Amended and Restated
Banner Aerospace, Inc.
Profit-Sharing/401(k) Plan and Trust

Statements of Net Assets Available for Plan Benefits

As of December 31, 1999 and 1998

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Amended and Restated
Banner Aerospace, Inc.
Profit-Sharing/401(k) Plan and Trust

Statement of Changes in Net Assets Available for Plan Benefits

For the Year Ended December 31, 1999

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The following description of the Amended and Restated Banner Aerospace, Inc. Profit-Sharing/401(k) Plan and Trust (the "Plan") provides only general information. Participants should refer to the Plan agreement for a more complete description of the Plan's provisions.

The Plan is a defined contribution plan which was established July 1, 1990 by Banner Aerospace, Inc. and Subsidiaries ("the Company"). The purpose of the Plan is twofold as it serves as a profit-sharing plan and a 401(k) salary reduction benefit plan. It is subject to the provisions of the Employee Retirement Income Security Act of 1974 ("ERISA").

The Plan covers certain employees of the Company not covered by a collective bargaining agreement, who have completed at least three consecutive months of service provided the employee also completes 250 hours of service during the three-month period. Participation in the Plan shall commence on the earlier of January 1, April 1, July 1, or October 1 concurrent with or immediately following the eligibility date.

Participants may elect to contribute up to 16 percent of their total salary or wages, including bonuses, commissions and overtime pay. The Company will make a matching contribution equal to 50 percent of the participant's contribution, provided that such matching contribution shall only apply to that portion of such participant's elective contribution which does not exceed 6 percent of the participant's compensation. Each fiscal year, the Company may also contribute an amount determined at the discretion of the Board of Directors.

On January 13, 1998, the Company transferred 100 percent of the assets of certain subsidiaries to AlliedSignal, Inc. ("Allied"). Those participants who were affected by the transfer of assets to Allied were fully vested in their benefits under the Plan. During March and April 1998, assets totaling approximately $7,011,000 were distributed to participants whose employment transferred to Allied.

On December 31, 1998, the Company transferred 100 percent of the stock of Solair, Inc., a subsidiary of Banner Aerospace, Inc., to Kellstrom Industries. Those participants who were affected by the transfer of assets to Kellstrom Industries were fully vested in their benefits under the Plan. On March 31, 1999, assets totaling approximately $306,000 were distributed to participants whose employment transferred to Kellstrom Industries.

Participants are immediately vested in their voluntary contributions plus actual earnings thereon. Vesting in the remainder of their accounts is based on years of completed service, as follows:

Upon termination of service, at the direction of the Plan administrator, a participant can receive a lump-sum payment. Any participant who remains in the employ of the Company, yet is required to receive a distribution, shall have that distribution made over a fixed term designated by the participant which satisfies both the minimum distribution rules and the minimum distribution incidental benefit rules of Code Section 401(a)(9) and which does not exceed the joint and last survivor life expectancy of the participant and a designated beneficiary.

Forfeited non-vested accounts totaled $111,996 and $74,934 during 1999 and 1998, respectively, which were used to reduce employer contributions.

Each participant's account is credited with the participant's contribution and an allocation of (a) the Company's contribution and (b) plan earnings. Allocations are based on participant earnings or account balances, as defined in the Plan.

As specified by the Plan, participants have a choice of investing all or a portion of their contributions into seven investment funds - the PNC Bank Investment Contract Fund, the BlackRock Managed Income Portfolio, the Fidelity Advisor Balanced Portfolio, the Fidelity Advisor Equity Growth Portfolio, the Fidelity Advisor Overseas Portfolio, the Fidelity Advisor High Yield Portfolio and/or the Fairchild Corporate Common Stock Fund. PNC Bank acts as trustee of all investments of the Plan.

The PNC Bank Investment Contract Fund buys investment contracts from insurance companies and banks on behalf of its investors. These contracts are designed to pay a specified rate of interest to the fund while providing for the return of principal.

On April 8, 1999, a special meeting of the shareholders of the Company was held to approve the exchange of the Company's common stock for common stock of The Fairchild Corporation. As a result of the approval by the shareholders to exchange the Company's common stock with common stock of The Fairchild Corporation, the Banner Common Stock Fund is now The Fairchild Corporation Common Stock Fund. Each share of Banner Aerospace common stock was converted into the right to receive 0.7885 shares of Fairchild Class A Common Stock.

The following assets individually represent 5 percent or more of the Plan's total assets as of December 31:

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*Less than 5percent of the Plan's total assets in the respective period.

During 1999, the Plan's investments (including gains and losses on investments bought and sold, as well as held during the year) appreciated in value by $1,578,199 as follows:

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The Trustee may make loans to participants at the direction of the Plan administrator. The loan program is equally applied to all participants on a uniform and nondiscriminatory basis. The maximum loan allowed to a participant (when added to the outstanding balance of any existing loans of such participant) may not be greater than 50 percent of the participant's vested account or $50,000, if less. The minimum loan is $1,000. Loan payments are to be made not less frequently than quarterly. The loan period shall not be in excess of five years from the date of the loan unless the proceeds are used for the purpose of acquiring, constructing or rehabilitating the principal residence of the participant or a member of his family. The Plan administrator shall determine the length of these loan terms. Loans granted shall bear a reasonable rate of interest commensurate with the interest rates charged by persons in the business of lending money for loans, which would be made under similar circumstances, taking into consideration such factors as creditworthiness of the borrower and security given for the loan.

The accompanying financial statements and schedule has been prepared on the accrual basis of accounting. The preparation of the financial statements in conformity with accounting principles generally accepted in the United States requires the Plan's management to use estimates and assumptions that affect the accompanying financial statements and disclosures. Actual results could differ from these estimates.

Investments are stated at the current market value. Changes in the current market value throughout the year are reflected in the statements of changes in net assets available for plan benefits as they occur. Realized and unrealized gains and losses on investments are based on the market value of the investments at the beginning of the plan year or initial cost if purchased during the year.

The PNC Bank Investment Contract Fund is a collective investment fund of PNC Bank, not a portfolio of the PNC Fund. Investments in the guaranteed investment contracts ("GIC"s) are valued at fair value as determined in good faith by the Trustee, based on contractual terms, creditworthiness of the GIC issuer, current market conditions, and comparison to similar instruments with readily ascertainable market values. The fair value of the GICs was determined by the Trustee to be equal to cost plus accrued interest.

Benefit payments are recorded when paid.

Expenditures for trustee fees, audit fees, legal fees and other administrative expenses of the Plan are to be paid by the Plan to the extent that the Company does not pay such expenses. The Company paid all administrative expenses for the years ended December 31, 1999 and 1998.

The Internal Revenue Service issued a determination letter dated September 24, 1997, stating that the Plan was designed in accordance with applicable sections of the Internal Revenue Code ("IRC") and, therefore, is not subject to tax under present income tax law. Once qualified, the Plan is required to operate in conformity with the IRC to maintain its qualification. Although the Plan has been amended since receiving the determination letter, the Plan administrator believes that the Plan is designed and is currently being operated in compliance with the applicable requirements of the IRC.

Certain Plan investments are shares of mutual funds managed by PNC Bank. PNC Bank is the trustee as defined by the Plan, and therefore, these transactions qualify as parties-in-interest.

Although it is the intention of the Company to keep the Plan in operation indefinitely, the Company has the right under the Plan to discontinue its contributions at any time and to terminate the Plan subject to the provisions of ERISA. In the event of Plan termination, participants will become 100 percent vested in their accounts.

Information as to the Plan's assets as of December 31, 1999 and 1998, and the transactions in such assets for the year ended December 31, 1999, including income on investments, investment transactions, gain or loss on the sale of securities and market values, has been certified as complete and accurate to the Plan administrator by PNC Bank.

On October 19, 1999, a special meeting of the Board of Directors was held to approve the merger of the Profit-Sharing/401(k) Plan and Trust with the Savings Plan for Employees of The Fairchild Corporation. As a result of the approval, PNC Bank National Association was removed as Trustee of the Banner Plan and was succeeded by Putnam Investment, the trustee of the "Fairchild Plan". The assets were transferred to Putnam on February 1, 2000, the date of the merger.

On December 1, 1999, the Company transferred a significant portion of the assets and liabilities of Dallas Aerospace, Inc., a subsidiary of Banner Aerospace, Inc., to Pratt Whitney. Those participants who were affected by the transfer of assets to Pratt Whitney were fully vested in their benefits under the Plan. During May 2000, assets totaling approximately $380,000 were distributed to participants whose employment transferred to Pratt Whitney.

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Amended and Restated

Banner Aerospace, Inc.

Profit-Sharing/401(k) Plan and Trust

Schedule of Assets Held for Investment Purposes

As of December 31, 1999

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* Represents a party-in-interest.