Space Systems/Loral Selected to Compete for $6 Billion U.S. Navy Communications System as Member of Raytheon Team.

Business Editors

NEW YORK--(BUSINESS WIRE)--Sept. 24, 2002

Initial Component Advanced Development Phase Contracts For the Mobile

User Objective System (MUOS) Awarded to Loral/Raytheon Team

Loral Space & Communications (NYSE:LOR) today announced that the United States Navy's Space and Naval Warfare Systems Command (SPAWAR) has awarded a Space Systems/Loral (SS/L) team, led by Raytheon (NYSE:RTN), a $40 million Component Advanced Development (CAD) contract to develop the U.S. Navy's $6 billion, next-generation, satellite-based mobile communications system, the Mobile User Objective System (MUOS).

CAD is a 14-month effort aimed at reducing risk and advancing system design concepts that stem from MUOS' recently completed 1999-to-2002 Concept Exploration Phase (CEP). SPAWAR tapped the Raytheon-SS/L team for CAD based on the team's performance during the earlier CEP program. The latest award reflects SPAWAR's selection of two teams, which will work in parallel until 2004, when one team will be selected to lead future MUOS efforts.

SS/L is part of a Raytheon-led team that also includes TRW Astro Aerospace and Honeywell. The two teams have been funded by SPAWAR to compete for a System Design and Development contract to be awarded in January 2004, for construction of the first MUOS satellite, which will be launched in 2008. Subsequently, the MUOS Program Production and Deployment contract will be awarded in mid-2006 and continue through 2023.

As part of the newly awarded development program, SS/L will be adapting its highly successful commercial 1300 spacecraft platform for the MUOS narrowband tactical communications system.

"The combination of SS/L's heritage satellite bus with the payload technology and expertise of our team members provides our government with cost-effective improvements in its satellite communications systems," said C. Patrick DeWitt, president of SS/L. "MUOS will ensure its users an uninterrupted communications link, without concern for the location, weather or local geography."

MUOS

MUOS will be a narrowband satellite communication (SATCOM) system that supports a worldwide, multi-service/multi-national population of mobile and fixed-site warfighter terminals. Its capabilities will provide a considerable increase in throughput over the current Ultra High Frequency (UHF) Follow-on (UFO) narrowband satellite communications system. It will also provide greater flexibility through improved link performance for users such as Navy SEALS and other special forces to operate in difficult environments.

SS/L Satellites

SS/L's MUOS design is based on the company's space-proven 1300 geostationary satellite platform, which has an excellent record of reliable operation and is highly adaptable to a wide variety of payloads. Over the past 45 years, SS/L satellites have amassed well over 900 years of on-orbit service.

About Raytheon

With headquarters in Lexington, Mass., Raytheon Company (NYSE:RTN) is a global technology leader in defense, government and commercial electronics, and business and special mission aircraft.

About Space Systems/Loral

Space Systems/Loral is a premier designer, manufacturer, and integrator of powerful satellites and satellite systems. SS/L also provides a range of related services, including mission control operations and procurement of launch services. Based in Palo Alto, California, the company has an international base of commercial and governmental customers whose applications include broadband digital communications, wireless telephony, direct-to-home broadcast, defense communications, environmental monitoring, and air traffic control. SS/L is ISO 9001 certified. For more information, visit www.ssloral.com.

Loral Space & Communications is a high technology company that concentrates primarily on satellite manufacturing and satellite-based services, including broadcast transponder leasing and value added services, domestic and international corporate data networks, broadband data transmission, content and Internet services. For more information, visit Loral's web site at www.loral.com.

This document contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In addition, Loral Space & Communications Ltd. or its representatives have made or may make forward-looking statements, orally or in writing which may be included in, but are not limited to, various filings made by the company with the Securities and Exchange Commission, press releases or oral statements made with the approval of an authorized executive officer of the company. Actual results could differ materially from those projected or suggested in any forward-looking statements as a result of a wide variety of factors and conditions which are described in the section of the company's annual report on Form 10-K for the fiscal year ended December 31, 2001, entitled "Certain Factors That May Affect Future Results," and the company's other filings with the Securities and Exchange Commission. The reader is specifically referred to these documents.