Elbit Systems — Capital/Financing Update 2004

Jun 2, 2004

2.6.04

לכבוד לכבוד הבורסה לניירות ערך רשות ניירות ערך www.tase.co.il www.isa.gov.il א.ג.נ.,

לעתונות הודעה– ( "החברה" מ ) "ט מערכות בעיאלב : הנדון

ב ולהגישה "בארההיום שבכוונתנו לפרסם (Press Release) ה לעתונותב הודע" מצ . לרשות ניירות ערך האמריקאית6K ח" כדו

, בכבוד רב

אילן פכולדר מזכיר החברה

Advanced Technology Center, P.O. Box 539, Haifa 31053, Israel Tel: 972-48315315 Fax: 972-4-8550002

ELBIT SYSTEMS WINS CONTRACT FROM ISRAELI MINISTRY OF DEFENSE TO OPERATE AND MAINTAIN THE HELICOPTERS OF THE ISRAEL AIR FORCE FLIGHT SCHOOL

CONTRACT VALUED AT APPROXIMATELY $40 MILLION TO BE PERFORMED OVER A TEN-YEAR PERIOD

Haifa, Israel, June 2, 2004- Elbit Systems Ltd.( NASDAQ: ESLT) announced that it was awarded, through its wholly owned subsidiary Cyclone Aviation Products Ltd.("Cyclone"), a ten-year contract from the Israeli Ministry of Defense for the operation and maintenance of the helicopters of the Israel Air Force ("IAF") Flight School. Under the contract, which will be executed by providing flight hours ("Power by the Hour"), Cyclone will provide full maintenance services to the IAF Bell 206 and Cobra AH-1A helicopters. The contract is valued at approximately $40 million. Cyclone has recruited approximately 30 specialists who are experienced in the maintenance of these IAF helicopters.

The maintenance and full logistic support of the IAF Flight School helicopters are being transferred from the IAF to Cyclone as part of the IAF process of outsourcing and privatization of various services. The service and support activities to be performed by Cyclone under the new contract are in line with other outsourcing services being performed by Elbit Systems for the IAF. Elbit Systems is currently operating the “Snunit” GROB 120I trainer aircraft for the IAF Flight School. The ”Snunit” program is a Private Finance Initiative (PFI) contract, under which the trainer aircraft are owned and fully maintained by Elbit Systems. The "Snunit" trainers have already accumulated thousands of operational hours in the service of the IAF Flight School.

Joseph Ackerman, President and CEO of Elbit Systems , commented: "The contract for the maintenance and support of the IAF Flight School helicopters is an additional important milestone in the realization of Elbit Systems' strategy to expand its activities in the area of maintenance, support and operation services, in Israel and worldwide."

About Elbit Systems

Elbit Systems Ltd. is an international defense electronics company engaged in a wide range of defense-related programs throughout the world, in the areas of aerospace, land and naval systems, command, control, communications, computers, intelligence, surveillance and reconnaisance (“C4ISR”), advanced electro-optic and space technologies. The Company focuses on the upgrading of existing military platforms and developing new technologies for defense and homeland security applications.

For more about Elbit Systems, please visit our website at www.elbitsystems.com

Contacts

Company contact IR Contacts Ilan Pacholder, VP Finance Ehud Helft/Kenny Green Elbit Systems Ltd Gelbart Kahana Tel: 972-4 831-6632 Tel: 1-866-704-6710 Fax: 972-4 831-6659 Fax: 972-3-607-4711 Pacholder@elbit.co.il ehud@gk-biz.com kenny@ gk-biz.com

STATEMENTS IN THIS PRESS RELEASE WHICH ARE NOT HISTORICAL DATA ARE FORWARD-LOOKING STATEMENTS WHICH INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES OR OTHER FACTORS NOT UNDER THE COMPANY’S CONTROL, WHICH MAY CAUSE ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS OF THE COMPANY TO BE MATERIALLY DIFFERENT FROM THE RESULTS, PERFORMANCE OR OTHER EXPECTATIONS IMPLIED BY THESE FORWARD-LOOKING STATEMENTS. THESE FACTORS INCLUDE, BUT ARE NOT LIMITED TO, THOSE DETAILED IN THE COMPANY’S PERIODIC FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION.