- The larger of the two awards, a $38 million contract modification to an existing firm-fixed-price contract, calls for L-3 to supply non-long-lead critical spare parts needed for Royal Australian Air Force's fleet of 10 C-27J transport planes, currently on order. Delivery of these parts is due by March 2015.
- The smaller, but perhaps more interesting award is a $16.4 million cost-plus-fixed-fee contract with the U.S. Defense Advanced Research Projects Agency -- DARPA. L-3 will be supporting Phases 2 and, if the appropriate contract option is exercised, also Phase 3 of the DARPA mobile hotspots program.
As DARPA explains on its website, this project aims to provide "high-bandwidth communications for troops in remote forward operating locations" lacking access to traditional wired Internet. If successful, this experimental program will use air, mobile, and fixed assets to create a "gigabit-per-second tactical millimeter-wave backbone network" extending from military commanders all the way down to the lowest-echelon warfighters. The UAV pods will be an integral part of this project.
In Phase 2, L-3 will be expected to deliver a "solution" consisting of radio and router pods that can be mounted aboard Shadow unmanned aerial vehicles (UAVs) manufactured by Textron (NYSE:TXT). These pods will be used to create UAV-borne mobile hotspots in the vicinity of the UAVs. Completion of Phase 2 is expected to be achieved by March 12, 2015.
Rich Smith has no position in any stocks mentioned. The Motley Fool owns shares of L-3 Communications Holdings and Textron. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.