 1. The board of directors, in its uncontrolled discretion, may set aside from time to time out of the net profits or earned surplus of the Corporation such sum or sums as it deems expedient as a reserve fund to meet contingencies, for equalizing dividends, for maintaining any property of the Corporation and for any other purpose.

     Section 2. The moneys of the Corporation shall be deposited in the name of the Corporation in such bank or banks or trust companies as the board of directors shall designate and may be drawn out only on checks signed in the name of the Corporation by such person or persons as the board of directors by appropriate resolution may direct. Notes and commercial paper, when authorized by the board, shall be signed in the name of the Corporation by such officer or officers or agent or agents as shall thereunto be authorized from time to time.

     Section 3. The fiscal year of the Corporation shall be determined by resolution of the board of directors.

ARTICLE VII
Waiver of Notice

     Any shareholder, officer or director may waive in writing any notice required to be given by law or under these Bylaws whether before, at, or after the time stated therein.

ARTICLE VIII
Action without a Meeting

     Any action required to be taken at a meeting of the directors, or any committee designated by the directors or at a meeting of the shareholders of this Corporation, or any action which may be taken at a meeting of directors, committee, or shareholders, to be taken without a meeting if a consent in writing setting forth the action so taken shall be signed by all of the directors, committee members or shareholders entitled to vote with respect to the subject matter thereof and delivered to the Secretary for inclusion in the minutes or for filing with the Corporate reports. Action taken shall be effective when all parties have signed the consent, unless the consent specifies a difference effective date.

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ARTICLE IX
Indemnification of Corporate Directors,
Officers, Employees and Agents

     Section 1. As used in this Article:

     (a) “Corporation” includes any domestic or foreign predecessor entity of the Corporation in a merger, consolidation, or other transaction in which the predecessor’s existence ceased upon consummation of the transaction.

     (b) “Director” means an individual who is or was a director of the corporation and an individual who, while a director of the Corporation, is or was serving at the Corporation’s request as a director, officer, partner, trustee, employee, or agent of any other foreign or domestic corporation or of any partnership, joint venture, trust, other enterprise, or employee benefit plan. A director shall be considered to be serving an employee benefit plan at the Corporation’s request if his duties to the Corporation also impose duties on or otherwise involve services by him to the plan or to participants in or beneficiaries of the plan.

     (c) “Expenses” include attorney fees.

     (d) “Liability” means the obligation to pay a judgment, settlement, penalty, fine (including an excise tax assessed with respect to an employee benefit plan), or reasonable expense incurred with respect to a proceeding.

     (e) “Official capacity,” when used with respect to a director, means the office of director in the Corporation, and, when used with respect to an individual other than a director, means the office in the Corporation held by the officer or the employment or agency relationship undertaken by the employee or agent on behalf of the Corporation. “Official capacity” does not include service for any other foreign or domestic corporation or for any partnership, joint venture, trust, other enterprise, or employee benefit plan.

     (f) “Party” includes an individual who was, is, or is threatened to be, made a named defendant or respondent in a proceeding.

     (g) “Proceeding” means any threatened, pending, or completed action, suit, or proceeding, whether civil, criminal, administrative, or investigative and whether formal or informal.

     Section 2. The following standards of conduct shall govern indemnification under this Article IX:

     (a) Except as provided in paragraph (d) of this Section 2, the Corporation shall indemnify against liability incurred in any proceeding an individual made a party to the proceeding because he is or was a Director if:

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(i) he conducted himself in good faith;

(ii) he reasonably believed:

(A) in the case of conduct in his Official Capacity with the Corporation that his conduct was in the Corporation’s best interests; or

(B) in all other cases, that his conduct was at least not opposed to the Corporation’s best interests; and

(iii) in the case of any criminal proceeding, he had no reasonable cause to believe his conduct was unlawful.

     (b) A Director’s conduct with respect to an employee benefit plan for a purpose he reasonably believed to be in the interests of the participants in or beneficiaries of the plan is conduct that satisfies the requirements of subparagraph (B) of subparagraph (ii) of paragraph (a) of this Section 2.

     (c) The termination of any Proceeding by judgment, order, settlement, or conviction, or upon a plea of nolo contendere or its equivalent, is not of itself determinative that the individual did not meet the standard of conduct set forth in paragraph (a) of this Section 2.

     (d) The Corporation will not indemnify a Director under this Section 2 either:

(i) in connection with a Proceeding by or in the right of the Corporation in which the Director was adjudged liable to the Corporation; or

(ii) in connection with any Proceeding charging improper personal benefit to the Director, whether or not involving action in his Official Capacity, in which he was adjudged liable on the basis that personal benefit was improperly received by him.

     (e) Indemnification permitted under this Section 2 in connection with a Proceeding by or in the right of the Corporation is limited to reasonable Expenses incurred in connection with the Proceeding.

     Section 3. The Corporation shall indemnify a person who is or was a Director of the Corporation and who was wholly successful, on the merits or otherwise, in defense of any proceeding to which he was a party against reasonable expenses incurred by him in connection with the proceeding.

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     Section 4. The following procedures must be complied with in connection with indemnification pursuant to this Article IX:

     (a) The Corporation will not indemnify a Director under Section 2 of this Article unless authorized in the specific case after a determination has been made that indemnification of the Director is permissible in the circumstances because he has met the standard of conduct set forth in paragraph (a) of Section 2.

     (b) The determination required to be made by paragraph (a) of this Section 4 shall be made:

(i) by the Board of Directors by a majority vote of a quorum, which quorum shall consist of directors not parties to the proceeding; or

(ii) if a quorum cannot be obtained, by a majority vote of a committee of the board designated by the board, which committee shall consist of two or more directors not parties to the proceeding; except that directors who are parties to the proceeding may participate in the designation of Directors for the committee.

     (c) If the quorum cannot be obtained or the committee cannot be established under paragraph (b) of this Section 4, or even if a quorum is obtained or a committee designated if such quorum or committee so directs, the determination required to be made by paragraph (a) of this Section 4 shall be made:

(i) by independent legal counsel selected by a vote of the board of directors or the committee in the manner specified in subparagraph (i) or (ii) of paragraph (b) of this Section 4 or, if a quorum of the full board cannot be obtained and a committee cannot be established, by independent legal counsel selected by a majority vote of the full board; or

(ii) by the shareholders.

     (d) Authorization of indemnification and evaluation as to reasonableness of expenses shall be made in the same manner as the determination that indemnification is permissible except that, if the determination that indemnification is permissible is made by independent legal counsel, authorization of indemnification and evaluation as to reasonableness of expenses shall be made by the body that selected said counsel.

     Section 5. The Corporation may pay for or reimburse the reasonable expenses incurred by a Director who is a party to a proceeding in advance of the final disposition of the proceeding, if:

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     (a) the Director furnishes the Corporation a written affirmation of his good-faith belief that he has met the standard of conduct described in subparagraph (i) of paragraph (a) of Section 2 of this Article;

     (b) the Director furnishes the Corporation a written undertaking, executed personally or on his behalf, to repay the advance if it is determined that he did not meet such standard of conduct; and

     (c) a determination is made that the facts then known to those making the determination would not preclude indemnification under this Section 5.

The undertaking required by (b) of this Section 5 shall be an unlimited general obligation of the Director, but need not be secured and may be accepted without reference to financial ability to make repayment.

     Section 6. This Article shall not limit the Corporation’s power to pay or reimburse expenses incurred by a Director in connection with his appearance as a witness in a proceeding at a time when he has not been made a named defendant or respondent in the proceeding.

     Section 7. An Officer, employee or agent of the Corporation who is not a Director shall be entitled to indemnification pursuant to this Article under the following conditions:

     (a) An Officer of the Corporation who is not a Director is entitled to a mandatory indemnification pursuant to Section 3 of this Article.

     (b) The Corporation shall indemnify and advance expenses pursuant to Section 5 of this Article to an officer, employee, or agent of the Corporation who is not a Director to the same extent as a Director; and

     (c) The Corporation may indemnity and advance expenses to an officer, employee, or agent of the Corporation who is not a Director to a greater extent then provided in this Article if consistent with law and if provided for by a resolution of its directors or in a contract.

     Section 8. The Corporation may purchase and maintain insurance on behalf of an individual who is or was a Director, officer, employee, fiduciary, or agent of the Corporation and who, while a Director, officer, employee, fiduciary, or agent of the Corporation, is or was serving at the request of the Corporation as a Director, officer, partner, trustee, employee, fiduciary, or agent of any other foreign or domestic Corporation or of any partnership, joint venture, trust, other enterprise, or employee benefit plan against any liability arising out of his status as such, whether or not the Corporation would have the power to indemnify him against such liability under the provisions of this Article.

     Section 9. Any indemnification of or advance of expenses to a Director in accordance with this Article, if arising out of a proceeding by or on behalf of the Corporation, shall be reported in writing to the shareholders with or before the notice of the next shareholders’ meeting.

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ARTICLE X
Amendments

     The Board of Directors may amend or repeal these Bylaws unless the Articles of Incorporation reserve this power exclusively to the shareholders in whole or in part or the shareholders in amending or repealing a particular Bylaw provide expressly that the Directors may not amend or repeal such Bylaw. The shareholders may amend or repeal the Bylaws even though the Bylaws may also be amended or repealed by its Board of Directors.

     The foregoing Bylaws were approved and adopted by the Board of Directors on the 1^st day of June, 1990.

/s/ Mary Beth Laughery

Secretary

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EX-4.19

Exhibit 4.19

ALION SCIENCE AND TECHNOLOGY CORPORATION EMPLOYEE
OWNERSHIP, SAVINGS AND INVESTMENT PLAN

Amended and Restated as of October 1, 2006

ALION SCIENCE AND TECHNOLOGY CORPORATION

EMPLOYEE OWNERSHIP, SAVINGS AND INVESTMENT PLAN

Table of Contents

		Page
ARTICLE I Adoption of the Plan			1
1.1	Establishment		1
1.2	Trust		2
1.3	Restatement Effective Date		2
1.4	Adoption of Plan		2
1.5	Withdrawal of Adopting Employer		2
1.6	Supplements		3
ARTICLE II Definitions			4
2.1	Account		4
2.2	Acquisition Loan		5
2.3	Adopting Employers		5
2.4	Affiliate		5
2.5	Allocation Date		6
2.6	Authorized Leave of Absence		6
2.7	Beneficiary		6
2.8	Board of Directors		6
2.9	Closing Date		6
2.10	Code		6
2.11	Common Stock		7
2.12	Company		7
2.13	Compensation		7
2.14	Current Market Value		9
2.15	Disability		9
2.16	RESERVED		9
2.17	Elective Deferral		9
2.18	Eligible Employee		10
2.19	Employee		10
2.20	Employer		11
2.21	Employment Commencement Date		11
2.22	ERISA		11
2.23	ESOP Accounts		11
2.24	ESOP Committee		11
2.25	ESOP Component		12
2.26	ESOP Elective Deferral Account		12
2.27	ESOP Matching Account		12
2.28	ESOP Profit Sharing Account		12
2.29	ESOP Rollover Account		12

- i -

Table of Contents

		Page
2.30	Fiduciary		12
2.31	Financed Shares		13
2.32	Fiscal Year		13
2.33	Former IIT Research Institute Employee		13
2.34	Highly Compensated Employee		13
2.35	Hour of Service		14
2.36	IIT Research Institute		14
2.37	Leased Employee		15
2.38	Matching Contributions		15
2.39	Non ESOP Accounts		15
2.40	Non ESOP Component		15
2.41	Non ESOP Elective Deferral Account		15
2.42	Non ESOP Matching Account		16
2.43	Non ESOP Profit Sharing Account		16
2.44	Non ESOP Rollover Account		16
2.45	Normal Retirement Age		16
2.46	Participant		16
2.47	Pay Period		16
2.48	Period of Participation		17
2.49	Period of Service		17
2.50	Period of Severance		18
2.51	Plan		18
2.52	Plan Year		18
2.53	Profit Sharing Contributions		18
2.54	Qualified Military Service		19
2.55	Qualified Nonelective Contributions		19
2.56	Qualified Nonelective Contribution Account		19
2.57	Recordkeeper		19
2.58	Reemployment Commencement Date		20
2.59	Retirement		20
2.60	Rollover Contributions		20
2.61	Severance from Service		20
2.62	Severance from Service Date		20
2.63	Surviving Spouse		21
2.64	Trade Day		21
2.65	Trust		22
2.66	Trustee		22
2.67	Trust Fund		22
2.68	United States-Based Payroll		22
2.69	Valuation Date		22
ARTICLE III Eligibility			23
3.1	Eligibility Requirements		23
3.2	Procedure for Joining the Plan		23
3.3	Transfer Between Adopting Employers to Position Covered by Plan		24
3.4	Transfer to Position Not Covered by Plan		24
3.5	Transfer to Position Covered by Plan		24

- ii -

Table of Contents

		Page
3.6	Treatment of Qualified Military Service		25
ARTICLE IV Contributions			26
4.1	Elective Deferrals		26
4.2	Qualified Nonelective Contributions		27
4.3	Profit Sharing Contributions		28
4.4	Matching Contributions		30
4.5	Rollover Contributions		31
4.6	Direct Transfers		32
4.7	Refund of Contributions to the Adopting Employers		33
4.8	Payment		34
4.9	Limits for Highly Compensated Employees		34
4.10	Correction of Excess Contributions		38
4.11	Correction of Excess Deferrals		42
4.12	Correction of Excess Aggregate Contributions		44
ARTICLE V Investment of Accounts			48
5.1	Election of Investment Funds		48
5.2	Diversification		53
5.3	Change in Investment Allocation of Future Deferrals		55
5.4	Transfer of Account Balances Between Investment Funds		55
5.5	Ownership Status of Funds		55
5.6	Allocation of Earnings		56
5.7	Acquisition Loans		57
5.8	Acquisition Loan Payments		58
5.9	Sales of Common Stock		59
5.10	Allocations of Financed Shares		59
5.11	Allocation of Dividends and Distributions on Common Stock		61
5.12	Nonallocation		62
ARTICLE VI Voting and Tendering of Stock			63
6.1	Voting of Common Stock		63
6.2	Tendering of Common Stock		64
ARTICLE VII Vesting			65
7.1	Elective Deferral, Rollover Contribution, Qualified Nonelective Contribution and Matching Contribution   Accounts
			65
7.2	Profit Sharing Contribution Accounts		65
7.3	Forfeitures		65
7.4	Break in Service Rules		67
ARTICLE VIII In-Service Withdrawals			68
8.1	Elective Deferrals and Qualified Nonelective Contributions		68
8.2	Rollover Contributions		70
8.3	General Terms and Conditions		70
8.4	Hurricane Katrina Distribution		71

- iii -

Table of Contents

		Page
ARTICLE IX Distribution of Benefits			74
9.1	General		74
9.2	Commencement of Benefits		74
9.3	Form of Distribution		77
9.4	Determination of Amount of Distribution		77
9.5	Direct Rollovers		78
9.6	Notice and Payment Elections		80
9.7	Qualified Domestic Relations Orders		81
9.8	Designation of Beneficiary		85
9.9	Lost Participant or Beneficiary		86
9.10	Payments to Incompetents		87
9.11	Offsets		87
9.12	Income Tax Withholding		87
9.13	Common Stock Dividend Distributions		87
9.14	Distributions		87
9.15	Rights, Options and Restrictions on Common Stock		89
9.16	Price Protection		91
ARTICLE X Loans			93
10.1	Availability of Loans		93
10.2	Written Loan Policy		93
10.3	Maximum Amount of Loan		93
10.4	Repayment Schedule		94
10.5	Interest Rate		94
10.6	Security for Loans		95
ARTICLE XI Contribution and Benefit Limitations			96
11.1	Contribution Limits		96
11.2	Annual Adjustments to Limits		96
11.3	Excess Amounts		96
ARTICLE XII Top-Heavy Rules			99
12.1	General		99
12.2	Vesting		99
12.3	Minimum Contribution		99
12.4	Definitions		100
12.5	Special Rules		103
ARTICLE XIII The Trust Fund			105
13.1	Trust		105
13.2	Investment of Accounts		105
13.3	Expenses		105
ARTICLE XIV Administration of The Plan			106
14.1	General Administration		106
14.2	Responsibilities of the ESOP Committee		106
14.3	Liability for Acts of Other Fiduciaries		107

- iv -

Table of Contents

		Page
14.4	Employment by Fiduciaries		108
14.5	Recordkeeping		108
14.6	Claims Review Procedure		108
14.7	Indemnification of Directors and Employees		110
14.8	Immunity from Liability		111
ARTICLE XV Amendment Or Termination Of Plan			112
15.1	Right to Amend or Terminate Plan		112
15.2	Amendment to Vesting Schedule		113
15.3	Maintenance of Plan		113
15.4	Termination of Plan and Trust		113
15.5	Distribution on Termination		114
ARTICLE XVI Additional Provisions			116
16.1	Effect of Merger, Consolidation or Transfer		116
16.2	No Assignment		116
16.3	Limitation of Rights of Employees		117
16.4	Construction		117
16.5	Company Determinations		117
16.6	Continued Qualification		118
16.7	Governing Law		118
EXHIBIT A			119
Adopting Employers and Special Plan Provisions for Certain Adopting Employers			119
EXHIBIT B			120
Special Withdrawal and Distribution Provisions			120
EXHIBIT C			130
Designation of Current Year Method for ADP and ACP Testing			130
SUPPLEMENT NO. 1			131
John J. McMullen Associates, Inc. 401(k) Retirement Plan and John J. McMullen Associates, Inc. Employee Stock Ownership Plan			131
SUPPLEMENT NO. 2			134
BMH Associates, Inc. Profit Sharing 401(k) Plan			134
SUPPLEMENT NO. 3			136
MA&D 401(k) Plan			136

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ALION SCIENCE AND TECHNOLOGY CORPORATION EMPLOYEE
OWNERSHIP, SAVINGS AND INVESTMENT PLAN

ARTICLE I

Adoption of the Plan

1.1 Establishment.

     (a) Alion Science and Technology Corporation, a corporation organized under the laws of the state of Delaware, hereby amends and restates the Alion Science and Technology Corporation Employee Ownership, Savings And Investment Plan (the “Plan”) generally effective as of October 1, 2006. The Plan was originally established December 19, 2001 as the Beagle Holdings, Inc. Employee Ownership, Savings And Investment Plan. The Plan includes two components: (1) a stock bonus plan that constitutes an employee stock ownership plan within the meaning of Section 4975(e)(7) of the Code (“ESOP Component”), and (2) a profit sharing plan that includes a cash or deferred arrangement under Section 401(k) of the Code (“Non ESOP Component”). The ESOP Component is designed to invest in the ESOP Accounts; the Non ESOP Component is designed to invest in the Non ESOP Accounts.

     (b) The Non ESOP Component is intended to meet the applicable requirements of Section 401(a) of the Internal Revenue Code of 1986 (the “Code”), including a cash or deferred arrangement intended to qualify under Section 401(k) of the Code. The ESOP Component is designed to be invested primarily in stock of the Company and is intended to meet the applicable requirements of Sections 401(a), 409, and 4975(e)(7) of the Code and Section 407(d)(6) of the Employee Retirement Income Security Act of 1974 (“ERISA”), which also includes a cash or deferred arrangement intended to qualify under Section 401(k) of the Code. The ESOP Component of the Plan is designed to invest primarily in qualifying employer securities. The terms of the Plan shall be interpreted consistent with the foregoing.

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1.2 Trust.

     The Trust shall be the sole source of benefits under the Plan and the Adopting Employers or any Affiliate shall not have any liability for the adequacy of the benefits provided under the Plan. The Trust may be comprised of more than one trust, and plan assets may be held by more than one Trustee.

1.3 Restatement Effective Date.

     The Plan shall be amended and restated as of October 1, 2006, or such other dates as may be specifically provided herein or as otherwise required by law for the Plan to satisfy the requirements of Section 401(a) of the Code.

1.4 Adoption of Plan.

     With the prior approval of the Board of Directors, or other officer of the Company to whom authority to approve participation by an entity is delegated by the Board of Directors, the Plan and Trust may be adopted by any corporation or other entity (hereinafter referred to as an Adopting Employer). Such adoption shall be made by the Adopting Employer taking the actions designated by the ESOP Committee as appropriate to the proper adoption and operation of the Plan and Trust. In the event of the adoption of the Plan and Trust by an Adopting Employer, the Plan and Trust shall be interpreted in a manner consistent with such adoption. The Adopting Employers shall be listed in Exhibit A attached to this Plan.

1.5 Withdrawal of Adopting Employer.

     (a) An Adopting Employer’s participation in this Plan may be terminated, voluntarily or involuntarily, at any time, as provided in this Section.

     (b) An Adopting Employer shall withdraw from the Plan and Trust if the Plan and Trust, with respect to that Adopting Employer, fail to qualify under Sections 401(a) and 501(a)

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of the Code (or, in the opinion of the ESOP Committee, they may fail to so qualify) and the continued sponsorship of that Adopting Employer may jeopardize the status with respect to the Company or the remaining Adopting Employers, of the Plan and Trust under Sections 401(a) and 501(a) of the Code. The Adopting Employer shall receive at least thirty (30) days prior written notice of a withdrawal under this subsection, unless a shorter period is agreed to or is determined to be appropriate by the ESOP Committee in order to preserve the qualified status of the Plan.

     (c) An Adopting Employer may voluntarily withdraw from the Plan and Trust for any reason. Such withdrawal requires at least thirty (30) days written notice to the ESOP Committee and the Trustee, unless a shorter period is agreed to.

     (d) Upon withdrawal, the Trustee shall segregate the assets attributable to Employees of the withdrawn Adopting Employer, the amount thereof to be determined by the ESOP Committee and the Trustee. The segregated assets shall be held, paid to another trust, distributed or otherwise disposed of as is appropriate under the circumstances; provided, however, that any transfer shall be for the exclusive benefit of Participants and their Beneficiaries. A withdrawal of an Adopting Employer from the Plan is not necessarily a termination under ARTICLE XV. If the withdrawal is a termination, then the provisions of ARTICLE XV shall also be applicable.

1.6 Supplements.

     Except as otherwise provided in this document, the  terms and conditions of this document are supplemented by the terms and            provisions of any Supplement hereto, and the same are hereby incorporated herein by reference. The Plan is a single plan under the Code and ERISA that is funded by a single pool of assets. In the event of a conflict between the terms of this document and the terms of any Supplement, the terms of the Supplement shall control unless specifically provided otherwise.

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ARTICLE II

Definitions

     The following terms have the meaning specified below unless the context indicates otherwise:

2.1 Account.

     The entire interest of a Participant in the Trust Fund. A Participant’s Account shall consist of an ESOP Account and a Non ESOP Account and a Qualified Nonelective Contribution Account. The ESOP Account and the Non ESOP Account will contain the following subaccounts:

(a) ESOP Account

(1)	ESOP Elective Deferral Account
(2)	ESOP Matching Account
(3)	ESOP Rollover Account
(4)	ESOP Profit Sharing Account
(5)	ESOP Stock, Cash and Loan Accounts may be established as Subaccounts

(b) Non ESOP Account

(1)	Elective Deferral Account
(2)	Matching Account
(3)	Rollover Account
(4)	Profit Sharing Account
(5)	Non ESOP Loan Account may be established as a Subaccount

The ESOP Committee may set up such additional subaccounts as it deems necessary for the proper administration of the Plan.

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2.2 Acquisition Loan.

     A loan or other extension of credit used by the Trustee to finance the acquisition of Common Stock, which loan may constitute an extension of credit to the Trust from a party in interest (as defined in ERISA).

2.3 Adopting Employers.

     Any corporation or other entity (including the Company) that elects to participate in the Plan on account of some or all of its Employees, provided that participation in the Plan by such entity is approved by the Board of Directors, or officer of the Company to whom authority to approve participation by an entity is delegated by the Board of Directors. The Adopting Employers, and if applicable, the divisions, operations or similar cohesive groups of the Adopting Employers that participate in the Plan shall be listed in Exhibit A to this Plan. If an adopting entity does not participate in the Plan with respect to all of its Eligible Employees, the term “Adopting Employer” shall include only those divisions, operations or similar cohesive groups of such entity that participate in the Plan.

2.4 Affiliate.

     A trade or business that, together with an Adopting Employer, is a member of (i) a controlled group of corporations within the meaning of Section 414(b) of the Code; (ii) a group of trades or businesses (whether or not incorporated) under common control as defined in Section 414(c) of the Code, or (iii) an affiliated service group as defined in Section 414(m) of the Code, or which is an entity otherwise required to be aggregated with the Adopting Employer pursuant to Section 414(o) of the Code. For purposes of ARTICLE XI, the determination of controlled groups of corporations and trades or businesses under common control shall be made after taking into account the modification required under Section 415(h) of the Code. All such

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entities, whether or not incorporated, shall be treated as a single employer to the extent required by the Code.

2.5 Allocation Date.

     March 31 and September 30 of each Plan Year. Notwithstanding the foregoing, for purposes of the Common Stock, the term “Allocation Date” shall include June 30, 2005.

2.6 Authorized Leave of Absence.

     An absence approved by an Adopting Employer on a uniform and nondiscriminatory basis not exceeding six (6) months for any of the following reasons: illness of an Employee or a relative, the death of a relative, education of the Employee, or personal or family business of an extraordinary nature, provided in each case that the Employee returns to the service of the Adopting Employer within the time period specified by the Adopting Employer.

2.7 Beneficiary.

     The person or persons (including a trust or trusts) who are entitled to receive benefits from a deceased Participant’s Account after such Participant’s death (whether or not such person or persons are expressly so designated by the Participant).

2.8 Board of Directors.

     The Board of Directors of Alion Science and Technology Corporation.

2.9 Closing Date.

     The date upon which the Company or an Affiliate acquires a substantial portion of the assets of IIT Research Institute.

2.10 Code.

     The Internal Revenue Code of 1986, as amended.

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2.11 Common Stock.

     Alion Science and Technology Corporation common stock.

2.12 Company.

     Alion Science and Technology Corporation.

2.13 Compensation.

     (a) (1) Except as otherwise provided herein and in an Exhibit or Supplement, the total wages, salaries, and fees for professional services and other amounts received (without regard to whether or not an amount is paid in cash) for personal services actually rendered in the course of employment with the Employer to the extent that the amounts are includible in gross income, including, but not limited to (A) commissions paid to salesmen, (B) compensation for services on the basis of a percentage of profits, (C) taxable fringe benefits, (D) bonuses, overtime and other extra compensation, and (E) amounts described in Sections 104(a)(3), 105(h) of the Code, but only to the extent that these amounts are includible in the gross income of the Employee.

          (2) Notwithstanding the foregoing, Compensation shall not include: (A) Employer contributions to a plan of deferred compensation which are not includible in the Employee’s gross income for the taxable year in which contributed, or any distributions from a plan of deferred compensation (regardless of whether such amounts are includible in the gross income of the Employee when distributed); (B) amounts realized from the sale, exchange or other disposition of stock appreciation rights; and (C) other amounts which received special tax benefits, such as premiums for group-term life insurance to the extent that the premiums are not includible in the gross income of the Employee.

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          (3) To the extent not otherwise excluded by subsection (a)(2), Compensation also shall not include (even if otherwise includible in gross income): (A) reimbursements or other expense allowances (B) nontaxable fringe benefits (cash or noncash), (C) moving expenses, (D) deferred compensation including equity or similar compensation such as Stock Appreciation Rights (SARs), phantom stock, stock options, warrants or other similar arrangements, (E) welfare benefits (including severance payments), (F) amounts includable in the gross income of an Employee upon making the election described in Section 83(b) of the Code.

          (4) In all cases, however, notwithstanding any exclusions above, Compensation shall include any amount which would otherwise be deemed Compensation under this subsection 2.13(a) but for the fact that it is deferred pursuant to a salary reduction agreement under this Plan or under any plan described in Section 401(k) or 125 of the Code or a qualified transportation fringe benefit program defined in Section 132(f) of the Code.

     (b) The annual Compensation of each Participant taken into account for any Plan Year shall not exceed $220,000, as adjusted for cost-of-living increases in accordance with Section 401(a)(17)(B) of the Code.

     (c) Except to the extent required by law, Compensation shall be determined only on the basis of amounts paid during the Plan Year, including any Plan Year with a duration of fewer than twelve (12) months.

     (d) Compensation of a person who becomes a Participant during the Plan Year shall only include amounts paid after the date on which such person commenced participation in the Plan.

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2.14 Current Market Value.

     (a) Except as provided in subsection (b) below, the current market value of Company Stock for all purposes under the Plan shall be determined by the Trustee based upon a valuation performed by an independent appraiser, as defined in Section 401(a)(28)(C) of the Code. Current Market Value will generally be based upon a semi-annual appraisal performed as of a Valuation Date; provided, however, that the ESOP Committee may order interim valuations, which will be binding as of the relevant date specified therein. Nothing in this Plan will be construed as requiring Current Market Value to be determined as of any date other than a Valuation Date or an interim Valuation Date.

     (b) Notwithstanding subsection (a) above, for purposes of Section 9.15 regarding the Company’s right of first refusal to purchase Common Stock distributed from the Plan to a Participant or Beneficiary as described in Section 9.15, Current Market Value means the price to purchase the Common Stock offered by a bona fide, independent purchaser.

2.15 Disability.

     Disability means that a Participant is determined to be disabled under the Employer’s Long Term Disability Plan.

2.16 RESERVED.

2.17 Elective Deferral.

     A voluntary reduction of a Participant’s Compensation in accordance with Section 4.1 hereof that qualifies for treatment under Section 402(e)(3) of the Code. A Participant’s election to make Elective Deferrals may be made only with respect to an amount that the Participant could otherwise elect to receive in cash and that is not currently available to the Participant.

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2.18 Eligible Employee.

     A person who is an Employee of an Adopting Employer who:

     (a) is on a United States-Based Payroll;

     (b) is not employed in a position or classification within a bargaining unit which is covered by a collective bargaining agreement with respect to which retirement benefits were the subject of good faith bargaining (unless such agreement provides for coverage hereunder of Employees of such unit);

     (c) is not assigned on the books and records of the Employer to any division, operation or similar cohesive group of an Adopting Employer that is excluded from participation in the Plan by the Board of Directors of the Company, or officer of the Company to whom such authority is delegated by the Board of Directors;

     (d) is not a nonresident alien who receives no earned income (within the meaning of Section 911(d)(2) of the Code) from the Employer which constitutes income from sources within the United States (within the meaning of Section 861(a)(3) of the Code).

     (e) is not a Leased Employee or any other person who performs services for an Adopting Employer other than as an Employee.

2.19 Employee.

     Except to the extent otherwise provided herein any person employed by an Employer, including any officer of the Employer, who is expressly so designated as an employee or officer on the books and records of the Employer and who is treated as such by the Employer for federal employment tax purposes. Any person who, after the close of a Plan Year, is retroactively treated by the Employer or any other party as an employee for such prior Plan Year shall not, for purposes of the Plan, be considered an Employee for such prior Plan Year unless expressly so

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treated as such by the Employer. The term “Employee” specifically excludes a person who the Employer considers to be a “contract employee” or “independent contractor” for the period that the person is considered by the Employer to be a “contract employee” or “independent contractor” even if the person is later reclassified as a common law employee by the Internal Revenue Service or a court of law, or is otherwise reclassified.

2.20 Employer.

     An Adopting Employer and any Affiliate thereof (whether or not such Affiliate participates in the Plan). The term “Employer” shall be used throughout this Plan to designate the respective Employer entities unless the context demands otherwise. Each entity covering its Employees hereunder shall be deemed to be such only as to those Participants who are on its payroll, and, in each case only to the extent of the Compensation it pays to these Participants.

2.21 Employment Commencement Date.

     The date on which an individual first performs an Hour of Service with the Employer.

2.22 ERISA.

     The Employee Retirement Income Security Act of 1974, as amended.

2.23 ESOP Accounts.

     That portion of a Participant’s Account made up of the ESOP Elective Deferral Account, ESOP Matching Account, ESOP Profit Sharing Account, ESOP Rollover Account and such other subaccounts with respect to the ESOP Component as determined by the ESOP Committee.

2.24 ESOP Committee.

     The ESOP Committee appointed by the President and CEO of the Company to administer the Plan in accordance with ARTICLE XIV.

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2.25 ESOP Component.

     The portion of the Plan which is a stock bonus plan which constitutes an employee stock ownership plan within the meaning of Section 4975(e)(7) of the Code.

2.26 ESOP Elective Deferral Account.

     That portion of a Participant’s Account which is attributable to ESOP elective deferrals received pursuant to Section 4.1, adjusted for withdrawals and distributions, and the earnings and losses attributable thereto.

2.27 ESOP Matching Account.

     That portion of a Participant’s Account which is attributable to ESOP matching contributions received pursuant to Section 4.4, adjusted for withdrawals and distributions, and the earnings and losses attributed thereto.

2.28 ESOP Profit Sharing Account.

     That portion of a Participant’s Account which is attributable to ESOP Profit Sharing Contributions received pursuant to Section 4.3, adjusted for withdrawals and distributions, and the earnings and losses attributed thereto.

2.29 ESOP Rollover Account.

     That portion of a Participant’s Account which is attributable to ESOP Rollover Contributions received pursuant to Section 4.5, adjusted for withdrawals and distributions, and the earnings and losses attributed thereto.

2.30 Fiduciary.

     Any person who exercises any discretionary authority or discretionary control over the management of the Plan, or exercises any authority or control respecting management or disposition of Plan assets; who renders investment advice for a fee or other compensation, direct

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or indirect, as to assets held under the Plan, or has any authority or discretionary responsibility in the administration of the Plan. This definition shall be interpreted in accordance with Section 3(21) of ERISA.

2.31 Financed Shares.

     Shares of Common Stock acquired by the Trust with the proceeds of an Acquisition Loan.

2.32 Fiscal Year.

     The fiscal year of the Company, ending at 11:59 p.m. on the last Friday in September. Notwithstanding the foregoing, for purposes of the deduction rules of Code Section 404, Fiscal Year shall be deemed to coincide with the Plan Year.

2.33 Former IIT Research Institute Employee.

     An Eligible Employee who (a) is or was an employee of IIT Research Institute and became an Employee of an Adopting Employer in the first Plan Year, or (b) was an employee of IIT Research Institute on or before December 20, 2002 and became an Employee of an Adopting Employer within five (5) years of the Employee’s termination of employment with IIT Research Institute.

2.34 Highly Compensated Employee.

     (a) Any Employee who:

          (1) is a five percent (5%) owner at any time during the Plan Year or the preceding Plan Year; or

          (2) for the preceding Plan Year received Compensation in excess of the amount specified in Section 414(q)(1)(B)(i) of the Code; and in accordance with

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Section 414(q)(1)(B)(ii) of the Code, was a member of the Top Paid Group for such preceding Plan Year.

     (b) A former Employee will be treated as a Highly Compensated Employee if the former Employee was a Highly Compensated Employee at the time of his or her separation from service or the former Employee was a Highly Compensated Employee at any time after attaining age fifty-five (55).

     (c) The dollar amount incorporated under subsection (a)(2) shall be adjusted as provided in Section 414(q)(1) of the Code.

     (d) This Section shall be interpreted in a manner consistent with Section 414(q) of the Code and the regulations thereunder and shall be interpreted to permit any elections permitted by such regulations to be made.

     (e) The term Top Paid Group for any year includes Employees in the group of Employees specified in Section 414(q)(3) of the Code, which consists of the top twenty percent (20%) of Employees when ranked on the basis of compensation paid during such year.

2.35 Hour of Service.

     Any hour for which any person is directly or indirectly paid (or entitled to payment) by the Employer for the performance of duties as an Employee, as determined from the appropriate records of the Employer. Hours of Service shall be computed and credited in accordance with the Department of Labor regulations under Section 2530.200b.

2.36 IIT Research Institute.

     Illinois Institute of Technology Research Institute, an Illinois corporation, and Human Factors Applications, Inc., a Pennsylvania corporation.

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2.37 Leased Employee.

     Any person (other than an Employee) who, pursuant to an agreement between the Employer and any other person, has performed services for the Employer (or any related person as provided in Section 414(n)(6) of the Code) on a substantially full-time basis for a period of at least one (1) year and such services are performed under primary direction or control of the Employer. Leased Employees are not eligible to participate in the Plan.

2.38 Matching Contributions.

     Contributions made to the Trust in accordance with Section 4.4 hereof.

2.39 Non ESOP Accounts.

     That portion of a Participant’s Account which is made up of the Non ESOP Elective Deferral Account, the Non ESOP Matching Account, the Non ESOP Profit Sharing Account, the Non ESOP Rollover Account and such other subaccounts with respect to the Non ESOP Component as determined by the ESOP Committee.

2.40 Non ESOP Component.

     The portion of the Plan which constitutes a profit sharing plan that includes a cash or deferred arrangement under Section 401(k) of the Code.

2.41 Non ESOP Elective Deferral Account.

     That portion of a Participant’s Account which is attributable to Non ESOP elective deferral contributions received pursuant to Section 4.1, adjusted for withdrawals and distributions, and the earnings and losses attributable thereto.

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2.42 Non ESOP Matching Account.

     That portion of a Participant’s Account which is attributable to Non ESOP matching contributions received pursuant to Section 4.4, adjusted for withdrawals and distributions, and the earnings and losses attributable thereto.

2.43 Non ESOP Profit Sharing Account.

     That portion of a Participant’s Account which is attributable to Non ESOP Profit Sharing Contributions received pursuant to Section 4.3, adjusted for withdrawals and distributions, and the earnings and losses attributable thereto.

2.44 Non ESOP Rollover Account.

     That portion of a Participant’s Account which is attributable to Non ESOP Rollover Contributions received pursuant to Section 4.5, adjusted for withdrawals and distributions, and the earnings and losses attributable thereto.

2.45 Normal Retirement Age.

     The Participant’s attainment of age sixty five (65).

2.46 Participant.

     An individual who is enrolled in the Plan pursuant to ARTICLE III and has not received a distribution of all of the funds credited to his or her Account (or had such funds fully forfeited). In the case of an Eligible Employee who makes a Rollover Contribution to the Plan under Section 4.5(a)(3) prior to enrollment under ARTICLE III, such Eligible Employee shall, until he or she enrolls under ARTICLE III, be considered a Participant for the limited purposes of maintaining and receiving his or her Rollover Contribution Account under the terms of the Plan.

2.47 Pay Period.

     A period scheduled by an Adopting Employer for payment of wages or salaries.

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2.48 Period of Participation.

     That portion of a Period of Service during which an Eligible Employee was a Participant. A Human Factors Applications, Inc. employee will get one Period of Participation for each year of participation in the Human Factors Applications, Inc. Profit Sharing and 401(k) Plan. A former employee of Innovative Technology Solutions Corporation will get one Period of Participation for each year of participation in the Innovative Technology Solutions 401(k) Profit Sharing Plan & Trust.

2.49 Period of Service.

     The period of time beginning on the Employee’s Employment Commencement Date or Reemployment Commencement Date, whichever is applicable, and ending on the Employee’s Severance from Service Date. If the Severance from Service is because the Employee resigns, retires or is discharged, and the Employee is rehired by an Employer within twelve (12) months after his Severance from Service Date, the period between his Severance from Service Date and his rehire date is included in his Period of Service. Notwithstanding the foregoing, if an Employee resigns, retires or is discharged during a period of absence for any reason other than a resignation, retirement, discharge or death, the period between his Severance from Service Date and his rehire date is included in his Period of Service only if the Employee’s rehire date is within twelve (12) months after the original absence date. For this purpose, a Former IIT Research Institute Employee shall receive credit for his or her period of service with IIT Research Institute, including any credit for service with a previous employer to the extent such service was taken into account under a qualified or other tax-favored retirement plan maintained by IIT Research Institute.

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     A Period of Service for the purposes of this Plan shall also include any period of uninterrupted employment performed by an employee of any Employer or an Affiliate and any period of uninterrupted employment with the predecessor of any Employer or an Affiliate, but only to the extent such period of employment would otherwise be recognized under the terms of the Plan. For this purpose, employment with a predecessor includes any period of employment with a trade or business, or period of employment recognized under a tax-qualified plan under Section 401(a) of the Code maintained by a trade or business that was performed by an employee who was employed by the trade or business immediately prior to a transfer to the employment of the acquiring Employer or an Affiliate in connection with the purchase by the Employer or Affiliate of all or a portion of the assets used in that trade or business.

2.50 Period of Severance.

     The period of time beginning on the Employee’s Severance from Service Date and ending on the Employee’s Reemployment Commencement Date.

2.51 Plan.

     The Alion Science and Technology Corporation Employee Ownership, Savings and Investment Plan, as amended from time to time.

2.52 Plan Year.

     The annual twelve- (12) month period beginning on October 1 of each year and ending on September 30 of each year.

2.53 Profit Sharing Contributions.

     Any contribution by the Adopting Employers to the Trust pursuant to Section 4.3.

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2.54 Qualified Military Service.

     Any service in the Uniformed Services (as defined in Chapter 43 of Title 38 of the United States Code) by any individual if such individual is entitled to reemployment rights under such chapter with respect to such service. Qualified Military Service includes any period of duty on a voluntary or involuntary basis in the United States Armed Forces, the Army National Guard and the Air National Guard when engaged in active duty for training, inactive duty for training or full-time National Guard duty, the commissioned corps of the Public Health Service and any other category of persons designated by the President of the United States in time of war or emergency. Such periods of duty shall include active duty, active duty for training, initial active duty for training, inactive duty training, full-time National Guard duty and absence from employment for an examination to determine fitness for such duty.

2.55 Qualified Nonelective Contributions.

     Any contributions by the Adopting Employers to the Trust pursuant to Section 4.2. Qualified Nonelective Contributions are one hundred percent (100%) vested when made and are subject to the special distribution restrictions prescribed in Section 9.2(e).

2.56 Qualified Nonelective Contribution Account.

     That portion of a Participant’s Account that is attributable to Qualified Nonelective Contributions received pursuant to Section 4.2, adjusted for withdrawals and distributions, and the earnings and losses attributable thereto.

2.57 Recordkeeper.

     The organization or organizations designated by the ESOP Committee to be the recordkeeper(s) for the Plan.

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2.58 Reemployment Commencement Date.

     The first date on which the Employee performs an Hour of Service following a Period of Severance that is excluded under Section 7.4 in determining whether a Participant has a nonforfeitable right to his or her ESOP or Non ESOP Contribution Accounts.

2.59 Retirement.

     A termination of employment that occurs after a Participant has attained Normal Retirement Age.

2.60 Rollover Contributions.

     Amounts transferred or contributed to this Plan from another plan or IRA in accordance with Section 4.5.

2.61 Severance from Service.

     The termination of employment by reason of resignation, Retirement, discharge, layoff or death; or the failure to return from Authorized Leave of Absence, Qualified Military Service or Disability.

2.62 Severance from Service Date.

     The earliest of:

     (a) the date on which an Employee resigns, retires, is discharged, or dies; or

     (b) except as provided in paragraphs (c), (d), (e) and (f) hereof, the first anniversary of the first date of a period during which an Employee is absent for any reason other than resignation, retirement, discharge or death; or

     (c) in the case of a Qualified Military Service leave of absence from which the Employee does not return before expiration of recall rights, Severance from Service Date means the first day of absence because of the leave; or

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     (d) in the case of an absence due to Disability, Severance from Service Date means the earlier of the first anniversary of the first day of absence because of the Disability or the date of termination of the Disability; or

     (e) in the case of an Employee who is discharged or resigns (i) by reason of the pregnancy of the Employee, (ii) by reason of the birth of a child to the Employee, (iii) by reason of the placement of a child with the Employee in connection with the adoption of such child by the Employee or (iv) for purposes of caring for such child for a period beginning immediately following such birth or placement, “Severance from Service Date”, for the sole purpose of determining the length of a Period of Service, shall mean the first anniversary of the resignation or discharge; or

     (f) in the case of an Employee who is absent from service beyond the first anniversary of the first day of absence (i) by reason of the pregnancy of the Employee, (ii) by reason of the birth of a child to the Employee, (iii) by reason of the placement of a child with the Employee in connection with the adoption of such child by the Employee or (iv) for purposes of caring for such child for a period beginning immediately following such birth or placement, the Severance from Service Date shall be the second anniversary of the first day of such absence. The period between the first and second anniversaries of the first day of absence is neither a Period of Service nor a Period of Severance.

2.63 Surviving Spouse.

     A person who was legally married to the Participant immediately before the Participant’s death.

2.64 Trade Day.

     Days on which the Recordkeeper is able to make transfers of Plan assets.

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2.65 Trust.

     The Alion Science and Technology Corporation Employee Ownership, Savings and Investment Trust and any successor agreement made and entered into for the establishment of a trust fund of all contributions which may be made to the Trustee under the Plan. The Trust may be held by separate Trustees.

2.66 Trustee.

     The Trustee and any successor trustees under the Trust holding all or part of the Trust Fund.

2.67 Trust Fund.

     The cash, securities, and other property held by the Trustee for the purposes of the Plan.

2.68 United States-Based Payroll.

     A payroll maintained by the Company or an Adopting Employer that is designated as a United States payroll on the books and records of the Company or Adopting Employer and that is subject to United States wage withholding and reporting laws.

2.69 Valuation Date.

     Any day that the New York Stock Exchange is open for trading; provided, however, that the terms Trade Day and Valuation Date shall not be construed to mean that Common Stock must be newly valued on each of these days. For Common Stock, the term “Valuation Date” means the semiannual date on which Common Stock is valued by an Independent Appraiser (which shall generally be as of March 31 and September 30), and such other interim Valuation Dates as declared by the ESOP Committee. Notwithstanding the foregoing, for purposes of the Common Stock, the term “Valuation Date” shall include June 30, 2005.

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ARTICLE III

Eligibility

3.1 Eligibility Requirements.

     An Eligible Employee shall be eligible to make Elective Deferrals and Rollover Contributions immediately following his or her Employment Commencement Date (or, if later, the date an Employee becomes an Eligible Employee). An Eligible Employee shall be eligible for Matching Contributions and Profit Sharing Contribution, if any, immediately following his or her completion of a Period of Service of twelve (12) consecutive months. An Eligible Employee who was eligible for a Matching Contribution, and Profit Sharing Contribution, if any, as of the date he or she incurred a Severance from Service, and who is reemployed as an Eligible Employee, shall again be eligible for a Matching Contribution, and Profit Sharing Contribution, if any, immediately on his or her date of reemployment.

3.2 Procedure for Joining the Plan.

     Each Eligible Employee may join the Plan by communicating with the Company’s Director of Human Resources or his or her designee in accordance with the instructions that will be made available to each Eligible Employee. An enrollment in the Plan shall not be deemed to have been completed until the Eligible Employee has designated: (i) a percentage by which his or her Compensation shall be reduced as an Elective Deferral in accordance with the requirements of Section 4.1; (ii) election of investment funds in accordance with ARTICLE V; (iii) one or more Beneficiaries; and (iv) such other information as specified by the Company’s Director of Human Resources or his or her designee. Enrollment will be effective as of the first Pay Period following completion of enrollment for which it is administratively feasible to carry out such enrollment. The ESOP Committee, in its discretion, may from time to time make

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exceptions and adjustments in the foregoing procedures on a uniform and nondiscriminatory basis.

3.3 Transfer Between Adopting Employers to Position Covered by Plan.

     A Participant who is transferred to a position with another Adopting Employer in which the Participant remains an Eligible Employee will continue as an active Participant of the Plan.

3.4 Transfer to Position Not Covered by Plan.

     If a Participant is transferred to a position with an Employer in which the Participant is no longer an Eligible Employee, the Participant will remain a Participant of the Plan with respect to contributions previously made but shall no longer be eligible to have Elective Deferrals or any other contributions made to the Plan on his or her behalf until he or she again becomes an Eligible Employee. In the event the Participant is subsequently transferred to a position in which he or she again becomes an Eligible Employee, the Participant may renew Elective Deferrals by communicating with the Company’s Director of Human Resources or his or her designee and providing all of the information requested by such person. The renewal of Elective Deferrals will be effective as of the first Pay Period following receipt by the Company’s Director of Human Resources or his or her designee of the requested information for which it is administratively feasible to re-enroll such Participant.

3.5 Transfer to Position Covered by Plan.

     If an Employee who is not eligible to participate in the Plan by reason of his or her position with an Employer is transferred to a position that is eligible to participate in the Plan, such Employee may join the plan in accordance with Sections 3.1 and 3.2.

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3.6 Treatment of Qualified Military Service.

     Notwithstanding any provision of this Plan to the contrary, contributions, benefits and service credit with respect to Qualified Military Service will be provided in accordance with Section 414(u) of the Code.

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ARTICLE IV

Contributions

4.1 Elective Deferrals.

     (a) Except as otherwise provided herein and in an Exhibit or Supplement to this Plan, a Participant may authorize an Adopting Employer to reduce his or her Compensation for each Pay Period on a pre-tax basis by an amount equal to any whole percentage of Compensation that does not exceed sixty percent (60%) and to have such amount contributed to the Plan as an Elective Deferral. At the time amounts are contributed to the Plan as an Elective Deferral, the Participant will designate the percentage (in increments of 1%) to be (i) held for investment in the Participant’s ESOP Elective Deferral Account in accordance with Section 5.1(c) and (ii) otherwise invested in the Participants’ Non ESOP Elective Deferral Account in accordance with Section 5.1(a). A Participant may elect to defer no more than eleven percent (11%) of Compensation into the Participant’s ESOP Elective Deferral Account for each Pay Period.

     (b) A Participant shall not be permitted to make Elective Deferrals during any calendar year in excess of the dollar limitation contained in Section 402(g) of the Code in effect for such calendar year.

     (c) A Participant may change his or her Elective Deferral percentage to increase, decrease or discontinue said percentage, or the allocation between the ESOP and Non ESOP Elective Deferral Accounts by notifying the Company’s Director of Human Resources or his or her designee, such change to take effect as of the first Pay Period by which it is administratively feasible to make such change.

     (d) A Participant may not make Elective Deferrals with respect to Compensation that has already been made available to the Participant.

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     (e) With the approval of the Board of Directors, or any officer of the Company to whom authority to determine contributions is delegated by the Board of Directors, an Adopting Employer may provide its Eligible Employees with a cash or deferred election with respect to all or a portion of the Service Contract Act reconciliation amounts referenced in Section 4.2(b) (“SCA Amounts”). If such cash or deferred election is provided, an Eligible Employee can elect either (i) to receive the SCA Amounts in cash as additional taxable compensation, or (ii) to have the SCA Amounts contributed to the Plan as additional Elective Deferrals, subject to the limitations otherwise provided under the Plan. If an Eligible Employee does not make a cash or deferred election within the time period specified by the ESOP Committee, the SCA Amounts will be paid to the Eligible Employee in cash as additional taxable compensation.

     (f) All Employees who are eligible to make elective deferrals under this Plan and who have attained age 50 before the close of the calendar year shall be eligible to make catch-up contributions in accordance with, and subject to the limitations of, Section 414(v) of the Code. Such catch-up contributions shall not be taken into account for purposes of the provisions of the Plan implementing the required limitations of Sections 402(g) and 415 of the Code. The Plan shall not be treated as failing to satisfy the provisions of the Plan implementing the requirements of Section 401(k)(3), 401(k)(11), 401(k)(12), 410(b), or 416 of the Code, as applicable, by reason of the making of such catch-up contributions. Such catch-up contributions shall be included for purposes of Matching Contributions.

4.2 Qualified Nonelective Contributions.

     (a) Discretionary Amounts: Each Plan Year the Adopting Employers may contribute to the Trust such amounts as determined by the Board of Directors or any officer to whom authority to determine contributions is delegated by the Board of Directors, in his or her sole

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discretion. Any amounts contributed under this subsection are to be designated by the Adopting Employers as Qualified Nonelective Contributions and shall be allocated in accordance with Sections 4.10(c) and 4.12(c), as applicable.

     (b) Service Contract Act Reconciliation Amounts: Each Plan Year the Adopting Employers may contribute to the Trust such amounts as determined by the Board of Directors or other officer to whom authority to determine contributions is delegated by the Board of Directors, in his or her sole discretion, consisting of the entire amount or any part of any deficiency between health and welfare and/or pension contributions actually made under a contract covered by the Service Contract Act and the amount of such contribution or contributions required by a wage determination issued under the contract. Such amount shall be calculated in accordance with the formula specified in 29 CFR §4.175 as follows:

The total amount contributed for a month, calendar or contract quarter, or other specified time is divided by the total hours worked under the contract by service employees subject to the Act during the period in question to determine an hourly contribution rate.

The difference between the contribution rate required in the determination and the actual contribution may be contributed to the Plan on behalf of each Eligible Employee for purposes of fulfilling the Adopting Employers’ fringe benefit obligations under the Service Contract Act.

4.3 Profit Sharing Contributions.

     The Board of Directors is authorized each year to instruct the Company to make a discretionary Profit Sharing Contribution. For the Plan Year beginning October 1, 2002, the Board of Directors has authorized a Profit Sharing Contribution of 2.5% of the Compensation of all Participants eligible to share in the Profit Sharing Contribution for the Plan Year, 1% to the

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ESOP Component and 1.5% to the Non ESOP Component. This contribution rate will remain in effect until changed by resolution of the Board of Directors. The Profit Sharing Contribution shall be allocated to those eligible Participants in the same ratio as each such Participant’s Compensation for the Plan Year bears to the total Compensation of all such eligible Participants for the Plan Year. The Compensation of a Participant who during the Plan Year first becomes eligible under Section 3.1 to share in the Profit Sharing Contribution shall only include amounts paid on or after said date. The Board of Directors will designate whether the contribution is to be allocated to the ESOP Profit Sharing Account or the Non ESOP Profit Sharing Account. The ESOP Profit Sharing Contribution may be made in cash, Common Stock or a combination thereof at the discretion of the Board of Directors or any officer of the Company to whom authority to determine contributions is delegated by the Board of Directors. To the extent that the Profit Sharing Contribution is made in Common Stock, such shares shall be transferred to the Trustee of the ESOP Component of the Plan as of the Allocation Date to which they relate and shall be based on the Current Market Value of Common Stock as of that Allocation Date.

     Regardless of the first five sentences of the first paragraph of this Section 4.3, the Chief Executive Officer (“CEO”) of the Company or an officer of the Company designated by the CEO may set up divisions, operations, subsidiaries or similar cohesive groups which have their own contribution rate for Profit Sharing Contributions during part or all of any Plan Year. The contribution rate for any unit for Profit Sharing Contributions may be zero. A Participant’s total Profit Sharing Contribution for the Plan Year will be the sum of the products of his Compensation attributable to each unit multiplied by the unit’s contribution rate. Any Participant who becomes part of such unit during a Plan Year shall be eligible to receive the Profit Sharing Contributions, if any, that he had been eligible to receive before joining such unit

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until his date of transfer and begin receiving the Profit Sharing Contributions, if any, that are applicable to such unit as of his date of transfer.

4.4 Matching Contributions.

     Except as otherwise provided in an Exhibit or Supplement to this Plan, each Adopting Employer shall make Matching Contributions in the following percentages: (i) the Company will match one hundred percent (100%) of the first three percent (3%) of Compensation deferred by a Participant and (ii) the Company will match fifty percent (50%) of the next two percent (2%). This Matching Contribution shall be immediately 100% vested (as set forth in Section 7.1); shall be subject to the distribution limitations described in Section 401(k)(12)(E)(i) of the Code; and shall be a safe harbor matching contribution as described in Sections 401(k)(12) and 401(m)(11) of the Code. This Matching Contribution shall be determined each Plan Year based on the Compensation and total pre-tax deferrals for the Plan Year. Notwithstanding the foregoing, the Compensation and pre-tax deferrals of a Participant who during the Plan Year first becomes eligible under Section 3.1 to receive a Matching Contribution shall only include Compensation paid and pre-tax deferrals made on or after said date.

     Except as otherwise provided in an Exhibit or Supplement to this Plan, the Matching Contribution shall be made in either (i) cash or (ii) Common Stock or cash that is invested in Common Stock as determined by the Board of Directors or officer of the Company to whom the Board of Directors has delegated the authority to determine contributions under the Plan. To the extent that the matching contribution is made in Common Stock, such shares shall be transferred to the Trustee of the ESOP Component of the Plan as of the Allocation Date following the pay date during which the Elective Contributions to which such Matching Contributions relate would have been paid, and shall be based on the Current Market Value of Common Stock as of the

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Allocation Date as of the end of the period to which the Matching Contributions relate. To the extent such Matching Contribution is made in Common Stock or cash that is invested in Common Stock, it shall be allocated to the Participant’s ESOP Matching Contribution Accounts, and shall remain invested in Common Stock in accordance with and subject to Section 5.1(b). To the extent the Matching Contribution is made in unrestricted cash, it will be allocated to the Participant’s Non ESOP Matching Contribution Account.

4.5 Rollover Contributions.

     (a) Participants may transfer into the Plan Qualifying Rollover Amounts from other plans or IRAs, subject to the uniform and non-discriminatory policies of the ESOP Committee, the following terms and conditions and provided that the ESOP Committee, in its sole discretion, agrees to accept such a Rollover Contribution:

          (1) the transferred funds are received by the Trustee no later than sixty (60) days from receipt by the Participant of a distribution from the other plan or IRA;

          (2) the Rollover Contributions transferred pursuant to this Section 4.5(a) shall be credited to either the Participant’s ESOP Rollover Contribution Account or the Participant’s Non ESOP Rollover Account (at the direction of the Participant and based on the rules and policies of the ESOP Committee) and will be invested upon receipt by the Trustee; and

          (3) a Rollover Contribution will not be accepted unless (A) the Employee on whose behalf the Rollover Contribution will be made is either a Participant or an Eligible Employee who has notified the ESOP Committee that he or she intends to become a Participant as of the first date on which he or she is eligible therefor, and (B) all required information, including selection of specific investment accounts, is provided to the Recordkeeper.

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     (b) For purposes of this Section, the following terms shall have the meanings specified:

          (1) Qualifying Rollover Amounts. Amounts from the following types of plans or IRAs:

(A) a qualified plan described in Section 401(a) or 403(a) of the Code, including after-tax employee contributions.

(B) an annuity contract described in Section 403(b) of the Code, excluding after-tax employee contributions.

(C) an eligible plan under Section 457(b) of the Code which is maintained by a state, political subdivision of a state, or any agency or instrumentality of a state or political subdivision of a state.

(D) an IRA, but only to the extent that the amount would have been includible in gross income of the Participant if the amount had been distributed to the Participant and not rolled over to any plan or IRA.

(E) Federal Civil Service Thrift Plan and other government plans, if permitted by law.

          (2) IRA. An individual retirement account or annuity under Section 408(a) or (b) of the Code, respectively.

4.6 Direct Transfers.

     (a) The Plan shall accept a transfer of assets, including elective transfers in accordance with Treas. Regs. Section 1.411(d)-4 Q&A-3(b) and transfers in connection with a plan merger, directly from another plan qualified under Section 401(a) of the Code only if the ESOP Committee, in its sole discretion, agrees to accept such a transfer. In determining whether to accept such a transfer, the ESOP Committee shall consider the administrative inconvenience

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engendered by such a transfer and any risks to the continued qualification of the Plan under Section 401(a) of the Code. Acceptance of any such transfer shall not preclude the ESOP Committee from refusing any such subsequent transfers.

     (b) Any transfer of assets accepted under this subsection shall be separately accounted for at all times and shall remain subject to the provisions of the transferor plan (as it existed at the time of such transfer) to the extent required by Section 411(d)(6) of the Code as if such provisions were part of the Plan. In all other respects, however, such transferred assets shall be subject to the provisions of this Plan. The ESOP Committee may, but is not required to, describe in Exhibit B to this Plan the special provisions that must be preserved under Section 411(d)(6) of the Code, if any, following the transfer of assets from another plan in accordance with this subsection (b).

4.7 Refund of Contributions to the Adopting Employers.

     Notwithstanding the provisions of ARTICLES XIII and XV, if, or to the extent that, any Adopting Employer’s deductions for contributions made to the Plan are disallowed, such Adopting Employer will have the right to obtain the return of any such contributions for a period of one (1) year from the date of disallowance. For this purpose, all contributions are made subject to the condition that they are deductible under the Code for the taxable year of the Adopting Employers for which the contributions are made. Furthermore, any contribution made on the basis of a mistake in fact may be returned to the Adopting Employers within one (1) year from the date such contribution was made. If the Internal Revenue Service determines that the Plan is not initially qualified within the meaning of Section 401 of the Code, the assets of the Trust Fund attributable to any Adopting Employer’s contributions prior to such determination shall be returned to such Adopting Employer within twelve (12) months after such

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determination, but only if the application for such qualification is made no later than the due date (including extensions thereof) of the Adopting Employer’s income tax return for the taxable year in which the Plan is adopted, or such later date as the Secretary of the Treasury may prescribe.

4.8 Payment.

     The Adopting Employers shall pay to the Trustee in U.S. currency, or by other property acceptable to the Trustee, all contributions for each Plan Year within the time prescribed by law, including extensions granted by the Internal Revenue Service, for filing the federal income tax return of the Company for its taxable year in which such Plan Year ends. Unless designated by the Adopting Employers as nondeductible, all contributions made, shall be deemed to be conditioned on their current deductibility under Section 404 of the Code.

4.9 Limits for Highly Compensated Employees.

     (a) Elective Deferrals, Matching Contributions and Qualified Nonelective Contributions allocable to the Accounts of Highly Compensated Employees shall not in any Plan Year exceed the limits specified in this Section. The ESOP Committee may make the adjustments authorized in this Section to ensure that the limits of subsection (b) (or any other applicable limits) are not exceeded, regardless of whether such adjustments affect some Participants more than others. This Section shall be administered and interpreted in accordance with Sections 401(k) and 401(m) of the Code.

     (b) (1) The Actual Deferral Percentage of the Highly Compensated Employees shall not exceed, in any Plan Year, the greater of:

(A) one hundred twenty-five percent (125%) of the Actual Deferral Percentage for all other Eligible Participants; or

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(B) the lesser of two hundred percent (200%) of the Actual Deferral Percentage for all other Eligible Participants or the Actual Deferral Percentage for the other Eligible Participants plus two (2) percentage points.

          (2) The Actual Contribution Percentage of the Highly Compensated Employees shall not exceed, in any Plan Year, the greater of:

(A) one hundred twenty five percent (125%) of the Actual Contribution Percentage for all other Eligible Participants; or

(B) the lesser of two hundred percent (200%) of the Actual Contribution Percentage for all other Eligible Participants or the Actual Contribution Percentage for the other Eligible Participants plus two (2) percentage points.

          (3) The limitations under Section 4.9(b)(3) shall be modified to reflect any higher limitations provided by the Internal Revenue Service under regulations, notices or other official statements.

     (c) The following terms shall have the meanings specified:

          (1) Actual Contribution Percentage. The average of the ratios for a designated group of Employees (calculated separately for each Employee in the group) of the sum of the Matching Contributions (other than those treated as part of the Actual Deferral Percentage), Qualified Nonelective Contributions (other than those treated as part of the Actual Deferral Percentage), and Elective Deferrals (other than those treated as part of the Actual Deferral Percentage) allocated for the applicable year on behalf of the Participant, divided by the Participant’s Compensation for such applicable year. The “applicable year” for determining the Actual Contribution Percentage for the group of Highly Compensated Employees shall be the current Plan Year. For all other Eligible Participants, the “applicable year” for determining the

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Actual Contribution Percentage shall be the immediately preceding Plan Year, unless, in accordance with the procedures prescribed by the Internal Revenue Service, the ESOP Committee elects to use the current Plan Year. In the event the ESOP Committee elects to use the current Plan Year for this purpose for any Plan Year, the ESOP Committee shall so indicate in Exhibit C to this Plan.

          (2) Actual Deferral Percentage. The average of the ratios for a designated group of Employees (calculated separately for each Employee in the group) of the sum of the Elective Deferrals, Qualified Nonelective Contributions and Matching Contributions (that the Company elects to have treated as part of the Actual Deferral Percentage) allocated for the applicable year on behalf of a Participant, divided by the Participant’s Compensation for such applicable year. The “applicable year” for determining the Actual Deferral Percentage for the group of Highly Compensated Employees shall be the current Plan Year. For all other Eligible Participants, the “applicable year” for determining the Actual Deferral Percentage shall be the immediately preceding Plan Year, unless in accordance with the procedures prescribed by the Internal Revenue Service, the ESOP Committee elects to use the current Plan Year. In the event the ESOP Committee elects to use the current Plan Year for this purpose for any Plan Year, the ESOP Committee shall so indicate in Exhibit C to this Plan.

          (3) Compensation. To the extent regulations permit the definition of Compensation in ARTICLE II to be used, then such definition shall be applied for purposes of this ARTICLE; provided, however, that to the extent such definition is not so permitted, then Compensation shall include all compensation required to be counted under Section 414(s) of the Code; provided further, however, that this definition shall not apply for purposes of the definition of Highly Compensated Employee in Section 2.34.

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          (4) Eligible Participant. Any Employee of an Adopting Employer who is authorized under the terms of the Plan to make Elective Deferrals, or have Qualified Nonelective Contributions allocated to his or her Account for the Plan Year.

     (d) For purposes of determining whether a plan satisfies the Actual Contribution Percentage test of Section 401(m) of the Code, all Employee and matching contributions that are made under two (2) or more plans that are aggregated for purposes of Section 401(a)(4) and 410(b) of the Code (other than Section 410(b)(2)(A)(ii)) of the Code are to be treated as made under a single plan and that if two (2) or more plans are permissively aggregated for purposes of Section 401(m) of the Code, the aggregated plans must also satisfy Section 401(a)(4) and 410(b) of the Code as though they were a single plan.

     (e) In calculating the Actual Contribution Percentage for purposes of Section 401(m) of the Code, the actual contribution ratio of a Highly Compensated Employee will be determined by treating all plans subject to Section 401(m) of the Code under which the Highly Compensated Employee is eligible (other than those that may not be permissively aggregated) as a single plan.

     (f) For purposes of determining whether a plan satisfies the Actual Deferral Percentage test of Section 401(k) of the Code, all elective contributions that are made under two (2) or more plans that are aggregated for purposes of Section 401(a)(4) or 410(b) of the Code (other than Section 410(b)(2)(A)(ii)) of the Code are to be treated as made under a single plan and that if two (2) or more plans are permissively aggregated for purposes of Section 401(k), the aggregated plans must also satisfy Sections 401(a)(4) and 410(b) as though they were a single plan.

     (g) In calculating the Actual Deferral Percentage for purposes of Section 401(k) of the Code, the actual deferral ratio of a Highly Compensated Employee will be determined by

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treating all cash or deferred arrangements under which the Highly Compensated Employee is eligible (other than those that may not be permissively aggregated) as a single arrangement.

     (h) An elective contribution will be taken into account under the Actual Deferral Percentage test of Section 401(k)(3)(A) of the Code for a Plan Year only if it is allocated to the Employee as of a date within that Plan Year. For this purpose, an elective contribution is considered allocated as of a date within a Plan Year if the allocation is not contingent on participation or performance of services after such date and the elective contribution is actually paid to the Trust no later than twelve (12) months after the Plan Year to which the contribution relates.

     (i) The Employer Matching Contribution described in Section 4.4 is designed to meet the safe harbor requirements of Section 401(k)(12) and 401(m)(11) of the Code. Accordingly, the Plan is designed to meet the nondiscrimination requirements applicable to Elective Contributions and Employer Matching Contributions for all Participants. For so long as the Plan satisfies the aforesaid safe harbor requirements, the testing requirements of this Section 4.9 shall not apply to those Eligible Participants entitled to receive a Matching Contribution described in Section 4.4.

4.10 Correction of Excess Contributions.

     (a) Excess Contributions shall be corrected as provided in this Section. The ESOP Committee may also prevent anticipated Excess Contributions as provided in this Section. The ESOP Committee may use any method of correction or prevention provided in this Section or any combination thereof, as it determines in its sole discretion. This Section shall be administered and interpreted in accordance with Sections 401(k) and 401(m) of the Code.

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     (b) The ESOP Committee may refuse to accept any or all prospective Elective Deferrals to be contributed by a Participant.

     (c) (1) The Company may, in its sole discretion, elect to contribute, as provided in Section 4.2(a), a Qualified Nonelective Contribution in an amount necessary to satisfy any or all of the requirements of Section 4.9.

          (2) Qualified Nonelective Contributions that are made for a Plan Year to correct Excess Contributions shall only be allocated to the Accounts of Participants who are not Highly Compensated Employees. Such Qualified Nonelective Contributions shall be allocated in accordance with Section 1.401(k)-2(a)(6)(iv) of the Treasury Regulations. The allocation to any Participant shall not exceed the limits under Section 415 of the Code.

          (3) Qualified Nonelective Contributions for a Plan Year shall be contributed to the Trust within twelve (12) months after the close of such Plan Year.

          (4) Qualified Nonelective Contributions shall only be allocated to Participants who receive Compensation during the Plan Year for which such contribution is made.

     (d) The ESOP Committee may, during a Plan Year, distribute to a Participant (or such Participant’s Beneficiary if the Participant is deceased), any or all Excess Contributions or Excess Deferrals (whether Elective Deferrals, Matching Contributions or Qualified Nonelective Contributions) allocable to that Participant’s Account for that Plan Year, notwithstanding any contrary provision of the Plan. Such distributions shall be adjusted for income (gain or loss). The ESOP Committee has the discretion to determine and allocate income using any of the methods set forth in accordance with Treasury Regulation Section 1.401(k)-2(b)(2)(iv).

     (e) (1) The ESOP Committee may recharacterize any or all Excess Contributions for a Plan Year as Employee contributions in accordance with the provisions of this subsection.

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Any Excess Contributions that are so recharacterized shall be treated as if the Participant had elected to instead receive cash Compensation on the earliest date that any Elective Deferrals made on behalf of the Participant during the Plan Year would have been received had the Participant originally elected to receive such amount in cash and then contributed such amount as an Employee contribution. To the extent required by the Internal Revenue Service, however, such recharacterized Excess Contributions shall continue to be treated as if such amounts were not recharacterized.

          (2) The ESOP Committee shall report any recharacterized Excess Contributions as Employee contributions to the Internal Revenue Service and to the affected Participants at such times and in accordance with such procedures as are required by the Internal Revenue Service. The ESOP Committee shall take such other actions regarding the amounts so recharacterized as may be required by the Internal Revenue Service.

          (3) Excess Contributions may not be recharacterized under this subsection more than two and one-half (2¹/2) months after the close of the Plan Year to which the recharacterization relates. Recharacterization is deemed to occur when the Participant is so notified (as required by the Internal Revenue Service).

          (4) The amount of Excess Contributions to be distributed or recharacterized shall be reduced by Excess Deferrals previously distributed for the taxable year ending in the same Plan Year and Excess Deferrals to be distributed for a taxable year will be reduced by Excess Contributions previously distributed or recharacterized for the Plan beginning in such taxable year.

     (f) (1) The ESOP Committee may distribute any or all Excess Contributions for a Plan Year in accordance with the provisions of this subsection. Such distribution may only occur

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after the close of such Plan Year and within twelve (12) months of the close of such Plan Year. In the event of the termination of the Plan, such distribution shall be made within twelve (12) months after such termination. Such distributions shall be adjusted for income (gain or loss), including an adjustment for income for the period between the end of the Plan Year and the date of the distribution. The ESOP Committee has the discretion to determine and allocate income using any of the methods set forth in accordance with Treasury Regulation Section 1.401(k)-2(b)(2)(iv). A distribution of an Excess Contribution under this subsection may be made without regard to any notice or consent otherwise required pursuant to Sections 411(a)(11) and 417 of the Code.

          (2) Amounts distributed under this subsection (or other provisions of this Section) shall first be treated as distributions from the Participant’s subaccounts in the following order:

(A) from the Participant’s Elective Deferrals Account (if such Excess Contribution is attributable to Elective Deferrals);

(B) from the Participant’s Qualified Nonelective Contribution Account (if such Excess Contribution is attributable to Qualified Nonelective Contributions); and

(C) from the Participant’s Matching Contribution Account (if such Excess Contribution is attributable to Matching Contributions).

     (g) (1) The term “Excess Contribution” shall mean, with respect to a Plan Year, the excess of the Elective Deferrals (including any Qualified Nonelective Contributions and Matching Contributions that are treated as Elective Deferrals under Sections 401(k)(2) and 401(k)(3) of the Code) on behalf of eligible Highly Compensated Employees for the Plan Year

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over the maximum amount of such contributions permitted under Sections 401(k)(2) and 401(k)(3) of the Code.

          (2) Any distribution of Excess Contributions for a Plan Year shall be made to Highly Compensated Employees on the basis of the amount of contributions by, or on behalf of, each such Highly Compensated Employee.

          (3) The amount of Excess Contributions to be distributed or recharacterized shall be reduced by Excess Deferrals previously distributed for the taxable year ending in the same Plan Year and Excess Deferrals to be distributed for a taxable year will be reduced by Excess Contributions previously distributed or recharacterized for the Plan beginning in such taxable year.

4.11 Correction of Excess Deferrals.

     (a) Excess Deferrals shall be corrected as provided in this Section. The ESOP Committee may also prevent anticipated Excess Deferrals as provided in this Section. The ESOP Committee may use any method of correction or prevention provided in this Section or any combination thereof, as it determines in its sole discretion. A distribution of an Excess Deferral under this Section may be made without regard to any notice or consent otherwise required pursuant to Sections 411(a)(11) and 417 of the Code. This Section shall be administered and interpreted in accordance with Sections 401(k) and 402(g) of the Code.

     (b) The ESOP Committee may refuse to accept any or all prospective Elective Deferrals to be contributed by a Participant.

     (c) (1) The ESOP Committee may distribute any or all Excess Deferrals to the Participant on whose behalf such Excess Deferrals were made before the close of the Applicable

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Taxable Year. Distributions under this subsection include income allocable to the Excess Distribution so distributed, as determined under this subsection.

          (2) Distribution under this subsection shall only be made if all the following conditions are satisfied:

(A) the Participant seeking the distribution designates the distribution as an Excess Deferral;

(B) the distribution is made after the date the Excess Deferral is received by the Plan; and

(C) the Plan designates the distribution as a distribution of an Excess Deferral.

     (3) The income allocable to the Excess Deferral distributed under this subsection shall be determined in the same manner as under subsection (d)(3), except that income shall be determined for the period from the end of the Applicable Taxable Year to the date on which the distribution is made.

     (d) (1) The ESOP Committee may distribute any or all Excess Deferrals to the Participant on whose behalf such Excess Deferrals were made after the close of the Applicable Taxable Year. Distribution under this subsection shall only be made if the Participant timely provides the notice required under subsection (d)(2) and such distribution is made after the Applicable Taxable Year and before the first April 15 following the close of the Applicable Taxable Year. Distributions under this subsection shall include income allocable to the Excess Deferrals so distributed, as determined in accordance with Treasury Regulation Section 1.401(k)-2(b)(2)(iv).

          (2) Any Participant seeking a distribution of an Excess Deferral in accordance with this subsection must notify the ESOP Committee of such request no later than the first March 15 following the close of the Applicable Taxable Year. The ESOP Committee may agree to accept notification received after such date (but before the first April 15 following the close of

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the Applicable Taxable Year) if it determines that it would still be administratively practicable to make such distribution in view of the delayed notification. The notification required by this subsection shall be deemed made if a Participant’s Elective Deferrals to the Plan in any Plan Year create an Excess Deferral.

          (3) The income allocable to the Excess Deferral distributed under this subsection shall be determined in the same manner as under Section 4.12(f)(2), except that the term “Excess Deferrals” shall be substituted for “Excess Contributions” and the term “Applicable Taxable Year” shall be substituted for “Plan Year.”

     (e) The following terms shall have the meanings specified:

          (1) Applicable Taxable Year. The taxable year (for federal income tax purposes) of the Participant in which an Excess Deferral must be included in gross income (when made) in accordance with Section 402(g) of the Code.

          (2) Excess Deferral. A Participant’s Elective Deferrals (and other contributions limited by Section 402(g) of the Code), for an Applicable Taxable Year that are in excess of the limits imposed by Section 402(g) of the Code for such Applicable Taxable Year.

4.12 Correction of Excess Aggregate Contributions.

     (a) Excess Aggregate Contributions shall be corrected as provided in this Section. The ESOP Committee may use any method of correction or prevention provided in this Section or any combination thereof, as it determines in its sole discretion. This Section shall be administered and interpreted in accordance with Sections 401(k) and 401(m) of the Code.

     (b) The ESOP Committee may refuse to accept any or all prospective Elective Deferrals to be contributed to a Participant.

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     (c) (1) The Company may, in its sole discretion, elect to contribute, as provided in Section 4.2(a), a Qualified Nonelective Contribution in an amount necessary to satisfy any or all of the requirements of Section 4.9.

          (2) Qualified Nonelective Contributions that are made for a Plan Year to correct Excess Aggregate Contributions shall only be allocated to the Accounts of Participants who are not Highly Compensated Employees. Such Qualified Nonelective Contributions shall be allocated in accordance with Section 1.401(m)-2(a)(5)(ii) of the Treasury Regulations. The allocation to any Participant shall not exceed the limits under Section 415 of the Code.

          (3) Qualified Nonelective Contributions for a Plan Year shall be contributed to the Trust within twelve (12) months after the close of such Plan Year.

          (4) Qualified Nonelective Contributions shall only be allocated to Participants who receive Compensation during the Plan Year for which such contribution is made.

     (d) The ESOP Committee may, during a Plan Year, distribute to a Participant (or such Participant’s Beneficiary if the Participant is deceased), any or all Excess Aggregate Contributions allocable to that Participant’s Account for that Plan Year, notwithstanding any contrary provision of the Plan. Such distribution shall include earnings or losses (if any) attributable to such amounts, as determined by the ESOP Committee, in accordance with Section 1.401(m)-2(b)(2)(iv).

     (e) (1) The ESOP Committee may forfeit any or all Excess Aggregate Contributions for a Plan Year in accordance with the provisions of this subsection. The amounts so forfeited shall not include any amounts that are nonforfeitable under ARTICLE VII.

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          (2) Any forfeitures under this subsection shall be made in accordance with the procedures for distributions under subsection (f) except that such amounts shall be forfeited instead of being distributed.

     (f) (1) The ESOP Committee may distribute any or all Excess Aggregate Contributions for a Plan Year in accordance with the provisions of this subsection. Such distribution may only occur after the close of such Plan Year and within twelve (12) months of the close of such Plan Year. Such distributions shall be specifically designated by the ESOP Committee as a distribution of Excess Aggregate Contributions. In the event of the complete termination of the Plan, such distribution shall be made within twelve (12) months after such termination. Such distribution shall include the income allocable to the amounts so distributed, as determined under this subsection. The ESOP Committee may make any special allocations of earnings or losses necessary to carry out the provisions of this subsection. A distribution of an Excess Aggregate Contribution under this subsection may be made without regard to any notice or consent otherwise required pursuant to Sections 411(a)(11) and 417 of the Code.

          (2) Amounts distributed under this subsection (or other provisions of this Section) shall first be treated as distributions from the Participant’s subaccounts in the following order:

(A) from the Participant’s Qualified Nonelective Contribution Account (if such Excess Aggregate Contribution is attributable to Qualified Nonelective Contributions); and

(B) from the Participant’s Matching Contribution Account (if such Excess Aggregate Contribution is attributable to Matching Contributions).

     (g) (1) The term “Excess Aggregate Contribution” shall mean, with respect to a Plan Year, the excess of the aggregate amount of the matching contributions and employee

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contributions (including any Qualified Nonelective Contributions or elective deferrals taken into account in computing the Actual Contribution Percentage) actually made on behalf of eligible Highly Compensated Employees for the Plan Year over the maximum amount of such contributions permitted under Section 401(m)(2)(A) of the Code.

          (2) The terms “employee contributions” and “matching contributions” shall, for purposes of this Section, have the meanings set forth in Treas. Reg. §1.401(m)-1(f).

          (3) Any distribution of Excess Aggregate Contributions for a Plan Year shall be made to Highly Compensated Employees on the basis of the amount of contributions by, or on behalf of, each such Highly Compensated Employee.

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ARTICLE V

Investment of Accounts

5.1 Election of Investment Funds.

     (a) Except as otherwise prescribed in subsections 5.1(b), (c), (d), and (e) and Section 5.2, upon enrollment in the Plan, each Participant shall direct that the funds in the Participant’s Account be invested in increments of one percent (1%) in one or more of the investment options designated by the ESOP Committee, which may include designated investment funds, specific investments or both. The investment choices made available shall be sufficient to allow compliance with Section 404(c) of ERISA.

     (b) Except as otherwise determined by the ESOP Committee or provided herein, all investments in a Participant’s ESOP Account will be held in Common Stock, subject to the same diversification rules as set forth in Section 5.2.

     (c) Each Participant shall be entitled to designate the percentage (in multiples of one percent) of his Elective Contributions that shall be invested in Common Stock under the ESOP Component of this Plan, subject to the eleven percent (11%) limitation set forth in Section 4.1(a). To the extent a Participant directs his Elective Contributions to be invested under the ESOP Component, such contributions shall be accumulated in a short term interest fund in the ESOP Component of the Plan and shall be converted to Common Stock as of the Valuation Date using the Common Stock value as of the Valuation Date preceding or as of the conversion date (whichever is lower), and shall then be allocated to the participant’s ESOP Elective Deferral Account. Notwithstanding the above, in the event the total Elective Deferrals directed to the ESOP Component exceed five (5%) of the aggregate payroll expenses since December 20, 2002 (measured as of the end of each Plan Year) of the Company and each of the subsidiaries of the Company (a) that is an Adopting Employer, and (b) substantially all of whose employees are

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eligible to participate in the ESOP Component, the ESOP Committee may choose pursuant to uniform and nondiscriminatory policies to redirect a portion of each Participant’s Elective Deferrals that have been directed to the ESOP Component, and any interest credited to such amounts, to the Participant’s non-ESOP Accounts. Such a reduction would be applied on a pro rata basis to Elective Deferrals intended to be invested in the ESOP Component during such period.

     (d) Except as otherwise determined by the ESOP Committee or provided herein, a Participant’s Rollover Contribution Account may be invested in Common Stock at its then Current Market Value only at or near the time that the Rollover Contribution is accepted and received by the ESOP Committee or Trustee, and only if the Participant is a new Employee or a rehired Employee. Amounts to be invested in Common Stock will be initially accumulated in a short term interest fund in the ESOP Component of the Plan, and will be converted to Common Stock on the Allocation Date coincident with or next following the date of receipt based on the Current Market Value as of the Allocation Date coincident with such conversion date. Amounts not invested in the ESOP Rollover Account may be invested in accordance with Section 5.1(a). Amounts held in the ESOP Rollover Account will be subject to the diversification rules of Section 5.2. Notwithstanding the foregoing, with respect to new Employees as a result of a merger, acquisition or consolidation of another entity, where such new Employee’s Rollover Contribution is received by the Trustee after the Allocation Date next occurring after such merger, acquisition or consolidation, the ESOP Committee shall have discretion to decide that such new Employee’s Rollover Contribution be initially accumulated in a short term interest fund in the ESOP Component of the Plan, and converted to Common Stock at the Allocation Date coinciding with or next following the receipt of such new Employee’s properly completed

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investment election form, based on the Current Market Value as of the Allocation Date immediately preceding the date such transferred funds were received; provided, however, that the foregoing shall apply only if (i) such new Employee’s properly completed investment election form is received on or before the Date immediately preceding the date such transferred funds were received, and (ii) the funds are received before the earlier of the date that the Trustee releases the value of the Common Stock as of the prior Allocation Date or forty-five (45) days following such Allocation Date.

     (e) In its discretion, the ESOP Committee may from time to time designate new funds and, where appropriate, preclude investment in existing funds and provide for the transfer of Accounts invested in those funds to other funds selected by the Participant but if no such election is made, to a default investment as determined by the ESOP Committee in its discretion.

     (f) Except as otherwise prescribed in subsections 5.1(b), (c), (d) and (e) and Section 5.2, a Participant’s investment election will apply to the entire Account of the Participant.

     (g) In establishing rules and procedures under Section 5.1, the following shall apply:

          (1) Each Participant, Beneficiary or Alternate Payee shall affirmatively elect to self-direct the investment of assets in his or her Account, but such election may provide for default investments in the absence of specific directions from such Participant, Beneficiary or Alternate Payee. For purposes of any elections to invest in the ESOP Component of the Plan, the Participant, Beneficiary or Alternate Payee shall be considered a “named fiduciary” of the Plan as described in Section 402(a)(2) of ERISA.

          (2) The investment directions of a Participant shall continue to apply after that Participant’s death or incompetence until the Beneficiary (or, if there is more than one

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Beneficiary for that Account, all of the Beneficiaries), guardian or other representatives provide contrary direction.

          (3) The ESOP Committee may decline to implement investment designations if such investment, in the ESOP Committee’s judgment:

(A) would result in a prohibited transaction under Section 4975 of the Code;

(B) would generate income taxable to the Trust Fund;

(C) would not be in accordance with the Plan and Trust;

(D) would cause a Fiduciary to maintain the indicia of ownership of any assets of the Trust Fund outside the jurisdiction of the district courts of the United States other than as permitted by Section 404(b) of ERISA and Labor Reg. §2550.404(b)-1;

(E) would jeopardize the Plan’s tax qualified status under the Code;

(F) could result in a loss in excess of the amount credited to the Account; or

(G) would violate any other requirements of the Code or ERISA.

          (4) Except as otherwise prescribed in subsections 5.1(b), (c), and (d) and Section 5.2, the ESOP Committee may establish reasonable restrictions on the frequency with which investment directions may be given, consistent with Section 404(c) of ERISA.

          (5) The ESOP Committee may establish limits on the use of brokers, investment counsel or other advisors that may be utilized, including specifying that all investments must be made through a designated broker or brokers.

          (6) The ESOP Committee may establish limits on the types of investments that are permitted.

     (h) Except as otherwise prescribed in subsections Section 5.1(b), (c), (d), and (e) and Section 5.2, the ESOP Committee shall establish such rules and procedures as may be advisable

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or necessary to carry out the provisions of this Section, with such rules and procedures being consistent with Section 404(c) of ERISA.

     (i) The ESOP Committee shall establish such rules and procedures as may be advisable or necessary to reasonably ensure that all transactions involving the investment funds comply with all applicable laws, including the securities laws.

     (j) Except as otherwise determined by the ESOP Committee or provided herein, a Participant’s Account attributable to a direct transfer in accordance with Section 4.6 may be invested in Common Stock only at or near the time the direct transfer is accepted and received by the ESOP Committee or Trustee, and only if the Participant is a new Employee. Amounts to be invested in Common Stock will be initially accumulated in a short term interest fund in the ESOP Component of the Plan, and will be converted to Common Stock on the Allocation Date coincident with or next following the date of receipt based on the Current Market Value as of the Allocation Date coincident with such investment date. Amounts not invested in the ESOP Account may be invested in accordance with Section 5.1(a). Amounts held in the ESOP Account will be subject to the diversification rules of Section 5.2. Notwithstanding the foregoing, a Participant’s Account attributable to the money purchase pension plan account under the Innovative Technology Solutions 401(k) Profit Sharing Plan & Trust may not be invested in Common Stock. Also notwithstanding the foregoing, with respect to new Employees as a result of a merger, acquisition or consolidation of another entity, where such new Employee’s direct transfer is received by the Trustee after the Allocation Date next occurring after such merger, acquisition or consolidation, the ESOP Committee shall have discretion to decide that such new Employee’s direct transfer be initially accumulated in a short term interest fund in the ESOP Component of the Plan, and converted to Common Stock at the Allocation

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Date coinciding with or next following the receipt of such new Employee’s properly completed investment election form, based on the Current Market Value as of the Allocation Date immediately preceding the date such transferred funds were received; provided, however, that the foregoing shall apply only if (i) such new Employee’s properly completed investment election form is received on or before the Allocation Date immediately preceding the date such transferred funds were received, and (ii) the funds are received before the earlier of the date that the Trustee releases the value of the Common Stock as of the prior Allocation Date or forty-five (45) days following such Allocation Date.

5.2 Diversification.

     Notwithstanding Section 5.1(b), any Participant who has attained age 55 and completed a Period of Participation of at least ten (10) years shall be permitted to direct that up to twenty-five percent (25%) of the total number of shares of Common Stock allocated (including any shares of Common Stock previously diversified, distributed or sold to fund a distribution) to the Participant’s ESOP Account, as of the September 30 immediately preceding each Plan Year during the Qualified Election Period (reduced by any shares of Common Stock previously diversified, distributed or sold to fund a distribution), and rounded to the nearest whole integer may be invested among the otherwise available investment options under the Plan in accordance with the provisions of subsection 5.1 (a) above. If a Participant participates at any time during the Plan Year, for purposes of crediting service for this diversification provision, such Participant will be credited with one Period of Participation. With respect to a qualified Participant’s final diversification election, fifty percent (50%) is substituted for twenty-five percent (25%) in determining the amount subject to the diversification election. Any direction to diversify hereunder may be made within 90 days after the close of each Plan Year during the Participant’s

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Qualified Election Period, as defined below. Any direction made during the applicable 90-day period following any Plan Year may be revoked or modified at any time during such 90-day period. Any such diversification shall be implemented by the 180^th day of the Plan Year in which the Participant’s direction is made or such later date as is administratively necessary or appropriate. All such directions shall be in accordance with any notice, rulings, or regulations or other guidance issued by the Internal Revenue Service with respect to Section 401(a)(28)(B) of the Code. For the purposes of this Section, the term “Qualified Election Period” shall mean the six (6) Plan Year period beginning with the later of the Plan Year in which the Participant attains age 55 or completes a Period of Participation of ten (10) years. In addition, subject to the Company’s satisfaction of its bank loan covenants, beginning in the first quarter of the Plan Year which begins on October 1, 2007, and then in the first quarter of each year thereafter, a Participant who had an ESOP Account as of the Closing Date, regardless of his or her Period of Service with the Company or an Adopting Employer, shall have the right to make a non-cumulative election to transfer up to 10% of the current value of their ESOP Account to an investment fund other than the Company Stock Fund. A Participant hired after the Closing Date will have this diversification right in the first quarter of the Plan Year following a Period of Service with the Company or an Adopting Employer consisting of at least five full years, provided that the Employee’s Period of Service with an Adopting Employer before the effective date of adoption as provided in Exhibit A will not be considered, and provided further that service with a previous employer will be disregarded. Once the Participant becomes eligible for this special diversification election, the special diversification election will apply regardless of whether he or she remains employed.

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5.3 Change in Investment Allocation of Future Deferrals.

     Except as otherwise prescribed in Sections 5.1(b), (c), (d), and (e) and Section 5.2 each Participant may elect to change the investment allocation of future contributions effective as of the first Trade Day subsequent to notice to the Recordkeeper by which it is administratively feasible to make such change. Any changes must be made either in increments of one percent (1%) of the Participant’s Account and must result in a total investment of one hundred percent (100%) of the Participant’s Account.

5.4 Transfer of Account Balances Between Investment Funds.

     Except as otherwise prescribed in Sections 5.1(b), (c), (d), and (e) and Section 5.2, each Participant may elect to transfer all or a portion of the amount in his or her Non ESOP Account between investment funds effective as of the first Trade Day following notice to the Recordkeeper by which it is administratively feasible to carry out such transfer. Such transfers must be made in either one percent (1%) increments of the entire Account and, as of the completion of the transfer, must result in investment of one hundred percent (100%) of the Non ESOP Account. Transfers shall be effected by telephone notice to the Recordkeeper.

5.5 Ownership Status of Funds.

     The Trust shall be the owner of record of the Plan assets. The ESOP Committee shall have records maintained as of the Valuation Date for each investment option allocating a portion of the investment option to each Participant who has elected that his or her Account be invested in such investment option. The records shall reflect each Participant’s portion of Common Stock in cash and unitized shares of stock and shall reflect each Participant’s portion of all other investment options as may be established by the ESOP Committee in a cash amount.

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5.6 Allocation of Earnings.

     (a) (1) The ESOP Committee, as of each Valuation Date, shall adjust the amounts credited to the Accounts (including Accounts for persons who are no longer Employees) so that the total of such Account balances equals the fair market value of the Trust Fund assets as of such Valuation Date. Except as otherwise provided herein, any changes in the fair market value of the Trust Fund assets since the preceding Valuation Date shall be charged or credited to each Account in the ratio that the balance in each such Account as of the preceding Valuation Date bears to the balances in all Accounts as of that Valuation Date with appropriate adjustments to reflect any distributions, allocations or similar adjustments to such Account or Accounts since that Valuation Date. To the extent that separate investment funds are established (as provided in Section 5.1(a)), the adjustments required by subsection (a)(1) shall be made by applying subsection (a)(1) separately for each such investment fund so that any changes in the net worth of each such investment fund are charged or credited to the portion of each Account invested in such investment fund in the ratio that the portion of each such Account invested in such investment fund as of the preceding Valuation Date (reduced by any distributions made from that portion of such Account since that Valuation Date) bears to the total amount credited to such investment funds as of that Valuation Date (reduced by distributions made from such investment fund since that Valuation Date).

          (3) Interim valuations, in accordance with the foregoing procedure, may be made at such time or times as the ESOP Committee directs for all or a portion of the investment options.

     (b) The ESOP Committee may, in its sole discretion, direct the Trustee to segregate and separately invest any Trust Fund assets, including but not limited to, any Trust Fund assets

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that are attributable to cash dividends on Common Stock pending distribution or allocation of such assets in accordance with Section 9.13. If any assets are segregated in this fashion, the earnings or losses on such assets shall be determined apart from other Trust assets and shall be adjusted on each Valuation Date, or at such other times as the ESOP Committee deems necessary, in accordance with this Section.

5.7 Acquisition Loans.

     (a) The ESOP Committee may direct the Trustees to incur Acquisition Loans from time to time in order to acquire Financed Shares or to repay a prior Acquisition Loan. An installment obligation incurred in connection with the purchase of Financed Shares shall be treated as an Acquisition Loan. All indebtedness incurred to acquire Financed Shares in a single transaction shall be treated as one Acquisition Loan. An Acquisition Loan shall be for a specific term, shall bear a reasonable rate of interest and shall not be payable on demand, except in the event of default.

     (b) Financed Shares acquired with the proceeds from an Acquisition Loan shall be held in a Loan Suspense Account until allocated to Participants under Section 5.10.

     (c) An Acquisition Loan may be secured by a pledge of the Financed Shares acquired with the proceeds of the Acquisition Loan (or acquired with the proceeds of a prior Acquisition Loan which is being refinanced). No other assets of the Trust Fund may be pledged as collateral for an Acquisition Loan. The lender shall not have recourse against any assets of the Trust Fund other than any Financed Shares which are subject to such pledge. Any pledge of Financed Shares must provide for the release of the pledged shares at the time that the Trustee repays any part of the Acquisition Loan. Such unencumbered shares shall be available for allocation to Participants’ ESOP Profit Sharing Accounts.

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     (d) If the lender is a party in interest (as defined in ERISA) or a disqualified person (as defined in the Code), the Acquisition Loan must provide for a transfer of the pledged shares to the lender only to the extent that the Trust has defaulted on the Acquisition Loan by failing to meet the required payment schedule.

5.8 Acquisition Loan Payments.

     (a) The Trustee, as directed by the ESOP Committee, shall pay principal and/or interest on any Acquisition Loan only from: (i) Profit Sharing Contributions paid in cash; (ii) any earnings attributable to such Profit Sharing Contributions; and (iii) any cash dividends or distributions (as defined in Code Section 1368) received by the Trust on the Financed Shares purchased with the proceeds of such Acquisition Loan (whether unallocated or, to the extent permitted by law, allocated).

     (b) The payments made by the Trustee with respect to an Acquisition Loan for Plan Year must not exceed the sum of such Profit Sharing Contributions, earnings and dividends (including distributions (as defined in Code Section 1368)) for that Plan Year and prior Plan Years, less the amount of such payments for prior Plan Years.

     (c) If any Employer is the lender with respect to an Acquisition Loan, Profit Sharing Contributions may be paid in the form of cancellation of indebtedness under the Acquisition Loan with written notice to the ESOP Committee and the Trustee. If the Employer is not the lender with respect to an Acquisition Loan, the Employer may elect, with written notice to the ESOP Committee and the Trustee, to make payments on the Acquisition Loan directly to the lender and to treat such payments as Profit Sharing Contributions or as additional Acquisition Loans.

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5.9 Sales of Common Stock.

     (a) Subject to the approval of the Board of Directors, the Trustee, as directed by the ESOP Committee, may sell Common Stock to any person (including an Employer), provided that any such sale must be made at a price not less than Current Market Value as of the date of the sale.

     (b) In the event the Trustee is unable to make payments of principal and/or interest on an Acquisition Loan when due (other than a loan from the Company which has no corresponding extension of credit to the Company by a third party lender), with the approval of the Board of Directors, the ESOP Committee may direct the Trustee to sell any Financed Shares that have not yet been allocated to Participants’ ESOP Profit Sharing Accounts or to obtain a new Acquisition Loan in an amount sufficient to make such payments.

     (c) Notwithstanding any other provision of this Article V, in the event of the sale of the Company, the termination of the Plan or other Plan’s failure to qualify as an employee stock ownership plan under Code Section 4975(e)(7), the ESOP Committee may direct the Trustees to apply the proceeds from the sale of the Financed Shares remaining in the Loan Suspense Account to repay the Acquisition Loan incurred to purchase the Financed Shares.

     (d) Any sale of Common Stock under this Section must comply with the fiduciary duties applicable to the ESOP Committee under ERISA Section 404(a)(1).

5.10 Allocations of Financed Shares.

     (a) Any Financed Shares acquired by the Trust shall initially be credited to a Loan Suspense Account and will be allocated to the ESOP Profit Sharing Accounts of Participants only as the Trustee makes payments on the Acquisition Loan. The number of Financed Shares to be released from the Loan Suspense Account for allocation to Participants’ ESOP Profit Sharing

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Accounts for each Plan Year shall be determined by multiplying the number of Financed Shares held in the Loan Suspense Account immediately before the release for the current Plan Year by a fraction. The numerator of the fraction shall be the amount of principal and interest paid on the Acquisition Loan for that Plan Year. The denominator of the fraction shall be the sum of the numerator plus the total payments of principal and interest on that Acquisition Loan projected to be paid for all future Plan Years. For this purpose, the interest to be paid or accrued in future years to be computed by using the interest rate in effect as of the current Allocation Date.

     (b) Pursuant to the terms of the Acquisition Loan (or, at the election of the ESOP Committee if the Acquisition Loan is silent in this regard), the ESOP Committee may elect to release Financed Shares from the Loan Suspense Account based solely on the ratio that the payments of principal for each Plan Year bear to the total principal amount of the Acquisition Loan. This method may be used only to the extent that:

     (1) the Acquisition Loan provides for annual payments of principal and interest at a cumulative rate that is not less rapid at any time than level annual payments of such amounts for ten (10) years;

          (2) interest included in any payment on the Acquisition Loan is disregarded only to the extent that it would be determined to be interest under standard loan amortization tables; and

          (3) the entire duration of the Acquisition Loan repayment period does not exceed ten (10) years, even in the event of a renewal, extension or refinancing of the Acquisition Loan.

     (c) In each Plan Year in which assets of the Trust Fund are applied to make payments on an Acquisition Loan, the Financed Shares released from the Loan Suspense Account in

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accordance with the provisions of this Section shall be allocated among the ESOP Profit Sharing Accounts of Participants in the manner determined by the ESOP Committee based upon the source of funds used to make the payments on the Acquisition Loan (i.e., ESOP Profit Sharing Contributions, earnings attributable to ESOP Profit Sharing Contributions, cash dividends on Financed Shares allocated to ESOP Profit Sharing Accounts and/or cash dividends on Financed Shares credited to the Loan Suspense Account).

     (d) If cash dividends on Financed Shares allocated to a Participant’s ESOP Profit Sharing Account are used to make payments on an Acquisition Loan, the Financed Shares released from the Loan Suspense Account shall be allocated to that Participant’s ESOP Profit Sharing Account, provided, however, that the Current Market Value of the Financed Shares released from the Loan Suspense Account must be at least equal to the amount of the cash dividends.

5.11 Allocation of Dividends and Distributions on Common Stock.

     (a) Any cash dividends or distributions, as defined in Code Section 1368, received on shares of Common Stock allocated to Participants’ ESOP Accounts will be allocated to the respective Accounts of such Participants.

     (b) Any stock dividends received on Common Stock shall be credited to the account to which such Common Stock was allocated at the time the dividend was declared (e.g., a Participant’s ESOP Profit Sharing Account or ESOP Matching Contribution Account or the Loan Suspense Account).

     (c) Any cash dividends or distributions received on unallocated shares of Common Stock, including any Financed Shares credited to the Loan Suspense Account, shall be

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considered to be net income of the Trust, but will be allocated only to the accounts of Participants who are active employees.

5.12 Nonallocation.

     No allocation of Common Stock of an S corporation (or other assets in lieu of such Common Stock) may be made to any “Disqualified Person” (within the meaning of Section 409(p)(4) of the Code) during any “Nonallocation Year” (within the meaning of Section 409(p)(3) of the Code). Any allocation of Common Stock made in violation of this edict shall be null and void ab initio. To the extent permitted by law, the ESOP Committee may adjust the mix of assets in Participants’ Accounts to prevent the occurrence of a Nonallocation Year, by removing Common Stock from the accounts of Disqualified Persons and replacing it with other assets of identical value taken from the Accounts of Participants who are not Disqualified Persons, subject to the requirements that: (1) no such action may diminish the overall value of any Participant’s Accounts, (2) each Participant shall continue to have the right to receive distribution of his entire Account balance in the form of Common Stock to the extent otherwise permitted hereunder, and (3) the Accounts of each Active Participant who is not a Disqualified Person shall be adjusted in the same proportionate manner as the Accounts of all other Active Participants. In the event that either applicable law or the absence of assets other than Common Stock in the Accounts of Participants who are not Disqualified Persons prevents the asset reallocation referred to above, then any such allocation to a Disqualified Person shall be null and void, and the Common Stock in issue shall be reallocated among the Accounts of Participants who are not Disqualified Persons in the ratio of their compensation in the Plan Year involved.

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ARTICLE VI

Voting and Tendering of Stock

6.1 Voting of Common Stock

     (a) The voting of Common Stock held by the Trust shall be subject to the provisions of ERISA and the following provisions, to the extent such provisions are not inconsistent with ERISA:

          (1) With respect to any corporate matter that involves the voting of Common Stock with respect to the approval or disapproval of any corporate merger or consolidation, recapitalization, reclassification, liquidation, dissolution, sale of substantially all of the assets of a trade or business, or such other transactions that may be prescribed by regulation (and, if the Company has a registration-type class of securities, all other shareholder voting issues), each Participant may be entitled to direct the Trustee as to the exercise of any shareholder voting rights attributable to shares of Common Stock then allocated to his ESOP Accounts, but only to the extent required by Sections 401(a)(22) and 409(e)(3) of the Code and the regulations there under. For purposes of the foregoing sentence, each Participant shall be a named fiduciary of the Plan as described in Section 402(a)(2) of ERISA. The ESOP Committee shall have the sole responsibility for determining when a corporate matter has arisen that involves the voting of Common Stock under this provision. If a Participant is entitled to so direct the Trustee, all allocated Common Stock as to which such instructions have been received (which may include an instruction to abstain) shall be voted by the Trustee in accordance with such instructions, provided that the Trustee may vote the shares as it determines is necessary to fulfill its fiduciary duties under ERISA. The Trustee shall vote any shares as to which no voting instructions have been received at the direction of the ESOP Committee, subject to its fiduciary duties under ERISA.

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          (2) In all other circumstances, the Trustee shall vote all shares of Common Stock as directed by the ESOP Committee.

6.2 Tendering of Common Stock

     (a) The tendering of Common Stock held by the Trust shall be subject to the provisions of ERISA and the following provisions, to the extent such provisions are not inconsistent with ERISA:

          (1) In the event of a tender offer or other offer to purchase shares of Common Stock held by the Trust, the Trustee shall tender or sell the shares as directed by each Participant with respect to shares of Common Stock then allocated to his ESOP Accounts, subject to the fiduciary duties under ERISA. In carrying out its responsibilities under this Section, the Trustee may rely on information furnished to it by the ESOP Committee, including the names and current addresses of Participants, the number of shares of Common Stock allocated to their ESOP Accounts, and the number of shares of Common Stock held by the Trust (if any) that have not yet been allocated. The Trustee shall vote any shares as to which no voting instructions have been received at the direction of the ESOP Committee, subject to its fiduciary duties under ERISA.

          (2) In all other circumstances, the Trustee shall tender all shares of Company Stock as directed by the ESOP Committee.

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ARTICLE VII

Vesting

7.1 Elective Deferral, Rollover Contribution, Qualified Nonelective Contribution and Matching Contribution Accounts.

     Except as otherwise provided in an Exhibit or Supplement to this Plan, each Participant shall have a nonforfeitable right to all amounts in the Participant’s Elective Deferral, Rollover Contribution, Qualified Nonelective Contribution and Matching Contribution Accounts.

7.2 Profit Sharing Contribution Accounts.

     (a) Except as otherwise provided in an Exhibit or Supplement to this Plan, each Participant shall have a nonforfeitable right to his or her ESOP Profit Sharing Account and Non ESOP Profit Sharing Account in accordance with the following:

(1)Period of Service	Vested Interest
Less than 2 years		0	%
with two (2) years		25	%
with three (3) years		50	%
with four (4) years		75	%
with five (5) years		100	%

          (2) if earlier, 100% vested upon the Participant’s death while an Employee, Disability while an Employee or attainment of Normal Retirement Age while an Employee.

     (b) For purposes of this Section 7.2, all service as a Leased Employee, if any, shall be taken into account for purposes of determining a Participant’s nonforfeitable right to his or her Profit Sharing Account, even though Leased Employees are not eligible to participate in the Plan.

7.3 Forfeitures.

     (a) In the event that a Participant incurs a Severance from Service before attaining a nonforfeitable right to his or her entire ESOP Profit Sharing Account, the portion of his or her ESOP Profit Sharing Account that is forfeitable will be forfeited as of the earlier of: (1) the date on which the Participant incurs a Period of Severance of five (5) consecutive years; or (2) the

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Allocation Date coinciding with or next following the date on which the vested portion of the Participant’s ESOP Profit Sharing Accounts is distributed in accordance with ARTICLE IX provided the participant is not rehired before such Allocation Date. For purpose of the preceding sentence, if a Participant’s vested balance in his ESOP Profit Sharing Account is zero, he shall be deemed to have received a distribution of his vested ESOP Profit Sharing Account balance as of the date he incurred a Severance from Service. In the event that a Participant incurs a Severance from Service before attaining a nonforfeitable right to his or her entire Non ESOP Profit Sharing Account, the portion of his or her Non ESOP Profit Sharing Account that is forfeitable will be forfeited as soon as it is administratively feasible immediately following the earlier of: (A) the date on which the Participant incurs a Period of Severance of five (5) consecutive years; or (B) the date on which the vested portion of the Participant’s Non ESOP Profit Sharing Account is distributed in accordance with ARTICLE IX. For purpose of the preceding sentence, if a Participant’s vested balance in his Non ESOP Profit Sharing Account is zero, he shall be deemed to have received a distribution of his vested Non ESOP Profit Sharing Account balance as of the date he incurred a Severance from Service. Forfeitures from the Non ESOP and ESOP Components of the Plan will be used to reduce future contributions of the Adopting Employers to the Plan or to pay administrative expenses.

     (b) If, in connection with his or her Severance from Service, a Participant received a distribution of a portion of his or her entire Account when he or she did not have a nonforfeitable right to his or her entire Account, the portion of his or her Account that was forfeited, unadjusted by any subsequent gains or losses, shall be restored if he or she again becomes an Employee before incurring a Period of Severance of five (5) consecutive years.

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7.4 Break in Service Rules.

     (a) Periods of Service. In determining the length of a Period of Service, the ESOP Committee shall include all Periods of Service, except the following Periods of Service shall not be taken into account:

          (1) in the case of a Participant who has never had a vested Account balance, the Period of Service before any Period of Severance which equals or exceeds five (5) consecutive years; and

          (2) in the case of a Participant who has had a vested account balance and who has incurred a Period of Severance which equals or exceeds five (5) years, the Period of Service after such Period of Severance shall not be taken into account for purposes of determining the nonforfeitable interest of such Participant in the Profit Sharing Contributions allocated to his or her Account before such Period of Severance.

     (b) Periods of Severance. In determining the length of a Period of Severance, the ESOP Committee shall include any period of time beginning on an Employee’s Severance from Service Date and ending on the date on which he or she is next credited with an Hour of Service, provided that such Hour of Service is not credited within the twelve- (12) consecutive month period following such Severance from Service Date.

     (c) Other Periods. In making the determinations described in subsections (a) and (b) of this Section, any period in excess of six (6) months of an Authorized Leave of Absence shall be regarded as neither a Period of Service nor a Period of Severance.

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ARTICLE VIII

In-Service Withdrawals

8.1 Elective Deferrals and Qualified Nonelective Contributions.

     (a) Subject to the terms and conditions prescribed in Section 8.3, a Participant may withdraw all or a portion of his or her (1) Non ESOP Elective Deferral Account or Qualified Nonelective Contribution Account on or after attainment of age fifty-nine and one-half (59¹/2), or (2) ESOP and Non ESOP Rollover Accounts at any time, as long as the hardship criteria are met; (3) ESOP and Non ESOP Elective Deferral Accounts (excluding earnings on Elective Deferrals) in the event of a hardship. In addition, subject to the terms and conditions prescribed in Section 8.3, a Participant who has attained at least age fifty-nine and one-half (59¹/2) may elect to withdraw all or a portion of his or her Non-ESOP ITSC Elective Deferral Account (as described in Exhibit B).

     (b) In order to be entitled to a hardship withdrawal under this Section, a Participant must satisfy the requirements of both subsection (c) and subsection (d). Whether a Participant is entitled to a withdrawal under this Section is to be determined by the ESOP Committee in accordance with nondiscriminatory and objective standards.

     (c) (1) A Participant will be deemed to have experienced an immediate and heavy financial need necessary to satisfy the requirements of this subsection if the withdrawal is on account of:

(A) medical expenses described in Section 213(d) of the Code incurred by the Participant, the Participant’s spouse or any dependents of the Participant;

(B) the purchase (excluding mortgage payments) of a principal residence of the Participant;

(C) payment of tuition for the next twelve (12) months of post-secondary education for the Participant or his or her spouse, children or dependents;

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(D) the need to prevent the eviction of the Participant from his or her principal residence or the foreclosure on the mortgage of the Participant’s principal residence;

(E) payment for burial and/or funeral expenses for the Participant’s parent, spouse, child or other dependent (as defined in Section 152 of the Code, without regard to Section 152(d)(1)(B));

(F) expenses for the repair of damage to a Participant’s principal residence that would qualify as a casualty deduction under Code Section 165 on the Participant’s tax return (without regard to whether the loss exceeds the adjusted gross income threshold); or

(G) other circumstances that the ESOP Committee determines constitutes an immediate and heavy financial need.

     (d) (1) A withdrawal under this subsection will be deemed necessary to satisfy an immediate and heavy financial need of the Participant if it satisfies the requirements of this subsection. To the extent the amount of the withdrawal would be in excess of the amount required to relieve the financial need of the Participant (which amount may include any amounts necessary to pay any federal, state, or local income taxes or penalties reasonably anticipated to result from the withdrawal) or to the extent such need may be satisfied from other resources that are reasonably available to the Participant, such withdrawal shall not satisfy the requirements of this subsection. For purposes of this subsection, a Participant’s resources shall be deemed to include those assets of his or her spouse or minor children that are reasonably available to the Participant.

          (2) A withdrawal may be treated as necessary to satisfy a financial need if the ESOP Committee reasonably relies upon the Participant’s representation that the need cannot be relieved:

(A) through reimbursement or compensation by insurance or otherwise;

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(B) by reasonable liquidation of the Participant’s assets to the extent such liquidation would not itself cause an immediate and heavy financial need;

(C) by cessation of Elective Deferrals under the Plan for at least six (6) months after receipt of the hardship withdrawal; or

(D) by other distributions or nontaxable (at the time of the loan) loans from plans maintained by the Adopting Employers or by any other employer or by borrowing from commercial sources on reasonable commercial terms.

     (e) If a Participant receives a withdrawal for reasons of financial hardship, the Participant may not make any Elective Deferrals during the six (6) months immediately subsequent to the date of distribution.

8.2 Rollover Contributions.

     Subject to the terms and conditions prescribed in Sections 8.1 (a)(2) and 8.3 (including but not limited to the restriction noted in 8.3(e)), a Participant may withdraw all or a portion of his or her Rollover Contribution.

8.3 General Terms and Conditions.

     All in-service withdrawals are subject to the following terms and conditions:

     (a) In-service withdrawals of less than five hundred dollars ($500) will not be permitted.

     (b) In determining the amount of any in-service withdrawal, the Participant’s Non ESOP Account shall be valued as of the Valuation Date coinciding with the date the request for an in-service withdrawal is processed. An in-service withdrawal from the Participant’s ESOP Account shall be valued based on the Current Market Value of Common Stock as of the Valuation Date coinciding with or immediately preceding the withdrawal; provided, however,

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that the ESOP Committee may order an interim valuation performed as of any date (including retroactively), which valuation shall be used.

     (c) Payment of the amount withdrawn will be made as soon as administratively feasible after the effective date of the withdrawal.

     (d) In-service withdrawals from a Participant’s Account will generally be made in cash.

     (e) Funds for in-service withdrawals will be taken on a pro-rata basis against the Participant’s investment balances in his or her Non ESOP Account. If the amount of the withdrawal cannot be satisfied from the Non ESOP Account, the remainder will then be taken pro rata from the balances in the ESOP Account.

     (f) In-service withdrawals may not be redeposited in the Plan.

     (g) The ESOP Committee may adopt such other rules and procedures as it deems necessary, in its sole discretion, to properly administer the in-service withdrawal provisions in this ARTICLE.

8.4 Hurricane Katrina Distribution.

     (a) The following defined terms shall apply for purposes of this Section 8.4.

          (i) “Eligible Contributions” means ESOP and Non-ESOP Elective Deferral Accounts (excluding earnings credited after December 31, 1988), ESOP and Non-ESOP Rollover Accounts, ESOP and Non-ESOP HFA Pre-Tax Deferral Accounts (excluding earnings credited after December 31, 1988), ESOP and Non-ESOP HFA Rollover Accounts, ESOP and Non-ESOP ITSC Pre-Tax Deferral Accounts (excluding earnings credited after December 31, 1988), ESOP and Non-ESOP ITSC Rollover Accounts, Non-ESOP JJMA Pretax Account (excluding earnings credited after December 31, 1988),

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Non-ESOP JJMA Rollover Account, Non-ESOP JJMA Matching Contribution Account, Non-ESOP JJMA Transfer Account, Non-ESOP JJMA Base Match Account, and Non-ESOP JJMA Discretionary Match Account.

     (ii) “Hurricane Katrina Distribution” means a distribution to a Qualified Individual pursuant to this Section 8.4. A Hurricane Katrina Distribution must be made on or after August 25, 2005 and before January 1, 2007. After December 31, 2006, Hurricane Katrina Distributions will no longer be available under the Plan.

     (iii) “Qualified Individual” means a Participant or Beneficiary (A) whose principal place of abode on August 28, 2005 was located in Louisiana, Mississippi, Alabama or Florida, and (B) who sustained an economic loss by reason of Hurricane Katrina. For this purpose, an individual’s principal place of abode is where the individual lives unless temporarily absent due to special circumstances. A temporary absence from the household due to special circumstances, such as illness, education, business, vacation, or military service, will not change an individual’s principal place of abode. If an individual’s principal place of abode was in Louisiana, Mississippi, Alabama or Florida immediately before August 28, 2005, and the individual evacuated because of Hurricane Katrina, the individual’s principal place of abode will be considered to be in Louisiana, Mississippi, Alabama or Florida on August 28, 2005. The Committee shall rely on an individual’s certification that he or she is a Qualified Individual unless the Committee has actual knowledge to the contrary.

     (b) A Qualified Individual may request a Hurricane Katrina Distribution of all or a portion of his or her Eligible Contributions; provided, however, in no event shall the total of all such distributions to a Qualifying Individual exceed $100,000. The Committee may establish

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such rules, impose such requirements and require the completion of such forms and documents (in electronic or paper formats), in its sole discretion, and applied in a nondiscriminatory and objective basis, in order to administer this Section 8.4.

     (c) If a Participant who is a Qualifying Individual receives a Hurricane Katrina Distribution pursuant to this Section 8.4, he or she may re-contribute such distribution to the Plan provided such amount is re-contributed within three years of the date the Hurricane Katrina Distribution is made. Any amount re-contributed pursuant to this paragraph shall be credited to such Participant’s ESOP and Non-ESOP Rollover Contributions Account in accordance with the source (ESOP or Non-ESOP) of the original Hurricane Katrina Distribution.

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ARTICLE IX

Distribution of Benefits

9.1 General.

     (a) Except as otherwise provided in an Exhibit or Supplement to this Plan (or otherwise required by Section 4.6(b)), all benefits payable under this Plan shall be paid in the manner and at the times specified in this ARTICLE. Special distribution rules with respect to Common Stock are set forth in Section 9.14 and Section 9.15.

     (b) All payment methods and distributions shall comply with the requirements of Sections 401(a)(9) and 401(a)(14) of the Code and the regulations thereunder, and, if necessary, shall be interpreted to so comply. All distributions shall comply with the incidental death benefit requirement of Section 401(a)(9)(G) of the Code. Distributions shall comply with the final regulations in Treas. Regs. §§ 1.401(a)(9)-1 through 1.401(a)(9)-9 and with any other provisions reflecting Section 401(a)(9) of the Code that are prescribed by the IRS in revenue rulings, notices and other guidance published in the Internal Revenue Bulletin. The provisions of the Plan reflecting Section 401(a)(9) of the Code override any distribution provisions in the Plan inconsistent with Section 401(a)(9) of the Code.

9.2 Commencement of Benefits.

     (a) Except as otherwise provided in this Section 9.2, or in Sections 9.14 and 9.15, a Participant (or Beneficiary) shall be entitled to commence distribution of the nonforfeitable portion of his or her Account after a Severance from Service, Retirement, Disability or death.

     (b) Except as otherwise provided in this Section 9.2, or in Sections 9.14 and 9.15, payment of benefits to a Participant (or Beneficiary) shall commence within a reasonable period of time following the Participant’s Severance from Service, Retirement, Disability or death.

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     (c) Except as otherwise required by Section 9.2(f), if the value of the nonforfeitable portion of the Participant’s Account exceeds the maximum amount prescribed in Section 411(a)(11) of the Code, no portion of his Account may be distributed to him before he attains the later of Normal Retirement Age or age 62 without his written consent. Such written consent must be obtained no more than one hundred and eighty (180) days (ninety (90) days for distributions made on or before December 31, 2006) before the commencement of the distribution. The value of the nonforfeitable portion of the Participant’s Account shall be determined without regard to that portion of the Account that is attributable to rollover contributions (and the earnings allocable thereto) within the meaning of Sections 402(c), 403(a)(4), 403(b)(8), 408(d)(3)(A)(ii), and 457(e)(16) of the Code. Notwithstanding the preceding provisions of this subsection (c), all distributions to a Participant’s Beneficiary shall commence within a reasonable period of time following the Participant’s death (no consent of the Beneficiary is required); provided, however, that if the Beneficiary is the Participant’s Surviving Spouse, then such Surviving Spouse may elect to defer commencement of distributions for a period of up to five years from the date of death of the Participant.

     (d) Unless a Participant elects otherwise, distribution to the Participant shall commence no later than sixty (60) days after the close of the Plan Year in which the latest of the following events occurs:

          (1) attainment by the Participant of Normal Retirement Age;

          (2) the tenth (10th) anniversary of the date on which Participant commenced participation in the Plan; or

          (3) Participant’s Severance from Service.

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     (e) Distribution of the nonforfeitable portion of a Participant’s Account shall generally commence in accordance with the general provisions of this Section 9.2, but in no event before the earliest of the following events:

          (1) The Participant’s severance from employment within the meaning of Section 401(k)(2)(B)(i)(I) of the Code (as then effective). Effective for distributions commencing after December 31, 2001, the “severance from employment” standard shall apply to any distributions after such date regardless of when the severance from employment occurred.

          (2) The Participant’s attainment of age fifty-nine and one-half (59-1/2).

          (3) The termination of the Plan without establishment or maintenance of another defined contribution plan (other than an employee stock ownership plan).

     (f) A Participant who has attained age seventy and one-half (70¹/2) and who is subject to the mandatory distribution requirements of Section 401(a)(9) of the Code shall receive annual distributions in the minimum amount necessary to comply with Section 401(a)(9) of the Code.

     (g) If a Participant dies before the time when distribution is considered to have commenced in accordance with applicable regulations, then any remaining nonforfeitable portion of the Participant’s Account shall be distributed within five (5) years after the Participant’s death. If a distribution is considered to have commenced in accordance with the applicable regulations before the Participant’s death, the remaining nonforfeitable portion of the Participant’s Account shall be distributed at least as rapidly as under the method of distribution being used as of the date of the Participant’s death. For purposes of this Section 9.2(g), the Surviving Spouse of the Participant will be treated as the Participant if: the Surviving Spouse is the Beneficiary of the Participant’s Account; the Surviving Spouse dies after the Participant; and distributions had not yet commenced to the Surviving Spouse.

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9.3 Form of Distribution.

     (a) Except to the extent otherwise provided in the Plan, distributions under the Plan shall be made in the form of a lump sum in substantially equal, annual installments over a period not exceeding five years (or such greater number of installments as determined under Section 9.14(c)), or a combination thereof, at the option of the ESOP Committee in accordance with a nondiscriminatory and uniform policy. For amounts distributed from the Non-ESOP Component of the Plan, only lump sum distributions are available.

     (b) Distribution of the nonforfeitable portion of the Participant’s ESOP Account shall be made in cash or in-kind, at the election of the ESOP Committee, provided, however, that the ESOP Committee shall notify the Participant of his or her right (subject to the exceptions contained in Section 9.14(d)) to demand distribution of his or her ESOP Account entirely in whole shares of Company Stock (with only the value of any fractional share paid in cash).

     (c) A Participant shall be notified of his rights under this Section no less than thirty (30) days and no more than one hundred and eighty (180) days (ninety (90) days for distributions made on or before December 31, 2006) before a distribution is made. Written consent of a Participant to a distribution (if required) may not be made before he receives such notice and must not be made more than one hundred and eighty (180) days (ninety days for distributions made on or before December 31, 2006) before a distribution is made.

9.4 Determination of Amount of Distribution.

     In determining the amount of any distribution hereunder, the nonforfeitable portion of a Participant’s Non ESOP Account shall be valued as of the Valuation Date coinciding with the date the request for a distribution is processed. In valuing a Participant’s ESOP Accounts or Common Stock, the Current Market Value as of the Valuation Date coinciding with or preceding

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the distribution or installment shall be used; provided, however, that the ESOP Committee may order an interim valuation performed as of any date (including retroactively), which valuation shall be used.

9.5 Direct Rollovers.

     (a) A Participant may elect that all or any portion of a distribution that would otherwise be paid as an Eligible Rollover Distribution shall instead be transferred as a Direct Rollover.

     (b) The ESOP Committee shall determine and apply rules and procedures as it deems reasonable with respect to Direct Rollovers. The ESOP Committee may change such rules and procedures from time to time and shall not be bound by any previous rules and procedures it has applied.

     (c) The following terms shall have the meanings specified:

          (1) Direct Rollover. An available distribution that is paid directly to an Eligible Retirement Plan for the benefit of the distributee.

          (2) Distributee. A Participant or former Participant. In addition, the Participant’s or former Participant’s Surviving Spouse or former spouse who is the Alternate Payee under a Qualified Domestic Relations Order, as defined in Section 414(p) of the Code, are Distributees with regard to the interest of the spouse or former spouse.

          (3) Eligible Retirement Plan. An individual retirement account described in Section 408(a) of the Code, an individual retirement annuity (other than an endowment contract) described in Section 408(b) of the Code, a qualified trust described in Section 401(a) of the Code if such qualified trust is part of a plan that permits acceptance of Direct Rollovers or an annuity plan described in Section 403(a) of the Code. In the case of a Direct Rollover for the benefit of

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the spouse or former spouse of a Participant, the term “Eligible Retirement Plan” shall only include an individual retirement account described in Section 408(a) of the Code and an individual retirement annuity (other than an endowment contract) described in Section 408(b) of the Code. The term “Eligible Retirement Plan” shall also include an annuity contract described in Section 403(b) of the Code and an eligible plan under Section 457(b) of the Code which is maintained by a state, political subdivision of a state, or any agency or instrumentality of a state or political subdivision of a state and which agrees to separately account for amounts transferred into such plan from this Plan. In the case of a Direct Rollover for the benefit of the surviving spouse of a Participant, or a spouse or former spouse who is the alternate payee under a qualified domestic relations order, as defined in Section 414(p) of the Code, the term “Eligible Retirement Plan” shall include all of the plans and arrangements otherwise described in this subsection (3).

          (4) Eligible Rollover Distribution. Any distribution under the Plan to a Participant, a Participant’s spouse or a Participant’s former spouse, except for the following:

(A) Any distribution to the extent the distribution is required under Section 401(a)(9) of the Code.

(B) The portion of any distribution that is not includable in gross income (determined without regard to the exclusion for net unrealized appreciation described in Section 402(e)(4) of the Code), except the term “Eligible Rollover Distribution” shall include the portion of a distribution that consists of after-tax employee contributions which are not includable in gross income; provided, that such after-tax employee contributions can only be transferred to an individual retirement account or annuity described in Section 408(a) or (b) of the Code, or to a qualified defined contribution plan described in Section 401(a) or 403(a) of the Code that agrees to separately account for amounts so transferred, including separately accounting for the portion of

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such distribution which is includable in gross income and the portion of such distribution which is not so includable.

(C) Returns of elective deferrals described in Treas. Reg. §1.415-6(b)(6)(iv) that are returned as a result of the limitations under Section 415 of the Code.

(D) Corrective distributions of excess contributions and excess deferrals under qualified cash or deferred arrangements as described in Treas. Reg. §1.401(k)-1(f)(4) and §1.402(g)-1(e)(3), respectively, and corrective distributions of excess aggregate contributions as described in Treas. Reg. §1.401(m)-1(e)(3), together with the income allocable to these corrective distributions.

(E) Loans treated as distributions under Section 72(p) of the Code and not excepted by Section 72(p)(2) of the Code.

(F) Loans in default that are deemed distributions.

(G) Dividends paid on employer securities as described in Section 404(k) of the Code.

(H) The costs of life insurance coverage.

(I) Any distribution which is made upon hardship of the Participant.

(J) Similar items designated by the Internal Revenue Service in revenue rulings, notices, and other guidance of general applicability.

9.6 Notice and Payment Elections.

     (a) The ESOP Committee shall provide Participants or other Distributees of Eligible Rollover Distributions with a written notice designed to comply with the requirements of Section 402(f) of the Code. Such notice shall be provided within a reasonable period of time before making an Eligible Rollover Distribution.

     (b) Any elections concerning the payment of benefits under this ARTICLE shall be made on a form prescribed by the ESOP Committee. The Participant or other Distributee shall

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submit a completed form to the ESOP Committee at least thirty (30) days before payment is scheduled to commence, unless the ESOP Committee agrees to a shorter time period. Any election made under this Section shall be revocable until thirty (30) days before payment is scheduled to commence.

     (c) An election to have payment made in a Direct Rollover shall only be valid if the Participant or other Distributee provides adequate information to the ESOP Committee for the implementation of such Direct Rollover and such reasonable verification as the ESOP Committee may require that the transferee is an Eligible Retirement Plan.

9.7 Qualified Domestic Relations Orders.

     (a) Notwithstanding any contrary provision of the Plan, payments shall be made in accordance with any judgment, decree or order determined to be a Qualified Domestic Relations Order.

     (b) (1) If the Plan receives a Domestic Relations Order, the ESOP Committee shall promptly notify the Participant and each Alternate Payee of the receipt of such order and of the Plan’s procedures for determining whether such order is a Qualified Domestic Relations Order. The ESOP Committee shall, within a reasonable period after receipt of such order, determine whether it is a Qualified Domestic Relations Order and notify the Participant and each Alternate Payee of that determination.

          (2) During any period in which the issue of whether a Domestic Relations Order is a Qualified Domestic Relations Order is being determined, the ESOP Committee shall separately account for the amounts that would have been payable to the Alternate Payee during such period if the order had been determined to be a Qualified Domestic Relations Order. The

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ESOP Committee shall separately account for such amounts first from a Participant’s Non-ESOP Accounts, and then from a Participant’s ESOP Accounts.

     (c) (1) A Domestic Relations Order meets the requirements of this subsection only if such order clearly specifies the following:

(A) the name and last known mailing address (if any) of the Participant and the name and mailing address of each Alternate Payee covered by the order;

(B) the amount or the percentage of the Participant’s benefits to be paid by the Plan to each such Alternate Payee or the manner in which such amount or percentage is to be determined;

(C) the number of payments or period to which such order applies; and

(D) each plan to which such order applies.

          (2) A Domestic Relations Order meets the requirements of this subsection only if such order does not:

(A) require the Plan to provide any type or form of benefit or any option not otherwise provided under the Plan;

(B) require the Plan to provide increased benefits (determined on the basis of actuarial value); and

(C) does not require the payment of benefits to an Alternate Payee that is required to be paid to another Alternate Payee under another order previously determined to be a Qualified Domestic Relations Order.

     (d) A domestic relations order shall not be treated as failing to meet the requirements of Section 9.7(c)(2)(A) solely because such order requires that payment of benefits be made to an Alternate Payee:

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          (1) in the case of any payment before a Participant has separated from service, on or after the date on which the Participant attains (or would have attained) the Earliest Retirement Date;

          (2) as if the Participant had retired on the date on which such payment is to begin under such order (but taking into account only the present value of the benefits actually accrued and not taking into account the present value of any employer subsidy for early retirement); and

          (3) in any form in which such benefits may be paid under the Plan to the Participant (other than in the form of a qualified joint and survivor annuity with respect to the Alternate Payee and his or her subsequent spouse).

     (e) A domestic relations order shall not be treated as failing to meet the requirements of Section 9.7(c)(2)(A) solely because such order requires that payment of benefits be made to an Alternate Payee at a date before the Participant is entitled to receive a distribution. Such distribution shall be made to such Alternate Payee notwithstanding any contrary provision of the Plan; provided, however, that such distribution will be made first from a Participant’s Non ESOP Accounts, and then from a Participant’s ESOP Accounts.

     (f) The following terms shall have the meanings specified:

          (1) Alternate Payee. Any spouse, former spouse, child or other dependent of a Participant who is recognized by a Domestic Relations Order as having a right to benefits under the Plan with respect to such Participant.

          (2) Domestic Relations Order. A judgment, decree or order relating to child support, alimony or marital property rights, as defined in Section 414(p)(1)(B) of the Code.

          (3) Earliest Retirement Date. The earlier of:

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(A) the date on which the Participant is entitled to a distribution under the Plan; or

(B) the later of:

               (i) the date the Participant attains age fifty (50); or

               (ii) the earliest date on which the Participant could begin receiving benefits under the Plan if the Participant separated from service.

          (4) Qualified Domestic Relations Order. A Domestic Relations Order that satisfies the requirements of subsection (c) and Section 414(p)(1)(A) of the Code.

     (g) If an Alternate Payee entitled to payment under this Section is the spouse or former spouse of a Participant and payment will otherwise be made in an Eligible Rollover Distribution, then such spouse or former spouse may elect that all, or any portion, of such payment shall instead be transferred as a Direct Rollover. Such Direct Rollover shall be governed by the requirements of Section 9.5.

     (h) If a Domestic Relations Order directs that payment be made to an Alternate Payee before the Participant’s Earliest Retirement Date and such Domestic Relations Order otherwise qualifies as a Qualified Domestic Relations Order, then the Domestic Relations Order shall be treated as a Qualified Domestic Relations Order and such payment shall be made to the Alternate Payee, even though the Participant is not entitled to receive a distribution under the Plan because he or she continues to be an Employee of the Employer; provided however, that this early payment provision will apply such that any early payment must first be applied to a Participant’s Non ESOP Account; and when said Account is depleted, then to the Participant’s ESOP Accounts.

     (i) This Section shall be interpreted and administered in accordance with Section 414(p) of the Code.

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9.8 Designation of Beneficiary.

     (a) A Participant may designate a Beneficiary (including successive or contingent Beneficiaries) in accordance with this Section 9.8. Such designation shall be on a form prescribed by the ESOP Committee, may include successive or contingent Beneficiaries, shall be effective upon receipt by the ESOP Committee and shall comply with such additional conditions and requirements as the ESOP Committee shall prescribe. The interest of any person as Beneficiary shall automatically cease on his or her death and any further payments from the Plan shall be made to the next successive or contingent Beneficiary.

     (b) A Participant may change his or her Beneficiary designation from time to time, without the consent or knowledge of any previously designated Beneficiary, by filing a new Beneficiary designation form with the ESOP Committee in accordance with subsection (a).

     (c) If a Participant dies without a designated Beneficiary surviving, the person or persons in the following class of successive beneficiaries surviving, any testamentary devise or bequest to the contrary notwithstanding, shall be deemed to be the Participant’s Beneficiary: the Participant’s (1) spouse, (2) children and issue of deceased children by right of representation, (3) parents, (4) brothers and sisters and issue of deceased brothers and sisters by right of representation, or (5) executors or administrators. If no Beneficiary can be located during a period of seven (7) years from the date of death, the Participant’s Account shall be treated in the same manner as a forfeiture under Section 7.3(a).

     (d) Notwithstanding the foregoing provisions of this Section, if a Participant is married at the time of his or her death, such Participant shall be deemed to have designated his or her surviving spouse as Beneficiary, unless such Participant has filed a Beneficiary designation under subsection (a) and such spouse has consented in writing to the election (acknowledging the

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effect of the election and specifically acknowledging the nonspouse Beneficiary) and such consent was witnessed by either the ESOP Committee (or its delegate) or a notary public. Such consent shall not be required if the Participant does not have a spouse or the spouse cannot be located. Such consent shall not be required if the Participant is legally separated from his or her spouse or the Participant has been abandoned (under applicable local law) and the Participant has a court order to such effect, unless a Qualified Domestic Relations Order provides otherwise. If the Participant’s spouse is legally incompetent to give consent, the spouse’s legal guardian (even if the guardian is the Participant) may give consent.

9.9 Lost Participant or Beneficiary.

     (a) All Participants and Beneficiaries shall have the obligation to keep the ESOP Committee informed of their current address until such time as all benefits due have been paid.

     (b) If any amount is payable to a Participant or Beneficiary who cannot be located to receive such payment, such amount may, at the discretion of the ESOP Committee, be forfeited; provided, however, that if such Participant or Beneficiary subsequently claims the forfeited amount, it shall be reinstated and paid to such Participant or Beneficiary. Such reinstatement may, in the ESOP Committee’s sole discretion, be made from contributions by one or more Adopting Employers, forfeitures or Trust earnings, and shall be treated as a special allocation that supersedes the normal allocation rules.

     (c) If the ESOP Committee has not, after due diligence, located a Participant or Beneficiary who is entitled to payment within three (3) years after the Participant’s Severance from Service, then, at the discretion of the ESOP Committee, such person may be presumed deceased for purposes of this Plan. Any such presumption of death shall be final, conclusive and binding on all parties.

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9.10 Payments to Incompetents.

     If a Participant or Beneficiary entitled to receive any benefits hereunder is adjudicated to be legally incapable of giving valid receipt and discharge for such benefits, the benefits may be paid to the duly authorized personal representative of such Participant or Beneficiary.

9.11 Offsets.

     Any transfers or payments made from a Participant’s Account to a person other than the Participant pursuant to the provisions of this Plan shall reduce the Participant’s Account and offset any amounts otherwise due to such Participant. Such transfers or payments shall not be considered a forfeiture for purposes of the Plan.

9.12 Income Tax Withholding.

     To the extent required by Section 3405 of the Code, distributions and withdrawals from the Plan shall be subject to federal income tax withholding.

9.13 Common Stock Dividend Distributions.

     With respect to any fiscal year of the Employer in which it is a C corporation (as opposed to an S corporation) in accordance with Section 404(k) of the Code, cash dividends on Common Stock that has been allocated to Participant Accounts may be distributed to Participants and Beneficiaries no later than ninety (90) days after the close of the Plan Year in which the dividends are paid.

9.14 Distributions.

     (a) Time of Distributions Due to Termination of Employment. Except as provided in subsection (b) below, and unless an earlier distribution commencement date is required by another provision of this Plan other than Sections 9.2(a) and 9.2(b), distribution of the Participant’s ESOP Accounts will commence no later than the earlier of:

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     (i) the sixth Plan Year following the Plan Year during which the Participant incurred a Severance from Service, unless the Participant is reemployed before such time, or

     (ii) as soon as administratively feasible after the first Allocation Date following the Participant’s sixty fifth (65th) birthday.

     If a Participant’s ESOP Account includes financed securities as described in Section 409(o)(1)(B) of the Code, then such financed securities shall be deemed not to be part of the Account until the Allocation Date of the Plan Year in which the Acquisition Loan has been fully repaid.

     (b) Time of Distributions Due to Retirement, Death or Disability. Upon a Participant’s Severance from Service after attainment of Normal Retirement Age, Retirement, Disability or death, distribution of the Participant’s ESOP Accounts will begin no later than the earlier of:

     (i) as soon as administratively feasible after the first Allocation Date following the Participant’s Severance from Service under this subparagraph 9.14(b); or

     (ii) one year after the end of the first Plan Year in which the Participant’s Severance from Service after attainment of Normal Retirement Age, Retirement, Disability or death occurs.

     (c) Form of Payment. Except as otherwise provided herein, distributions of vested Common Stock shall be made either in a lump sum, in substantially equal, annual installments over a period not exceeding five (5) years (provided that the period over which installments may be distributed may be extended an additional year, up to an additional five (5) years, for each $175,000 or fraction thereof by which the Participant’s Account exceeds $885,000 as adjusted

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for increases in the cost of living pursuant to Section 409(o)(2) of the Code), or a combination thereof, and that the selection of the option will be made by the ESOP Committee pursuant to a uniform and nondiscriminatory policy; or

     (d) If the Company is an S corporation, or if its Charter or Articles of Incorporation and/or Bylaws restrict the ownership of substantially all outstanding shares of Common Stock to current Employees and the Trust, the distribution of a Participant’s Common Stock may be made entirely in cash without granting the Participant the right to demand a distribution in Common Stock. Alternatively, Common Stock may be distributed subject to the requirement that it be immediately resold to the Company (or to the Trust) under payment terms that comply with Section 9.15. If Company Stock is distributed from the Trust to a Participant who directs that the Company Stock be distributed to his individual retirement arrangement in a direct rollover, then the Company shall repurchase the Company Stock immediately upon the distribution of the Company Stock to the Participant’s individual retirement arrangement.

9.15 Rights, Options and Restrictions on Common Stock.

     (a) Right of First Refusal.

          (1) Any Common Stock distributed by the Trust shall be subject to a right of first refusal. The right of first refusal shall provide that, prior to any subsequent transfer, the Common Stock must first be offered for purchase in writing to the Company, and then to the Trust, at the then Current Market Value.

          (2) The Company and the Trust shall have a total of fourteen (14) days to exercise the right of first refusal on the same terms offered by a prospective buyer.

          (3) The Company may require that a Participant entitled to a distribution of Common Stock execute an appropriate stock transfer agreement evidencing the right of first

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refusal prior to receiving a certificate for Common Stock. The Board of Directors may establish any other reasonable procedures relating to this right of first refusal.

     (b) Put Option.

          (1) The Company shall provide a put option for any Participant or Beneficiary who receives a distribution of Common Stock. The put option shall permit the Participant or Beneficiary to sell such Common Stock to the Company at any time during two option periods, at the then Current Market Value. The Company may allow the Trust to purchase shares of Common Stock tendered to the Company under such a put option.

          (2) The first put option period shall be for at least sixty (60) days beginning on the date of distribution. The second put option period shall be for at least sixty (60) days beginning after the new determination of Current Market Value (and notice to the Participant thereof) in the following Plan Year.

          (3) The payment for any Common Stock sold under such a put option shall be made within thirty (30) days if the shares were distributed as part of an installment distribution.

          (4) If the shares were distributed in a lump-sum distribution, payment shall begin within thirty (30) days and may be made in a lump-sum or in substantially equal, annual installments over a period not exceeding five (5) years, with adequate security provided and interest payable at a reasonable rate on any unpaid installment balance, as determined by the Company.

          (5) The provisions of this Section 9.15(b)(1) and 9.15(b)(2) shall apply only if the Company is a C Corporation.

     (c) Restrictions on Common Stock. Common Stock held or distributed by the Trust may include such legend restrictions on transferability as the Company may reasonably require

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in order to assure compliance with applicable federal and state securities laws. Except as otherwise provided in subsections (a) and (b) above, no shares of Common Stock held or distributed by the Trustees may be subject to a put, call or other option, or buy-sell or similar arrangement. The provisions of this Section 9.15 shall continue to apply to Common Stock even if the Plan ceases to be an employee stock ownership plan under Section 4975(e)(7) of the Code.

     (d) Except as provided in subsections (a) or (b) or as otherwise required by law, no Common Stock acquired with proceeds of an Acquisition Loan may be subject to a put, call, or other option, buy-sell or similar arrangement, while held by or when distributed from the Plan.

     (e) The provisions of this Section are non-terminable and shall continue notwithstanding the repayment of any Acquisition Loan, the proceeds which were used to acquire Common Stock, and notwithstanding the fact that the Plan ceases to be an employee stock ownership plan.

9.16 Price Protection.

     Notwithstanding any other provision of this Plan to the contrary, any Participant who:

     (a) Had an ESOP Rollover Account as of the Closing Date;

     (b) Was at least age 55 on December 31, 2002; and

     (c) On or before December 31, 2007 separates from service for any reason on or after attaining age 60, incurs a Disability or dies, and requests a lump sum distribution from the ESOP Component in conjunction with such event, shall have the right to sell his shares distributed from the Participant’s ESOP Rollover Account that were acquired on the Closing Date to the Company at a value per share equal to the greater of:

          (1) The original purchase price of a share of Common Stock as of the Closing Date, and

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          (2) The then Current Market Value of the Common Stock.

This provision shall also apply if a Participant requests a lump sum distribution, but the ESOP Committee, pursuant to its uniform, nondiscriminatory policy for processing distributions from the ESOP Accounts, converts a Participant’s request for a lump sum distribution into installment payments.

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ARTICLE X

Loans

10.1 Availability of Loans.

     Participants may borrow against all or a portion of the vested balance in the Participant’s Account (“Available Loan Amount”), subject to the limitations set forth in this ARTICLE and any applicable Loan policy adopted by the ESOP Committee. Loans will be made available to all Participants on a reasonably equivalent basis and will not be made available to Highly Compensated Employees in an amount greater than the amount made available to other employees. Participants who have incurred a Severance from Service will not be eligible for a Plan loan.

10.2 Written Loan Policy.

     The ESOP Committee in authorizing a loan to be made to a Participant shall determine all terms of the loan, such as the amount and method of repayment, the repayment period of the loan, the rate of interest to be paid on such loan and the security for the loan. The ESOP Committee shall set forth in writing the rules and regulations with respect to Participant loans which are to provide, at a minimum, the following: (a) the identity of the person or position authorized to administer the loan program; (b) a procedure for applying for loans; (c) the basis on which loans will be approved or denied; (d) limitations (if any) on the types and amount of loans offered; (e) the procedure for determining a reasonable rate of interest; (f) the types of collateral which may secure a loan; and (g) the events constituting default and the steps that will be taken to preserve Plan assets in the event of a default.

10.3 Maximum Amount of Loan.

     No loan in excess of fifty percent (50%) of the Participant’s Available Loan Amount will be permitted. In addition, limits imposed by the Code and any other requirements of applicable

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statute or regulation will be applied. Under the current requirements of the Code, a loan cannot exceed the lesser of one-half (¹/2) of the value of the Participant’s Available Loan Amount or fifty thousand dollars ($50,000) reduced by the excess of (a) the highest outstanding balance of loans by that Participant from the Plan during the one (1) year period ending on the day before the date on which such loan was made, over (b) the outstanding balance of that Participant’s loans from the Plan on the date on which such loan was made. For purposes of the above limitations, all loans from all plans of the Employer or one of the Adopting Employers, and other members of a group of employers described in Section 414(b), (c), (m) and (o) of the Code, are aggregated.

10.4 Repayment Schedule.

     Unless the loan is used to acquire any dwelling unit which within a reasonable time is to be used (determined at the time the loan is made) as the principal residence of the Participant, the loan, under its terms, must be repaid within five (5) years. All repayments shall be made through payroll deductions in accordance with the loan agreement executed at the time the loan is made, except as otherwise provided by the ESOP Committee. The repayment schedule shall provide for substantially level amortization of the loan. Loan repayments will be suspended under this Plan as permitted under Section 414(u) of the Code and as required to comply with an order issued in a bankruptcy proceeding.

10.5 Interest Rate.

     A loan pursuant to this ARTICLE shall bear a reasonable rate of interest that provides a return commensurate with the prevailing interest rate charged on similar loans by persons in the business of lending money.

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10.6 Security for Loans.

     A loan shall be adequately secured with the value and liquidity of the security being such that it may reasonably be anticipated that loss of principal or interest by the Plan will not result from the loan due date to the actual date of enforcement of the security interest in the event of a default. Each loan shall be secured by any security that the ESOP Committee may in its sole discretion require of the Participant, including the Participant’s Available Loan Amount, as long as the Trustee is willing to accept said security. No more than fifty percent (50%) of a Participant’s Available Loan Amount may be used as security for the outstanding balance of all Plan loans made to that Participant. The requirement in the preceding sentence must be satisfied immediately after the origination of each Participant loan secured in whole or in part by any portion of the Participant’s Available Loan Amount.

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ARTICLE XI

Contribution and Benefit Limitations

11.1 Contribution Limits.

     (a) The Annual Additions that may be allocated to a Participant’s Account for any Limitation Year shall not exceed the lesser of:

          (1) forty-four thousand dollars ($44,000); or

          (2) one hundred percent (100%) of the Participant’s Compensation for that Limitation Year.

     (b) If the Employer maintains any other Defined Contribution Plans then the limitations specified in this Section shall be computed with reference to the aggregate Annual Additions for each Participant from all such Defined Contribution Plans.

     (c) If the Annual Additions for a Participant would exceed the limits specified in this Section, then the Annual Additions under this Plan for that Participant shall be reduced to the extent necessary to prevent such limits from being exceeded. Such reduction shall be made in accordance with Section 11.3.

11.2 Annual Adjustments to Limits.

     The dollar limitation for Annual Additions shall be adjusted for cost-of-living to the extent permitted under Section 415(d) of the Code.

11.3 Excess Amounts.

     (a) The foregoing limits shall be limits on the allocation that may be made to a Participant’s Account in any Limitation Year. If an excess Annual Addition would otherwise result from an allocation of forfeitures, reasonable errors in determining Compensation or other comparable reasons, then the ESOP Committee may take any (or all) of the following steps to prevent the excess Annual Additions from being allocated:

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          (1) return any contributions from the Participant, as long as such return is nondiscriminatory;

          (2) hold the excess amounts unallocated in a suspense account and apply the balance of the suspense account against Matching, Qualified Nonelective or Profit Sharing Contributions for that Participant made in succeeding years;

          (3) hold the excess amounts unallocated in a suspense account and apply the balance of the suspense account against succeeding year Matching, Qualified Nonelective or Profit Sharing Contributions;

          (4) reallocate the excess amounts to other Participants.

     (b) Any suspense account established under this Section shall not be credited with income or loss unless otherwise directed by the ESOP Committee. If a suspense account under this Section is to be applied in a subsequent Limitation Year, then the amounts in the suspense account shall be applied before any Annual Additions (other than forfeitures) are made for such Limitation Year.

     (c) The following terms used in this Section 11 shall have the following meanings specified:

          (1) Annual Addition. The sum for any Limitation Year of additions (not including Rollover Contributions) to a Participant’s Account as a result of:

(A) Profit Sharing Contributions (including Matching Contributions, Qualified Nonelective Contributions and Elective Deferrals);

(B) Employee contributions;

(C) forfeitures; and

(D) amounts described in Code Sections 415(l)(1) and 419A(d)(2).

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          (2) Defined Contribution Plan. A plan qualified under Section 401(a) of the Code that provides an individual account for each Participant and benefits based solely on the amount contributed to the Participant’s Account, plus any income, expenses, gains and losses, and forfeitures of other Participants which may be allocated to such Participant’s account.

          (3) Limitation Year. The Plan Year, until the Employer adopts a different Limitation Year.

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ARTICLE XII

Top-Heavy Rules

12.1 General.

     This ARTICLE shall only be applicable if the Plan becomes a Top-Heavy Plan under Section 416 of the Code. If the Plan does not become a Top-Heavy Plan, then none of the provisions of this ARTICLE shall be operative. The provisions of this ARTICLE shall be interpreted and applied in a manner consistent with the requirements of Section 416 of the Code and the regulations thereunder.

12.2 Vesting.

     (a) If the Plan becomes a Top-Heavy Plan, then amounts in a Participant’s Account attributable to Profit Sharing Contributions shall be vested in accordance with ARTICLE VII. This Section shall only apply to Participants who have at least One Hour of Service after the Plan becomes a Top-Heavy Plan.

     (b) If the Plan ceases to be a Top-Heavy Plan then subsection (a) shall no longer be applicable; provided, however, that in no event shall the vested percentage of any Participant be reduced by reason of the Plan ceasing to be a Top-Heavy Plan. Subsection (a) shall nevertheless continue to apply for any Participant who was previously covered by it and who has at least three (3) Years of Top-Heavy Service.

12.3 Minimum Contribution.

     (a) For each Plan Year that the Plan is a Top-Heavy Plan, the Adopting Employers shall make a contribution to be allocated directly to the Account of each Non-Key Employee.

     (b) The amount of the contribution (and forfeitures) required to be contributed and allocated for a Plan Year by this Section is three percent (3%) of the Top-Heavy Compensation for that Plan Year of each Non-Key Employee who is both a Participant and an Employee on the

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last day of the Plan Year for which the contribution is made, with adjustments as provided herein. If the contributions (other than Rollover Contributions) allocated to the Accounts of each Key Employee for a Plan Year are less than three percent (3%) of his or her Top-Heavy Compensation, then the contribution required by the preceding sentence shall be reduced for that Plan Year to the same percentage of Top-Heavy Compensation that was allocated to the Account of the Key Employee whose Account received the greatest allocation of contributions (other than Rollover Contributions) for that Plan Year, when computed as a percentage of Top-Heavy Compensation.

     (c) The contribution required by this Section shall be reduced for a Plan Year to the extent of any contributions made and allocated under this Plan (as permitted under Section 416 of the Code and the regulations thereunder). In addition, to the extent a Participant participates in any other plans of the Employer for a Plan Year, the contribution required by this Section shall be reduced by any contributions allocated or benefits accrued under any such plans. Elective Deferrals shall be treated as if they were contributions for purposes of determining any minimum contributions required under subsection (b). The contribution required by this Section shall be reduced to the extent of any matching contributions under this Plan or any other plan of the Employer.

12.4 Definitions.

     (a) The following terms shall have the meanings specified herein:

          (1) Aggregated Plans.

(A) The Plan, any plan that is part of a “required aggregation group” and any plan that is part of a “permissive aggregation group” that the Adopting Employers treat as an Aggregated Plan.

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(B) The “required aggregation group” consists of each plan of the Adopting Employers in which a Key Employee participates (in the Plan Year containing the Determination Date or any of the four (4) preceding Plan Years) and each other plan of the Adopting Employers which enables any plan of the Adopting Employers in which a Key Employee participates to meet the requirements of Section 401(a)(4) or Section 410(b) of the Code. Also included in the required aggregation group shall be any terminated plan that covered a Key Employee and was maintained within the five (5) year period ending on the Determination Date.

(C) The “permissive aggregation group” consists of any plan not included in the “required aggregation group” if the Aggregated Plan described in subparagraph (A) above would continue to meet the requirements of Section 401(a)(4) and 410 of the Code with such additional plan being taken into account.

          (2) Determination Date. The last day of the preceding Plan Year, or, in the case of the first plan year of any plan, the last day of such plan year. The computations made on the Determination Date shall utilize information from the immediately preceding Allocation Date.

          (3) Key Employee.

(A) An Employee or former Employee (including any deceased Employee) who at any time during the Plan Year that includes the Determination Date was an officer of one of the Adopting Employers having annual Top-Heavy Compensation for the Plan Year greater than one hundred thirty thousand dollar ($130,000) (as adjusted under Section 416(i)(l) of the Code), a five percent (5%) owner of one of the Adopting Employers, or a one percent (1%) owner of one of the Adopting Employers having annual Top-Heavy Compensation of more than one hundred fifty thousand dollars ($150,000). The determination of who is a Key Employee will be made in

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accordance with Section 416(i)(l) of the Code and the applicable regulations and other guidance of general applicability issued thereunder.

(B) Beneficiaries of an Employee shall acquire the character of such Employee and inherited benefits will retain the character of the benefits of the Employee who performed services.

          (4) Non-Key Employee. Any Employee who is not a Key Employee.

          (5) Top-Heavy Compensation. The term Top-Heavy Compensation shall have the same meaning as the term Compensation has under Section 2.34.

          (6) Top-Heavy Plan. The Plan is a Top-Heavy Plan for a Plan Year if, as of the Determination Date for that Plan Year, the sum of (i) the present value of the cumulative accrued benefits for Key Employees under all Defined Benefit Plans that are Aggregated Plans and (ii) the aggregate of the accounts of Key Employees under all Defined Contribution Plans that are Aggregated Plans exceeds sixty percent (60%) of the comparable sum determined for all Employees. For purposes of determining whether the Plan is top-heavy, a Participant’s accrued benefit in a defined benefit plan will be determined under a uniform accrual method which applies in all defined benefit plans maintained by the Employer or, where there is no such method, as if such benefit accrued not more rapidly than the slowest rate of accrual permitted under the fractional rule of Section 411(b)(1)(C) of the Code.

          (7) Years of Top-Heavy Service. The Period of Service with the Adopting Employers that might be counted under Section 411(a) of the Code, disregarding all service that may be disregarded under Section 411(a)(4) of the Code.

     (b) The definitions in this Section and the provisions of this ARTICLE shall be interpreted in a manner consistent with Section 416 of the Code.

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12.5 Special Rules.

     (a) For purposes of determining the present value of the cumulative accrued benefit for any Participant or the amount of the Account of any Participant, such present value or amount shall be increased by the aggregate distributions made with respect to such Participant under the Plan during the one (1) year period ending on the Determination Date. The preceding sentence shall also apply to distributions under a terminated plan which, had it not been terminated, would have been aggregated with the Plan under Section 416(g)(2)(A)(i) of the Code. In the case of a distribution made for a reason other than separation from service, death, or disability, this subsection (2) shall be applied by substituting “five (5) year period” for “one (1) year period.”

     (b) (1) In the case of unrelated rollovers and transfers, the plan making the distribution or transfer is to count the distribution as a distribution under Section 416(g)(3) of the Code. For this purpose, rollovers and transfers are to be considered unrelated if they are both initiated by the Employee and made from a plan maintained by one employer to a plan maintained by another employer.

          (2) In the case of related rollovers and transfers, the plan making the distribution or transfer is not to count the distribution or transfer under Section 416(g)(3) of the Code, and the plan accepting the rollover or transfer counts the rollover or transfer in the present value of the accrued benefits. For this purpose, rollovers and transfers are to be considered related if they are not unrelated under subsection (b)(1).

     (c) If any individual is a Non-Key Employee with respect to any plan for any Plan Year, but such individual was a Key Employee with respect to such plan for any prior Plan Year,

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any accrued benefit for such Employee (and the account of such Employee) shall not be taken into account.

     (d) Beneficiaries of Key Employees and former Key Employees are considered to be Key Employees and Beneficiaries of Non-Key Employees and former Non-Key Employees are considered to be Non-Key Employees.

     (e) The accrued benefit of an Employee who has not performed any service for the Adopting Employer maintaining the Plan at any time during the one (1) year period ending on the Determination Date is excluded from the calculation to determine top-heaviness.

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ARTICLE XIII

The Trust Fund

13.1 Trust.

     During the period in which this Plan remains in existence, the Company or any successor thereto shall maintain in effect at least one Trust with a corporation and/or an individual(s) as Trustee, to hold, invest, and distribute the Trust Fund in accordance with the terms of such Trust. The Trustee shall be appointed by the Board of Directors.

13.2 Investment of Accounts.

     The Trustee shall invest and reinvest the Participant’s accounts in the investment options available under the Plan in accordance with ARTICLE V, as directed by the ESOP Committee or its delegate. The ESOP Committee shall issue such directions in accordance with the investment options selected by the Participants which shall remain in force until altered in accordance with Article V.

13.3 Expenses.

     Expenses of the Plan and Trust shall be paid from the Trust or by the Company, if the Company in its discretion so chooses.

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ARTICLE XIV

Administration of The Plan

14.1 General Administration.

     The general administration of the Plan shall be the responsibility of the ESOP Committee which shall be the named Fiduciary for purposes of ERISA. The ESOP Committee shall have the authority, in its sole discretion, to construe the terms of the Plan and to make determinations as to eligibility for benefits and as to other issues within the “Responsibilities of the ESOP Committee” described in this ARTICLE. All such determinations of the ESOP Committee shall be conclusive and binding on all persons.

14.2 Responsibilities of the ESOP Committee.

     Except as otherwise provided in ERISA, the ESOP Committee (and any other named Fiduciaries) may allocate any duties and responsibilities under the Plan and Trust among themselves in any mutually agreed upon manner. Such allocation shall be in a written document signed by the ESOP Committee (and any other named Fiduciaries) and shall specifically set forth this allocation of duties and responsibilities, which may include the following:

     (a) Determination of all questions which may arise under the Plan with respect to questions of fact and law, including without limitation eligibility for participation, administration of Accounts, membership, vesting, loans, withdrawals, accounting, status of Accounts, stock ownership and voting rights, and any other issue requiring interpretation or application of the Plan.

     (b) Establishment of procedures required by the Plan, such as notification to Employees as to joining the Plan, selecting and changing investment options, suspending deferrals, exercising voting rights in stock, withdrawing and borrowing Account balances,

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designation of Beneficiaries, election of method of distribution, and any other matters requiring a uniform procedure.

     (c) Adoption of necessary amendments to supplement omissions from the Plan or reconcile any inconsistency therein.

     (d) Filing appropriate reports with the government as required by law.

     (e) Appointment of Recordkeepers and investment managers.

     (f) Review at appropriate intervals of the performance of the Trustee and such investment managers as may have been designated.

     (g) Appointment of such additional Fiduciaries as deemed necessary for the effective administration of the Plan, such appointments to be by written instrument.

14.3 Liability for Acts of Other Fiduciaries.

     Each Fiduciary shall be responsible only for the duties allocated or delegated to said Fiduciary, and other Fiduciaries shall not be liable for any breach of fiduciary responsibility with respect to any act or omission of any other Fiduciary unless:

     (a) The Fiduciary knowingly participates in or knowingly attempts to conceal the act or omission of such other Fiduciary and knows that such act or omission constitutes a breach of fiduciary responsibility by the other Fiduciary;

     (b) The Fiduciary has knowledge of a breach of fiduciary responsibility by the other Fiduciary and has not made reasonable efforts under the circumstances to remedy the breach; or

     (c) The Fiduciary’s own breach of his or her specific fiduciary responsibilities has enabled another Fiduciary to commit a breach. No Fiduciary shall be liable for any acts or omissions which occur prior to his or her assumption of Fiduciary status or after his or her termination from such status.

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14.4 Employment by Fiduciaries.

     Any Fiduciary hereunder may employ, with the written approval of the ESOP Committee, one or more persons to render service with regard to any responsibility which has been assigned to such Fiduciary under the terms of the Plan including legal, tax, or investment counsel and may delegate to one or more persons any administrative duties (clerical or otherwise) hereunder.

14.5 Recordkeeping.

     The ESOP Committee shall keep or cause to be kept any necessary data required for determining the Account status of each Participant. In compiling such information, the ESOP Committee may rely upon its employment records, including representations made by the Participant in the employment application and subsequent documents submitted by the Participant to the Employer. The Trustee shall be entitled to rely upon such information when furnished by the ESOP Committee or its delegate. Each Employee shall be required to furnish the ESOP Committee upon request and in such form as prescribed by the ESOP Committee, such personal information, affidavits and authorizations to obtain information as the ESOP Committee may deem appropriate for the proper administration of the Plan, including but not limited to proof of the Employee’s date of birth and the date of birth of any person designated by a Participant as a Beneficiary.

14.6 Claims Review Procedure.

     (a) Except as otherwise provided in this Section 14.6, the ESOP Committee shall make all determinations as to the right of any person to Accounts under the Plan. Any such determination shall be made pursuant to the following procedures, which shall be conducted in a manner designed to comply with Section 503 of ERISA:

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          (1) Step 1. Claims with respect to an Account should be filed by a claimant as soon as practicable after the claimant knows or should know that a dispute has arisen with respect to an Account, but at least thirty (30) days prior to the claimant’s actual retirement date or, if applicable, within sixty (60) days after the death, Disability or Severance from Service of the Participant whose Account is at issue, by mailing a copy of the claim to the ESOP Committee.

          (2) Step 2. In the event that a claim with respect to an Account is wholly or partially denied by the ESOP Committee, the ESOP Committee shall, within ninety (90) days following receipt of the claim, so advise the claimant in writing setting forth: the specific reason or reasons for the denial; specific reference to pertinent Plan provisions on which the denial is based; a description of any additional material or information necessary for the claimant to perfect the claim; an explanation as to why such material or information is necessary; and an explanation of the Plan’s claim review procedure.

          (3) Step 3. Within sixty (60) days following receipt of the denial of a claim with respect to an Account, a claimant desiring to have the denial appealed shall file a request for review by an officer of the Company or a benefit appeals committee, as designated by the ESOP Committee, by mailing a copy thereof to the address shown in subsection (a)(1); provided, however, that such officer or any member of such benefit appeals committee, as applicable, may not be the person who made the initial adverse benefits determination nor a subordinate of such person.

          (4) Step 4. Within thirty (30) days following receipt of a request for review, the designated officer or benefit appeals committee shall provide the claimant a further opportunity to present his or her position. At the designated officer or benefit appeals

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committee’s discretion, such presentation may be through an oral or written presentation. Prior to such presentation, the claimant shall be permitted the opportunity to review pertinent documents and to submit issues and comments in writing. Within a reasonable time following presentation of the claimant’s position, which usually should not exceed thirty (30) days, the designated officer or benefit appeals committee shall inform the claimant in writing of the decision on review setting forth the reasons for such decision and citing pertinent provisions in the Plan.

     (b) Except as otherwise provided in subsection (a), the ESOP Committee is the Fiduciary to whom the Plan grants full discretion, with the advice of counsel: to interpret the Plan; to determine whether a claimant is eligible for benefits; to decide the amount, form and timing of benefits; and to resolve any other matter under the Plan which is raised by a claimant or identified by the ESOP Committee, including but not limited to factual determinations. All questions arising from or in connection with the provisions of the Plan and its administration, not herein provided to be determined by the Board of Directors, shall be determined by the ESOP Committee, and any determination so made shall be conclusive and binding upon all persons affected thereby. Claims for Disability Benefits shall be determined under the final Department of Labor claims procedure regulations (DOL Reg. §2560.503-1) which are hereby incorporated by reference.

14.7 Indemnification of Directors and Employees.

     The Adopting Employers shall indemnify any Fiduciary who is a director, officer or Employee of the Employer, his or her heirs and legal representatives, against all liability and reasonable expense, including counsel fees, amounts paid in settlement and amounts of judgments, fines or penalties, incurred or imposed upon him in connection with any claim,

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action, suit or proceeding, whether civil, criminal, administrative or investigative, by reason of acts or omissions in his or her capacity as a Fiduciary hereunder, provided that such act or omission is not the result of gross negligence or willful misconduct. The Adopting Employers may indemnify other Fiduciaries, their heirs and legal representatives, under the circumstances, and subject to the limitations set forth in the preceding sentence, if such indemnification is determined by the Board of Directors to be in the best interests of the Adopting Employers.

14.8 Immunity from Liability.

     Except to the extent that Section 410(a) of ERISA prohibits the granting of immunity to Fiduciaries from liability for any responsibility, obligation, or duty imposed under Title I, Subtitle B, Part 4, of said Act, an officer, Employee, member of the Board of Directors of the Employer or other person assigned responsibility under this Plan shall be immune from any liability for any action or failure to act except such action or failure to act which results from said officer’s, Employee’s, Participant’s or other person’s own gross negligence or willful misconduct.

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ARTICLE XV

Amendment Or Termination Of Plan

15.1   Right to Amend or Terminate Plan.

          The Company reserves the right at any time or times, by action of the Board of Directors, to modify, amend or terminate the Plan in whole or in part, in which event a certified copy of the resolution of the Board of Directors, authorizing such modification, amendment or termination shall be delivered to the Trustee and to the other Adopting Employers whose Employees are covered by this Plan, provided, however, that no amendment to the Plan shall be made which shall:

          (a) reduce any vested right or interest to which any Participant or Beneficiary is then entitled under this Plan or otherwise reduce the vested rights of a Participant in violation of Section 411(d)(6) of the Code;

          (b) vest in the Adopting Employers any interest or control over any assets of the Trust;

          (c) cause any assets of the Trust to be used for, or diverted to, purposes other than for the exclusive benefit of Participants and their Beneficiaries; or

          (d) change any of the rights, duties or powers of the Trustee without its written consent.

          (e) Notwithstanding the foregoing provisions of this Section or any other provisions of this Plan, any modification or amendment of the Plan may be made retroactively if necessary or appropriate to conform the Plan with, or to satisfy the conditions of, ERISA, the Code, or any other law, governmental regulation or ruling.

In the alternative, subject to the conditions prescribed in subsections (a) through (e), the Plan may be amended by any officer of the Company to whom authority to amend the Plan is

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delegated by the Board of Directors, provided, however, that any such amendment does not, in the view of such officer, materially increase costs of the Plan to the Company or any Adopting Employer.

15.2   Amendment to Vesting Schedule.

          Any amendment that modifies the vesting provisions of ARTICLE VII shall either:

          (a) provide for a rate of vesting that is at least as rapid for any Participant as the vesting schedule previously in effect; or

          (b) provide that any adversely affected Participant with a Period of Service of at least three (3) years may elect, in writing, to remain under the vesting schedule in effect prior to the amendment. Such election must be made within sixty (60) days after the later of the:

(1)	adoption of the amendment;
(2)	effective date of the amendment; or
(3)	issuance by the ESOP Committee of written notice of the amendment.

15.3   Maintenance of Plan.

          The Adopting Employers have established the Plan with the bona fide intention and expectation that they will be able to make contributions indefinitely, but the Adopting Employers are not and shall not be under any obligation or liability whatsoever to continue contributions or to maintain the Plan for any given length of time.

15.4   Termination of Plan and Trust.

          The Plan and Trust hereby created shall terminate upon the occurrence of any of the following events:

          (a) Delivery to the Trustee of a notice of termination executed by the Company specifying the date as of which the Plan and Trust shall terminate; or

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          (b) Adjudication of the Company as bankrupt or general assignment by the Company to or for the benefit of creditors or dissolution of the Company.

Upon termination of this Plan, or permanent discontinuance of contributions hereunder, with or without written notification, the rights of each Participant to the amounts credited to that Participant’s Account at such time shall be fully vested and nonforfeitable. In the event a partial termination of the Plan is deemed to have occurred, each Participant affected shall be fully vested in and shall have a nonforfeitable right to the amounts credited to that Participant’s Account with respect to which the partial termination occurred.

15.5   Distribution on Termination.

          (a) (1) If the Plan is terminated, or contributions permanently discontinued, an Adopting Employer, at its discretion, may (at that time or at any later time) direct the Trustee to distribute the amounts in a Participant’s Account in accordance with the distribution provisions of the Plan. Such distribution shall, notwithstanding any prior provisions of the Plan, be made in a single lump-sum without the Participant’s consent as to the timing of such distribution. If, however, an Adopting Employer (or an Affiliate) maintains an alternative defined contribution plan (other than an employee stock ownership plan), then the preceding sentence shall not apply and the Adopting Employer, at its discretion, may direct such distributions to be made as a direct transfer to such other plan without the Participant’s consent, if the Participant does not consent to an immediate distribution.

               (2) If an Adopting Employer does not direct distribution under paragraph (1), each Participant’s Account shall be maintained until distributed in accordance with the provisions of the Plan (determined without regard to this Section) as though the Plan had not been terminated or contributions discontinued.

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          (b) If the ESOP Committee determines that it is administratively impracticable to make distributions under this Section in cash or that it would be in the Participant’s best interest to make some or all of the distributions with in-kind property, it shall offer all Participants and Beneficiaries entitled to a distribution under this Section a reasonable opportunity to elect to receive a distribution of the in-kind property being distributed by the Trust. Those Participants and Beneficiaries so electing shall receive a proportionate share of such in-kind property in the form (outright, in trust or in partnership) that the ESOP Committee determines will provide the most feasible method of distribution.

          (c) (1) Amounts attributable to elective contributions shall only be distributable by reason of this Section if one of the following is applicable:

(A) the Plan is terminated without the establishment or maintenance of another defined contribution plan (other than an employee stock ownership plan);

               (2) For purposes of this subsection, the term “elective contributions” means employer contributions made to the Plan that were subject to a cash or deferred election under a cash or deferred arrangement.

               (3) Elective contributions are distributable under subsections (c)(1)(B) and (C) above only if the Adopting Employers continue to maintain the Plan after the disposition.

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ARTICLE XVI

Additional Provisions

16.1   Effect of Merger, Consolidation or Transfer.

          In the event of any merger or consolidation with or transfer of assets or liabilities to any other plan or to this Plan, each Participant of the Plan shall be entitled to a benefit immediately after the merger, consolidation or transfer, which is equal to or greater than the benefit he or she would have been entitled to receive immediately before the merger, consolidation or transfer (if the Plan had been terminated).

16.2   No Assignment.

          (a) Except as provided herein, the right of any Participant or Beneficiary to any benefit or to any payment hereunder shall not be subject to alienation, assignment, garnishment, attachment, execution or levy of any kind.

          (b) Subsection (a) shall not apply to any payment or transfer permitted by the Internal Revenue Service pursuant to regulations issued under Section 401(a)(13) of the Code.

          (c) Subsection (a) shall not apply to any payment or transfer pursuant to a Qualified Domestic Relations Order.

          (d) Subsection (a) shall not apply to any payment or transfer to the Trust in accordance with Section 401(a)(13)(C) of the Code to satisfy the Participant’s liabilities to the Plan or Trust in any one or more of the following circumstances:

               (1) the Participant is convicted of a crime involving the Plan;

               (2) a civil judgment (or consent order or decree) in an action is brought against the Participant in connection with an ERISA fiduciary violation; or

               (3) the Participant enters into a settlement agreement with the Department of Labor over an ERISA fiduciary violation.

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16.3   Limitation of Rights of Employees.

          This Plan is strictly a voluntary undertaking on the part of the Adopting Employers and shall not be deemed to constitute a contract between any of the Adopting Employers and any Employee, or to be a consideration for, or an inducement to, or a condition of the employment of any Employee. Nothing contained in the Plan shall be deemed to give any Employee the right to be retained in the service of any of the Adopting Employers or shall interfere with the right of any of the Adopting Employers to discharge or otherwise terminate the employment of any Employee of an Adopting Employer at any time. No Employee shall be entitled to any right or claim hereunder except to the extent such right is specifically fixed under the terms of the Plan.

16.4   Construction.

          The provisions of this Plan shall be interpreted and construed in accordance with the requirements of the Code and ERISA. Any amendment or restatement of the Plan or Trust that would otherwise violate the requirements of Section 411(d)(6) of the Code or otherwise cause the Plan or Trust to cease to be qualified under Section 401(a) of the Code shall be deemed to be invalid. Capitalized terms shall have meanings as defined herein. Singular nouns shall be read as plural, masculine pronouns shall be read as feminine and vice versa, as appropriate. References to “Section” or “ARTICLE” shall be read as references to appropriate provisions of this Plan, unless otherwise indicated.

16.5   Company Determinations.

          Any determinations, actions or decisions of the Company (including but not limited to, Plan amendments and Plan termination) shall be made by its Board of Directors in accordance with its established procedures or by such other individuals, groups or organizations that have been properly delegated by the Board of Directors to make such determination or decision.

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16.6   Continued Qualification.

          This Plan is established with the intent that it shall qualify under Sections 401(a), 401(k) and 4975(e)(7) of the Code as those Sections exist at the time the Plan is amended and restated. If the Internal Revenue Service determines that the Plan does not meet those requirements, the Plan shall be amended retroactively as necessary to correct any such inadequacy.

16.7   Governing Law.

          This Plan shall be governed by, construed and administered in accordance with ERISA and any other applicable federal law; provided, however, that to the extent not preempted by federal law, this Plan shall be governed by, construed and administered under the laws of the State of Delaware, other than its laws respecting choice of law.

*   *   *

          To record the adoption of the Plan, the undersigned has executed the Plan on behalf of the Employer on this 29^th day of January, 2007.

ATTEST:		ALION SCIENCE AND TECHNOLOGY CORPORATION
/s/ Joshua Izenberg
	By:	/s/ Bahman Atefi
	Title:	Chief Executive Officer

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Exhibit A

Adopting Employers and Special Plan Provisions for Certain Adopting Employers

Name	Effective Date of Adoption
Alion Science and Technology Corporation	December 19, 2001
Human Factors Applications, Inc.	December 20, 2002
Washington Consulting, Inc.	February 25, 2006

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Exhibit B

Special Withdrawal and Distribution Provisions

A Participant who was a participant in the Human Factors Applications, Inc. Profit Sharing and 401(k) Plan (“HFA 401(k) Plan”) and whose accounts under the HFA 401(k) Plan were transferred to the Plan in connection with the merger of the HFA 401(k) Plan with and into the Plan, shall be subject to the following special withdrawal and distribution provisions with respect to his HFA Accounts under the Plan:

1.	Such a Participant (or his Beneficiary) may elect a distribution from his HFA Accounts, at any time after his Severance from Service.
2.	Such a Participant who has attained at least age fifty-nine and one-half (591/2) may elect a withdrawal from his HFA Deferral Account and HFA Matching Account, at any time before his Severance from Service.
3.	Such a Participant may elect a withdrawal from his HFA Deferral Account before his Severance from Service, in the event of a hardship, in accordance with the rules for a hardship withdrawal of Elective Deferrals in Section 8.1 of the Plan.
4.	Such a Participant may elect a withdrawal from his HFA Rollover Account, at any time before his Severance from Service.

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Exhibit B

Special Withdrawal and Distribution Provisions (continued)

Innovative Technology Solutions
401(k) Profit Sharing Plan & Trust

A Participant who was a participant in the Innovative Technology Solutions 401(k) Profit Sharing Plan & Trust (“ITSC 401(k) Plan”) and whose accounts under the ITSC 401(k) Plan were transferred to the Plan in connection with the merger of the ITSC 401(k) Plan with and into the Plan, shall be subject to the following special withdrawal and distribution provisions with respect to his one hundred percent (100%) vested interest in his ITSC Accounts under the Plan (i.e., his ITSC Elective Deferral Account, ITSC Money Purchase Pension Plan Account, ITSC Employer Contributions Account (consisting of the three separate accounts under the ITSC 401(k) Plan attributable to safe harbor nonelective employer contributions, discretionary nonelective employer contributions and matching employer contributions) and ITSC Rollover Account):

1.	Such a Participant (or his Beneficiary) may elect a withdrawal from his Non-ESOP ITSC Elective Deferral Account after attainment of age fifty-nine and one-half (59 1/2).
2.	Such a Participant (or his Beneficiary) may elect a distribution from his ITSC Accounts, at any time after his Severance from Service.
3.	Such a Participant who has attained the later of (a) age sixty-five (65), and (b) the fifth (5th) anniversary of his employment commencement date with Innovative Technology Solutions Corporation, may elect a withdrawal from his ITSC Accounts (including his ITSC Money Purchase Pension Plan Account), at any time before his Severance from Service.

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4.	Such a Participant may elect a withdrawal from his ITSC Elective Deferral Account (excluding earnings) before his Severance from Service, in the event of a hardship, in accordance with the rules for a hardship withdrawal of Elective Deferrals in Section 8.1 of the Plan.
5.	Such a Participant may elect a withdrawal from his ITSC Rollover Account, at any time before his Severance from Service.
6.	Regardless of 1. through 4. above, no portion of such a Participant’s ITSC Accounts may be used as security for a loan unless, at the time the security interest is entered into, the Participant’s spouse, if any, consents to the use of the Participant’s ITSC Accounts as security. Such consent must acknowledge the effect of the consent, be signed within the ninety (90) day period ending on the date on which the loan is to be so secured, and be witnessed by a Plan representative or notary public. Such consent shall thereafter be binding with respect to the consenting spouse or any subsequent spouse with respect to that loan. A new consent shall be required if the Participant’s ITSC Accounts are used as security for the renegotiation, extension, renewal or other revision of the loan.
	Regardless, no spousal consent for a loan for which a Participant’s ITSC Accounts (other than his ITSC Money Purchase Pension Plan Account) is being used as security is required on or after April 1, 2004.

7. Regardless of 1. through 4. above, no in-service withdrawal may be made from such a Participant’s ITSC Accounts unless the Participant’s spouse, if any, consents to the withdrawal. Such consent must acknowledge the effect of the withdrawal, be signed within the ninety (90) day period ending on the date of the withdrawal, and be witnessed

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by a Plan representative or notary public. In addition, an in-service withdrawal from such a Participant’s ITSC Accounts shall be made in a joint and 50% survivor annuity (if married) or a single life annuity (if unmarried), as described in 7. below, unless he elects a lump sum payment and his spouse consents to such payment in accordance with the rules in 7. below.

Regardless, no spousal consent for a withdrawal from a Participant’s ITSC Accounts (other than his ITSC Money Purchase Pension Plan Account) is required on or after April 1, 2004. No in-service withdrawal from a Participant’s ITSC Accounts (other than his ITSC Money Purchase Pension Plan Account) on or after April 1, 2004 shall be available in the form of an annuity.

8. Such a Participant whose Accounts under this Plan exceed Five Thousand Dollars ($5,000), shall be paid his ITSC Accounts in a joint and 50% survivor annuity (if married) or a single life annuity (if unmarried), unless he elects installment payments from the Trust Fund (subject to his right to elect at any time to accelerate the installment payments or to elect a lump sum for the remainder of his ITSC Account), a combination of a lump sum and installment payments from the Trust Fund, a joint and 75% survivor annuity (if married), a joint and 100% survivor annuity (if married) or an optional form of payment available under this Plan. The amount payable monthly under the annuity forms described in the preceding sentence shall be the amount that can be purchased from an insurance company selected by the ESOP Committee, in its sole discretion, with the amount in his ITSC Accounts. The joint and 50% survivor annuity for a married

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Participant shall be payable monthly to the Participant during the Participant’s lifetime after retirement with fifty percent (50%) of such benefit continued to the Participant’s spouse for the duration of the spouse’s lifetime after the death of the Participant. Any such election of the Participant must be made in writing not more than one hundred and eighty (180) days (ninety (90) days for distributions made on or before December 31, 2006) before benefit payments begin, consented to by his spouse and filed with the ESOP Committee. The election must designate a form of benefit payment, and a specific alternate Beneficiary (including any class of Beneficiaries or any contingent Beneficiaries), which may not be changed without spousal consent. The spouse’s consent must acknowledge the effect of the election. Consent of a prior spouse shall be invalid with respect to a current spouse. Before any payment is made, the Participant must have received from the ESOP Committee written notification that an election is available and a general description of the terms of the methods of payment. The Participant may request within sixty (60) days of the receipt of his notice of election an explanation in nontechnical language of the terms and conditions of the joint and 50% survivor annuity or other ESOP forms of payment and the effect of its selection. The ESOP Committee shall respond within thirty (30) days of the receipt of the Participant’s request for additional information. The Participant shall have at least one hundred and eighty (180) days (ninety (90) days for distributions made on or before December 31, 2006) after receiving the written explanation in which to make his selection. The Participant may change his election at any time before payments begin. However, if a married Participant elects the joint and 50% survivor annuity and then changes his election, he may change

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his election only with the written consent of his spouse. Consent of the Participant’s spouse must be witnessed by a Plan representative or notary public.

Notwithstanding anything in this Plan to the contrary, as permitted by Section 1.411(d)-4 Q&A 2(e) of the Income Tax Regulations, a distribution from such a Participant’s ITSC Accounts (other than his ITSC Money Purchase Pension Plan Account) with a benefit commencement date on or after April 1, 2004 shall no longer be available in the form of a joint and 50%, 75% or 100% survivor annuity (if married), a single life annuity (if unmarried), installment payments from the Trust Fund or a combination of a lump sum and installment payments from the Trust Fund. No spousal consent shall be required for such a distribution. A distribution from such a Participant’s ITSC Money Purchase Pension Plan Account with a benefit commencement date on or after April 1, 2004 shall no longer be available in the form of a joint and 75% survivor annuity (if married), installment payments from the Trust Fund or a combination of a lump sum and installment payments from the Trust Fund.

9. If such a Participant is married and dies before his benefit commencement date, and his Accounts under the Plan exceed Five Thousand Dollars ($5,000), one hundred percent (100%) of the Participant’s ITSC Accounts shall be paid to the Participant’s surviving spouse in the form of a single life annuity. The amount payable monthly under the preceding sentence shall be the amount that can be purchased from an insurance company selected by the ESOP Committee, in its sole discretion, with the amount in his ITSC Accounts. The annuity shall be payable monthly to the surviving spouse for the

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surviving spouse’s lifetime. A Participant’s spouse may direct that payment under such annuity commence within a reasonable period after the Participant’s death. If the spouse does not so direct, payment under such annuity shall commence at the time the Participant would have attained his Normal Retirement Age. Such a Participant shall have the right, during the election period, to elect to have his death benefits paid to another Beneficiary or under an optional form of payment permitted under the Plan. Regardless of the preceding sentences, such a Participant (whether or not married) may elect at any time that his ITSC Accounts be paid in the form of installment payments from the Trust Fund (subject to his Beneficiary’s right to elect to accelerate the installment payments or to elect a lump sum for the remainder of his ITSC Accounts). Any such election of a Participant must be made in writing, consented to by his spouse, and filed with the ESOP Committee. Consent of the Participant’s spouse must be witnessed by a Plan representative or notary public. The election must designate a specific alternate beneficiary (including any contingent beneficiaries) that may not be changed without spousal consent. The spouse’s consent must acknowledge the effect of the election. Any consent by a spouse shall be effective only with respect to such spouse. The election period shall be the period which begins on the first day of the Plan Year in which the Participant attains age thirty-five (35) and ends on the date of the Participant’s death. If a Participant terminates employment with the Employer prior to the first day of the Plan Year in which he attains age thirty-five (35), with respect to his ITSC Accounts as of the date of termination, the election period shall begin on the date of separation. A Participant who will not yet attain age thirty-five (35) as of the end of any current Plan Year may make a special qualified election to designate another Beneficiary for the

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period beginning on the date of such election and ending on the first day of the Plan Year in which he will attain age thirty-five (35). Such election shall not be valid unless the Participant receives a written explanation comparable to the explanation to be provided during the applicable period (as described below). The Participant’s spouse will automatically be reinstated as his Beneficiary as of the first day of the Plan Year in which he attains age thirty-five (35), subject to his right to elect to designate another Beneficiary. The ESOP Committee shall provide each Participant within the applicable period a written explanation of: (a) the terms and conditions of the surviving spouse benefit; (b) the Participant’s right to make, and the effect of, an election to designate another Beneficiary or an alternative form of distribution; (c) the rights of the Participant’s spouse; (d) the right to make, and the effect of a revocation of a previous election to designate another Beneficiary or an alternative form of distribution; and (e) the relative values of the various optional methods of payment under the Plan. For this purpose, the applicable period shall mean the period beginning with the first day of the Plan Year in which the Participant attains age thirty-two (32) and ending with the close of the Plan Year preceding the Plan Year in which the Participant attains age thirty-five (35). Regardless, if a Participant enters the Plan or first becomes subject to the requirements of this paragraph after the first day of the Plan Year in which the Participant attained age thirty-five (35), the applicable period shall continue for the one (1) year period after the date on which the Participant commenced participation in the Plan or first becomes subject to the requirements of this paragraph, if later. If a Participant separates from service before attaining age thirty-five (35), the applicable period shall begin one (1) year before the date the Participate separates from service and end one (1) year after

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the Participant separated from service. The Participant and his spouse may change their election at any time before the Participant’s death.

Notwithstanding anything in this Plan to the contrary, as permitted by Section 1.411(d)-4 Q&A 2(e) of the Income Tax Regulations, a death benefit distribution from such a Participant’s ITSC Accounts (other than his ITSC Money Purchase Pension Plan Account) with a benefit commencement date on or after April 1, 2004 shall no longer be available in the form of a single life annuity or installment payments from the Trust Fund. No spousal consent shall be required for such a distribution. A death benefit distribution from such a Participant’s ITSC Money Purchase Pension Plan Account with a benefit commencement date on or after April 1, 2004 shall no longer be available in the form of installment payments from the Trust Fund.

10. If a former Participant in the ITSC 401(k) Plan who had forfeited before January 1, 2004 his nonvested interest in his account(s) under that plan attributable to employer contributions subject to a vesting schedule under that plan, is rehired on or after January 1, 2004 by the Employer before the occurrence of five (5) consecutive Breaks in Service (as defined in Section 7.4), his nonvested interest that was forfeited before January 1, 2004 under the ITSC 401(k) Plan shall be recredited (without adjustment for earnings) as of the date of his reemployment to his ITSC Employer Contributions Account from a special Employer contribution to the Plan. Such a Participant shall be one hundred percent (100%) vested in his ITSC Employer Contributions Account. Further, a former Participant in the ITSC 401(k) Plan who is rehired on or after

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January 1, 2004 by the Employer may not repay to the Plan any prior distributions from the ITSC 401(k) Plan.

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Exhibit C

Designation of Current Year Method for ADP and ACP Testing

(Plan Sections and 4.11(c)(1) and (2))

Except as otherwise provided below, the ESOP Committee shall use the “Current Year Method” for complying with the nondiscrimination requirements in Sections 401(k) and (m) of the Code:
Testing Plan *                                                                                   Plan Year(s)

* The “Testing Plan” can be the entire Plan, or one or more disaggregated “Testing Plans” as permitted under the applicable regulations or
    other guidance.

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Supplement No. 1

John J. McMullen Associates, Inc. 401(k) Retirement Plan and John J. McMullen
Associates, Inc.Employee Stock Ownership Plan

          1.1 Purpose. The purpose of this Supplement 1 is to set forth provisions applicable to individuals who were previously participants in the John J. McMullen Associates, Inc. 401(k) Retirement Plan (“Former JJMA 401(k) Participants”) and/or the John J. McMullen Associates, Inc. Employee Stock Ownership Plan (“Former JJMA ESOP Participants”) (collectively the “Former JJMA Participants”) immediately before the merger of those plans into this Plan and who became participants in the Plan upon the transfer of assets from those plans to this Plan, or such earlier date as provided in Section 1.4. Except to the extent expressly modified by this Supplement 1, the provisions of the Plan shall apply to the participation of such Former JJMA Participants. The provisions of this Supplement 1 shall, unless provided otherwise, be effective for Former JJMA 401(k) Participants as of the date assets were transferred from the John J. McMullen Associates, Inc. 401(k) Retirement Plan to this Plan (the “JJMA 401(k) Merger Date”). The provisions of this Supplement I shall, unless provided otherwise, be effective for a Former JJMA ESOP Participant as of the date assets were transferred from the John J. McMullen Associates, Inc. Employee Stock Ownership Plan into the ESOP Component of this Plan (the “JJMA ESOP Merger Date”). Notwithstanding the foregoing, the provisions of the Plan and this Supplement shall amend the provisions of the JJMA 401(k) Plan and the JJMA ESOP as they exist before the JJMA 401(k) Merger Date or the JJMA ESOP Merger Date, as the case may be, to the extent necessary to comply with statutory changes to the Code and ERISA effective as of effective date of the applicable statutory change.

          1.2 Former JJMA Participants. Participant shall include a former employee whose account under the JJMA 401(k) Plan or JJMA ESOP was transferred to the Plan.

          1.3 Employment Commencement Date. In no event shall a Former JJMA Participant’s Employment Commencement Date be before JJMA becomes an Affiliate of the Company.

          1.4 Participation. A Former JJMA Participant who is an Eligible Employee on April 1, 2005 shall become a Participant in the Plan as of such date. Such a Former JJMA Participant shall become eligible to contribute to the Plan as of the first day of the first payroll period beginning on or after April 1, 2005. For purposes of determining eligibility for Matching Contribution and any Profit Sharing Contribution, a Former JJMA Participant’s Period of Service shall include the longer of his or her (a) ”year of eligibility service” under the JJMA 401(k) Plan as of April 1, 2005, or (b) ”years of service” under the JJMA ESOP as of April 1, 2005.

          1.5 Special ESOP Component Election. A Former JJMA Participant may elect during the 90-day election period beginning on April 2, 2005 to have all or a portion of the following amounts invested in Common Stock (a) the amounts transferred to the Plan from his or her JJMA 401(k) Plan (excluding any amounts credited to the JJMA 401(k) Voluntary Contributions Account and the JJMA 401(k) Qualified Voluntary Employee Contributions Account and amounts invested in an outstanding loan), and/or (b) any cash transferred to the Plan attributable

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to his or her JJMA ESOP account. Any eligible amounts in a Participant’s JJMA 401(k) Plan account that a Participant elects to invest in Common Stock will be transferred to the ESOP Component on the last day of the election period where they will be accumulated in a short term interest fund in the ESOP Component of the Plan, and then converted to Common Stock on the special investment date coincident with or next following the Allocation Date based on the then Current Market Value, provided the Participant is an Employee on that date. Any cash amounts in a Participant’s JJMA ESOP account will be initially accumulated in a short term interest fund in the ESOP Component of the Plan. Thereafter, the portion of those amounts the Participant elects to invest in Common Stock will be converted to Common Stock on the investment date coincident with or next following the Allocation Date based on the then Current Market Value, provided the Participant is an Employee on that date, and the portion of those amounts that are not invested in Common Stock will be transferred to the Non ESOP Component and invested as if it were a new contribution.

          1.6 Mapping of Investments. Except as provided in Section 1.5, a Former JJMA Participant’s account under the JJMA 401(k) Plan which is transferred to this Plan shall be invested in the Non ESOP Component Funds that the ESOP Committee, or its delegate, determines most closely resemble the investment funds under the JJMA Plan in which such account was invested immediately before the transfer. A Former JJMA Participant’s account under the JJMA ESOP which is transferred to this Plan shall be invested pursuant to Section 1.5.

          1.7 Diversification. For purposes of Plan Section 5.2, a Former JJMA Participant’s Period of Participation shall include the period of time during which he or she participated in the JJMA ESOP. For purposes of Plan Section 5.2, a Former JJMA Participant’s “years of employment” shall not include his or her employment with JJMA before the date on which JJMA became an Employer under the Plan.

          1.8 Vesting. A Former JJMA Participant who is an Employee on April 1, 2005 shall be fully vested in his or her benefit under the JJMA 401(k) Plan as of April 1, 2005. A Former JJMA ESOP Participant who is an Employee on April 1, 2005 shall be fully vested in his or her benefit under the JJMA ESOP as of April 1, 2005. For purposes of determining a Former JJMA Participant’s vested percentage in his or her Profit Sharing Contributions under the Plan, such Participant’s Period of Service shall include the longer of (a) his or her “continuous service” under the JJMA 401(k) Plan as of April 1, 2005, or (b) his or her “credited service” under the JJMA ESOP as of April 1, 2005. For a Former JJMA ESOP Participant, his or her 2005 service for purposes of vesting under the Plan shall equal the greater of (a) his or her service determined under the Plan’s rules for determining Period of Service for 2005 (including any service with JJMA between January 1, 2005 and his or her Employment Commencement Date) and (b) his or her credited service for 2005 determined under the JJMA ESOP as of April 1, 2005.

          If a Former JJMA Participant who was not an Employee when the JJMA 401(k) Plan is merged into this Plan is reemployed by the Employer or an Affiliate without incurring a five-year Period of Severance –

(a) the amount of his or her forfeitures under the JJMA 401(k) Plan and/or the JJMA ESOP shall be restored to his or her Account as of the last day of the Plan Year in which he or she is reemployed and shall be deducted from forfeitures which

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otherwise would be allocable for such year or, to the extent such forfeitures are insufficient, shall require a supplemental contribution from the Employer; and

(b) such restored amounts will be fully vested upon restoration.

          1.9 In-Service Withdrawals. Subject to Plan Sections 8.1(a)(2) and 8.3, the following in-service withdrawal options are available to Former JJMA 401(k) Participants:

(a)	A Former JJMA 401(k) Participant may elect a withdrawal from his JJMA 401(k) Payroll Deferral Account under the Non ESOP Component on or after attainment of age fifty-nine and one-half (59 1/2 ).
(b)	A Former JJMA 401(k) Participant may elect a withdrawal from his JJMA 401(k) Payroll Deferral Account (excluding all earnings after December 31, 1988) under the Non ESOP Component in accordance with the rules for a hardship withdrawal of Elective Deferrals in Plan Section 8.1.
(c)	A Former JJMA 401(k) Participant may withdraw all or a portion of his or her JJMA 401(k) Voluntary Contributions Account, JJMA 401(k) Qualified Voluntary Employee Contributions Account and JJMA 401(k) Plan Rollover Account under the Non ESOP Component at anytime.
(d)	A Former JJMA 401(k) Participant may withdraw amounts credited prior to July 1, 1990 to his JJMA 401(k) Company Contributions Account under the Non ESOP Component by demonstrating financial need to the ESOP Committee. For this purpose only, financial need shall mean expenses arising as a result of an accident or illness of the Participant or his dependents, or the purchase, construction or repair of the Participant’s principal residence. This financial need withdrawal option is only available if the Participant has withdrawn all other amounts available to him under the Plan.

          1.10 Special Distribution Rules. A Former JJMA ESOP Participant shall have the right to receive his or her account under the JJMA ESOP which were transferred from the JJMA 401(k) Plan in June 1998 and were subsequently converted to Common Stock as a result of the Company’s acquisition of JJMA (a) in annual installments beginning as soon as administratively feasible following the Allocation Date coinciding with or next following the Participant’s Severance from Service and paid over a period of five years or such longer period as permitted under Section 409 of the Code, and (b) in cash. A Former JJMA Participant shall have the right to receive his or her JJMA Money Purchase Pension Account under the Non ESOP Component in the form of a qualified joint and survivor annuity or paid as a qualified preretirement survivor annuity, to the extent required by Section 411(d)(6) of the Code.

          1.11 Merger of JJMA Plans. Effective as of the JJMA 401(k) Merger Date, all accrued benefits under the JJMA 401(k) Plan shall become accrued benefits under the Plan. Effective as of the JJMA ESOP Merger Date, all accrued benefits under the JJMA ESOP shall become accrued benefits under the Plan.

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Supplement No. 2

BMH Associates, Inc. Profit Sharing 401(k) Plan

1.1 Purpose. The purpose of this Supplement No. 2 is to set forth provisions applicable to individuals (“Former BMH Participants”) who were previously participants in the BMH Associates, Inc. Profit Sharing 401(k) Plan (“BMH Plan”) immediately before the acquisition of BMH Associates, Inc. by the Company and who became participants in the Plan on February 11, 2006 as provided in Section 1.4. Except to the extent expressly modified by this Supplement No. 2, the provisions of the Plan shall apply to the participation of such Former BMH Participants as of the date assets are transferred from the BMH Plan to this Plan.

1.2 Former BMH Participants. A Participant shall include any former employee whose account under the BMH Plan was transferred to the Plan.

1.3 Employment Commencement Date. In no event shall a Former BMH Participant’s Employment Commencement Date be before February 11, 2006.

1.4 Participation. A Former BMH Participant who is an Eligible Employee on February 11, 2006 shall become a Participant in the Plan as of such date. Such a Former BMH Participant shall become eligible to contribute to the Plan as of the first day of the first payroll period beginning on or after February 11, 2006. For purposes of determining eligibility for Matching Contribution and any Profit Sharing Contribution, a Former BMH Participant’s Period of Service shall include his or her service with BMH as of February 10, 2006. For purposes of determining the amount of any Matching Contribution and any Profit Sharing Contribution for the Plan Year ending September 30, 2006, a Former BMH Participant’s Compensation shall only include amounts paid by the Company after the later of February 10, 2006 or the date on which such person satisfies the eligibility requirements for such contribution.

1.5 Mapping of Investments. Except as provided in Section 5.1(j) of the Plan, a Former BMH Participant’s account under the BMH Plan which is transferred to this Plan shall be invested in the Non ESOP Component Funds that the ESOP Committee, or its delegate, determines most closely resemble the investment funds under the BMH Plan in which such account was invested immediately before the transfer.

1.6 Diversification. For purposes of Plan Section 5.2, a Former BMH Participant’s Period of Participation shall not include the period of time during which he or she participated in the BMH Plan. For purposes of Plan Section 5.2, a Former BMH Participant’s “years of employment” shall not include his or her employment with BMH Associates, Inc.

1.7 Vesting. A Former BMH Participant who is an Employee on February 11, 2006 shall be fully vested in his or her Profit Sharing Contributions under the Plan.

1.8 In-Service Withdrawals. Subject to Plan Sections 8.1(a)(2) and 8.3, a Former BMH Participant may withdraw from the Non ESOP Component any portion or all of his or her account under the BMH Plan which is transferred to this Plan on or after attainment of age fifty-nine and one-half (59¹/2). In addition, a Former BMH Participant may withdraw all or a portion of his or her (1) BMH Pre-Tax Contributions Account (excluding earnings), (2) BMH Profit

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Sharing Account, and (3) BMH Rollover Account, in the event of a hardship in accordance with the terms and conditions prescribed in Sections 8.1(b) and 8.3.

1.9 Merger of BMH Plan. Effective as of February 10, 2006, all accrued benefits under the BMH Plan shall become accrued benefits under this Plan.

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Supplement No. 3

MA&D 401(k) Plan

1.1 Purpose. The purpose of this Supplement No. 3 is to set forth provisions applicable to individuals (“Former MA&D Participants”) who were previously participants in the MA&D 401(k) Plan (“MA&D Plan”) immediately before the acquisition of Micro Analysis & Design, Inc. by the Company and who became participants in the Plan on May 20, 2006 (“MA&D Plan Merger Date”) as provided in Section 1.4 below. Except to the extent expressly modified by this Supplement No. 3, the provisions of the Plan shall apply to the participation of such Former MA&D Participants as of the date assets are transferred from the MA&D Plan to this Plan.

1.2 Former MA&D Participants. A Participant shall include any former employee whose account under the MA&D Plan was transferred to the Plan.

1.3 Employment Commencement Date. In no event shall a Former MA&D Participant’s Employment Commencement Date be before the MA&D Plan Merger Date.

1.4 Participation. A Former MA&D Participant who is an Eligible Employee on the MA&D Plan Merger Date shall become a Participant in the Plan as of such date. Such a Former MA&D Participant shall become eligible to contribute to the Plan as of the first day of the first payroll period beginning on or after the MA&D Plan Merger Date. For purposes of determining eligibility for Matching Contribution and any Profit Sharing Contribution, a Former MA&D Participant’s Period of Service shall include his or her service with MA&D as of the MA&D Plan Merger Date. For purposes of determining the amount of any Matching Contribution and any Profit Sharing Contribution for the Plan Year ending September 30, 2006, a Former MA&D Participant’s Compensation shall only include amounts paid by the Company after the later of the MA&D Plan Merger Date or the date on which such person satisfies the eligibility requirements for such contribution.

1.5 Mapping of Investments. Except as provided in Section 5.1(j) of the Plan, a Former MA&D Participant’s account under the MA&D Plan which is transferred to this Plan shall be invested in the Non ESOP Component Funds that the ESOP Committee, or its delegate, determines most closely resemble the investment funds under the MA&D Plan in which such account was invested immediately before the transfer.

1.6 Diversification. For purposes of Plan Section 5.2, a Former MA&D Participant’s Period of Participation shall not include the period of time during which he or she participated in the MA&D Plan. For purposes of Plan Section 5.2, a Former MA&D Participant’s “years of employment” shall not include his or her employment with MA&D Analysis & Design, Inc.

1.7 Vesting. A Former MA&D Participant who is an Employee on the MA&D Plan Merger Date shall be fully vested in his or her account balances under the MA&D Plan.

          If a Former MA&D Participant who was not an Employee on the MA&D Plan Merger Date is merged into this Plan is reemployed by the Employer or an Affiliate without incurring a five-year Period of Severance –

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(a)

the amount of his or her forfeitures of account balances attributable to the MA&D Plan shall be restored to his or her Account as of the last day of the Plan Year in which he or she is reemployed and shall be deducted from forfeitures which otherwise would be allocable for such year or, to the extent such forfeitures are insufficient, shall require a supplemental contribution from the Employer; and

(b)

such restored amounts will be fully vested upon restoration.

1.8 Normal Retirement Age. The Normal Retirement Age for a Former MA&D Participant with respect to account balances under the Non ESOP Component shall be age 60.

1.9 In-Service Withdrawals. A Former MA&D Participant may withdraw from the Non ESOP Component any portion or all of his or her account under the MA&D Plan which is transferred to this Plan on or after attainment of age fifty-nine and one-half (59¹/2). In addition, a Former MA&D Participant may withdraw from the Non ESOP Component: (a) any portion or all of his or her MA&D Rollover Account at any time; and (b) any portion or all of his or her MA&D Pre-Tax Contributions Account (excluding earnings) and MA&D Rollover Account in the event of a hardship in accordance with the terms and conditions prescribed in Sections 8.1 and 8.3.

1.10 Merger of MA&D Plan. All accrued benefits under the MA&D Plan shall become accrued benefits under this Plan.

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EX-5.1

Exhibit 5.1

April 30, 2007

Alion Science and Technology Corporation
1750 Tysons Boulevard, Suite 1300
McLean, VA 22102

Ladies and Gentlemen:

     We have acted as securities counsel for Alion Science and Technology Corporation, a Delaware Corporation (the “Company”), in connection with its filing with the Securities and Exchange Commission (the “SEC”) of a registration statement on Form S-4 (the “Registration Statement”) under the Securities Act of 1933, as amended (the “Securities Act”), with respect to the issuance of $250,000,000 aggregate principal amount of the Company’s 10 1/4% Senior Notes due 2015 (the “Exchange Notes”). The Exchange Notes are to be offered pursuant to the terms of the exchange offer (the “Exchange Offer”) set forth in the Registration Statement by the Company in exchange for a like principal amount of the Company’s issued and outstanding 10 1/4% Senior Notes due 2015 (the “Original Notes”), pursuant to an Indenture, dated as of February 8, 2007 (the “Indenture”), among the Company, the subsidiaries of the Company that are parties thereto (the “Guarantors”) and Wilmington Trust Company, as Trustee (the “Trustee”), and will be guaranteed by the Guarantors pursuant to the terms of the Indenture (the “Guarantees”).

     We have reviewed executed copies of the Registration Rights Agreement, dated February 8, 2007, by and between the Company and Credit Suisse Securities (USA) LLC (the “Agreement”) and the Indenture and the form of the Exchange Notes, and we have examined the originals, or photostatic or certified copies, of such records of the Company and the Guarantors, of certificates of officers of the Company and the Guarantors and of public documents, and such other documents as we have deemed relevant and necessary as the basis of the opinions set forth below. In such examination, we have assumed the genuineness of all signatures, the authenticity of all documents submitted to us as originals, the conformity to original documents of all documents submitted to us as photostatic or certified copies and the authenticity of the originals of such copies, and we have further assumed that the Trustee is qualified to act as such under the Trust Indenture Act of 1939, as amended (the “TIA”).

     Based upon and subject to the foregoing, and the qualifications, exceptions and limitations herein, we are of the opinion that (1) the Exchange Notes have been duly authorized by all necessary corporate action on the part of the Company; (2) the Guarantees have been duly authorized by all necessary corporate action on the part of the Guarantors; and (3) when the Registration Statement, as finally amended (including all necessary post-effective amendments) has become effective under the Securities Act, the Indenture has been qualified under the TIA and the Exchange Notes (in the form examined by us) have been duly executed and authenticated in accordance with the terms of the Indenture and have been issued and delivered upon consummation of the Exchange Offer against receipt of the Original Notes surrendered in exchange therefor in accordance with the terms of the Indenture, the Registration Rights Agreement and the Exchange Offer, the Exchange Notes will constitute valid and binding obligations of the Company, enforceable against the Company in accordance with their terms, and the Guarantees will constitute valid and binding obligations of the Guarantors, enforceable against the Guarantors in accordance with their terms, in each case except to the extent that enforcement thereof may be limited by (i) bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or other similar laws now or hereafter in effect relating to creditors’ rights generally and (ii) general principles of equity regardless of whether enforceability is considered in a proceeding at law or in equity.

     The opinions expressed above are limited to the laws of the State of New York, the General Corporation Law of the State of Delaware, the Virginia Stock Corporation Act, the Pennsylvania Business Corporation Law, the Colorado Business Corporation Act, the California General Corporation Law and the Securities Act, all as amended and all as in effect on the date hereof. We express no opinion as to matters relating to securities or blue sky laws of any jurisdiction or any rules or regulations thereunder other than the Securities Act.

     This opinion letter is limited to the matters stated herein, and no opinion is implied or may be inferred beyond the matters expressly stated. We hereby consent to the use of our opinion as herein set forth as an exhibit to the Registration Statement and to the use of our name under the caption “Legal Matters” in the prospectus forming a part of the Registration Statement. In giving this consent, we do not hereby admit that we come within the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations of the SEC promulgated thereunder or Item 509 of Regulation S-K.

Very truly yours,

/s/ Baker & McKenzie LLP

BAKER & McKENZIE LLP

EX-10.85

Exhibit 10.85

INDEMNIFICATION AGREEMENT

     This Indemnification Agreement (this “Agreement”) is made and entered into as of this            day of                                , by and between Alion Science and Technology Corporation, a Delaware corporation (the “Company”), and                                          (“Indemnitee”).

     WHEREAS, highly competent persons have become more reluctant to serve publicly-held corporations as directors or in other capacities unless they are provided with adequate protection through insurance and adequate indemnification against inordinate risks of claims and actions against them arising out of their service to and activities on behalf of the corporation;

     WHEREAS, the Board has determined that the increased difficulty in attracting and retaining such persons is detrimental to the best interests of the Company’s stockholders and that the Company should act to assure such persons that there will be increased certainty of such protection in the future;

     WHEREAS, it is reasonable, prudent and necessary for the Company contractually to obligate itself to indemnify such persons to the fullest extent permitted by applicable law so that they will serve or continue to serve the Company free from undue concern that they will not be so indemnified; and

     WHEREAS, Indemnitee is willing to serve, continue to serve and to take on additional service for or on behalf of the Company on the condition that he be so indemnified.

     NOW, THEREFORE, in consideration of the premises and the covenants contained herein, the Company and Indemnitee, intending to be legally bound, do hereby covenant and agree as follows:

     Section 1. Definitions. For purposes of this Agreement:

     (a) “Board” means the board of directors of the Company.

     (b) “Change in Control” means a change in control of the Company occurring after the Effective Date of a nature that would be required to be reported in response to Item 6(e) of Schedule 14A of Regulation 14A (or in response to any similar item on any similar schedule or form) promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), whether or not the Company is then subject to such reporting requirement; provided, however, that, without limitation, such a Change in Control shall be deemed to have occurred if after the Effective Date: (i) any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing fifty percent (50%) or more of the combined voting power of the Company’s then outstanding securities; or (ii) the

Company is a party to a merger, consolidation, sale of assets, plan of liquidation or other reorganization as a consequence of which members of the Board in office immediately prior to such transaction or event constitute less than a majority of the Board thereafter.

     (c) “Corporate Status” describes the status of a person who is or was a director, officer, employee or agent of the Company or of any other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise which such person is or was serving at the request of the Company.

     (d) “Disinterested Director” means a director of the Company who is not and was not a party to a Proceeding in respect of which indemnification is sought by Indemnitee.

     (e) “Effective Date” means                     ,           .

     (f) “Expenses” shall include all reasonable attorneys’ fees, retainers, court costs, transcript costs, fees of experts, witness fees, travel expenses, duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees, and all other reasonable disbursements or expenses of the types customarily incurred in connection with prosecuting, defending, preparing to prosecute or defend, investigating, being or preparing to be a witness in, or otherwise participating in, a Proceeding.

     (g) “Independent Counsel” means a law firm, or a member of a law firm, that is experienced in matters of corporate law and neither presently is, nor in the past five (5) years has been, retained to represent: (i) the Company or Indemnitee in any matter material to either such party; or (ii) any other party to a Proceeding giving rise to a claim for indemnification hereunder. Notwithstanding the foregoing, the term “Independent Counsel” shall not include any person, who, under the applicable standards of professional conduct then prevailing, would have a conflict of interest in representing either the Company or Indemnitee in an action to determine Indemnitee’s rights under this Agreement.

     (h) “Proceeding” includes any action, suit, arbitration, alternate dispute resolution mechanism, investigation, administrative hearing or any other proceeding, whether civil, criminal, administrative or investigative, except one (i) initiated by Indemnitee pursuant to Section 11 of this Agreement to enforce his rights under this Agreement or (ii) pending on or before the Effective Date.

     Section 2. Services by Indemnitee. Indemnitee agrees to serve as a director, officer, employee and/or agent of the Company, as applicable. Indemnitee may, at any time and for any reason, resign from such position(s) (subject to any other contractual obligation or any obligation imposed by operation of law), in which event the Company shall have no obligation under this Agreement to continue Indemnitee in such position. This Agreement shall not be deemed an employment contract between the Company (or any of its subsidiaries) and Indemnitee. Indemnitee specifically acknowledges that Indemnitee’s employment with the Company (or any of its subsidiaries), if any, is at will, and the Indemnitee may be discharged at any time for any reason, with or without cause, except as may be otherwise provided in any written employment contract between

2

Indemnitee and the Company (or any of its subsidiaries), other applicable formal severance policies duly adopted by the Board, or, with respect to service as a director of the Company, by the Company’s Certificate of Incorporation, Bylaws, and the General Corporation Law of the State of Delaware. The foregoing notwithstanding, this Agreement shall continue in force after Indemnitee has ceased to serve as an officer, director, agent and/or employee of the Company.

     Section 3. Indemnification — General. The Company shall indemnify, and advance Expenses to, Indemnitee (a) as provided in this Agreement and (b) (subject to the provisions of this Agreement) to the fullest extent permitted by applicable law in effect on the date hereof and as amended from time to time. The rights of Indemnitee provided under the preceding sentence shall include, but shall not be limited to, the rights set forth in the other sections of this Agreement.

     Section 4. Proceedings Other Than Proceedings by or in the Right of the Company. Indemnitee shall be entitled to the rights of indemnification provided in this Section 4 if, by reason of his Corporate Status, he is, or is threatened to be made, a party to or a participant in any threatened, pending or completed Proceeding, other than a Proceeding by or in the right of the Company. Pursuant to this Section 4, Indemnitee shall be indemnified against all Expenses, judgments, penalties, fines and amounts paid in settlement actually and reasonably incurred by him or on his behalf in connection with such Proceeding or any claim, issue or matter therein, if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Company and, with respect to any criminal Proceeding, had no reasonable cause to believe his conduct was unlawful.

     Section 5. Proceedings by or in the Right of the Company. Indemnitee shall be entitled to the rights of indemnification provided in this Section 5 if, by reason of his Corporate Status, he is, or is threatened to be made, a party to or a participant in any threatened, pending or completed Proceeding brought by or in the right of the Company to procure a judgment in its favor. Pursuant to this Section 5, Indemnitee shall be indemnified against all Expenses actually and reasonably incurred by him or on his behalf in connection with such Proceeding if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Company; provided, however, that, if applicable law so provides, no indemnification against such Expenses shall be made in respect of any claim, issue or matter in such Proceeding as to which Indemnitee shall have been adjudged to be liable to the Company unless and to the extent that the court in which such Proceeding shall have been brought or is pending shall determine that such indemnification may be made.

     Section 6. Indemnification for Expenses of a Party Who is Wholly or Partly Successful. In addition to indemnification authorized under any other provision of this Agreement, to the extent that Indemnitee is, by reason of his Corporate Status, a party to (or a participant in) and is successful, on the merits or otherwise, in defense of any Proceeding, he shall be indemnified against all Expenses actually and reasonably incurred by him or on his behalf in connection therewith. If Indemnitee is not wholly successful in defense of such Proceeding but is successful, on the merits or otherwise, as to one or more but less than all claims, issues or matters in such Proceeding, the Company shall

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indemnify Indemnitee against all Expenses actually and reasonably incurred by him or on his behalf in connection with each successfully resolved claim, issue or matter. The parties hereto shall make a reasonable allocation of those Expenses that relate to each such claim, issue or matter. For purposes of this section and without limitation, the termination of any claim, issue or matter in such a Proceeding by dismissal, with or without prejudice, shall be deemed to be a successful result as to such claim, issue or matter.

     Section 7. Indemnification for Expenses of a Witness. Notwithstanding any other provision of this Agreement, to the extent that Indemnitee is, by reason of his Corporate Status, a witness in any Proceeding to which Indemnitee is not a party, he shall be indemnified against all Expenses actually and reasonably incurred by him or on his behalf in connection therewith.

     Section 8. Advancement of Expenses. The Company shall advance all reasonable Expenses incurred by or on behalf of Indemnitee in connection with any Proceeding within ten (10) days after the receipt by the Company of a statement or statements from Indemnitee requesting such advance or advances from time to time, whether prior to or after final disposition of such Proceeding. Such statement or statements shall evidence the Expenses reasonably incurred by Indemnitee and shall include or be preceded or accompanied by an undertaking by or on behalf of Indemnitee to repay any Expenses advanced if it shall ultimately be determined that Indemnitee is not entitled to be indemnified against such Expenses.

     Section 9. Procedure for Determination of Entitlement to Indemnification.

     (a) To obtain indemnification under this Agreement, Indemnitee shall submit to the Company a written request, including therein or therewith such documentation and information as is reasonably available to Indemnitee and is reasonably necessary to determine whether and to what extent Indemnitee is entitled to indemnification.

     (b) Upon written request by Indemnitee for indemnification pursuant to the first sentence of Section 9(a) hereof, a determination, if required by applicable law, with respect to Indemnitee’s entitlement thereto shall be made in the specific case: (i) if a Change in Control shall have occurred, by Independent Counsel in a written opinion to the Board, a copy of which shall be delivered to Indemnitee; or (ii) if a Change of Control shall not have occurred, (A) by a majority vote of the Disinterested Directors, even though less than a quorum of the Board, or (B) if there are no such Disinterested Directors or, if such Disinterested Directors so direct, by Independent Counsel in a written opinion to the Board, a copy of which shall be delivered to Indemnitee; and, if it is so determined that Indemnitee is entitled to indemnification, payment to Indemnitee shall be made within ten (10) days after such determination. Indemnitee shall cooperate with the person, persons or entity making such determination with respect to Indemnitee’s entitlement to indemnification, including providing to such person, persons or entity upon reasonable advance request any documentation or information which is not privileged or otherwise protected from disclosure and which is reasonably available to Indemnitee and reasonably necessary to such determination. Such determination shall be made as promptly as is reasonably practicable, taking into account all facts and circumstances.

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Any reasonable costs or expenses (including reasonable attorneys’ fees and disbursements) actually incurred by Indemnitee in so cooperating with the person, persons or entity making such determination shall be borne by the Company (irrespective of the determination as to Indemnitee’s entitlement to indemnification) and the Company hereby indemnifies and agrees to hold Indemnitee harmless therefrom.

     (c) In the event the determination of entitlement to indemnification is to be made by Independent Counsel pursuant to Section 9(b) hereof, the Independent Counsel shall be selected as provided in this Section 9(c). If a Change of Control shall not have occurred, the Independent Counsel shall be selected by the Board, and the Company shall give written notice to Indemnitee advising him of the identity of the Independent Counsel so selected. If a Change of Control shall have occurred, the Independent Counsel shall be selected by Indemnitee (unless Indemnitee shall request that such selection be made by the Board, in which event the preceding sentence shall apply), and Indemnitee shall give written notice to the Company advising it of the identity of the Independent Counsel so selected. In either event, Indemnitee or the Company, as the case may be, may, within ten (10) days after such written notice of selection shall have been given, deliver to the Company or to Indemnitee, as the case may be, a written objection to such selection; provided, however, that such objection may be asserted only on the ground that the Independent Counsel so selected does not meet the requirements of “Independent Counsel” as defined in Section 1 of this Agreement, and the objection shall set forth with particularity the factual basis of such assertion. If such written objection is so made and substantiated, the Independent Counsel so selected may not serve as Independent Counsel unless and until such objection is withdrawn or a court has determined that such objection is without merit. If, within thirty (30) days after submission by Indemnitee of a written request for indemnification pursuant to Section 9(a) hereof, no Independent Counsel shall have been selected and not objected to, either the Company or Indemnitee may petition any court of competent jurisdiction for resolution of any objection which shall have been made by the Company or Indemnitee to the other’s selection of Independent Counsel and/or for the appointment as Independent Counsel of a person selected by the court or by such other person as the court shall designate, and the person with respect to whom all objections are so resolved or the person so appointed shall act as Independent Counsel under Section 9(b) hereof. The Company shall pay any and all reasonable fees and Expenses of Independent Counsel incurred by such Independent Counsel in connection with acting pursuant to Section 9(b) hereof, and the Company shall pay all reasonable fees and Expenses incident to the procedures of this Section 9(c), regardless of the manner in which such Independent Counsel was selected or appointed. Upon the due commencement of any judicial proceeding or arbitration pursuant to Section 11(a)(iii) of this Agreement, Independent Counsel shall be discharged and relieved of any further responsibility in such capacity (subject to the applicable standards of professional conduct then prevailing).

     Section 10. Presumptions and Effect of Certain Proceedings.

     If a Change of Control shall have occurred, in making a determination with respect to entitlement to indemnification hereunder, the person or persons or entity making such determination shall presume that Indemnitee is entitled to indemnification under this Agreement if Indemnitee has submitted a request for indemnification in

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accordance with Section 9(a) of this Agreement, and the Company shall have the burden of proof to overcome that presumption in connection with the making by any person, persons or entity of any determination contrary to that presumption.

     The termination of any Proceeding or of any claim, issue or matter therein, by judgment, order, settlement or conviction, or upon a plea of nolo contendere or its equivalent, shall not (except as otherwise expressly provided in this Agreement) of itself adversely affect the right of Indemnitee to indemnification or create a presumption that Indemnitee did not act in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the Company or, with respect to any criminal Proceeding, that Indemnitee had reasonable cause to believe that his conduct was unlawful.

     Section 11. Remedies of Indemnitee.

     (a) In the event that (i) a determination is made pursuant to Section 9 of this Agreement that Indemnitee is not entitled to indemnification under this Agreement, (ii) advancement of Expenses is not timely made pursuant to Section 8 of this Agreement, (iii) no determination of entitlement to indemnification shall have been made pursuant to Section 9(b) of this Agreement within 90 days after receipt of the Company of the request for indemnification, (iv) payment of indemnification is not made pursuant to Section 6 or 7 of this Agreement within ten (10) days after receipt by the Company of a written request therefor or (v) payment of indemnification is not made within ten (10) days after a determination has been made that Indemnitee is entitled to indemnification, Indemnitee shall be entitled to an adjudication by a court of competent jurisdiction of his entitlement to such indemnification or advancement of Expenses. Alternatively, Indemnitee, at his option, may seek an award in arbitration to be conducted by a single arbitrator pursuant to the Commercial Arbitration Rules of the American Arbitration Association. Indemnitee shall commence such proceeding seeking an adjudication or an award in arbitration within one hundred eighty (180) days following the date on which Indemnitee first has the right to commence such proceeding pursuant to this Section 11(a); provided, however, that the foregoing clause shall not apply in respect of a proceeding brought by Indemnitee to enforce his rights under Section 6 of this Agreement.

     (b) In the event that a determination shall have been made pursuant to Section 9(b) of this Agreement that Indemnitee is not entitled to indemnification, any judicial proceeding or arbitration commenced pursuant to this Section 11 shall be conducted in all respects as a de novo trial, or arbitration, on the merits and the Indemnitee shall not be prejudiced by reason of that adverse determination. If a Change of Control shall have occurred, in any judicial proceeding or arbitration commenced pursuant to this Section 11 the Company shall have the burden of proving that Indemnitee is not entitled to indemnification or advancement of Expenses, as the case may be.

     (c) If a determination shall have been made pursuant to Section 9(b) of this Agreement that Indemnitee is entitled to indemnification, the Company shall be bound by such determination in any judicial proceeding or arbitration commenced pursuant to this Section 11, absent (i) a misstatement by Indemnitee of a material fact, or an omission of a material fact necessary to make Indemnitee’s statement not materially misleading, in

6

connection with the request for indemnification, or (ii) a prohibition of such indemnification under applicable law.

     (d) In the event that Indemnitee, pursuant to this Section 11, seeks a judicial adjudication of or an award in arbitration to enforce his rights under, or to recover damages for breach of, this Agreement, Indemnitee shall be entitled to recover from the Company, and shall be indemnified by the Company against, any and all Expenses actually and reasonably incurred by him in such judicial adjudication or arbitration, but only if he prevails therein. If it shall be determined in said judicial adjudication or arbitration that Indemnitee is entitled to receive part but not all of the indemnification or advancement of Expenses sought, the Expenses incurred by Indemnitee in connection with such judicial adjudication or arbitration shall be prorated accordingly between Indemnitee and the Company.

     Section 12. Selection of Counsel. In the event the Company shall be obligated under this Agreement to pay the Expenses of any Proceeding against Indemnitee, the Company, if appropriate, shall be entitled to assume the defense of such Proceeding, with counsel approved by Indemnitee, which approval shall not be unreasonably withheld, upon the delivery to Indemnitee of written notice of its election so to do. After delivery of such notice, approval of such counsel by Indemnitee and the retention of such counsel by the Company, the Company will not be liable to Indemnitee under this Agreement for any fees of counsel subsequently incurred by Indemnitee with respect to the same proceeding, provided that (i) Indemnitee shall have the right to employ his counsel in any such proceeding at Indemnitee’s expense; and (ii) if (A) the employment of counsel by Indemnitee has been previously authorized by the Company, (B) Indemnitee shall have reasonably concluded that there may be a conflict of interest between the Company and Indemnitee in the conduct of any such defense or (C) the Company shall not, in fact, have employed counsel to assume the defense of such proceeding, then the fees and Expenses of Indemnitee counsel shall be at the expense of the Company.

     Section 13. Mutual Acknowledgment. Both the Company and Indemnitee acknowledge that in certain instances Federal law or applicable public policy may prohibit the Company from indemnifying its directors, officers, employees and agents under this Agreement or otherwise. Indemnitee understands and acknowledges that the Company has undertaken or may be required in the future to undertake with the Securities and Exchange Commission to submit the question of indemnification to a court in certain circumstances for a determination of the Company’s right under public policy to indemnify Indemnitee.

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     Section 14. Non-exclusivity; Survival of Rights; Insurance; Subrogation.

     (a) The rights of indemnification and to receive advancement of Expenses as provided by this Agreement shall not be deemed exclusive of any other rights to which Indemnitee may at any time be entitled under applicable law, the Certificate of Incorporation, the Bylaws, any agreement, a vote of stockholders or a resolution of directors, or otherwise. No amendment, alteration or repeal of this Agreement or of any provision hereof shall limit or restrict any right of Indemnitee under this Agreement or of any provision hereof in respect of any action taken or omitted by such Indemnitee in his Corporate Status prior to such amendment, alteration or repeal.

     (b) To the extent that the Company maintains an insurance policy or policies providing liability insurance for directors, officers, employees or agents of the Company or of any other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise which such person serves at the request of the Company, Indemnitee shall have the status as an insured under such policy or policies in accordance with its or their terms to the maximum extent of the coverage available for any such director, officer, employee or agent under such policy or policies.

     (c) In the event of any payment under this Agreement, the Company shall be subrogated to the extent of such payment to all of the rights of recovery of Indemnitee, who shall execute all papers required and take all actions necessary to secure such rights, including execution of such documents as are necessary to enable the Company to bring suit to enforce such rights.

     (d) The Company shall not be liable under this Agreement to make any payment of amounts otherwise indemnifiable hereunder if and to the extent that Indemnitee has otherwise actually received such payment under any insurance policy, contract, agreement or otherwise.

     (e) The Company’s obligation to indemnify or advance Expenses hereunder to Indemnitee who is or was serving at the request of the Company as a director, officer, employee or agent of any other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise shall be reduced by any amount Indemnitee has actually received as indemnification or advancement of Expenses from such other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise.

     Section 15. Duration of Agreement. This Agreement shall continue until and terminate upon the later of: (a) ten (10) years after the date that Indemnitee shall have ceased to serve as a director, officer, employee and/or agent of the Company or of any other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise which Indemnitee served at the request of the Company (the “Anniversary Date”); or (b) the final termination of any Proceeding then pending on the Anniversary Date in respect of which Indemnitee is seeking rights of indemnification or advancement of Expenses hereunder and of any proceeding commenced by Indemnitee pursuant to Section 11 of this Agreement relating thereto. This Agreement shall be binding upon the Company and its successors and assigns and shall inure to the benefit of Indemnitee and his heirs, executors and administrators.

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     Section 16. Severability. If any provision or provisions of this Agreement shall be held to be invalid, illegal or unenforceable for any reason whatsoever: (a) the validity, legality and enforceability of the remaining provisions of this Agreement (including, without limitation, each portion of any section of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby; (b) such provision or provisions shall be deemed reformed to the extent necessary to conform to applicable law and to give the maximum effect to the intent of the parties hereto; and (c) to the fullest extent possible, the provisions of this Agreement (including, without limitation, each portion of any section of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifested thereby.

     Section 17. Exception to Right of Indemnification or Advancement of Expenses. Notwithstanding any other provision of this Agreement, Indemnitee shall not be entitled to indemnification or advancement of Expenses under this Agreement with respect to any Proceeding brought by Indemnitee, unless the bringing of such Proceeding or making of such claim shall have been approved by the Board.

     Section 18. Identical Counterparts. This Agreement may be executed in one or more counterparts, each of which shall for all purposes be deemed to be an original but all of which together shall constitute one and the same agreement. Only one such counterpart signed by the party against whom enforceability is sought needs to be produced to evidence the existence of this Agreement.

     Section 19. Headings. The headings of the paragraphs of this Agreement are inserted for convenience only and shall not be deemed to constitute part of this Agreement or to affect the construction thereof.

     Section 20. Modification and Waiver. No supplement, modification or amendment of this Agreement shall be binding unless executed in writing by both of the parties hereto. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provisions hereof (whether or not similar) nor shall such waiver constitute a continuing waiver.

     Section 21. Notice by Indemnitee. Indemnitee agrees to notify promptly the Company in writing upon being served with any summons, citation, subpoena, complaint, indictment, information or other document relating to any Proceeding or matter which may be subject to indemnification or advancement of Expenses covered hereunder.

     Section 22. Notices. All notices, requests, demands and other communications hereunder shall be in writing and shall be deemed to have been duly given if (i) delivered by hand or air courier and receipted for by the party to whom said notice or other communication shall have been directed or (ii) mailed by certified or registered mail, with postage prepaid, on the fifth (5th) business day after the date on which it is so mailed:

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If to Indemnitee, to:

[name]
[address]

If to the Company, to:

Alion Science and Technology Corporation
1750 Tysons Blvd. Suite 1300
McLean, VA 22102-4213
Attention: General Counsel

or to such other address as may have been furnished to Indemnitee by the Company or to the Company by Indemnitee, as the case may be, in accordance with the foregoing requirements.

     Section 23. Contribution. To the fullest extent permissible under the applicable law, if the indemnification provided for in this Agreement is unavailable to Indemnitee for any reason whatsoever, the Company, in lieu of indemnifying Indemnitee, shall contribute to the amount incurred by Indemnitee, whether for judgments, fines, penalties, excise taxes, amounts paid or to be paid in settlement and/or for Expenses, in connection with any claim relating to an indemnifiable event under this Agreement, in such proportion as is deemed fair and reasonable in light of all of the circumstances of such Proceeding in order to reflect (i) the relative benefits received by the Company and Indemnitee as a result of the event(s) and/or transaction(s) giving cause to such Proceeding, and (ii) the relative fault of the Company (and its directors, officers, employees and agents) and Indemnitee in connection with such event(s) and/or transaction(s).

     Section 24. Governing Law. This Agreement and the legal relations among the parties shall be governed by, and construed and enforced in accordance with, the laws of the State of Delaware, without regard to its conflict of laws rules.

     Section 25. Miscellaneous. Use of the masculine pronoun shall be deemed to include usage of the feminine pronoun where appropriate.

[Signatures follow on next page]

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     IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the day and year first above written.

INDEMNITEE:

ALION SCIENCE AND TECHNOLOGY CORPORATION

By:

Name:

Its:

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EX-12.1

EXHIBIT 12.1

Alion Science and Technology

Computation of Ratio of Earnings to Fixed Charges

																Three Months
																Ended
	Years Ended September 30,															December 31,
Actual Data	2002			2003			2004			2005			2006			2006
	(Amounts in thousands)
Fixed Charges
Cash interest expense	$	—		$	3,774		$	7,563		$	9,328		$	19,349		$	10,038
Amortization of capitalized expenses related to indebtedness		—			353			2,791			3,897			2,591			642
Total fixed charges	$	—		$	4,127		$	10,354		$	13,225		$	21,940		$	10,680
Earnings
Pre-tax earnings (loss)	$	(91	)	$	(12,616	)	$	(15,094	)	$	(40,172	)	$	(31,089	)	$	(14,125	)
Fixed charges		—			4,127			10,354			13,225			21,940			10,680
Earnings (loss) before fixed charges	$	(91	)	$	(8,489	)	$	(4,740	)	$	(26,947	)	$	(9,149	)	$	(3,445	)
Ratio of earnings to fixed charges		(1	)		(2	)		(2	)		(2	)		(2	)		(2	)

(1)	For fiscal year 2002 the ratio of earnings to fixed charges was not applicable as there were no fixed charges.
(2)	Earnings for fiscal years 2003 to 2006 and the three months ended December 31, 2006 were inadequate to cover fixed charges in those periods by $8.5 million, $4.7 million, $26.9 million, $9.1 million, and $3.4 million, respectively.

EX-23.1

Exhibit 23.1

Consent of Independent Registered Public Accounting Firm

The Board of Directors
Alion Science and Technology Corporation:

We consent to the use of our report dated January 31, 2006, except for note 20, as to which the date is April 27, 2007, with respect to the consolidated balance sheet of Alion Science and Technology Corporation (the Company), as of September 30, 2005, and the related consolidated statements of operations, shareholder’s equity (deficit), and cash flows for the years ended September 30, 2005 and 2004, and the related consolidated financial statement schedule for the years ended September 30, 2005 and 2004, included herein and to the references to our firm under the headings “Summary Historical Condensed Consolidated Financial Data”, “Selected Consolidated Financial Data” and “Independent Registered Public Accounting Firms” in the prospectus.

/s/ KPMG LLP
Chicago, Illinois
April 27, 2007

EX-23.2

Exhibit 23.2

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the use in this Registration Statement on Form S-4 of our report dated November 29, 2006 (except for Note 20, as to which the date is April 27, 2007) relating to the financial statements as of and for the year ended September 30, 2006 and related financial statement schedule of Alion Science and Technology Corporation appearing in the Prospectus, which is part of this Registration Statement.

We also consent to the reference to us under the headings “Summary Historical Condensed Consolidated Financial Data”, “Selected Consolidated Financial Data” and “Independent Registered Public Accounting Firms” in such Prospectus.

/s/ DELOITTE & TOUCHE LLP

McLean, Virginia
April 27, 2007

EX-25.1

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM T-1

STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE

Check if an Application to Determine Eligibility of a Trustee Pursuant to Section 305(b)(2) þ

WILMINGTON TRUST COMPANY

(Exact name of Trustee as specified in its charter)

Delaware	51-0055023
(Jurisdiction of incorporation of organization if not a U.S. national bank)	(I.R.S. Employer Identification No.)

1100 North Market Street
Wilmington, Delaware 19890-0001
(302) 651-1000
(Address of principal executive offices, including zip code)

Michael A. DiGregorio
Senior Vice President and General Counsel
Wilmington Trust Company
1100 North Market Street
Wilmington, Delaware 19890-0001
(302) 651-8793
(Name, address, including zip code, and telephone number, including area code, of agent of service)

ALION SCIENCE AND TECHNOLOGY CORPORATION*
GUARANTORS LISTED ON ANNEX A HERETO

DELAWARE	54-2061691
(State or other jurisdiction or incorporation or organization)	(I.R.S. Employer Identification No.)

1750 Tysons Boulevard
Suite 1300
McLean, VA 22102
(703) 918-4480
(Address of principal executive offices, including zip code)

10 ¹/4% Senior Notes due 2015

Guarantees of 10 ¹/4% Senior Notes due 2015

Annex A
Table of Guarantors

Exact Name of	State or Other	Primary Standard
Guarantor as	Jurisdiction of	Industrial		I.R.S. Employer
Specified in the	Incorporation or	Classification Code		Identification
Charter	Organization	Number		Number
Alion – BMH Corporation	Virginia		541330		54-1384264
Alion – CATI Corporation	California		541511		77-0323371
Alion – JJMA Corporation	New York		541330		13-5679965
Alion – MA&D Corporation	Colorado		541511		84-1145568
Alion – METI Corporation	Virginia		541690		54-1554099
Human Factors Applications, Inc.	Pennsylvania		541330		23-2217191
Washington Consulting, Inc.	Virginia		541611		76-0725281

The address for each of the guarantors is c/o Alion Science and Technology Corporation, 1750 Tysons Boulevard, Suite 1300, McLean, VA 22102, telephone: (703) 918-4480. The name and address, including zip code, of the agent for service of process for each additional registrant is James C. Fontana, Alion Science and Technology Corporation, 1750 Tysons Boulevard, Suite 1300, McLean, VA, 22102, telephone: (703) 918-4480.

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ITEM 1. GENERAL INFORMATION.

Furnish the following information as to the trustee:

(a) Name and address of each examining or supervising authority to which it is subject.

Federal Deposit Insurance Corp.      State Bank Commissioner

20 Exchange Place, Room 6014       555 East Loockerman Street, Suite 210

New York, New York 10005             Dover, Delaware 19901

(b) Whether it is authorized to exercise corporate trust powers.

The trustee is authorized to exercise corporate trust powers.

ITEM 2. AFFILIATIONS WITH THE OBLIGOR.

If the obligor is an affiliate of the trustee, describe each affiliation:

Based upon an examination of the books and records of the trustee and information available to the trustee, the obligor is not an affiliate of the trustee.

ITEM 16. LIST OF EXHIBITS.

List below all exhibits filed as part of this Statement of Eligibility and Qualification.

• A copy of the Charter of Wilmington Trust Company (Exhibit 1), which includes the certificate of authority of Wilmington Trust Company to commence business (Exhibit 2) and the authorization of Wilmington Trust Company to exercise corporate trust powers (Exhibit 3).

• A copy of the existing By-Laws of Wilmington Trust Company (Exhibit 4).

• Consent of Wilmington Trust Company required by Section 321(b) of the Trust Indenture Act (Exhibit 6).

• A copy of the latest Report of Condition of Wilmington Trust Company (Exhibit 7).

Pursuant to the requirements of the Trust Indenture Act of 1939, as amended, the trustee, Wilmington Trust Company, a corporation organized and existing under the laws of Delaware, has duly caused this Statement of Eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in the City of Wilmington and State of Delaware on the 30^th day of April, 2007.

[SEAL]		WILMINGTON TRUST COMPANY
Attest:	/s/ Christopher J. Slaybaugh	By:	/s/ Denise Geran
	Assistant Secretary	Name: Denise M. Geran
		Title: Vice President

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EXHIBIT 1*

AMENDED CHARTER

Wilmington Trust Company

Wilmington, Delaware

As existing on May 9, 1987

* Exhibit 1 also constitutes Exhibits 2 and 3.

Amended Charter
or
Act of Incorporation
of
Wilmington Trust Company

     Wilmington Trust Company, originally incorporated by an Act of the General Assembly of the State of Delaware, entitled “An Act to Incorporate the Delaware Guarantee and Trust Company”, approved March 2, A.D. 1901, and the name of which company was changed to “Wilmington Trust Company” by an amendment filed in the Office of the Secretary of State on March 18, A.D. 1903, and the Charter or Act of Incorporation of which company has been from time to time amended and changed by merger agreements pursuant to the corporation law for state banks and trust companies of the State of Delaware, does hereby alter and amend its Charter or Act of Incorporation so that the same as so altered and amended shall in its entirety read as follows:

          First: - The name of this corporation is Wilmington Trust Company.

     Second: - The location of its principal office in the State of Delaware is at Rodney Square North, in the City of Wilmington, County of New Castle; the name of its resident agent is Wilmington Trust Company whose address is Rodney Square North, in said City. In addition to such principal office, the said corporation maintains and operates branch offices in the City of Newark, New Castle County, Delaware, the Town of Newport, New Castle County, Delaware, at Claymont, New Castle County, Delaware, at Greenville, New Castle County Delaware, and at Milford Cross Roads, New Castle County, Delaware, and shall be empowered to open, maintain and operate branch offices at Ninth and Shipley Streets, 418 Delaware Avenue, 2120 Market Street, and 3605 Market Street, all in the City of Wilmington, New Castle County, Delaware, and such other branch offices or places of business as may be authorized from time to time by the agency or agencies of the government of the State of Delaware empowered to confer such authority.

     Third: - (a) The nature of the business and the objects and purposes proposed to be transacted, promoted or carried on by this Corporation are to do any or all of the things herein mentioned as fully and to the same extent as natural persons might or could do and in any part of the world, viz.:

(1)

To sue and be sued, complain and defend in any Court of law or equity and to make and use a common seal, and alter the seal at pleasure, to hold, purchase, convey, mortgage or otherwise deal in real and personal estate and property, and to appoint such officers and agents as the business of the Corporation shall require, to make by-laws not inconsistent with the Constitution or laws of the United States or of this State, to discount bills, notes or other evidences of debt, to receive deposits of money, or securities for money, to buy gold and silver bullion and foreign coins, to buy and sell bills of exchange, and generally to use, exercise and enjoy all the powers, rights, privileges and franchises incident to a corporation which are proper or necessary for the transaction of the business of the Corporation hereby created.

(2)

To insure titles to real and personal property, or any estate or interests therein, and to guarantee the holder of such property, real or personal, against any claim or claims, adverse to his interest therein, and to prepare and give certificates of

	title for any lands or premises in the State of Delaware, or elsewhere.
(3)	To act as factor, agent, broker or attorney in the receipt, collection, custody, investment and management of funds, and the purchase, sale, management and disposal of property of all descriptions, and to prepare and execute all papers which may be necessary or proper in such business.
(4)	To prepare and draw agreements, contracts, deeds, leases, conveyances, mortgages, bonds and legal papers of every description, and to carry on the business of conveyancing in all its branches.
(5)	To receive upon deposit for safekeeping money, jewelry, plate, deeds, bonds and any and all other personal property of every sort and kind, from executors, administrators, guardians, public officers, courts, receivers, assignees, trustees, and from all fiduciaries, and from all other persons and individuals, and from all corporations whether state, municipal, corporate or private, and to rent boxes, safes, vaults and other receptacles for such property.
(6)	To act as agent or otherwise for the purpose of registering, issuing, certificating, countersigning, transferring or underwriting the stock, bonds or other obligations of any corporation, association, state or municipality, and may receive and manage any sinking fund therefor on such terms as may be agreed upon between the two parties, and in like manner may act as Treasurer of any corporation or municipality.
(7)	To act as Trustee under any deed of trust, mortgage, bond or other instrument issued by any state, municipality, body politic, corporation, association or person, either alone or in conjunction with any other person or persons, corporation or corporations.
(8)	To guarantee the validity, performance or effect of any contract or agreement, and the fidelity of persons holding places of responsibility or trust; to become surety for any person, or persons, for the faithful performance of any trust, office, duty, contract or agreement, either by itself or in conjunction with any other person, or persons, corporation, or corporations, or in like manner become surety upon any bond, recognizance, obligation, judgment, suit, order, or decree to be entered in any court of record within the State of Delaware or elsewhere, or which may now or hereafter be required by any law, judge, officer or court in the State of Delaware or elsewhere.
(9)	To act by any and every method of appointment as trustee, trustee in bankruptcy, receiver, assignee, assignee in bankruptcy, executor, administrator, guardian, bailee, or in any other trust capacity in the receiving, holding, managing, and disposing of any and all estates and property, real, personal or mixed, and to be appointed as such trustee, trustee in bankruptcy, receiver, assignee, assignee in bankruptcy, executor, administrator, guardian or bailee by any persons, corporations, court, officer, or authority, in the State of Delaware or elsewhere; and whenever this Corporation is so appointed by any person, corporation, court, officer or authority such trustee, trustee in bankruptcy, receiver, assignee,

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	assignee in bankruptcy, executor, administrator, guardian, bailee, or in any other trust capacity, it shall not be required to give bond with surety, but its capital stock shall be taken and held as security for the performance of the duties devolving upon it by such appointment.
(10)	And for its care, management and trouble, and the exercise of any of its powers hereby given, or for the performance of any of the duties which it may undertake or be called upon to perform, or for the assumption of any responsibility the said Corporation may be entitled to receive a proper compensation.
(11)	To purchase, receive, hold and own bonds, mortgages, debentures, shares of capital stock, and other securities, obligations, contracts and evidences of indebtedness, of any private, public or municipal corporation within and without the State of Delaware, or of the Government of the United States, or of any state, territory, colony, or possession thereof, or of any foreign government or country; to receive, collect, receipt for, and dispose of interest, dividends and income upon and from any of the bonds, mortgages, debentures, notes, shares of capital stock, securities, obligations, contracts, evidences of indebtedness and other property held and owned by it, and to exercise in respect of all such bonds, mortgages, debentures, notes, shares of capital stock, securities, obligations, contracts, evidences of indebtedness and other property, any and all the rights, powers and privileges of individual owners thereof, including the right to vote thereon; to invest and deal in and with any of the moneys of the Corporation upon such securities and in such manner as it may think fit and proper, and from time to time to vary or realize such investments; to issue bonds and secure the same by pledges or deeds of trust or mortgages of or upon the whole or any part of the property held or owned by the Corporation, and to sell and pledge such bonds, as and when the Board of Directors shall determine, and in the promotion of its said corporate business of investment and to the extent authorized by law, to lease, purchase, hold, sell, assign, transfer, pledge, mortgage and convey real and personal property of any name and nature and any estate or interest therein.

     (b) In furtherance of, and not in limitation, of the powers conferred by the laws of the State of Delaware, it is hereby expressly provided that the said Corporation shall also have the following powers:

(1)	To do any or all of the things herein set forth, to the same extent as natural persons might or could do, and in any part of the world.
(2)	To acquire the good will, rights, property and franchises and to undertake the whole or any part of the assets and liabilities of any person, firm, association or corporation, and to pay for the same in cash, stock of this Corporation, bonds or otherwise; to hold or in any manner to dispose of the whole or any part of the property so purchased; to conduct in any lawful manner the whole or any part of any business so acquired, and to exercise all the powers necessary or convenient in and about the conduct and management of such business.
(3)	To take, hold, own, deal in, mortgage or otherwise lien, and to lease, sell, exchange, transfer, or in any manner whatever dispose of property, real, personal

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	or mixed, wherever situated.
(4)	To enter into, make, perform and carry out contracts of every kind with any person, firm, association or corporation, and, without limit as to amount, to draw, make, accept, endorse, discount, execute and issue promissory notes, drafts, bills of exchange, warrants, bonds, debentures, and other negotiable or transferable instruments.
(5)	To have one or more offices, to carry on all or any of its operations and businesses, without restriction to the same extent as natural persons might or could do, to purchase or otherwise acquire, to hold, own, to mortgage, sell, convey or otherwise dispose of, real and personal property, of every class and description, in any State, District, Territory or Colony of the United States, and in any foreign country or place.
(6)	It is the intention that the objects, purposes and powers specified and clauses contained in this paragraph shall (except where otherwise expressed in said paragraph) be nowise limited or restricted by reference to or inference from the terms of any other clause of this or any other paragraph in this charter, but that the objects, purposes and powers specified in each of the clauses of this paragraph shall be regarded as independent objects, purposes and powers.

     Fourth: - (a) The total number of shares of all classes of stock which the Corporation shall have authority to issue is forty-one million (41,000,000) shares, consisting of:

(1)	One million (1,000,000) shares of Preferred stock, par value $10.00 per share (hereinafter referred to as “Preferred Stock”); and
(2)	Forty million (40,000,000) shares of Common Stock, par value $1.00 per share (hereinafter referred to as “Common Stock”).

     (b) Shares of Preferred Stock may be issued from time to time in one or more series as may from time to time be determined by the Board of Directors each of said series to be distinctly designated. All shares of any one series of Preferred Stock shall be alike in every particular, except that there may be different dates from which dividends, if any, thereon shall be cumulative, if made cumulative. The voting powers and the preferences and relative, participating, optional and other special rights of each such series, and the qualifications, limitations or restrictions thereof, if any, may differ from those of any and all other series at any time outstanding; and, subject to the provisions of subparagraph 1 of Paragraph (c) of this Article Fourth, the Board of Directors of the Corporation is hereby expressly granted authority to fix by resolution or resolutions adopted prior to the issuance of any shares of a particular series of Preferred Stock, the voting powers and the designations, preferences and relative, optional and other special rights, and the qualifications, limitations and restrictions of such series, including, but without limiting the generality of the foregoing, the following:

(1) The distinctive designation of, and the number of shares of Preferred Stock which shall constitute such series, which number may be increased (except where otherwise provided by the Board of Directors) or decreased (but not below the number of shares thereof then outstanding) from time to time by like action of the

4

	Board of Directors;
(2)	The rate and times at which, and the terms and conditions on which, dividends, if any, on Preferred Stock of such series shall be paid, the extent of the preference or relation, if any, of such dividends to the dividends payable on any other class or classes, or series of the same or other class of stock and whether such dividends shall be cumulative or non-cumulative;
(3)	The right, if any, of the holders of Preferred Stock of such series to convert the same into or exchange the same for, shares of any other class or classes or of any series of the same or any other class or classes of stock of the Corporation and the terms and conditions of such conversion or exchange;
(4)	Whether or not Preferred Stock of such series shall be subject to redemption, and the redemption price or prices and the time or times at which, and the terms and conditions on which, Preferred Stock of such series may be redeemed.
(5)	The rights, if any, of the holders of Preferred Stock of such series upon the voluntary or involuntary liquidation, merger, consolidation, distribution or sale of assets, dissolution or winding-up, of the Corporation.
(6)	The terms of the sinking fund or redemption or purchase account, if any, to be provided for the Preferred Stock of such series; and
(7)	The voting powers, if any, of the holders of such series of Preferred Stock which may, without limiting the generality of the foregoing include the right, voting as a series or by itself or together with other series of Preferred Stock or all series of Preferred Stock as a class, to elect one or more directors of the Corporation if there shall have been a default in the payment of dividends on any one or more series of Preferred Stock or under such circumstances and on such conditions as the Board of Directors may determine.
(c)	(1) After the requirements with respect to preferential dividends on the Preferred Stock (fixed in accordance with the provisions of section (b) of this Article Fourth), if any, shall have been met and after the Corporation shall have complied with all the requirements, if any, with respect to the setting aside of sums as sinking funds or redemption or purchase accounts (fixed in accordance with the provisions of section (b) of this Article Fourth), and subject further to any conditions which may be fixed in accordance with the provisions of section (b) of this Article Fourth, then and not otherwise the holders of Common Stock shall be entitled to receive such dividends as may be declared from time to time by the Board of Directors.
(2)	After distribution in full of the preferential amount, if any, (fixed in accordance with the provisions of section (b) of this Article Fourth), to be distributed to the holders of Preferred Stock in the event of voluntary or involuntary liquidation, distribution or sale of assets, dissolution or winding-up, of the Corporation, the holders of the Common Stock shall be entitled to receive all of the remaining assets of the Corporation, tangible and intangible, of whatever kind available for

5

	distribution to stockholders ratably in proportion to the number of shares of Common Stock held by them respectively.
(3)	Except as may otherwise be required by law or by the provisions of such resolution or resolutions as may be adopted by the Board of Directors pursuant to section (b) of this Article Fourth, each holder of Common Stock shall have one vote in respect of each share of Common Stock held on all matters voted upon by the stockholders.

     (d) No holder of any of the shares of any class or series of stock or of options, warrants or other rights to purchase shares of any class or series of stock or of other securities of the Corporation shall have any preemptive right to purchase or subscribe for any unissued stock of any class or series or any additional shares of any class or series to be issued by reason of any increase of the authorized capital stock of the Corporation of any class or series, or bonds, certificates of indebtedness, debentures or other securities convertible into or exchangeable for stock of the Corporation of any class or series, or carrying any right to purchase stock of any class or series, but any such unissued stock, additional authorized issue of shares of any class or series of stock or securities convertible into or exchangeable for stock, or carrying any right to purchase stock, may be issued and disposed of pursuant to resolution of the Board of Directors to such persons, firms, corporations or associations, whether such holders or others, and upon such terms as may be deemed advisable by the Board of Directors in the exercise of its sole discretion.

     (e) The relative powers, preferences and rights of each series of Preferred Stock in relation to the relative powers, preferences and rights of each other series of Preferred Stock shall, in each case, be as fixed from time to time by the Board of Directors in the resolution or resolutions adopted pursuant to authority granted in section (b) of this Article Fourth and the consent, by class or series vote or otherwise, of the holders of such of the series of Preferred Stock as are from time to time outstanding shall not be required for the issuance by the Board of Directors of any other series of Preferred Stock whether or not the powers, preferences and rights of such other series shall be fixed by the Board of Directors as senior to, or on a parity with, the powers, preferences and rights of such outstanding series, or any of them; provided, however, that the Board of Directors may provide in the resolution or resolutions as to any series of Preferred Stock adopted pursuant to section (b) of this Article Fourth that the consent of the holders of a majority (or such greater proportion as shall be therein fixed) of the outstanding shares of such series voting thereon shall be required for the issuance of any or all other series of Preferred Stock.

     (f) Subject to the provisions of section (e), shares of any series of Preferred Stock may be issued from time to time as the Board of Directors of the Corporation shall determine and on such terms and for such consideration as shall be fixed by the Board of Directors.

     (g) Shares of Common Stock may be issued from time to time as the Board of Directors of the Corporation shall determine and on such terms and for such consideration as shall be fixed by the Board of Directors.

     (h) The authorized amount of shares of Common Stock and of Preferred Stock may, without a class or series vote, be increased or decreased from time to time by the affirmative vote of the holders of a majority of the stock of the Corporation entitled to vote thereon.

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     Fifth: - (a) The business and affairs of the Corporation shall be conducted and managed by a Board of Directors. The number of directors constituting the entire Board shall be not less than five nor more than twenty-five as fixed from time to time by vote of a majority of the whole Board, provided, however, that the number of directors shall not be reduced so as to shorten the term of any director at the time in office, and provided further, that the number of directors constituting the whole Board shall be twenty-four until otherwise fixed by a majority of the whole Board.

     (b) The Board of Directors shall be divided into three classes, as nearly equal in number as the then total number of directors constituting the whole Board permits, with the term of office of one class expiring each year. At the annual meeting of stockholders in 1982, directors of the first class shall be elected to hold office for a term expiring at the next succeeding annual meeting, directors of the second class shall be elected to hold office for a term expiring at the second succeeding annual meeting and directors of the third class shall be elected to hold office for a term expiring at the third succeeding annual meeting. Any vacancies in the Board of Directors for any reason, and any newly created directorships resulting from any increase in the directors, may be filled by the Board of Directors, acting by a majority of the directors then in office, although less than a quorum, and any directors so chosen shall hold office until the next annual election of directors. At such election, the stockholders shall elect a successor to such director to hold office until the next election of the class for which such director shall have been chosen and until his successor shall be elected and qualified. No decrease in the number of directors shall shorten the term of any incumbent director.

     (c) Notwithstanding any other provisions of this Charter or Act of Incorporation or the By-Laws of the Corporation (and notwithstanding the fact that some lesser percentage may be specified by law, this Charter or Act of Incorporation or the By-Laws of the Corporation), any director or the entire Board of Directors of the Corporation may be removed at any time without cause, but only by the affirmative vote of the holders of two-thirds or more of the outstanding shares of capital stock of the Corporation entitled to vote generally in the election of directors (considered for this purpose as one class) cast at a meeting of the stockholders called for that purpose.

     (d) Nominations for the election of directors may be made by the Board of Directors or by any stockholder entitled to vote for the election of directors. Such nominations shall be made by notice in writing, delivered or mailed by first class United States mail, postage prepaid, to the Secretary of the Corporation not less than 14 days nor more than 50 days prior to any meeting of the stockholders called for the election of directors; provided, however, that if less than 21 days’ notice of the meeting is given to stockholders, such written notice shall be delivered or mailed, as prescribed, to the Secretary of the Corporation not later than the close of the seventh day following the day on which notice of the meeting was mailed to stockholders. Notice of nominations which are proposed by the Board of Directors shall be given by the Chairman on behalf of the Board.

     (e) Each notice under subsection (d) shall set forth (i) the name, age, business address and, if known, residence address of each nominee proposed in such notice, (ii) the principal occupation or employment of such nominee and (iii) the number of shares of stock of the Corporation which are beneficially owned by each such nominee.

     (f) The Chairman of the meeting may, if the facts warrant, determine and declare to

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the meeting that a nomination was not made in accordance with the foregoing procedure, and if he should so determine, he shall so declare to the meeting and the defective nomination shall be disregarded.

     (g) No action required to be taken or which may be taken at any annual or special meeting of stockholders of the Corporation may be taken without a meeting, and the power of stockholders to consent in writing, without a meeting, to the taking of any action is specifically denied.

     Sixth: - The Directors shall choose such officers, agents and servants as may be provided in the By-Laws as they may from time to time find necessary or proper.

     Seventh: - The Corporation hereby created is hereby given the same powers, rights and privileges as may be conferred upon corporations organized under the Act entitled “An Act Providing a General Corporation Law”, approved March 10, 1899, as from time to time amended.

     Eighth: - This Act shall be deemed and taken to be a private Act.

     Ninth: - This Corporation is to have perpetual existence.

     Tenth: - The Board of Directors, by resolution passed by a majority of the whole Board, may designate any of their number to constitute an Executive Committee, which Committee, to the extent provided in said resolution, or in the By-Laws of the Company, shall have and may exercise all of the powers of the Board of Directors in the management of the business and affairs of the Corporation, and shall have power to authorize the seal of the Corporation to be affixed to all papers which may require it.

     Eleventh: - The private property of the stockholders shall not be liable for the payment of corporate debts to any extent whatever.

     Twelfth: - The Corporation may transact business in any part of the world.

     Thirteenth: - The Board of Directors of the Corporation is expressly authorized to make, alter or repeal the By-Laws of the Corporation by a vote of the majority of the entire Board. The stockholders may make, alter or repeal any By-Law whether or not adopted by them, provided however, that any such additional By-Laws, alterations or repeal may be adopted only by the affirmative vote of the holders of two-thirds or more of the outstanding             shares of capital stock of the Corporation entitled to vote generally in the election of directors (considered for this purpose as one class).

     Fourteenth: - Meetings of the Directors may be held outside of the State of Delaware at such places as may be from time to time designated by the Board, and the Directors may keep the books of the Company outside of the State of Delaware at such places as may be from time to time designated by them.

     Fifteenth: - (a) (1) In addition to any affirmative vote required by law, and except as otherwise expressly provided in sections (b) and (c) of this Article Fifteenth:

(A) any merger or consolidation of the Corporation or any Subsidiary (as hereinafter

8

	defined) with or into (i) any Interested Stockholder (as hereinafter defined) or (ii) any other corporation (whether or not itself an Interested Stockholder), which, after such merger or consolidation, would be an Affiliate (as hereinafter defined) of an Interested Stockholder, or
(B)	any sale, lease, exchange, mortgage, pledge, transfer or other disposition (in one transaction or a series of related transactions) to or with any Interested Stockholder or any Affiliate of any Interested Stockholder of any assets of the Corporation or any Subsidiary having an aggregate fair market value of $1,000,000 or more, or
(C)	the issuance or transfer by the Corporation or any Subsidiary (in one transaction or a series of related transactions) of any securities of the Corporation or any Subsidiary to any Interested Stockholder or any Affiliate of any Interested Stockholder in exchange for cash, securities or other property (or a combination thereof) having an aggregate fair market value of $1,000,000 or more, or
(D)	the adoption of any plan or proposal for the liquidation or dissolution of the Corporation, or
(E)	any reclassification of securities (including any reverse stock split), or recapitalization of the Corporation, or any merger or consolidation of the Corporation with any of its Subsidiaries or any similar transaction (whether or not with or into or otherwise involving an Interested Stockholder) which has the effect, directly or indirectly, of increasing the proportionate share of the outstanding shares of any class of equity or convertible securities of the Corporation or any Subsidiary which is directly or indirectly owned by any Interested Stockholder, or any Affiliate of any Interested Stockholder,

shall require the affirmative vote of the holders of at least two-thirds of the outstanding shares of capital stock of the Corporation entitled to vote generally in the election of directors, considered for the purpose of this Article Fifteenth as one class (“Voting Shares”). Such affirmative vote shall be required notwithstanding the fact that no vote may be required, or that some lesser percentage may be specified, by law or in any agreement with any national securities exchange or otherwise.

(2) The term “business combination” as used in this Article Fifteenth shall mean any transaction which is referred to in any one or more of clauses (A) through (E) of paragraph 1 of the section (a).

          (b) The provisions of section (a) of this Article Fifteenth shall not be applicable to any particular business combination and such business combination shall require only such affirmative vote as is required by law and any other provisions of the Charter or Act of Incorporation or By-Laws if such business combination has been approved by a majority of the whole Board.

(c)	For the purposes of this Article Fifteenth:
(1)	A “person” shall mean any individual, firm, corporation or other entity.

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(2) “Interested Stockholder” shall mean, in respect of any business combination, any person (other than the Corporation or any Subsidiary) who or which as of the record date for the determination of stockholders entitled to notice of and to vote on such business combination, or immediately prior to the consummation of any such transaction:

(A)	is the beneficial owner, directly or indirectly, of more than 10% of the Voting Shares, or
(B)	is an Affiliate of the Corporation and at any time within two years prior thereto was the beneficial owner, directly or indirectly, of not less than 10% of the then outstanding voting Shares, or
(C)	is an assignee of or has otherwise succeeded in any share of capital stock of the Corporation which were at any time within two years prior thereto beneficially owned by any Interested Stockholder, and such assignment or succession shall have occurred in the course of a transaction or series of transactions not involving a public offering within the meaning of the Securities Act of 1933.

(3) A person shall be the “beneficial owner” of any Voting Shares:

(A)	which such person or any of its Affiliates and Associates (as hereafter defined) beneficially own, directly or indirectly, or
(B)	which such person or any of its Affiliates or Associates has (i) the right to acquire (whether such right is exercisable immediately or only after the passage of time), pursuant to any agreement, arrangement or understanding or upon the exercise of conversion rights, exchange rights, warrants or options, or otherwise, or (ii) the right to vote pursuant to any agreement, arrangement or understanding, or
(C)	which are beneficially owned, directly or indirectly, by any other person with which such first mentioned person or any of its Affiliates or Associates has any agreement, arrangement or understanding for the purpose of acquiring, holding, voting or disposing of any shares of capital stock of the Corporation.

(4)	The outstanding Voting Shares shall include shares deemed owned through application of paragraph (3) above but shall not include any other Voting Shares which may be issuable pursuant to any agreement, or upon exercise of conversion rights, warrants or options or otherwise.
(5)	“Affiliate” and “Associate” shall have the respective meanings given those terms in Rule 12b-2 of the General Rules and Regulations under the Securities Exchange Act of 1934, as in effect on December 31, 1981.
(6)	“Subsidiary” shall mean any corporation of which a majority of any class of

10

equity security (as defined in Rule 3a11-1 of the General Rules and Regulations under the Securities Exchange Act of 1934, as in effect on December 31, 1981) is owned, directly or indirectly, by the Corporation; provided, however, that for the purposes of the definition of Investment Stockholder set forth in paragraph (2) of this section (c), the term “Subsidiary” shall mean only a corporation of which a majority of each class of equity security is owned, directly or indirectly, by the Corporation.

     (d) majority of the directors shall have the power and duty to determine for the purposes of this Article Fifteenth on the basis of information known to them, (1) the number of Voting Shares beneficially owned by any person (2) whether a person is an Affiliate or Associate of another, (3) whether a person has an agreement, arrangement or understanding with another as to the matters referred to in paragraph (3) of section (c), or (4) whether the assets subject to any business combination or the consideration received for the issuance or transfer of securities by the Corporation, or any Subsidiary has an aggregate fair market value of $1,000,000 or more.

     (e) Nothing contained in this Article Fifteenth shall be construed to relieve any Interested Stockholder from any fiduciary obligation imposed by law.

     Sixteenth: Notwithstanding any other provision of this Charter or Act of Incorporation or the By-Laws of the Corporation (and in addition to any other vote that may be required by law, this Charter or Act of Incorporation by the By-Laws), the affirmative vote of the holders of at least two-thirds of the outstanding shares of the capital stock of the Corporation entitled to vote generally in the election of directors (considered for this purpose as one class) shall be required to amend, alter or repeal any provision of Articles Fifth, Thirteenth, Fifteenth or Sixteenth of this Charter or Act of Incorporation.

     Seventeenth:

     (a) a Director of this Corporation shall not be liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty as a Director, except to the extent such exemption from liability or limitation thereof is not permitted under the Delaware General Corporation Laws as the same exists or may hereafter be amended.

     (b) Any repeal or modification of the foregoing paragraph shall not adversely affect any right or protection of a Director of the Corporation existing hereunder with respect to any act or omission occurring prior to the time of such repeal or modification.”

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EXHIBIT 4

BY-LAWS

WILMINGTON TRUST COMPANY

WILMINGTON, DELAWARE

As existing on December 16, 2004

BY-LAWS OF WILMINGTON TRUST COMPANY

ARTICLE 1
Stockholders’ Meetings

     Section 1. Annual Meeting. The annual meeting of stockholders shall be held on the third Thursday in April each year at the principal office at the Company or at such other date, time or place as may be designated by resolution by the Board of Directors.

     Section 2. Special Meetings. Special meetings of stockholders may be called at any time by the Board of Directors, the Chairman of the Board, the Chief Executive Officer or the President.

     Section 3. Notice. Notice of all meetings of the stockholders shall be given by mailing to each stockholder at least ten (10) days before said meeting, at his last known address, a written or printed notice fixing the time and place of such meeting.

     Section 4. Quorum. A majority in the amount of the capital stock of the Company issued and outstanding on the record date, as herein determined, shall constitute a quorum at all meetings of stockholders for the transaction of any business, but the holders of a smaller number of shares may adjourn from time to time, without further notice, until a quorum is secured. At each annual or special meeting of stockholders, each stockholder shall be entitled to one vote, either in person or by proxy, for each share of stock registered in the stockholder’s name on the books of the Company on the record date for any such meeting as determined herein.

ARTICLE 2
Directors

     Section 1. Management. The affairs and business of the Company shall be managed by or under the direction of the Board of Directors.

     Section 2. Number. The authorized number of directors that shall constitute the Board of Directors shall be fixed from time to time by or pursuant to a resolution passed by a majority of the Board of Directors within the parameters set by the Charter of the Company. No more than two directors may also be employees of the Company or any affiliate thereof.

     Section 3. Qualification. In addition to any other provisions of these Bylaws, to be qualified for nomination for election or appointment to the Board of Directors, a person must have not attained the age of sixty-nine years at the time of such election or appointment, provided however, the Nominating and Corporate Governance Committee may waive such qualification as to a particular candidate otherwise qualified to serve as a director upon a good faith determination by such committee that such a waiver is in the best interests of the Company and its stockholders. The Chairman of the Board and the Chief Executive Officer shall not be qualified to continue to serve as directors upon the termination of their service in those offices for any reason.

     Section 4. Meetings. The Board of Directors shall meet at the principal office of the Company or elsewhere in its discretion at such times to be determined by a majority of its members, or at the call of the Chairman of the Board of Directors, the Chief Executive Officer or the President.

     Section 5. Special Meetings. Special meetings of the Board of Directors may be called at any time by the Chairman of the Board, the Chief Executive Officer or the President, and shall be called upon the written request of a majority of the directors.

     Section 6. Quorum. A majority of the directors elected and qualified shall be necessary to constitute a quorum for the transaction of business at any meeting of the Board of Directors.

     Section 7. Notice. Written notice shall be sent by mail to each director of any special meeting of the Board of Directors, and of any change in the time or place of any regular meeting, stating the time and place of such meeting, which shall be mailed not less than two days before the time of holding such meeting.

     Section 8. Vacancies. In the event of the death, resignation, removal, inability to act or disqualification of any director, the Board of Directors, although less than a quorum, shall have the right to elect the successor who shall hold office for the remainder of the full term of the class of directors in which the vacancy occurred, and until such director’s successor shall have been duly elected and qualified.

     Section 9. Organization Meeting. The Board of Directors at its first meeting after its election by the stockholders shall appoint an Audit Committee, a Compensation Committee and a Nominating and Corporate Governance Committee, and shall elect from its own members a Chairman of the Board, a Chief Executive Officer and a President, who may be the same person. The Board of Directors shall also elect at such meeting a Secretary and a Chief Financial Officer, who may be the same person, and may appoint at any time such committees as it may deem advisable. The Board of Directors may also elect at such meeting one or more Associate Directors. The Board of Directors, or a committee designated by the Board of Directors may elect or appoint such other officers as they may deem advisable.

     Section 10. Removal. The Board of Directors may at any time remove, with or without cause, any member of any committee appointed by it or any associate director or officer elected by it and may appoint or elect his successor.

     Section 11. Responsibility of Officers. The Board of Directors may designate an officer to be in charge of such departments or divisions of the Company as it may deem advisable.

     Section 12. Participation in Meetings. The Board of Directors or any committee of the Board of Directors may participate in a meeting of the Board of Directors or such committee, as the case may be, by conference telephone, video facilities or other communications equipment. Any action required or permitted to be taken at any meeting of the Board of Directors or any committee thereof may be taken without a meeting if all of the members of the Board of Directors or the committee, as the case may be, consent thereto in writing, and the writing or writings are filed with the minutes of the Board of Directors or such committee.

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ARTICLE 3
Committees of the Board of Directors

     Section 1. Audit Committee.

          (A) The Audit Committee shall be composed of not more than five (5) members, who shall be selected by the Board of Directors from its own members, none of whom shall be an officer or employee of the Company, and shall hold office at the pleasure of the Board.

          (B) The Audit Committee shall have general supervision over the Audit Services Division in all matters however subject to the approval of the Board of Directors; it shall consider all matters brought to its attention by the officer in charge of the Audit Services Division, review all reports of examination of the Company made by any governmental agency or such independent auditor employed for that purpose, and make such recommendations to the Board of Directors with respect thereto or with respect to any other matters pertaining to auditing the Company as it shall deem desirable.

          (C) The Audit Committee shall meet whenever and wherever its Chairperson, the Chairman of the Board, the Chief Executive Officer, the President or a majority of the Committee’s members shall deem it to be proper for the transaction of its business. A majority of the Committee’s members shall constitute a quorum for the transaction of business. The acts of the majority at a meeting at which a quorum is present shall constitute action by the Committee.

     Section 2. Compensation Committee.

          (A) The Compensation Committee shall be composed of not more than five (5) members, who shall be selected by the Board of Directors from its own members, none of whom shall be an officer or employee of the Company, and shall hold office at the pleasure of the Board of Directors.

          (B) The Compensation Committee shall in general advise upon all matters of policy concerning compensation, including salaries and employee benefits.

          (C) The Compensation Committee shall meet whenever and wherever its Chairperson, the Chairman of the Board, the Chief Executive Officer, the President or a majority of the Committee’s members shall deem it to be proper for the transaction of its business. A majority of the Committee’s members shall constitute a quorum for the transaction of business. The acts of the majority at a meeting at which a quorum is present shall constitute action by the Committee.

     Section 3. Nominating and Corporate Governance Committee.

          (A) The Nominating and Corporate Governance Committee shall be composed of not more than five members, who shall be selected by the Board of Directors from its own members, none of whom shall be an officer or employee of the Company, and shall hold office at the pleasure of the Board of Directors.

          (B) The Nominating and Corporate Governance Committee shall provide counsel and make recommendations to the Chairman of the Board and the full Board with respect to the performance of the Chairman of the Board and the Chief Executive Officer, candidates for membership on the Board of Directors and its committees, matters of corporate governance, succession planning for the Company’s

3

executive management and significant shareholder relations issues.

          (C) The Nominating and Corporate Governance Committee shall meet whenever and wherever its Chairperson, the Chairman of the Board, the Chief Executive Officer, the President, or a majority of the Committee’s members shall deem it to be proper for the transaction of its business. A majority of the Committee’s members shall constitute a quorum for the transaction of business. The acts of the majority at a meeting at which a quorum is present shall constitute action by the Committee.

     Section 4. Other Committees. The Company may have such other committees with such powers as the Board may designate from time to time by resolution or by an amendment to these Bylaws.

     Section 5. Associate Directors.

          (A) Any person who has served as a director may be elected by the Board of Directors as an associate director, to serve at the pleasure of the Board of Directors.

          (B) Associate directors shall be entitled to attend all meetings of directors and participate in the discussion of all matters brought to the Board of Directors, but will not have a right to vote.

     Section 6. Absence or Disqualification of Any Member of a Committee. In the absence or disqualification of any member of any committee created under Article III of these Bylaws, the member or members thereof present at any meeting and not disqualified from voting, whether or not he or they constitute a quorum, may unanimously appoint another member of the Board of Directors to act at the meeting in the place of any such absent or disqualified member.

ARTICLE 4
Officers

     Section 1. Chairman of the Board. The Chairman of the Board shall preside at all meetings of the Board of Directors and shall have such further authority and powers and shall perform such duties the Board of Directors may assign to him from time to time.

     Section 2. Chief Executive Officer. The Chief Executive Officer shall have the powers and duties pertaining to the office of Chief Executive Officer conferred or imposed upon him by statute, incident to his office or as the Board of Directors may assign to him from time to time. In the absence of the Chairman of the Board, the Chief Executive Officer shall have the powers and duties of the Chairman of the Board.

     Section 3. President. The President shall have the powers and duties pertaining to the office of the President conferred or imposed upon him by statute, incident to his office or as the Board of Directors may assign to him from time to time. In the absence of the Chairman of the Board and the Chief Executive Officer, the President shall have the powers and duties of the Chairman of the Board.

     Section 4. Duties. The Chairman of the Board, the Chief Executive Officer or the President, as designated by the Board of Directors, shall carry into effect all legal directions of the Board of Directors and shall at all times exercise general supervision over the interest, affairs and operations of the Company and perform all duties incident to his office.

4

     Section 5. Vice Presidents. There may be one or more Vice Presidents, however denominated by the Board of Directors, who may at any time perform all of the duties of the Chairman of the Board, the Chief Executive Officer and/or the President and such other powers and duties incident to their respective offices or as the Board of Directors, the Chairman of the Board, the Chief Executive Officer or the President or the officer in charge of the department or division to which they are assigned may assign to them from time to time.

     Section 6. Secretary. The Secretary shall attend to the giving of notice of meetings of the stockholders and the Board of Directors, as well as the committees thereof, to the keeping of accurate minutes of all such meetings, recording the same in the minute books of the Company and in general notifying the Board of Directors of material matters affecting the Company on a timely basis. In addition to the other notice requirements of these Bylaws and as may be practicable under the circumstances, all such notices shall be in writing and mailed well in advance of the scheduled date of any such meeting. He shall have custody of the corporate seal, affix the same to any documents requiring such corporate seal, attest the same and perform other duties incident to his office.

     Section 7. Chief Financial Officer. The Chief Financial Officer shall have general supervision over all assets and liabilities of the Company. He shall be custodian of and responsible for all monies, funds and valuables of the Company and for the keeping of proper records of the evidence of property or indebtedness and of all transactions of the Company. He shall have general supervision of the expenditures of the Company and periodically shall report to the Board of Directors the condition of the Company, and perform such other duties incident to his office or as the Board of Directors, the Chairman of the Board, the Chief Executive Officer or the President may assign to him from time to time.

     Section 8. Controller. There may be a Controller who shall exercise general supervision over the internal operations of the Company, including accounting, and shall render to the Board of Directors or the Audit Committee at appropriate times a report relating to the general condition and internal operations of the Company and perform other duties incident to his office.

     There may be one or more subordinate accounting or controller officers however denominated, who may perform the duties of the Controller and such duties as may be prescribed by the Controller.

     Section 9. Audit Officers. The officer designated by the Board of Directors to be in charge of the Audit Services Division of the Company, with such title as the Board of Directors shall prescribe, shall report to and be directly responsible to the Audit Committee and the Board of Directors.

     There shall be an Auditor and there may be one or more Audit Officers, however denominated, who may perform all the duties of the Auditor and such duties as may be prescribed by the officer in charge of the Audit Services Division.

     Section 10. Other Officers. There may be one or more officers, subordinate in rank to all Vice Presidents with such functional titles as shall be determined from time to time by the Board of Directors, who shall ex officio hold the office of Assistant Secretary of the Company and who may perform such duties as may be prescribed by the officer in charge of the department or division to which they are assigned.

     Section 11. Powers and Duties of Other Officers. The powers and duties of all other officers of the Company shall be those usually pertaining to their respective offices, subject to the direction of the Board of

5

Directors, the Chairman of the Board, the Chief Executive Officer or the President and the officer in charge of the department or division to which they are assigned.

     Section 12. Number of Offices. Any one or more offices of the Company may be held by the same person, except that (A) no individual may hold more than one of the offices of Chief Financial Officer, Controller or Audit Officer and (B) none of the Chairman of the Board, the Chief Executive Officer or the President may hold any office mentioned in Section 12(A).

ARTICLE 5
Stock and Stock Certificates

     Section 1. Transfer. Shares of stock shall be transferable on the books of the Company and a transfer book shall be kept in which all transfers of stock shall be recorded.

     Section 2. Certificates. Every holder of stock shall be entitled to have a certificate signed by or in the name of the Company by the Chairman of the Board, the Chief Executive Officer or the President or a Vice President, and by the Secretary or an Assistant Secretary, of the Company, certifying the number of shares owned by him in the Company. The corporate seal affixed thereto, and any of or all the signatures on the certificate, may be a facsimile. In case any officer, transfer agent or registrar who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the Company with the same effect as if he were such officer, transfer agent or registrar at the date of issue. Duplicate certificates of stock shall be issued only upon giving such security as may be satisfactory to the Board of Directors.

     Section 3. Record Date. The Board of Directors is authorized to fix in advance a record date for the determination of the stockholders entitled to notice of, and to vote at, any meeting of stockholders and any adjournment thereof, or entitled to receive payment of any dividend, or to any allotment of rights, or to exercise any rights in respect of any change, conversion or exchange of capital stock, or in connection with obtaining the consent of stockholders for any purpose, which record date shall not be more than 60 nor less than 10 days preceding the date of any meeting of stockholders or the date for the payment of any dividend, or the date for the allotment of rights, or the date when any change or conversion or exchange of capital stock shall go into effect, or a date in connection with obtaining such consent.

ARTICLE 6
Seal

     The corporate seal of the Company shall be in the following form:

Between two concentric circles the words “Wilmington Trust Company”
within the inner circle the words “Wilmington, Delaware.”

ARTICLE 7
Fiscal Year

     The fiscal year of the Company shall be the calendar year.

ARTICLE 8
Execution of Instruments of the Company

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     The Chairman of the Board, the Chief Executive Officer, the President or any Vice President, however denominated by the Board of Directors, shall have full power and authority to enter into, make, sign, execute, acknowledge and/or deliver and the Secretary or any Assistant Secretary shall have full power and authority to attest and affix the corporate seal of the Company to any and all deeds, conveyances, assignments, releases, contracts, agreements, bonds, notes, mortgages and all other instruments incident to the business of this Company or in acting as executor, administrator, guardian, trustee, agent or in any other fiduciary or representative capacity by any and every method of appointment or by whatever person, corporation, court officer or authority in the State of Delaware, or elsewhere, without any specific authority, ratification, approval or confirmation by the Board of Directors, and any and all such instruments shall have the same force and validity as though expressly authorized by the Board of Directors.

ARTICLE 9
Compensation of Directors and Members of Committees

     Directors and associate directors of the Company, other than salaried officers of the Company, shall be paid such reasonable honoraria or fees for attending meetings of the Board of Directors as the Board of Directors may from time to time determine. Directors and associate directors who serve as members of committees, other than salaried employees of the Company, shall be paid such reasonable honoraria or fees for services as members of committees as the Board of Directors shall from time to time determine and directors and associate directors may be authorized by the Company to perform such special services as the Board of Directors may from time to time determine in accordance with any guidelines the Board of Directors may adopt for such services, and shall be paid for such special services so performed reasonable compensation as may be determined by the Board of Directors.

ARTICLE 10
Indemnification

     Section 1. Persons Covered. The Company shall indemnify and hold harmless, to the fullest extent permitted by applicable law as it presently exists or may hereafter be amended, any person who was or is made or is threatened to be made a party or is otherwise involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative (a “proceeding”) by reason of the fact that he, or a person for whom he is the legal representative, is or was a director or associate director of the Company, a member of an advisory board the Board of Directors of the Company or any of its subsidiaries may appoint from time to time or is or was serving at the request of the Company as a director, officer, employee, fiduciary or agent of another corporation, partnership, limited liability company, joint venture, trust, enterprise or non-profit entity that is not a subsidiary or affiliate of the Company, including service with respect to employee benefit plans, against all liability and loss suffered and expenses reasonably incurred by such person. The Company shall be required to indemnify such a person in connection with a proceeding initiated by such person only if the proceeding was authorized by the Board of Directors.

     The Company may indemnify and hold harmless, to the fullest extent permitted by applicable law as it presently exists or may hereafter be amended, any person who was or is made or threatened to be made a party or is otherwise involved in any proceeding by reason of the fact that he, or a person for whom he is the legal representative, is or was an officer, employee or agent of the Company or a director, officer, employee or agent of a subsidiary or affiliate of the Company, against all liability and loss suffered and expenses reasonably incurred by such person. The Company may indemnify any such person in connection with a

7

proceeding (or part thereof) initiated by such person only if such proceeding (or part thereof) was authorized by the Board of Directors.

     Section 2. Advance of Expenses. The Company shall pay the expenses incurred in defending any proceeding involving a person who is or may be indemnified pursuant to Section 1 in advance of its final disposition, provided, however, that the payment of expenses incurred by such a person in advance of the final disposition of the proceeding shall be made only upon receipt of an undertaking by that person to repay all amounts advanced if it should be ultimately determined that the person is not entitled to be indemnified under this Article 10 or otherwise.

     Section 3. Certain Rights. If a claim under this Article 10 for (A) payment of expenses or (B) indemnification by a director, associate director, member of an advisory board the Board of Directors of the Company or any of its subsidiaries may appoint from time to time or a person who is or was serving at the request of the Company as a director, officer, employee, fiduciary or agent of another corporation, partnership, limited liability company, joint venture, trust, enterprise or nonprofit entity that is not a subsidiary or affiliate of the Company, including service with respect to employee benefit plans, is not paid in full within sixty days after a written claim therefor has been received by the Company, the claimant may file suit to recover the unpaid amount of such claim and, if successful in whole or in part, shall be entitled to be paid the expense of prosecuting such claim. In any such action, the Company shall have the burden of proving that the claimant was not entitled to the requested indemnification or payment of expenses under applicable law.

     Section 4. Non-Exclusive. The rights conferred on any person by this Article 10 shall not be exclusive of any other rights which such person may have or hereafter acquire under any statute, provision of the Charter or Act of Incorporation, these Bylaws, agreement, vote of stockholders or disinterested directors or otherwise.

     Section 5. Reduction of Amount. The Company’s obligation, if any, to indemnify any person who was or is serving at its request as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, enterprise or nonprofit entity shall be reduced by any amount such person may collect as indemnification from such other corporation, partnership, joint venture, trust, enterprise or nonprofit entity.

     Section 6. Effect of Modification. Any amendment, repeal or modification of the foregoing provisions of this Article 10 shall not adversely affect any right or protection hereunder of any person in respect of any act or omission occurring prior to the time of such amendment, repeal or modification.

ARTICLE 11
Amendments to the Bylaws

     These Bylaws may be altered, amended or repealed, in whole or in part, and any new Bylaw or Bylaws adopted at any regular or special meeting of the Board of Directors by a vote of a majority of all the members of the Board of Directors then in office.

8

ARTICLE 12
Miscellaneous

     Whenever used in these Bylaws, the singular shall include the plural, the plural shall include the singular unless the context requires otherwise and the use of either gender shall include both genders.

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EXHIBIT 6

Section 321(b) Consent

     Pursuant to Section 321(b) of the Trust Indenture Act of 1939, as amended, Wilmington Trust Company hereby consents that reports of examinations by Federal, State, Territorial or District authorities may be furnished by such authorities to the Securities and Exchange Commission upon request therefor.

	WILMINGTON TRUST COMPANY
Dated: April 30, 2007	By:	/s/ Denise Geran
	Name:		Denise M. Geran
	Title:		Vice President

EXHIBIT 7

NOTICE

This form is intended to assist state nonmember banks and
savings banks with state publication requirements. It has not been
approved by any state banking authorities. Refer to your
appropriate state banking authorities for your state publication
requirements.

R E P O R T            O F            C O N D I T I O N

Consolidating domestic subsidiaries of the

WILMINGTON TRUST COMPANY	of	WILMINGTON
Name of Bank		City

in the State of DELAWARE , at the close of business on December 31, 2006.

	Thousands of dollars
ASSETS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coins		228,015
Interest-bearing balances		0
Held-to-maturity securities		1,646
Available-for-sale securities		1,525,111
Federal funds sold in domestic offices		307,100
Securities purchased under agreements to resell		45,473
Loans and lease financing receivables:
Loans and leases held for sale		4,183
Loans and leases, net of unearned income		7,563,162
LESS: Allowance for loan and lease losses		85,397
Loans and leases, net of unearned income, allowance, and reserve		7,477,765
Assets held in trading accounts		0
Premises and fixed assets (including capitalized leases)		135,701
Other real estate owned		4,816
Investments in unconsolidated subsidiaries and associated companies		3,819
Customers’ liability to this bank on acceptances outstanding		0
Intangible assets:
a. Goodwill		1,946
b. Other intangible assets		3,694
Other assets		262,913
Total assets		10,002,182

CONTINUED ON NEXT PAGE

2

	Thousands of dollars
LIABILITIES
Deposits:
In domestic offices		8,169,959
Noninterest-bearing		938,068
Interest-bearing		7,231,891
Federal funds purchased in domestic offices		143,250
Securities sold under agreements to repurchase		470,057
Trading liabilities (from Schedule RC-D)		0
Other borrowed money (includes mortgage indebtedness and obligations under capitalized leases:		122,845
Bank’s liability on acceptances executed and outstanding		0
Subordinated notes and debentures		0
Other liabilities (from Schedule RC-G)		252,640
Total liabilities		9,158,751
EQUITY CAPITAL
Perpetual preferred stock and related surplus		0
Common Stock		500
Surplus (exclude all surplus related to preferred stock)		121,653
a. Retained earnings		773,616
b. Accumulated other comprehensive income		(52,338	)
Total equity capital		843,431
Total liabilities, limited-life preferred stock, and equity capital		10,002,182

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EX-99.1

Exhibit 99.1

FORM OF LETTER OF TRANSMITTAL
ALION SCIENCE AND TECHNOLOGY CORPORATION

LETTER OF TRANSMITTAL
TO
TENDER FOR EXCHANGE
UP TO
$250,000,000 AGGREGATE PRINCIPAL AMOUNT
FOR
101/4% SENIOR NOTES DUE 2015
THAT HAVE BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933

THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON          , 2007 UNLESS EXTENDED (THE “EXPIRATION DATE”). TENDERS MAY BE WITHDRAWN AT ANY TIME PRIOR TO 5:00 P.M., NEW YORK CITY TIME, ON THE EXPIRATION DATE.

Deliver to the Exchange Agent:

Wilmington Trust Company

By Registered or Certified Mail or Overnight Courier:	By Hand in Wilmington, DE:
Rodney Square North 1100 North Market Street Wilmington, DE 19890-1626 Attention: Alisha Clendaniel	Rodney Square North 1100 North Market Street Wilmington, DE 19890-1626 Attention: Alisha Clendaniel

By Facsimile Transmission:
(for Eligible Institutions Only)

Facsimile: 302-636-4139
Confirm by Telephone: 302-636-6470

DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR TRANSMISSION OF INSTRUCTIONS VIA A FACSIMILE NUMBER OTHER THAN THE ONE LISTED ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL SHOULD BE READ CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED.

The undersigned hereby acknowledges receipt and review of the prospectus dated April   , 2007 (the “Prospectus”), of Alion Science and Technology Corporation (“Alion”), a Delaware corporation, and this Letter of Transmittal, which together describe Alion’s offer (the “Exchange Offer”) to exchange $250,000,000 in aggregate principal amount of registered 101/4% Senior Notes Due 2015 (CUSIP Number 016275AF6) (the “Exchange Notes”) for a like aggregate principal amount of Alion’s issued and outstanding unregistered 101/4% Senior Notes Due 2015 (CUSIP Numbers 016275AE9/U01426AA0) (the “Outstanding Notes”) which were issued in a private offering on February 8, 2007 and which have certain transfer restrictions. The Outstanding Notes were issued and sold in reliance upon an exemption from registration under the Securities Act of 1933, as amended (“Securities Act”). Capitalized terms used but not defined herein shall have the same meaning given them in the Prospectus.

For each Outstanding Note accepted for exchange, the holder of such Outstanding Note will receive an Exchange Note having an aggregate principal amount equal to that of the surrendered Outstanding Note. Alion reserves the right, at any time or from time to time, to extend the Exchange Offer at its discretion, in which event the term “expiration date” shall mean the latest date to which the Exchange Offer is extended. Alion shall give notice of any extension by giving oral, confirmed in writing, or written notice to the exchange agent and by making a public announcement by press release prior to 9:00 a.m., New York City time, on the first business day after the previously scheduled expiration date. The term “business day” shall mean any day that is not a Saturday, Sunday or day on which banks are authorized by law to close in the State of New York.

This Letter of Transmittal is to be used by a holder of Outstanding Notes if original Outstanding Notes, where available, are to be forwarded herewith. If tenders of Outstanding Notes are to be made by book-entry transfer to an account maintained by the exchange agent at The Depository Trust Company (the “book-entry transfer facility”) pursuant to the procedures set forth in the Prospectus under the caption “The Exchange Offer — Procedures for Tendering Outstanding Notes”, then a tendering holder of Outstanding Notes will become bound by the terms and conditions of this Letter of Transmittal in accordance with the procedures established under ATOP. Holders of Outstanding Notes whose Outstanding Notes are not immediately available, or who are unable to deliver their Outstanding Notes and all other documents required by this Letter of Transmittal to the exchange agent on or prior to the expiration date, or who are unable to complete the procedure for book-entry transfer on a timely basis, must exchange their Outstanding Notes according to the guaranteed delivery procedures set forth in the Prospectus under the caption “The Exchange Offer — Procedures for Tendering Outstanding Notes — Guaranteed Delivery.” See Instruction 2. Delivery of documents to the book-entry transfer facility does not constitute delivery to the exchange agent.

The term “holder” with respect to the Exchange Offer means any person (i) in whose name Outstanding Notes are registered on the books of Alion or any other person who has obtained a properly completed bond power from the registered holder or (ii) any person whose Outstanding Notes are held of record by the book-entry transfer facility who desires to deliver such notes by book-entry transfer at the book-entry transfer facility. The undersigned has completed, executed and delivered this Letter of Transmittal to indicate the action the undersigned desires to take with respect to the Exchange Offer. Holders who wish to tender their Outstanding Notes must complete this Letter of Transmittal in its entirety.

PLEASE READ THE ENTIRE LETTER OF TRANSMITTAL AND THE PROSPECTUS CAREFULLY BEFORE CHECKING ANY BOX BELOW.

THE INSTRUCTIONS INCLUDED WITH THIS LETTER OF TRANSMITTAL MUST BE FOLLOWED. QUESTIONS AND REQUESTS FOR ASSISTANCE FOR ADDITIONAL COPIES OF THE PROSPECTUS AND THIS LETTER OF TRANSMITTAL MAY BE DIRECTED TO THE EXCHANGE AGENT.

List below the Outstanding Notes to which this Letter of Transmittal relates. If the space below is inadequate, list the registered numbers and principal amounts on a separate signed schedule and affix the list to this Letter of Transmittal.

DESCRIPTION OF OUTSTANDING NOTES TENDERED
Name(s) and Address(es) of Registered
Holder(s) Exactly as Name(s) Appear(s)	Principal			Aggregate
on Outstanding Notes.	Represented	Principal	Registered	Amount
(Please Fill in, if Blank)	Tendered**	Amount	Numbers(s)*	by Note(s)
* Need not be completed
** Unless otherwise indicated, any tendering holder of Outstanding Notes will be deemed to have tendered the entire aggregate principal amount represented by such Outstanding Notes. All tenders will be accepted only in minimum denominations equal to $2,000 or integral multiples of $1,000 in excess thereof.

o	CHECK HERE IF TENDERED OUTSTANDING NOTES ARE ENCLOSED HEREWITH.
o	CHECK HERE IF TENDERED OUTSTANDING NOTES ARE BEING DELIVERED PURSUANT TO A NOTICE OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE EXCHANGE AGENT AND COMPLETE THE FOLLOWING (FOR USE BY ELIGIBLE INSTITUTIONS ONLY):
	Name(s) of registered holder(s) of Outstanding Notes:_ _
	Date of execution of Notice of Guaranteed Delivery:_ _
	Window ticket number (if available):_ _
	Name of Eligible Institution that guaranteed delivery:_ _
	DTC Book Entry Account number (if delivered by book-entry transfer):_ _
o	CHECK HERE IF YOU ARE BROKER-DEALER AND WISH TO RECEIVE 10 ADDITIONAL COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR SUPPLEMENTS THERETO:
	Name:_ _
	Address:_ _
o	CHECK HERE IF YOU ARE A BROKER-DEALER AND YOU ARE RECEIVING EXCHANGE NOTES FOR YOUR OWN ACCOUNT IN EXCHANGE FOR OUTSTANDING NOTES THAT WERE ACQUIRED AS A RESULT OF MARKET MAKING ACTIVITIES OR OTHER TRADING ACTIVITIES.
	Name:_ _
	Address:_ _

SIGNATURES MUST BE PROVIDED BELOW
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY

Ladies and Gentlemen:

Subject to the terms and conditions of the Exchange Offer, the undersigned hereby tenders to Alion for exchange the principal amount of Outstanding Notes indicated above. Subject to and effective upon the acceptance for exchange of the principal amount of Outstanding Notes tendered in accordance with this Letter of Transmittal, the undersigned hereby exchanges, assigns and transfers to Alion all right, title and interest in and to the Outstanding Notes tendered for exchange hereby. The undersigned hereby irrevocably constitutes and appoints the exchange agent, the agent and attorney-in-fact of the undersigned (with full knowledge that the exchange agent also acts as the agent of Alion in connection with the Exchange Offer) with respect to the tendered Outstanding Notes with full power of substitution to:

•  deliver such Outstanding Notes, or transfer ownership of such Outstanding Notes on the account books maintained by the book-entry transfer facility, to Alion and deliver all accompanying evidences of transfer and authenticity, and

•  present such Outstanding Notes for transfer on the books of Alion and receive all benefits and otherwise exercise all rights of beneficial ownership of such Outstanding Notes,

all in accordance with the terms of the Exchange Offer. The power of attorney granted in this paragraph shall be deemed to be irrevocable and coupled with an interest.

The undersigned hereby represents and warrants that the undersigned has full power and authority to tender, exchange, sell, assign and transfer the Outstanding Notes tendered hereby and to acquire the Exchange Notes issuable upon the exchange of such tendered Outstanding Notes, and that Alion will acquire good and unencumbered title thereto, free and clear of all liens, restrictions, charges and encumbrances and not subject to any adverse claim, when the same are accepted for exchange by Alion.

The undersigned acknowledge(s) that this Exchange Offer is being made in reliance upon interpretations contained in no-action letters issued to third parties by the staff of the Securities and Exchange Commission (the “SEC”) to third parties in unrelated transactions. Based on those interpretations, the Company believes, that the Exchange Notes issued in exchange for the Outstanding Notes pursuant to the Exchange Offer may be offered for resale, resold and otherwise transferred by holders thereof (other than by an affiliate of Alion within the meaning of Rule 405 under the Securities Act or a broker-dealer who purchased Outstanding Notes exchanged for such Exchange Notes directly from Alion to resell pursuant to Rule 144A under the Securities Act or any other available exemption under the Securities Act), without compliance with the registration and Prospectus delivery provisions of the Securities Act, provided that such Exchange Notes are acquired in the ordinary course of such holders’ business and such holders are not participating in, and have no arrangement with any person to participate in, the distribution of such Exchange Notes. The undersigned specifically represent(s) or warrants to Alion that:

•  any Exchange Notes acquired in exchange for Outstanding Notes tendered hereby are being acquired in the ordinary course of business of the person receiving such Exchange Notes, whether or not the undersigned;

•  the undersigned is not participating in, and has no arrangement with any person to participate in, the distribution of Exchange Notes;

•  neither the undersigned nor any such other person is an “affiliate” (as defined in Rule 405 of the Securities Act) of Alion, or if the undersigned is an affiliate, the undersigned will comply with the registration and prospectus delivery requirements of the Securities Act.

If the undersigned is not a broker-dealer, the undersigned represents that it is not engaged in, and does not intend to engage in, a distribution of Exchange Notes. If the undersigned is a broker-dealer that will receive Exchange Notes for its own account in exchange for Outstanding Notes that were acquired as a result of market-making activities or other trading activities, it acknowledges that it will deliver a Prospectus in connection with any resale of such Exchange Notes; however, by so acknowledging and by delivering a Prospectus, the undersigned will not be deemed to admit that

it is an “underwriter” within the meaning of the Securities Act. The undersigned acknowledges that if the undersigned is participating in the Exchange Offer for the purpose of distributing the Exchange Notes:

•  the undersigned cannot rely on SEC no-action letters, and, in the absence of an exemption therefrom, must comply with the registration and Prospectus delivery requirements of the Securities Act in connection with a secondary resale transaction of the Exchange Notes, in which case the registration statement must contain the selling security holder information required by Item 507 or Item 508, as applicable, of Regulation S-K of the Securities Act;

•  a broker-dealer that delivers such a Prospectus to purchasers in connection with such resales will be subject to certain of the civil liability provisions under the Securities Act and will be bound by the provisions of the registration rights agreement (including certain indemnification rights and obligations); and

•  a broker-dealer agrees that upon receipt of notice from Alion that the Prospectus or the Registration Statement contains an untrue statement of material fact or requires making additional statements in order to make the statement made therein not misleading in any material respect, such broker-dealer will immediately suspend the sale of Exchange Notes until Alion has delivered to the broker-dealer corrected prospectuses, filed any necessary amendment to the Registration Statement with the SEC and notified the broker-dealer it may resume sales.

The undersigned will, upon request, execute and deliver any additional documents deemed by the exchange agent or Alion to be necessary or desirable to complete the exchange, assignment and transfer of the Outstanding Notes tendered hereby, including the transfer of such Outstanding Notes on the account books maintained by the book-entry transfer facility.

For purposes of the Exchange Offer, Alion shall be deemed to have accepted for exchange validly tendered Outstanding Notes when, as and if Alion gives oral or written notice thereof to the exchange agent. Any tendered Outstanding Notes that are not accepted for exchange pursuant to the Exchange Offer for any reason will be returned, without expense, to the undersigned at the address shown below or at a different address as may be indicated herein under “Special Delivery Instructions” as promptly as practicable after the expiration date.

All authority conferred or agreed to be conferred by this Letter of Transmittal shall survive the death, incapacity or dissolution of the undersigned, and every obligation of the undersigned under this Letter of Transmittal shall be binding upon the undersigned’s heirs, personal representatives, successors and assigns.

The undersigned acknowledges that the acceptance of properly tendered Outstanding Notes by Alion pursuant to the procedures described under the caption “The Exchange Offer — Procedures for Tendering Outstanding Notes” in the Prospectus and in the instructions hereto will constitute a binding agreement between the undersigned and Alion upon the terms and subject to the conditions of the Exchange Offer.

Unless otherwise indicated under “Special Issuance Instructions,” please issue the Exchange Notes issued in exchange for the Outstanding Notes accepted for exchange, and return any Outstanding Notes not tendered or not exchanged, in the name(s) of the undersigned or in the case of book-entry transfer credit to the account maintained at DTC indicated above the Exchange Notes. Similarly, unless otherwise indicated under “Special Delivery Instructions,” please mail or deliver the Exchange Notes issued in exchange for the Outstanding Notes accepted for exchange and any Outstanding Notes not tendered or not exchanged (and accompanying documents, as appropriate) to the undersigned at the address shown below the undersigned’s signature(s). In the event that both “Special Issuance Instructions” and “Special Delivery Instructions” are completed, please issue the Exchange Notes issued in exchange for the Outstanding Notes accepted for exchange in the name(s) of, and return any Outstanding Notes not tendered or not exchanged to, the person(s) so indicated. The undersigned recognizes that Alion has no obligation pursuant to the “Special Issuance Instructions” and “Special Delivery Instructions” to transfer any Outstanding Notes from the name of the registered holder(s) thereof if Alion does not accept for exchange any of the Outstanding Notes so tendered for exchange.

(COMPLETE SUBSTITUTE FORM W-9)

SPECIAL ISSUANCE INSTRUCTIONS
(SEE INSTRUCTIONS 5 AND 6)

To be completed ONLY (i) if Outstanding Notes in a principal amount not tendered, or Exchange Notes issued in exchange for Outstanding Notes accepted for exchange, are to be issued in the name of someone other than the undersigned, or (ii) if Outstanding Notes tendered by book-entry transfer that are not exchanged are to be returned by credit to an account maintained at the book-entry transfer facility other than the account indicated above.

Issue Exchange Notes and/or Outstanding Notes to:

Name:

(Please print or type)

Address:

(include zip code)

(Tax identification or social security number)

Credit unexchanged Outstanding Notes delivered by book-entry transfer to the book-entry transfer facility set forth below:

Book-entry transfer facility account number:

SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 5 AND 6)

To be completed ONLY if Outstanding Notes in a principal amount not tendered, or Exchange Notes issued in exchange for Outstanding Notes accepted for exchange, are to be mailed or delivered to someone other than the undersigned, or to the undersigned at an address other than that shown below the undersigned’s signature.

Mail or deliver Exchange Notes and/or Outstanding Notes to:

Name:

(Please print or type)

Address:

(include zip code)

(Tax identification or social security number)

IMPORTANT

PLEASE SIGN HERE
(COMPLETE ACCOMPANYING SUBSTITUTE FORM W-9)

X

X

Signature(s) of Registered Holder(s) of Outstanding Note(s)

_ _, 2007

_ _, 2007

Date                             

(The above lines must be signed by the registered holder(s) of Outstanding Notes as name(s) appear(s) on the Outstanding Notes or on a security position listing, or by person(s) authorized to become registered holder(s) by a properly completed bond power from the registered holder(s), a copy of which must be transmitted with this Letter of Transmittal. If Outstanding Notes to which this Letter of Transmittal relate are held of record by two or more joint holders, then all such holders must sign this Letter of Transmittal. If signature is by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a corporation or other person acting in a fiduciary or representative capacity, then such person must set forth his or her full title below and, unless waived by Alion, submit evidence satisfactory to Alion of such person’s authority so to act. See Instruction 5 regarding the completion of this Letter of Transmittal, printed below.)

Name:

(Please print or type)

Capacity:

Address:

(Including Zip Code)

Area Code and Telephone Number:

SIGNATURE GUARANTEE
(see instructions 2 and 5)
Certain signatures must be guaranteed by an Eligible Institution.

Signature(s) guaranteed by an Eligible Institution:

(Authorized signature)

(Title)

(Name and Firm)

(Address, include zip code)

(Area code and telephone number)

Date: _ _, 2007

INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS
OF THE EXCHANGE OFFER

1. Delivery of this Letter of Transmittal and Outstanding Notes or Book-Entry Confirmations. All physically delivered Outstanding Notes or any confirmation of a book-entry transfer to the exchange agent’s account at the book-entry transfer facility of Outstanding Notes tendered by book-entry transfer (a “book-entry confirmation”), as well as a properly completed and duly executed copy of this Letter of Transmittal (or facsimile hereof) or agent’s message (as defined in the Prospectus), and any other documents required by this Letter of Transmittal, must be received by the exchange agent at its address set forth herein prior to 5:00 p.m., New York City time, on the expiration date.

THE METHOD OF DELIVERY OF THE TENDERED OUTSTANDING NOTES, THIS LETTER OF TRANSMITTAL AND ALL OTHER REQUIRED DOCUMENTS TO THE EXCHANGE AGENT IS AT THE ELECTION AND RISK OF THE HOLDER AND, EXCEPT AS OTHERWISE PROVIDED BELOW, THE DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED OR CONFIRMED BY THE EXCHANGE AGENT. INSTEAD OF DELIVERY BY MAIL, IT IS RECOMMENDED THAT THE HOLDER USE AN OVERNIGHT OR HAND DELIVERY SERVICE. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ASSURE DELIVERY TO THE EXCHANGE AGENT BEFORE THE EXPIRATION DATE. NO LETTER OF TRANSMITTAL OR OUTSTANDING NOTES SHOULD BE SENT TO ALION.

2. Guaranteed Delivery Procedures. Holders who wish to tender their Outstanding Notes and whose Outstanding Notes are not immediately available or who cannot deliver their Outstanding Notes, this Letter of Transmittal or any other documents required hereby to the exchange agent prior to the expiration date or who cannot complete the procedure for book-entry transfer on a timely basis and deliver an agent’s message (as defined in the Prospectus), must tender their Outstanding Notes according to the guaranteed delivery procedures set forth in the Prospectus in “The Exchange Offer — Procedures for Tendering Outstanding Notes — Guaranteed Delivery. Pursuant to such procedures:

•  such tender must be made by or through a firm that is a participant in the Security Transfer Agents Medallion program or the Stock Exchange Medallion program, which is generally a member of a registered national securities exchange, a member of the National Association of Securities Dealers, Inc., or a commercial bank or a trust company having an office or correspondent in the United States or an “eligible guarantor institution” within the meaning of Rule 17Ad 15 under the Exchange Act (an “Eligible Institution”);

•  prior to the expiration date, the exchange agent must have received from an Eligible Institution a properly completed and duly executed Notice of Guaranteed Delivery (by facsimile transmission, mail or hand delivery) setting forth the name and address of the holder of the Outstanding Notes, the registered number(s) of such Outstanding Notes and the total principal amount of Outstanding Notes tendered, stating that the tender is being made thereby and guaranteeing that, within three New York Stock Exchange trading days after the Notice of Guaranteed Delivery date, this Letter of Transmittal (or facsimile hereof) properly completed and duly executed together with the certificates representing the Outstanding Notes in proper form for transfer (or a book-entry confirmation) and any other documents required hereby, must be deposited by the Eligible Institution with the exchange agent within three New York Stock Exchange trading days after the date of execution of the Notice of Guaranteed Delivery; and

•  the certificates for all physically tendered Outstanding Notes, in proper form for transfer (or book-entry confirmation, as the case may be) and all other documents required hereby are received by the exchange agent within three New York Stock Exchange trading days after the Notice of Guaranteed Delivery.

ANY HOLDER OF OUTSTANDING NOTES WHO WISHES TO TENDER OUTSTANDING NOTES PURSUANT TO THE GUARANTEED DELIVERY PROCEDURES DESCRIBED ABOVE MUST ENSURE THAT THE EXCHANGE AGENT RECEIVES THE NOTICE OF GUARANTEED DELIVERY PRIOR TO 5:00 P.M., NEW YORK CITY TIME, ON THE EXPIRATION DATE. See “The Exchange Offer — Procedures for Tendering Outstanding Notes — Guaranteed Delivery” section of the Prospectus.

3. Tender by Holder. Only a holder of Outstanding Notes may tender such Outstanding Notes in the Exchange Offer. Any beneficial holder of Outstanding Notes who is not the registered holder and who wishes to tender should arrange with the registered holder to execute and deliver this Letter of Transmittal on his behalf or must, prior to completing and executing this Letter of Transmittal and delivering his Outstanding Notes, either make appropriate arrangements to register ownership of the Outstanding Notes in such holder’s name or obtain a properly completed bond power from the registered holder.

4. Partial Tenders. Tenders of Outstanding Notes will be accepted only in minimum denominations equal to $2,000 or integral multiples of $1,000 in excess thereof. If less than the entire principal amount of any Outstanding Notes is tendered, the tendering holder should fill in the principal amount tendered in the third column of the box entitled “Description of Outstanding Notes Tendered” above. The entire principal amount of Outstanding Notes delivered to the exchange agent will be deemed to have been tendered unless otherwise indicated. If the entire principal amount of all Outstanding Notes is not tendered, then Outstanding Notes for the principal amount of Outstanding Notes not tendered and Exchange Notes issued in exchange for any Outstanding Notes accepted will be sent to the holder at his or her registered address, unless a different address is provided in the appropriate box on this Letter of Transmittal, promptly after the Exchange Notes are accepted for exchange.

5. Signatures on this Letter of Transmittal; Bond Powers and Endorsements; Guarantee of Signatures. If this Letter of Transmittal (or facsimile hereof) is signed by the record holder(s) of the Outstanding Notes tendered hereby, the signature must correspond with the name(s) as written on the face of the Outstanding Notes without alteration, enlargement or any change whatsoever. If this Letter of Transmittal (or facsimile hereof) is signed by a participant in the book-entry transfer facility, the signature must correspond with the name as it appears on the

security position listing as the holder of the Outstanding Notes. If any of the Outstanding Notes are owned of record by two or more joint owners, then all such joint owners must sign this Letter of Transmittal.

If this Letter of Transmittal (or facsimile hereof) is signed by the registered holder(s) of Outstanding Notes listed and tendered hereby and the Exchange Notes issued in exchange therefor are to be issued (or any untendered principal amount of Outstanding Notes is to be reissued) to the registered holder, the said holder need not and should not endorse any tendered Outstanding Notes, nor provide a separate bond power. In any other case, such holder must either properly endorse the Outstanding Notes tendered or transmit a properly completed separate bond power with this Letter of Transmittal, with the signatures on the endorsement or bond power guaranteed by an Eligible Institution.

If this Letter of Transmittal (or facsimile hereof) is signed by a person other than the registered holder(s) of any Outstanding Notes listed, such Outstanding Notes must be endorsed or accompanied by appropriate bond powers, in each case signed as the name of the registered holder(s) appears on the Outstanding Notes.

If this Letter of Transmittal (or facsimile hereof) or any Outstanding Notes or bond powers are signed by trustees, executors, administrators, guardians, attorneys-in-fact, officers of corporations or others acting in a fiduciary or representative capacity, such persons should so indicate when signing, and, unless waived by Alion, evidence satisfactory to Alion of their authority to act must be submitted with this Letter of Transmittal including such opinions of counsel, certifications and other information Alion or the trustee under the Indenture of the Outstanding Notes may require.

Endorsements on Outstanding Notes or signatures on bond powers required by this Instruction 5 must be guaranteed by an Eligible Institution.

No signature guarantee is required if:

•  this Letter of Transmittal (or facsimile hereof) is signed by the registered holder(s) of the Outstanding Notes tendered herein (or by a participant in the book-entry transfer facility whose name appears on a security position listing as the owner of the tendered Outstanding Notes) and the Exchange Notes are to be issued directly to such registered holder(s) (or, if signed by a participant in the book-entry transfer facility, deposited to such participant’s account at such book-entry transfer facility) and neither the box entitled “Special Delivery Instructions” nor the box entitled “Special Issuance Instructions” has been completed; or

•  such Outstanding Notes are tendered for the account of an Eligible Institution.

In all other cases, all signatures on this Letter of Transmittal (or facsimile hereof) must be guaranteed by an Eligible Institution.

6. Special Issuance and Delivery Instructions. Tendering holders should indicate, in the applicable box(es), the name and address (or account at the book-entry transfer facility) to which Exchange Notes or substitute Outstanding Notes for principal amounts not tendered or not accepted for exchange are to be issued or sent, if different from the name and address of the person signing this Letter of Transmittal. In the case of issuance in a different name, the taxpayer identification or social security number of the person named must also be indicated. Certificates for Outstanding Notes not exchanged will be returned by mail or, if tendered by book-entry, Outstanding Notes not exchanged will be credited to the account maintained by the registered holder at the book-entry transfer facility.

7. Transfer Taxes. The undersigned will pay all transfer taxes, if any, including those applicable to the exchange of Outstanding Notes pursuant to the Exchange Offer. If satisfactory evidence of payment of such taxes or exemption therefrom is not submitted with this Letter of Transmittal, the amount of such transfer taxes, if any, will be billed directly to such tendering holder.

8. Tax Identification Number. Federal income tax law requires that a U.S. holder of any Outstanding Notes that are accepted for exchange must provide Alion (as payor) with its correct taxpayer identification number (“TIN”), which, in the case of a U.S. holder who is an individual, generally is his or her social security number. If Alion is not provided with the TIN, the U.S. holder may be subject to a penalty imposed by the Internal Revenue Service (“IRS”) as further described in the enclosed “Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9” (the “Guidelines”), and may result in backup withholding of 28% of any payments made to you pursuant to the Exchange Offer or thereafter. (If withholding results in an over-payment of taxes, a refund may be obtained). Certain U.S. holders (including, among others, corporations) may not be subject to these backup withholding and reporting requirements. See the enclosed Guidelines for additional instructions.

To prevent backup withholding, each tendering U.S. holder must provide such U.S. holder’s correct TIN by completing the Substitute Form W-9 set forth herein, certifying that the TIN provided is correct (or that such U.S. holder is awaiting a TIN), and that the U.S. holder is not subject to backup withholding because:

•  the U.S. holder is exempt from backup withholding; or

•  the U.S. holder has not been notified by the IRS that such U.S. holder is subject to backup withholding as a result of failure to report all interest or dividends; or

•  the IRS has notified the U.S. holder that such holder is no longer subject to backup withholding.

In general, each non-U.S. holder must complete and submit the appropriate Form W-8 (which payor will provide upon request) signed under penalties of perjury, attesting to the appropriate status of the non-U.S. holder in order to prevent withholding (or, in certain circumstances, at a reduced rate). To the extent a non-U.S. holder does not submit the appropriate Form W-8 in a timely manner, U.S. federal income tax may be withheld at a rate of 30% on any payments made to you pursuant to the Exchange Offer or thereafter.

If the Outstanding Notes are registered in more than one name or are not in the name of the actual owner, see the enclosed Guidelines for information on which TIN to report.

Alion reserves the right in its sole discretion to take whatever steps are necessary to comply with Alion’ obligations regarding backup withholding.

To ensure compliance with requirements imposed by certain U.S. Treasury Regulations, notification is hereby given that any tax discussion or tax conclusions contained herein may be used solely for the matters addressed herein and cannot be used for the purposes of (i) the promoting, marketing or recommending to another person any tax-related matter, (ii) avoiding penalties

imposed under the United States Internal Revenue Code or under U.S. Treasury Regulations. EACH HOLDER IS STRONGLY URGED TO SEEK ADVICE WITH RESPECT TO THE U.S. FEDERAL, STATE, LOCAL AND NON-U.S. TAX CONSEQUENCES OF THE TRANSACTIONS DISCUSSED HEREIN BASED ON ITS PARTICULAR CIRCUMSTANCES FROM AN INDEPENDENT TAX ADVISOR.

9. Validity of Tenders. All questions as to the validity, form, eligibility (including time of receipt), acceptance and withdrawal of tendered Outstanding Notes will be determined by Alion in its sole discretion, which determination will be final and binding. Alion reserves the absolute right to reject any and all Outstanding Notes not properly tendered or any Outstanding Notes the acceptance of which would, in the opinion of Alion or its counsel, be unlawful. Alion also reserves the absolute right to waive any conditions of the Exchange Offer or defects or irregularities in tenders as to particular Outstanding Notes. The interpretation of the terms and conditions by Alion of the Exchange Offer (which includes this Letter of Transmittal and the instructions hereto) shall be final and binding on all parties. Unless waived, any defects or irregularities in connection with tenders of Outstanding Notes must be cured within such time as Alion shall determine. Neither Alion, the exchange agent nor any other person shall be under any duty to give notification of defects or irregularities with regard to tenders of Outstanding Notes nor shall any of them incur any liability for failure to give such information.

10. Waiver of Conditions. Alion reserves the absolute right to waive, in whole or in part, any of the conditions to the Exchange Offer set forth in the Prospectus or this Letter of Transmittal.

11. No Conditional Tender. No alternative, conditional, irregular or contingent tender of Outstanding Notes or transmittal of this Letter of Transmittal will be accepted. Holders tendering Outstanding Notes by execution and delivery of this Letter of Transmittal or by the ATOP system waive any and all rights to receive notice of acceptance of their Original Notes for exchange.

12. Mutilated, Lost, Stolen or Destroyed Outstanding Notes. Any holder whose Outstanding Notes have been mutilated, lost, stolen or destroyed should contact the exchange agent at the address indicated above for further instructions.

13. Requests for Assistance or Additional Copies. Requests for assistance or for additional copies of the Prospectus or this Letter of Transmittal may be directed to the exchange agent at the address or telephone number set forth on the cover page of this Letter of Transmittal. Holders may also contact their broker, dealer, commercial bank, trust company or other nominee for assistance concerning the Exchange Offer.

14. Withdrawal. Tenders may be withdrawn only pursuant to the withdrawal rights set forth in the Prospectus under the caption “The Exchange Offer — Withdrawal of Tenders.”

IMPORTANT:  THIS LETTER OF TRANSMITTAL OR A MANUALLY SIGNED FACSIMILE HEREOF (TOGETHER WITH THE OUTSTANDING NOTES DELIVERED BY BOOK-ENTRY TRANSFER OR IN ORIGINAL HARD COPY FORM) MUST BE RECEIVED BY THE EXCHANGE AGENT, OR THE NOTICE OF GUARANTEED DELIVERY MUST BE RECEIVED BY THE EXCHANGE AGENT, PRIOR TO THE EXPIRATION DATE.

PAYOR’S NAME:
SUBSTITUTE Form W-9	Part 1 — PLEASE PROVIDE YOUR TAXPAYER IDENTIFICATION NUMBER (“TIN”) IN THE BOX AT RIGHT AND CERTIFY BY SIGNING AND DATING BELOW.	Social Security Number OR Employer Identification Number
Department of the Treasury Internal Revenue Service (“IRS”)	Part 2 — Certification Under penalties of perjury, I certify that:		Part 3 — Awaiting TIN o
Payor’s Request for TIN	(1) the number shown on this form is my correct TIN (or I am waiting for a number to be issued to me), and
	(2) I am not subject to backup withholding because:
	(a) I am exempt from backup withholding, or
	(b) I have not been notified by the IRS that I am subject to backup withholding as a result of a failure to report all interest or dividends, or
	(c) the IRS has notified me that I am no longer subject to backup withholding, and I am a U.S. person (including a U.S. resident alien).
Payor’s Request for TIN	Certificate Instructions — You must cross out item(2) in Part 2 above if you have been notified by the IRS that you are subject to backup withholding because you have failed to report all interest and dividends on your tax return.
	SIGNATURE_ _		DATE_ _

NOTE:   FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING OF 28% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE EXCHANGE OFFER OR THEREAFTER. PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.

YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN PART 3 OF THE SUBSTITUTE FORM W-9

CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER

I certify under penalties of perjury that a taxpayer identification number has not been issued to me, and either (1) I have mailed or delivered an application to receive a taxpayer identification number to the appropriate United States Internal Revenue Service Center or Social Security Administration office, or (2) I intend to mail or deliver an application in the near future. I understand that if I do not provide a taxpayer identification number on the Substitute Form W-9 (or its equivalent) or the appropriate Form W-8 (in the case of a non-U.S. holder) to the payor within 60 days, I will be subject to backup withholding tax of 28% (or 30% in the case of non-U.S. holders) of all reportable payments made to me thereafter until I provide a taxpayer identification number.

Signature: _ _  Date:_ _, 2007

Name:

GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9

What Name and Number to Give the Requester

Name

Individual — If you are an individual, you must generally enter the name shown on your income tax return. However, if you have changed your last name, for instance, due to marriage, without informing the Social Security Administration of the name change, enter your first name, the last name shown on your Social Security card, and your new last name. If the account is in joint names, list first and then circle the name of the person or entity whose number you enter in Part 1 of the form.

Sole Proprietor — You must enter your individual name as shown on your income tax return on the “Name” line. You may enter your business, trade or “doing business as” name on the “Business name” line.

Single-Member Limited Liability Company (LLC) — If you are a single-member LLC (including a foreign LLC with a domestic owner) that is disregarded as an entity separate from its owner under Treasury regulations § 301.7701-3, enter the owner’s name on the “Name” line. Enter the LLC’s name on the “Business name” line. Check the appropriate box for your filing status (sole proprietor, corporation, etc.), then check the box for “Other” and enter “LLC” in the space provided. A disregarded domestic entity that has a foreign owner must use the appropriate Form W-8.

Other Entities — Enter the “Business name” as shown on required federal income tax documents on the “Name” line. This name should match the name shown on the charter or other legal document creating the entity. You may enter any business, trade or “doing business as” name on the “Business name” line.

Note:  You are requested to check the appropriate box for your status (individual, sole proprietor, corporation, etc.)

Taxpayer Identification Number (“TIN”)

You must enter your taxpayer identification number in the appropriate box. If you are a resident alien and you do not have and are not eligible to obtain a Social Security number, your TIN is your IRS individual taxpayer identification number (“ITIN”). Enter it in the Social Security number box. If you do not have an individual taxpayer identification number, see “How to Obtain a TIN” below. If you are a sole proprietor and you have an employer identification number (“EIN”), you may enter either your Social Security number (“SSN”) or your EIN. However, using your EIN may result in unnecessary notices to the requester, and the IRS prefers that you use your SSN. If you are a single-member LLC that is disregarded as an entity separate from its owner under Treasury regulations § 301.7701-3, and are owned by an individual, enter the owner’s Social Security number. If the owner of a disregarded LLC is a corporation, partnership, etc., enter the owner’s EIN. See the chart below on the last page for further clarification of name and TIN combinations.

SSNs have nine digits separated by two hyphens: i.e. 000-00-0000. EINs have nine digits separated by only one hyphen: i.e. 00-0000000.

How to Obtain a TIN

If you do not have a TIN, apply for one immediately. To apply for a Social Security number, obtain Form SS-5, Application for a Social Security Number Card, from your local Social Security Administration office or get this form online at www.socialsecurity.gov or by calling 1-800-772-1213. Obtain Form W-7 to apply for an ITIN or Form SS-4, Application for Employer Identification Number, to apply for an EIN. You can obtain Forms W-7 and SS-4 from the IRS by accessing the IRS website at www.irs.gov, or by calling 1-800-829-3676. You can also apply for an EIN online by accessing www.irs.gov/businesses and clicking on Employer ID Numbers under Businesses Topics. If you do not have a TIN, check the box for “TIN Applied For” in Part 1 of Substitute Form W-9, sign and date the form (including the “Certificate of Awaiting Taxpayer Identification Number”), and give it to the requester. For interest and dividend payments and certain payments made with respect to readily tradable instruments, you will generally have 60 days to obtain a TIN and give it to the requester before you are subject to backup withholding. Other payments are subject to backup withholding without regard to the 60-day rule, until you provide your TIN.

Note:  Checking the box for “TIN Applied For” in Part 1 of Substitute Form W-9 means that you have already applied for a TIN or that you intend to apply for one soon.

Exemptions from Backup Withholding

Payees Exempt from Backup Withholding

Generally, individuals (including sole proprietors and LLCs disregarded as entities separate from their owners) are NOT exempt from backup withholding. The table below on the last page will help determine the number to give the requester.

For interest and dividends, the following payees are generally exempt from backup withholding:

(1) An organization exempt from tax under section 501(a) of the Internal Revenue Code of 1986, as amended (the “Code”), an individual retirement account (IRA), or a custodial account under section 403(b)(7) of the Code if the account satisfies the requirements of section 401(f)(2) of the Code.

(2) The United States or any of its agencies or instrumentalities.

(3) A state, the District of Columbia, a possession of the United States, or any of their political subdivisions or instrumentalities.

(4) A foreign government or any of its political subdivisions, agencies or instrumentalities.

(5) An international organization or any of its agencies or instrumentalities.

GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9 — (Continued)

(6) A corporation.

(7) A foreign bank of central issue.

(8) A dealer in securities or commodities required to register in the United States, the District of Columbia or a possession of the United States.

(9) A real estate investment trust.

(10) An entity registered at all times during the tax year under the Investment Company Act of 1940.

(11) A common trust fund operated by a bank under section 584(a) of the Code.

(12) A financial institution (as defined for purposes of section 3406 of the Code).

(13) A middleman known in the investment community as a nominee or a custodian or who is listed in the most recent publication of the American Society of Corporate Secretaries, Inc. Nominee List.

(14) A trust exempt from tax under section 664 of the Code or described in section 4947 of the Code.

For broker transactions, persons listed in items 1-12, above, as well the persons listed in items 15-16, below, are exempt from backup withholding:

(15) Futures commission merchant registered with the Commodity Futures Trading Commission.

(16) A person registered under the Investment Advisers Act of 1940 who regularly acts as a broker.

Payments Exempt from Backup Withholding

Dividends and patronage dividends that are generally exempt from backup withholding include:

•  Payments to nonresident aliens subject to withholding under section 1441 of the Code.

•  Payments to partnerships not engaged in a trade or business in the United States and that have at least one nonresident alien partner.

•  Payments of patronage dividends not paid in money.

•  Payments made by certain foreign organizations.

•  Payments made by an ESOP pursuant to section 404(k) of the Code.

Interest payments that are generally exempt from backup withholding include:

•  Payments of interest on obligations issued by individuals. Note, however, that such a payment may be subject to backup withholding if the amount of interest paid to you during a taxable year in the course of the payer’s trade or business is $600 or more and you have not provided your correct TIN.

•  Payments of tax-exempt interest (including exempt-interest dividends under section 852 of the Code).

•  Payments described in section 6049(b)(5) of the Code to nonresident aliens.

•  Payments on tax-free covenant bonds under section 1451 of the Code.

•  Payments made by certain foreign organizations.

Payments that are not subject to information reporting are also not subject to backup withholding. For details, see sections 6041, 6041A, 6042, 6044, 6045, 6049, 6050A and 6050N of the Code, and the Treasury regulations thereunder.

If you are exempt from backup withholding, you should still complete and file Substitute Form W-9 to avoid possible erroneous backup withholding. Enter your correct TIN and check the “Exempt” box in Part 1, and sign and date the form and return it to the requester.

If you are a nonresident alien or a foreign entity not subject to backup withholding, you should provide the appropriate completed Form W-8.

Privacy Act Notice. — Section 6109 of the Code requires you to give your correct TIN to persons who must file information returns with the IRS to report interest, dividends and certain other income paid to you. The IRS uses the numbers for identification purposes and to help verify the accuracy of your tax return. The IRS may also provide this information to the Department of Justice for civil and criminal litigation and to cities, states and the District of Columbia to carry out their tax laws. The IRS may also disclose this information to other countries under a tax treaty, to federal and state agencies to enforce federal nontax criminal laws, or to federal law enforcement intelligence agencies to combat terrorism. You must provide your TIN whether or not you are required to file a tax return. Payers must generally withhold at the applicable rate on payments of taxable interest, dividends and certain other items to a payee who does not furnish a TIN to a payer. Certain penalties may also apply.

Penalties

(1) Failure to Furnish Taxpayer Identification Number. — If you fail to furnish your correct TIN, you are subject to a penalty of $50 for each such failure unless your failure is due to reasonable cause and not to willful neglect.

(2) Civil Penalty for False Information With Respect to Withholding. — If you make a false statement with no reasonable basis which results in no backup withholding, you are subject to a $500 penalty.

(3) Criminal Penalty for Falsifying Information. — Willfully falsifying certifications or affirmations may subject you to criminal penalties including fines and/or imprisonment.

FOR ADDITIONAL INFORMATION, CONTACT YOUR TAX ADVISORS OR THE INTERNAL REVENUE SERVICE.

GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9 — (Continued)

For this type of account:		Give Name and TIN of:
1.	Individual	The individual
2.	Two or more individuals (joint account)	The actual owner of the account or, if combined funds, the first individual on the account(1)
3.	Custodian account of a minor (Uniform Gift to Minor)	The minor(2)
4.	a. The usual revocable savings trust (grantor is also trustee)	The grantor-trustee(1)
	b. The so-called trust account that is not a legal or valid trust under state law	The actual owner(1)
5.	Sole proprietorship or single-member LLC	The owner(3)
6.	A valid trust, estate or pension trust	Legal entity(4)

For this type of account:		Give Name and TIN of:
7.	Corporation or LLC electing corporate status on Form 8832	The corporation
8.	Association, club, religious, charitable, educational or other tax-exempt organization	The organization
9.	Partnership or multi-member LLC	The partnership
10.	A broker or registered nominee	The broker or nominee
11.	Account with the Department of Agriculture in the name of a public entity (such as a state or local government, school district, or prison) that receives agricultural program payments	The public entity

(1)	List first and circle the name of the person whose number you furnish. If only one person on a joint account has a SSN, that person’s number must be furnished.
(2)	Circle the minor’s name and furnish the minor’s SSN.
(3)	You must show your individual name, but you may also enter your business or “doing business as” name. You may use either your SSN or EIN if you have one.
(4)	List first and circle the name of the legal trust, estate or pension trust. (Do not furnish the TIN of the personal representative or trustee unless the legal entity itself is not designated in the account title.)

NOTE:  If no name is circled when more than one name is listed, the number will be considered to be that of the first name listed.

EX-99.2

Exhibit 99.2

FORM OF NOTICE OF GUARANTEED DELIVERY

ALION SCIENCE AND TECHNOLOGY CORPORATION

NOTICE OF GUARANTEED DELIVERY
FOR
TENDER OF ALL OUTSTANDING
10 ¹/₄% SENIOR NOTES DUE 2015
IN EXCHANGE FOR
10 ¹/₄% SENIOR NOTES DUE 2015
THAT HAVE BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933

     This form, or one substantially equivalent hereto, must be used by a holder to accept the exchange offer of Alion Science and Technology Corporation, a Delaware corporation, and to tender 10¹/₄% Senior Notes Due 2015 (the “Outstanding Notes”) to the exchange agent pursuant to the guaranteed delivery procedures described in “The Exchange Offer—Procedures for Tendering Outstanding Notes—Guaranteed Delivery” beginning on page of the prospectus of Alion Science and Technology Corporation, dated                     , 2007 (the “Prospectus”), and in Instruction 2 to the related Letter of Transmittal. Any holder who wishes to tender Outstanding Notes pursuant to such guaranteed delivery procedures must ensure that the exchange agent receives this Notice of Guaranteed Delivery prior to the expiration date (as defined below) of the exchange offer. Certain terms used but not defined herein have the meanings ascribed to them in the Prospectus or the Letter of Transmittal.

     THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON                     , 2007, UNLESS EXTENDED (THE “EXPIRATION DATE”). OUTSTANDING NOTES TENDERED IN THE EXCHANGE OFFER MAY BE WITHDRAWN AT ANY TIME PRIOR TO 5:00 P.M., NEW YORK CITY TIME, ON THE EXPIRATION DATE.

The Exchange Agent for the Exchange Offer is:

WILMINGTON TRUST COMPANY

By Registered or Certified Mail
or Overnight Courier:	By Hand in Wilmington, DE.:
Rodney Square North	Rodney Square North
1100 North Market Street	1100 North Market Street
Wilmington, DE 19890-1626 Attention: Alisha Clendaniel	Wilmington, DE 19890-1626 Attention: Alisha Clendaniel

By Facsimile Transmission:
(for Eligible Institutions Only)
Facsimile: (302) 636 4139
Confirm by Telephone: (302) 636 6470

     DELIVERY OF THIS NOTICE OF GUARANTEED DELIVERY TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE, OR TRANSMISSION OF INSTRUCTIONS VIA FACSIMILE OTHER THAN AS SET FORTH ABOVE, WILL NOT CONSTITUTE A VALID DELIVERY.

     THIS NOTICE OF GUARANTEED DELIVERY IS NOT TO BE USED TO GUARANTEE SIGNATURES. IF A SIGNATURE ON A LETTER OF TRANSMITTAL IS REQUIRED TO BE GUARANTEED BY AN “ELIGIBLE GUARANTOR INSTITUTION” UNDER THE INSTRUCTIONS THERETO, SUCH SIGNATURE GUARANTEE MUST APPEAR IN THE APPLICABLE SPACE IN THE BOX PROVIDED ON THE LETTER OF TRANSMITTAL FOR GUARANTEE OF SIGNATURES.

     Ladies and Gentlemen:

     The undersigned hereby tenders to Alion Science and Technology Corporation, upon the terms and subject to the conditions set forth in the Prospectus and the related Letter of Transmittal, receipt of which is hereby acknowledged, the principal amount of Outstanding Notes set forth below pursuant to the guaranteed delivery procedures set forth in the Prospectus under the caption “The Exchange Offer – Procedures for Tendering Outstanding Notes – Guaranteed Delivery” and in Instruction 2 of the Letter of Transmittal.

     The undersigned hereby tenders the Outstanding Notes listed below:

Certificate Number(s) (if known)	Aggregate Principal
of Outstanding Notes:	Amount Represented:
Account Number at the Book-Entry Facility Tendered:	Aggregate Principal Amount Tendered*:

* Must be in minimum denominations of principal amount of $2,000 and integral multiples of $1,000 in excess thereof.

     All authority herein conferred or agreed to be conferred shall survive the death or incapacity of the undersigned and every obligation of the undersigned hereunder shall be binding upon the heirs, personal representatives, successors and assigns of the undersigned.

PLEASE SIGN AND COMPLETE

Name(s) of Record Holder(s):

Address(es):

Area Code and Telephone Number(s):

Signature(s) of owners of Authorized Signatory:

Dated:

     This Notice of Guaranteed Delivery must be signed by the holder(s) exactly as their name(s) appear on certificates for Outstanding Notes or on a security position listing as the owner of Outstanding Notes, or by person(s) authorized to become holder(s) by endorsements and documents transmitted with this Notice of Guaranteed Delivery. If signature is by a trustee, executor, administrator, guardian, attorney-in-fact, officer or other person acting in a fiduciary or representative capacity, such person must provide the following information.

PLEASE PRINT NAME(S) AND ADDRESS(ES)

Name(s):

Capacity:

Address(es):

GUARANTEE
(NOT TO BE USED FOR SIGNATURE GUARANTEE)

     The undersigned, a firm which is a member of a registered national securities exchange or of the National Association of Securities Dealers, Inc., or is a commercial bank or trust company having an office or correspondent in the United States, or is otherwise an “eligible guarantor institution” within the meaning of Rule 17 Ad-15 under the Securities Exchange Act of 1934, guarantees deposit with the exchange agent of the Letter of Transmittal (or facsimile thereof) properly completed and validly executed, together with the certificates representing the Outstanding Notes tendered hereby in proper form for transfer (or confirmation of the book-entry transfer of such Outstanding Notes into the exchange agent’s account at the book-entry transfer facility described in the prospectus under the caption “The Exchange Offer—Procedures for Tendering Outstanding Notes—Book-Entry Transfer” and in the Letter of Transmittal and any other required documents, all by 5:00 p.m., New York City time, within three business days after the expiration delivery of this Notice of Guaranteed Delivery.

Name of Firm:

Authorized Signatory:

Name:
Title:
Address:
	(Include zip code)

Area Code and Telephone Number:

Dated:

     DO NOT SEND CERTIFICATES FOR OUTSTANDING NOTES WITH THIS FORM. ACTUAL SURRENDER OF OUTSTANDING NOTES MUST BE MADE PURSUANT TO, AND BE ACCOMPANIED BY, A PROPERLY COMPLETED AND DULY EXECUTED LETTER OF TRANSMITTAL AND ANY OTHER REQUIRED DOCUMENTS.

INSTRUCTIONS FOR NOTICE OF GUARANTEED DELIVERY

     1. Delivery of this Notice of Guaranteed Delivery. A properly completed and duly executed copy of this Notice of Guaranteed Delivery and any other documents required by this Notice of Guaranteed Delivery must be received by the Exchange Agent at its address set forth herein prior to the Expiration Date. The method of delivery of this Notice of Guaranteed Delivery and any other required documents to the exchange agent is at the election and sole risk of the holder, and the delivery will be deemed made only when actually received by the exchange agent. If delivery is by mail, registered mail with return receipt requested, properly insured, is recommended. As an alternative to delivery by mail, the holders may wish to consider using an overnight or hand delivery service. In all cases, sufficient time should be allowed to assure timely delivery. For a description of the guaranteed delivery procedures, see Instruction 2 of the Letter of Transmittal.

     2. Signatures on this Notice of Guaranteed Delivery. If this Notice of Guaranteed Delivery is signed by the registered holder(s) of the Outstanding Notes referred to herein, the signature must correspond with the name(s) written on the face of the Outstanding Notes without alteration, enlargement, or any change whatsoever. If this Notice of Guaranteed Delivery is signed by a participant of the book-entry transfer facility whose name appears on a security position listing as the owner of the Outstanding Notes, the signature must correspond with the name shown on the security position listing as the owner of the Outstanding Notes.

     If this Notice of Guaranteed Delivery is signed by a person other than the registered holder(s) of any Outstanding Notes listed or a participant of the book-entry transfer facility, this Notice of Guaranteed Delivery must be accompanied by appropriate bond powers, signed as the name of the registered holder(s) appears on the Outstanding Notes or signed as the name of the participant shown on the book-entry transfer facility’s security position listing.

     If this Notice of Guaranteed Delivery is signed by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a corporation, or other person acting in a fiduciary or representative capacity, such person should so indicate when signing and submit with the Letter of Transmittal evidence satisfactory to Alion Science and Technology Corporation of such person’s authority to so act.

     3. Requests for Assistance or Additional Copies. Questions and requests for assistance and requests for additional copies of the prospectus may be directed to the Exchange Agent at the address specified in the prospectus. Holders may also contact their broker, dealer, commercial bank, trust company, or other nominee for assistance concerning the Exchange Offer.

EX-99.3

Exhibit 99.3

FORM OF LETTER TO REGISTERED HOLDERS & DEPOSITARY TRUST COMPANY

ALION SCIENCE AND TECHNOLOGY CORPORATION

LETTER TO REGISTERED HOLDERS AND
DEPOSITORY TRUST COMPANY PARTICIPANTS

FOR TENDER OF ALL OUTSTANDING
10¹/₄% SENIOR NOTES DUE 2015

IN EXCHANGE FOR

10¹/₄% EXCHANGE SENIOR NOTES DUE 2015
THAT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933

THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON               , 2007, UNLESS EXTENDED (THE “EXPIRATION DATE”). TENDERS IN THE EXCHANGE OFFER MAY BE WITHDRAWN AT ANY TIME PRIOR TO 5:00 P.M., NEW YORK CITY TIME, ON THE EXPIRATION DATE.

To Registered Holders and Depository Trust Company Participants:

     We are enclosing herewith the material listed below relating to the offer by Alion Science and Technology Corporation, a Delaware corporation, to exchange our 10¹/₄% Senior Notes due 2015 (the “Outstanding Notes”) for a like principal amount of our 10¹/₄% Senior Notes due 2015 which have been registered under the Securities Act of 1933 (the “Exchange Notes”) upon the terms and subject to the conditions set forth in the prospectus, dated                     , 2007, and the related Letter of Transmittal (which together constitute the “Exchange Offer”).

     Enclosed herewith are copies of the following documents:

1.	Prospectus dated                     , 2007;
2.	Letter of Transmittal (including Substitute Form W-9 Guidelines);
3.	Notice of Guaranteed Delivery;
4.	Letter that may be sent to your clients for whose account you hold Outstanding Notes in your name or in the name of your nominee together with instructions to your clients and space provided therein for obtaining such client’s instruction with regard to the Exchange Offer;
5.	Letter that may be sent from your clients to you with such clients’ instruction with regard to the Exchange Offer (included in item 4 above); and

     We urge you to contact your clients promptly. Please note that the Exchange Offer will expire on the Expiration Date unless extended. The Exchange Offer is not conditioned upon any minimum number of Outstanding Notes being tendered.

     Pursuant to the Letter of Transmittal, each holder of Outstanding Notes will represent to Alion Science and Technology Corporation that:

• the Exchange Notes acquired in exchange for Outstanding Notes pursuant to the Exchange Offer are being acquired in the ordinary course of business of the person receiving such Exchange Notes, whether or not the holder;

• the holder is not participating in, and has no arrangement with any person to participate in, the distribution of Exchange Notes within the meaning of the Securities Act of 1933, as amended (the “Securities Act”);

• neither the holder nor any such other person is an “affiliate” (within the meaning of Rule 405 under the Securities Act) of Alion Science and Technology Corporation or a broker-dealer tendering Exchange Notes acquired directly from Alion Science and Technology Corporation; and

• it is a resident of a state or other jurisdiction.

     If the holder is a broker-dealer that will receive Exchange Notes for its own account in exchange for Outstanding Notes, it acknowledges that it will deliver a prospectus in connection with any resale of such Exchange Notes.

     The enclosed Letter to Holders contains an authorization by the beneficial owners of the Outstanding Notes for you to make the foregoing representations to us on their behalf.

     Alion Science and Technology Corporation will not pay any fee or commission to any broker or dealer or to any other persons (other than the exchange agent) in connection with the solicitation of tenders of Exchange Notes pursuant to the Exchange Offer. You will pay all transfer taxes, if any, including those applicable to the exchange of Outstanding Notes pursuant to the Exchange Offer. If satisfactory evidence of payment of such taxes or exemption therefrom is not submitted with this Letter of Transmittal, the amount of such transfer taxes, if any, will be billed directly to you.

     Additional copies of the enclosed materials may be obtained from the exchange agent by calling (302) 636-6470.

Very truly yours,

ALION SCIENCE AND TECHNOLOGY CORPORATION

EX-99.4

Exhibit 99.4

FORM OF LETTER TO HOLDERS

Alion Science and Technology Corporation
1750 Tysons Boulevard
Suite 1300
McLean, VA 22102
(703) 918-4480

                    , 2007

To the Holders of Alion Science and Technology Corporation
      10¹/₄%Senior Notes due 2015:

     Alion Science and Technology Corporation, a Delaware corporation, is offering to exchange its 10¹/4% Outstanding Senior Notes due 2015 (CUSIP Numbers 016275AE9/U01426AA0 and U01426AA0/ USU01426AA05) (the “Outstanding Notes”) for 10¹/₄% Senior Notes due 2015 that have been registered under the Securities Act of 1933 (CUSIP Number 016275AF6/ US016275AF64) (the “Exchange Notes”) upon the terms and subject to the conditions set forth in the enclosed prospectus dated                     , 2007 (the “Prospectus”) and the related letter of transmittal (the “Letter of Transmittal” and, together with the Prospectus, the “Exchange Offer”). The Exchange Offer is conditioned upon a number of factors set out in the Prospectus under “The Exchange Offer—Conditions of the Exchange Offer” beginning on page               .

     The Outstanding Notes were issued on February 8, 2007, in an original aggregate principal amount of $250,000,000, the full principal amount of which remains outstanding. The maximum amount of Exchange Notes that will be issued in exchange for Outstanding Notes is $250,000,000.

     Please read carefully the Prospectus and the other enclosed materials relating to the Exchange Offer. If you require assistance, you should consult your financial, tax or other professional advisors. Holders who wish to participate in the Exchange Offer are asked to respond promptly by completing and returning the enclosed Letter of Transmittal, and all other required documentation, to Wilmington Trust Company, the exchange agent (the “Exchange Agent”), for the Exchange Offer.

     THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON               , 2007, UNLESS EXTENDED (THE “EXPIRATION DATE”).

     If you have questions regarding the terms of the Exchange Offer, please direct your questions to the Exchange Agent, Wilmington Trust Company, Attention: Alisha Clendaniel.

     Thank you for your time and effort in reviewing this request.

Very truly yours,

ALION SCIENCE AND TECHNOLOGY CORPORATION

PLEASE RETURN YOUR INSTRUCTIONS TO YOUR NOMINEE IN THE ENCLOSED ENVELOPE WITHIN AMPLE TIME TO PERMIT YOUR NOMINEE TO SUBMIT A TENDER ON YOUR BEHALF PRIOR TO THE EXPIRATION DATE.

INSTRUCTIONS TO REGISTERED HOLDER AND/OR BOOK
ENTRY TRANSFER PARTICIPANT

To Registered Holder and/or Participant of the Book-Entry Transfer Facility:

     The undersigned hereby acknowledges receipt of the Prospectus dated                     , 2007, of Alion Science and Technology Corporation, a Delaware corporation, and the accompanying Letter of Transmittal, that together constitute the offer of Alion Science and Technology Corporation (the “Exchange Offer”) to exchange Alion Science and Technology Corporation’s 10¹/₄% Senior Notes due 2015 (the “Outstanding Notes”) for a like principal amount of Alion Science and Technology Corporation’s 10¹/₄% Senior Notes due 2015 which have been registered under the Securities Act of 1933 (the “Exchange Notes”). Capitalized terms used but not defined herein shall have the meaning given to them in the Prospectus.

     This will instruct you, the registered holder and/or book-entry transfer facility participant, as to the action to be taken by you relating to the Exchange Offer with respect to the Outstanding Notes held by you for the account of the undersigned.

     The aggregate face amount of Outstanding Notes held by you for the account of the undersigned is (fill in amount):

          $                     of the Outstanding Notes.

     With respect to the Exchange Offer, the undersigned hereby instructs you (check appropriate box):

o to tender the following Outstanding Notes held by you for the account of the undersigned (insert principal amount of Outstanding Notes to be tendered) (if any): $                    .

o not to tender any Outstanding Notes held by you for the account of the undersigned.

     If the undersigned instructs you to tender the Outstanding Notes held by you for the account of the undersigned, it is understood that you are authorized to make, on behalf of the undersigned (and the undersigned by its signature below, hereby makes to you), the representations and warranties contained in the Letter of Transmittal that are to be made with respect to the undersigned as a beneficial owner, including but not limited to the representations, that:

• the Exchange Notes acquired in exchange for Outstanding Notes pursuant to the Exchange Offer are being acquired in the ordinary course of business of the person receiving such Exchange Notes, whether or not the undersigned;

• the undersigned is not participating in, and has no arrangement with any person to participate in, the distribution of Exchange Notes within the meaning of the Securities Act of 1933, as amended (the “Securities Act”);

• neither the undersigned nor any such other person is an “affiliate” (within the meaning of Rule 405 under the Securities Act) of Alion Science and Technology Corporation, any of the guarantors of the Outstanding Notes or a broker-dealer tendering Outstanding Notes acquired directly from Alion Science and Technology Corporation;

• the undersigned is a resident of the State of (fill in state or other jurisdiction)                                         .

     If the undersigned is a broker-dealer that will receive Exchange Notes for its own account in exchange for Outstanding Notes, it acknowledges that it will deliver a Prospectus in connection with any resale of such Exchange Notes.

     The undersigned authorizes you to bind the undersigned as set forth in the Letter of Transmittal and to take such other action as may be necessary to effect the valid tender of the Outstanding Notes held by you for the account of the undersigned.

SIGN HERE

Name(s) of beneficial owner(s):

Signature(s):

Name(s):

(PLEASE PRINT)

Address(es):

Telephone Number(s):

Taxpayer Identification or Social Security Number(s):

Date:

EX-99.5

Exhibit 99.5

April   , 2007

EXCHANGE AGENT AGREEMENT

Wilmington Trust Company

Rodney Square North

1100 North Market Street

Wilmington, Delaware 19890

Ladies and Gentlemen:

Alion Science and Technology Corporation (the “Company”), proposes to make an offer (the “Exchange Offer”) to exchange its 101/4% Senior Notes due 2015, (the “New Notes”) for a like principal amount of its outstanding 101/4% Senior Notes due 2015, (the “Old Notes”). The terms and conditions of the Exchange Offer as currently contemplated are set forth in a prospectus (the “Prospectus” included in the Company’s registration statement on Form S-4 (File No. 333-          ) as amended (the “Registration Statement”)) filed with the Securities and Exchange Commission (the “SEC”), and proposed to be distributed to all record holders of the Old Notes. The Old Notes and the New Notes are collectively referred to in this Exchange Agent Agreement (this “Agreement”) as the “Notes” or the “Securities.” Capitalized terms used herein and not defined shall have the respective meanings ascribed to them in the Registration Statement or the accompanying letter of transmittal (the “Letter of Transmittal”). This Exchange Agent Agreement is hereinafter referred to as this “Agreement”.

The Company hereby appoints Wilmington Trust Company to act as exchange agent (the “Exchange Agent”) in connection with the Exchange Offer. References hereinafter to “you” shall refer to Wilmington Trust Company.

The Exchange Offer is expected to be commenced by the Company on or about          , 2007. The Letter of Transmittal accompanying the Registration Statement is to be used by the holders of the Old Notes to tender into the Exchange Offer, and contains instructions with respect to the delivery of Old Notes tendered. The Exchange Agent’s obligations with respect to receipt and inspection of the Letter of Transmittal in connection with the Exchange Offer shall be satisfied for all purposes hereof by (1) inspection of the electronic message transmitted to the Exchange Agent by Exchange Offer participants in accordance with the Automated Tender Offer Program (“ATOP”) of the Depositary Trust Company (“DTC”), and by otherwise observing and complying with all procedures established by DTC in connection with ATOP, to the extent that ATOP is utilized by Exchange Offer participants, or (2) by inspection of the Letter of Transmittal by each respective holder of Old Notes.

The Exchange Offer shall expire at 5:00 p.m., New York City time, on          , 2007, or on such later date or time to which the Company may extend the Exchange Offer (the “Expiration Date”). Subject to the terms and conditions set forth in the Registration Statement, the Company expressly reserves the right to extend the Exchange Offer from time to time and may extend the Exchange Offer by giving oral (confirmed in writing) or written notice to you at any time before 9:00 a.m., New York City time, on the business day following the previously scheduled Expiration Date, and in such case the term “Expiration Date” shall mean the time and date on which the Exchange Offer as so extended shall expire.

The Company expressly reserves the right, in its sole discretion, to delay, amend or terminate the Exchange Offer, and not to accept for exchange any Old Notes not theretofore accepted for exchange, in among other cases upon the occurrence of any of the conditions of the Exchange Offer specified in the Registration Statement under the caption “The Exchange Offer — Expiration Date; Extensions; Termination; Amendments” and “The Exchange Offer — Conditions of The Exchange Offer.” The Company will give to you as promptly as practicable oral (confirmed in writing) or written notice of any delay, amendment, termination or non-acceptance.

In carrying out your duties as Exchange Agent, you are to act in accordance with the following instructions:

1. You will perform such duties and only such duties as are specifically set forth herein or in the section of the Registration Statement captioned the “The Exchange Offer”, in the Letter of Transmittal accompanying the Registration Statement and such duties which are necessarily incidental thereto.

2. You will establish a book-entry account with respect to the Old Notes at DTC (the “Book-Entry Transfer Facility”) for purposes of the Exchange Offer within two business days after the date of the Registration Statement, and any financial institution that is a participant in the Book-Entry Transfer Facility’s systems may make book-entry

delivery of the Old Notes by causing the Book-Entry Transfer Facility to transfer such Old Notes into your account in accordance with the Book-Entry Transfer Facility’s procedure for such transfer.

3. You are to examine each of the Letters of Transmittal and certificates for Old Notes (or confirmation of book-entry transfers into your account at the Book-Entry Transfer Facility) and any other documents delivered or mailed to you by or for holders of the Old Notes to ascertain whether: (i) the Letters of Transmittal, certificates and any such other documents are duly executed and properly completed in accordance with instructions set forth therein and in the Registration Statement and that such book-entry confirmations are in due and proper form and contain the information required to be set forth therein, and (ii) the Old Notes have otherwise been properly tendered. In each case where the Letter of Transmittal or any other document has been improperly completed or executed or where book-entry confirmations are not in due and proper form or omit certain information or any of the certificates for Old Notes are not in proper form for transfer or some other irregularity in connection with the acceptance of the Exchange Offer exists, you will endeavor to inform the presenters of the need for fulfillment of all requirements and to take any other action as may be necessary or advisable to cause such irregularity to be corrected.

4. With the approval of the Chief Financial Officer, Secretary or any Vice President of the Company (such approval, if given orally, promptly to be confirmed in writing) or any other party designated by such officer in writing, you are authorized to waive any irregularities in connection with any tender of Old Notes pursuant to the Exchange Offer. You are not otherwise authorized to waive any such irregularities.

5. Tenders of Old Notes may be made only as set forth in the Letter of Transmittal and in the section of the Registration Statement captioned “The Exchange Offer — Procedures for Tendering Outstanding Notes” and Old Notes shall be considered properly tendered to you only when tendered in accordance with the procedures set forth therein.

Notwithstanding the provisions of this paragraph 5, Old Notes which the Chief Financial Officer, Secretary or any Vice President of the Company or any other party designated by any such officer in writing shall approve as having been properly tendered shall be considered to be properly tendered (such approval, if given orally, must be confirmed in writing the same day to constitute valid approval).

6. You shall promptly advise the Company with respect to any Old Notes delivered subsequent to the Expiration Date and accept its instructions with respect to disposition of such Old Notes.

7. You shall accept tenders:

(a) in cases where the Old Notes are registered in two or more names only if signed by all named holders;

(b) in cases where the signing person (as indicated on the Letter of Transmittal) is acting in a fiduciary or a representative capacity only when proper evidence of his or her authority so to act is submitted; and

(c) from persons other than the registered holder of Old Notes provided that customary transfer requirements, including any payment of applicable transfer taxes, are fulfilled.

You shall accept partial tenders of Old Notes where so indicated and as permitted in the Letter of Transmittal and return any untendered Old Notes to the holder (or such other person as may be designated in the Letter of Transmittal) as promptly as practicable after expiration or termination of the Exchange Offer.

8. Upon satisfaction or waiver of all of the conditions to the Exchange Offer, the Company will notify you (such notice, if given orally, shall be promptly confirmed in writing) of its acceptance, promptly after the Expiration Date, of all Old Notes properly tendered and you, on behalf of the Company, will cause the exchange of such Old Notes for New Notes and cause such Old Notes to be cancelled. Delivery of New Notes will be made on behalf of the Company by the trustee at the rate of $1,000 principal amount of New Notes (subject to adjustment) for each $1,000 principal amount of the Old Notes tendered, and, in the case of Old Notes tendered, promptly after notice (such notice, if given orally, shall be promptly confirmed in writing) of acceptance of said Old Notes by the Company; provided, however, that in all cases, Old Notes tendered pursuant to the Exchange Offer will be exchanged only after timely receipt by you of certificates for such Old Notes (or confirmation of book-entry transfer into your account at the Book-Entry Transfer Facility), a properly completed and duly executed Letter of Transmittal (or facsimile thereof) and an Agent’s Message (as defined in the Registration Statement) with any required signature guarantees and any other required document. Unless otherwise instructed in writing by the Company, you shall issue New Notes only in minimum denominations of $2,000 and in any integral multiple of $1,000 in excess thereof.

9. Tenders pursuant to the Exchange Offer are irrevocable after the Expiration Date. Subject to the terms and upon the conditions set forth in the Registration Statement and the Letter of Transmittal, Old Notes tendered pursuant to the Exchange Offer may be withdrawn at any time on or prior to the Expiration Date in accordance with the terms of the Exchange Offer. All questions as to the form and validity of notices of withdrawal, including timeliness of receipt, shall be determined by the Company in its sole discretion which shall be final and binding.

10. The Company shall not be required to exchange any Old Notes tendered if any of the conditions set forth in the Registration Statement are not met. Notice of any decision by the Company not to exchange any Old Notes tendered shall be given (such notices, if given orally, shall be promptly confirmed in writing) by the Company to you.

11. If, pursuant to the Registration Statement, the Company does not accept for exchange all or part of the Old Notes tendered because of an invalid tender, the occurrence of certain other events set forth in the Registration Statement or otherwise, you shall as soon as practicable after the expiration or termination of the Exchange Offer return those certificates for unaccepted Old Notes (or effect appropriate book-entry transfer), together with any related required documents and the Letters of Transmittal relating thereto that are in your possession, to the persons who deposited them (or effected such book-entry transfer).

12. All certificates for reissued Old Notes, unaccepted Old Notes or New Notes (other than those effected by book-entry transfer) shall be forwarded by (a) first-class mail, postage pre-paid under a blanket surety bond protecting you and the Company from loss or liability arising out of the non-receipt or non-delivery of such certificates or (b) by registered mail insured separately for the replacement value of each of such certificates.

13. You are not authorized to pay or offer to pay any concessions, commissions or solicitation fees to any broker, dealer, bank or other persons or to engage or utilize any persons to solicit tenders.

14. As Exchange Agent hereunder you:

(a) will be regarded as making no representations and having no responsibilities as to the validity, sufficiency, value or genuineness of any of the Old Notes deposited with you pursuant to the Exchange Offer, and will not be required to and you shall not make any representation as to the validity, value or genuineness of the Registration Statement, the Exchange Offer or the New Notes;

(b) shall not be obligated to take any legal action hereunder which might in your reasonable judgment involve any expense or liability, unless you shall have been furnished with reasonable indemnity;

(c) shall not be liable to the Company for any action taken or omitted by you, or any action suffered by you to be taken or omitted, without negligence, misconduct or bad faith on your part, by reason of or as a result of the administration of your duties hereunder in accordance with the terms and conditions of this Agreement or by reason of your compliance with the instructions set forth herein or with any written or oral instructions delivered to you pursuant hereto, and may reasonably rely on and shall be protected in acting in good faith in reliance upon any certificate, instrument, opinion, notice, letter, facsimile or other document or security delivered to you and reasonably believed by you to be genuine and to have been signed by the proper party or parties;

(d) may reasonably act upon any tender, statement, request, comment, agreement or other instrument whatsoever not only as to its due execution and validity and effectiveness of its provisions, but also as to the truth and accuracy of any information contained therein, which you shall in good faith reasonably believe to be genuine or to have been signed or represented by a proper person or persons;

(e) may rely on and shall be protected in acting upon written notice or oral instructions from the Chief Financial Officer, Secretary or any Vice President of the Company or any other party designated by any such officer of the Company;

(f) shall not advise any person tendering Old Notes pursuant to the Exchange Offer as to whether to tender or refrain from tendering all or any portion of Old Notes or as to the market value, decline or appreciation in market value of any Old Notes that may or may not occur as a result of the Exchange Offer or as to the market value of the Exchange Notes;

(g) may consult with counsel with respect to any questions relating to your duties and responsibilities, and the written advice or opinion of such counsel shall be full and complete authorization and protection in respect of any action taken, suffered or omitted by you hereunder in good faith and in reliance thereon; and

(h) shall act solely as agent of the Company and shall not assume any obligation, or relationship of agency or trust for or, with any of the owners or holders of the Old Notes.

15. You shall send to all holders of Old Notes a copy of the Registration Statement, the Letter of Transmittal, the Notice of Guaranteed Delivery (as defined in the Registration Statement) and such other documents (collectively, the “Exchange Offer Documents”) as may be furnished by the Company to commence the Exchange Offer and take such other action as may from time to time be requested by the Company or its counsel (and such other action as you may reasonably deem appropriate) to furnish copies of the Exchange Offer Documents or such other forms as may be approved from time to time by the Company, to all holders of Old Notes and to all persons requesting such documents and to accept and comply with telephone requests for information relating to the Exchange Offer, provided that such information shall relate only to the procedures for accepting (or withdrawing from) the Exchange Offer. The Company will furnish you with copies of such documents at your request. All other requests for information relating to the Exchange Offer shall be directed to the Company, Attention: General Counsel, at the Company’s offices at 1750 Tysons Boulevard, Suite 1300, McLean, Virginia 22102, telephone number: 703-918-4480.

16. You shall advise by facsimile transmission, email or telephone, and promptly thereafter confirm in writing to the Chief Financial Officer or Secretary of the Company, and such other person or persons as the Company may request in writing, daily, and more frequently during the week immediately preceding the Expiration Date and if otherwise requested, up to and including the Expiration Date, as to the aggregate principal amount of Old Notes which have been tendered pursuant to the Registration Statement and the items received by you pursuant to the Exchange Offer and this Agreement, separately reporting and giving cumulative totals as to items properly received and items improperly received. In addition, you will also inform, and cooperate in making available to, the Company or any such other person or persons as the Company requests in writing from time to time prior to the Expiration Date of such other information as it or he or she reasonably requests. Such cooperation shall include, without limitation, the granting by you to the Company and such person as the Company may request of access to those persons on your staff who are responsible for receiving tenders, in order to ensure that immediately prior to the Expiration Date the Company shall have received information in sufficient detail to enable it to decide whether to extend the Exchange Offer. You shall prepare a final list of all persons whose tenders were accepted, the aggregate principal amount of Old Notes tendered, the aggregate principal amount of Old Notes accepted and the identity of any participating broker-dealers and the aggregate principal amount of Exchange Notes delivered to each, and deliver said list to the Company.

17. Letters of Transmittal and Notices of Guaranteed Delivery shall be stamped by you as to the date and, after the expiration of the Exchange Offer, the time of receipt thereof shall be preserved by you for a period of time at least equal to the period of time you customarily preserve other records pertaining to the transfer of securities, or one year, whichever is longer, and thereafter shall be delivered by you to the Company. You shall dispose of unused Letters of Transmittal and other surplus materials in accordance with your customary procedures.

18. You hereby expressly waive any lien, encumbrance or right of set-off whatsoever that you may have with respect to funds deposited with you for the payment of transfer taxes by reasons of amounts, if any, borrowed by the Company, or any of its subsidiaries or affiliates pursuant to any loan or credit agreement with you or for compensation owed to you hereunder.

19. For services rendered as Exchange Agent hereunder you shall be entitled to such compensation and reimbursement of out-of-pocket expenses as agreed in the attached Schedule A.

20. You hereby acknowledge receipt of the Registration Statement, the Letter of Transmittal and the other documents associated with the Exchange Offer attached hereto and further acknowledge that you have examined each of them. Any inconsistency between this Agreement, on the one hand, and the Registration Statement, the Letter of Transmittal and such other forms (as they may be amended from time to time), on the other hand, shall be resolved in favor of the Registration Statement, the Letter of Transmittal and such other forms, except with respect to the duties, liabilities and indemnification of you as Exchange Agent which shall be controlled by this Agreement.

21. The Company agrees to indemnify and hold you harmless in your capacity as Exchange Agent hereunder against any liability, cost or expense, including reasonable attorneys’ fees and expenses, arising out of or in connection with your appointment as Exchange Agent and the performance of your duties hereunder, including, without limitation, any act, omission, delay or refusal made by you in reasonable reliance upon any signature, endorsement, assignment, certificate, order, request, notice, instruction or other instrument or document reasonably believed by you to be valid, genuine and sufficient and in accepting any tender or effecting any transfer of Old Notes reasonably believed by you in

good faith to be authorized, and in delaying or refusing in good faith to accept any tenders or effect any transfer of Old Notes; provided, however, that the Company shall not be liable for indemnification or otherwise for any loss, liability, cost or expense to the extent arising out of your gross negligence, willful misconduct or bad faith. The Company’s obligations under this paragraph 21 shall survive the termination of this Agreement and the discharge of your obligation hereunder and any other termination of this Agreement under any federal or state bankruptcy law.

22. You shall comply with all requirements under the tax laws of the United States, including without limitation those relating to missing Tax Identification Numbers, and shall file any appropriate reports with the Internal Revenue Service. The Company understands that you are required, in certain instances, to deduct twenty-eight percent (28%) with respect to interest paid on the New Notes and proceeds from the sale, exchange, redemption or retirement of the New Notes from holders who have not supplied their correct Taxpayer Identification Numbers or required certification. Such funds will be turned over to the Internal Revenue Service in accordance with applicable regulations.

23. You shall notify the Company of the amount of any transfer taxes payable in respect of the exchange of Old Notes and shall deliver or cause to be delivered, in a timely manner, to each governmental authority to which any transfer taxes are payable in respect of the exchange of Old Notes your check in the amount of all transfer taxes so payable, and the Company shall reimburse you for the amount of any and all transfer taxes payable in respect of the exchange of Old Notes; provided, however, that you shall reimburse the Company for amounts refunded to you in respect of your payment of any such transfer taxes, at such time as such refund is received by you.

24. This Agreement and your appointment as Exchange Agent hereunder shall be construed and enforced in accordance with the laws of the State of New York applicable to agreements made and to be performed entirely within such state, and without regard to conflicts of law principles, and shall inure to the benefit of, and the obligations created hereby shall be binding upon, the successors and assigns of each of the parties hereto and nothing in this Agreement, express or implied, is intended to or shall confer upon any other person any right, benefit or remedy of any nature whatsoever under or by reason of this Agreement. Without limitation of the foregoing, the parties hereto expressly agree that no holder of Old Notes or Exchange Notes shall have any right, benefit or remedy of any nature whatsoever under or by reason of this Agreement.

25. This Agreement may be executed in two or more counterparts, each of which shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.

26. In case any provision of this Agreement shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

27. This Agreement shall not be deemed or construed to be modified, amended, rescinded, canceled or waived, in whole or in part, except by a written instrument signed by a duly authorized representative of the party to be charged.

28. Unless otherwise provided herein, all notices, requests and other communications to any party hereunder shall be in writing (including facsimile) and shall be given to such party, addressed to it, as its address or telecopy number set forth below:

If to the Company:

Alion Science and Technology Corporation

               1750 Tysons Boulevard

               Suite 1300

               McLean, Virginia 22102

               Facsimile:          

               Attention:  General Counsel

With a copy to:

Baker & McKenzie, LLP

               815 Connecticut Avenue

               Washington, DC 20006

               Facsimile:  202-452-7074

               Attention:  David S. Cole, Esq.

If to the Exchange Agent:

Wilmington Trust Company

               Rodney Square North

               1100 North Market Street

               Wilmington, Delaware 19890

               Facsimile:  (302) 636-4145

               Attention:  Corporate Trust Operations

With a copy to:

Peter Bogdanow

               Covington & Burling LLP

               1330 Avenue of the Americas

               New York, NY 10019

               Facsimile:  (202) 841-1010

               Attention:  Peter Bogdanow

29. Unless terminated earlier by the parties hereto, this Agreement shall terminate 90 days following the Expiration Date. Notwithstanding the foregoing, Paragraphs 18, 19, 21 and 22 shall survive the termination of this Agreement. Upon any termination of this Agreement, you shall promptly deliver to the Company any certificates for notes, funds or property (including, without limitation, Letters of Transmittal and any other documents relating to the Exchange Offer) then held by you as Exchange Agent under this Agreement.

30. This Agreement shall be binding and effective as of the date hereof.

Please acknowledge receipt of this Agreement and confirm the arrangements herein provided by signing and returning the enclosed copy.

ALION SCIENCE AND TECHNOLOGY CORPORATION

By: 

Name:  John B. Hughes

Title:    Chief Financial Officer

Accepted as the date

first above written:

WILMINGTON TRUST COMPANY,

as exchange agent

By: 

Name:

Title: