Cubic Corporation to Develop 'Revolutionary'
Precision Gunnery System for Spanish Army

SAN DIEGO, CALIF. - September 6, 2002 -- The Spanish Army will be the first military to use an advanced precision gunnery system developed by Cubic Corporation (AMEX:CUB) that allows combat vehicle crews to train as they would fight.

Cubic is supplying the new Precision Combat Training System (PCTS) for the Spanish Army's new fleet of Leopard 2E Main Battle Tanks under a contract awarded to ELCO Sistemas S.A., a company of Grupo Tecnobit. The total value of Cubic's and ELCO Sistemas' PCTS efforts for the Spanish Ministry of Defense exceeds $6 million.

PCTS, a direct-fire weapons simulation system, uniquely provides both precision gunnery and force-on-force training for combat vehicle crews. It incorporates eye-safe laser ammunition, maneuvering targets and sophisticated after-action review capabilities.

"PCTS truly represents a revolutionary step forward beyond present two-way simulation systems," said Gerald Dinkel, president and CEO of the Cubic Defense Applications (CDA) group. "It is the first system of its kind that supports both precision gunnery and tactical training requirements in realistic, rugged environments. This feature, among other benefits, will cost-effectively take the Spanish Army to the next level of training fidelity."

A key advantage of PCTS over older precision gunnery systems is its automatic "hunter-killer" capabilities, which allows the "attacker" to engage a second threat immediately after firing.

"With existing two-way systems, the gun must stay pointed at a target for the full fly-out duration before it can engage the next threat - and this can take up to five seconds. In a real combat situation, five seconds can be life critical," said Art Tuckman, vice president of Advanced Technology and chief scientist.

The difference lies within the way the ballistic "flyouts" are tracked and hits are measured. The older two way systems use retroflectors, mounted on the target, which require an optical line-of-sight between the shooter and target during flyout.

"With Cubic's system, the target simulates the ballistic flyout and tracks its own position to make a hit determination. The information is delivered within a few milliseconds within trigger pull, which allows the attacker to immediately move to the next target," said Tuckman.

PCTS incorporates a unique combination of optical and radio-frequency communications as well as advanced tracking techniques, which eliminate the need for retroflectors. The training experience is supported by real-time feedback to trainees and extensive After Action Review capabilities at mobile or fixed facilities.

"PCTS can be cost-effectively integrated into any combat training center," Tuckman said. "It seamlessly supports both precision gunnery and maneuvering training with the same set of hardware and software, so no expensive upgrades are needed to take a PCTS-outfitted tank into a combat training environment."

PCTS features key technologies from Cubic's MILES 2000 laser-based system, while incorporating the methodologies gained from 30 years fielding live combat training systems. The system's modular design ensures easy adaptation to new weapons, munitions and countermeasures. PCTS is fully compatible with other Tactical Engagement Simulation (TES) systems and Combat Training Centers.

ELCO will manufacture the PCTS components in Spain.

The Cubic Defense Applications group, one of Cubic's two major segments, produces instrumented air and ground combat training systems, battle command training, simulations and simulation support for U. S. and allied military forces. The group also produces high technology avionics, data links and communications products for government and commercial customers, and a wide range of technical and logistics services. The corporation's other major segment, Cubic Transportation Systems, designs and manufactures automatic fare collection systems for public mass transit authorities. For more information about Cubic, see the company's web site at www.cubic.com.