MTC Technologies [MTCT] will return $683,000 in performance-based payments and pay $474,000 in program costs to the Marine Corps after entering into a cancellation agreement relating to the company’s Tier II Unmanned Aircraft System (UAS) concept demonstration program, the company said recently.
“Marine Corps Systems Command and MTC Technologies cancelled their contract for a Tier II UAS Concept Demonstrator on 10 January 2008 based on an agreement made 18 December 2007. The terms of the agreement [are] confidential and proprietary and can not be released,” the Marine Corps told sister publication Defense Daily recently.
On Dec. 21, 2007, Britain’s BAE SYSTEMS agreed to acquire MTC in a $450 million deal.
MTC, which is based in Dayton, Ohio, will become part of BAE’s Technology Solutions & Services (TSS) business line, which is within the Arlington, Va.-based Customer Solutions operating group. Both companies have complementary offerings in the technical services area for life-cycle sustainment and support with TSS having a significant presence with Navy programs and MTC well entrenched with Air Force and Army programs (Defense Daily, Jan. 3).
As a result of the agreement with the Marine Corps, MTC expects to incur a one-time charge of approximately $6.7 million in the fourth quarter of 2007, according to the company.
BAE was apprised of MTC’s cancellation agreement with the Marine Corps before the signing of the merger agreement, MTC said.
In November, MTC had been selected to demonstrate the Tier II tactical UAS program concept for the Marine Corps. The 12-month, competitively awarded, firm fixed price contract was valued at $3 million, according to a company statement announcing the contract award.