<PAGE>
   
      AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 16, 1996
    
 
   
                                                      REGISTRATION NO. 333-02453
    
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
 
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                            ------------------------
 
   
                                AMENDMENT NO. 1
                                       TO
                                    FORM S-3
                             REGISTRATION STATEMENT
                                     UNDER
                           THE SECURITIES ACT OF 1933
    
                            ------------------------
                          NORTHROP GRUMMAN CORPORATION
             (Exact name of Registrant as specified in its charter)
 
                DELAWARE                                95-1055798
    (State or other jurisdiction of                  (I.R.S. Employer
     incorporation or organization)                Identification No.)
 
                             1840 CENTURY PARK EAST
                         LOS ANGELES, CALIFORNIA 90067
                                 (310) 553-6262
  (Address, including zip code, and telephone number, including area code, of
                   Registrant's principal executive offices)
 
            JAMES C. JOHNSON, CORPORATE VICE PRESIDENT AND SECRETARY
                          NORTHROP GRUMMAN CORPORATION
                             1840 CENTURY PARK EAST
                         LOS ANGELES, CALIFORNIA 90067
                                 (310) 553-6262
 (Name, address, including zip code, and telephone number, including area code,
                             of agent for service)
                            ------------------------
 
                                   COPIES TO:
 
          John D. Hussey, Esq.                     John R. Light, Esq.
Sheppard, Mullin, Richter & Hampton LLP              Latham & Watkins
   333 South Hope Street, 48th Floor        633 West Fifth Street, Suite 4000
     Los Angeles, California 90071            Los Angeles, California 90071
             (213) 620-1780                           (213) 485-1234
 
                            ------------------------
 
   
          APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO PUBLIC:
 As soon as practicable after this Registration Statement has become effective
    
                            ------------------------
 
   
    THE  REGISTRANT HEREBY  AMENDS THIS REGISTRATION  STATEMENT ON  SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A  FURTHER  AMENDMENT  WHICH SPECIFICALLY  STATES  THAT  THIS  REGISTRATION
STATEMENT  SHALL THEREAFTER BECOME EFFECTIVE IN  ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT  OF 1933  OR UNTIL  THE REGISTRATION  STATEMENT SHALL  BECOME
EFFECTIVE  ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
    
 
    The prospectus contained in  this Registration Statement  also relates to  a
registration  statement previously  filed with the  Commission (Registration No.
33-55143).
 
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------

<PAGE>
Information   contained  herein  is  subject   to  completion  or  amendment.  A
registration statement  relating to  these securities  has been  filed with  the
Securities  and Exchange  Commission. These securities  may not be  sold nor may
offers to buy be accepted prior  to the time the registration statement  becomes
effective.  This  Prospectus  shall  not  constitute an  offer  to  sell  or the
solicitation of an offer to buy nor shall there be any sale of these  securities
in  any State in which such offer,  solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any such State.

<PAGE>
   
                   SUBJECT TO COMPLETION, DATED MAY 16, 1996
    
 
                                7,000,000 Shares
 
                                NORTHROP GRUMMAN
                                  Common Stock
                               ($1.00 PAR VALUE)
 
                                 --------------
 
ALL OF THE SHARES OF COMMON STOCK,  PAR VALUE $1.00 PER SHARE ("COMMON  STOCK"),
OF  NORTHROP GRUMMAN CORPORATION (THE "COMPANY")  OFFERED HEREBY ARE BEING SOLD
 BY THE  COMPANY. OF  THE 7,000,000  SHARES OF  COMMON STOCK  BEING  OFFERED,
   5,950,000  SHARES ARE INITIALLY  BEING OFFERED IN  THE UNITED STATES AND
     CANADA (THE  "U.S.  SHARES")  BY  THE  U.S.  UNDERWRITERS  (THE  "U.S.
     OFFERING")  AND  1,050,000  SHARES ARE  INITIALLY  BEING CONCURRENTLY
      OFFERED OUTSIDE THE  UNITED STATES AND  CANADA (THE  "INTERNATIONAL
       SHARES")  BY  THE  MANAGERS  (THE  "INTERNATIONAL  OFFERING"  AND,
       TOGETHER WITH THE U.S.  OFFERING, THE "OFFERINGS"). THE  OFFERING
        PRICE AND UNDERWRITING DISCOUNTS AND  COMMISSIONS OF THE U.S.
             OFFERING AND THE INTERNATIONAL OFFERING ARE IDENTICAL.
 
   
THE  COMMON STOCK OF THE  COMPANY IS LISTED ON THE  NEW YORK STOCK EXCHANGE (THE
"NYSE") AND THE  PACIFIC STOCK  EXCHANGE UNDER THE  SYMBOL "NOC."  ON MAY  15,
  1996,  THE LAST REPORTED SALE PRICE  OF THE COMMON       STOCK ON THE NYSE
           WAS $62. SEE "PRICE RANGE OF COMMON STOCK AND DIVIDENDS."
    
 
                                 --------------
 
THESE SECURITIES  HAVE  NOT  BEEN  APPROVED OR  DISAPPROVED  BY  THE  SECURITIES
   AND   EXCHANGE  COMMISSION   OR  ANY   STATE  SECURITIES   COMMISSION  NOR
     HAS  THE   SECURITIES   AND   EXCHANGE   COMMISSION   OR   ANY   STATE
        SECURITIES   COMMISSION   PASSED  UPON   THE  ACCURACY   OR  AD-
            EQUACY   OF   THIS   PROSPECTUS.   ANY    REPRESENTATION
                       TO THE CONTRARY IS A CRIMINAL OFFENSE.
 

<TABLE>
<CAPTION>
                                                                             UNDERWRITING
                                                            PRICE TO         DISCOUNTS AND       PROCEEDS TO
                                                             PUBLIC           COMMISSIONS        COMPANY(1)
                                                        -----------------  -----------------  -----------------
<S>                                                     <C>                <C>                <C>
PER SHARE.............................................          $                  $                  $
TOTAL (2).............................................          $                  $                  $
</TABLE>

 
(1) BEFORE DEDUCTION OF EXPENSES PAYABLE BY THE COMPANY, ESTIMATED AT $700,000.
 
(2)  THE COMPANY HAS GRANTED  THE U.S. UNDERWRITERS AND  THE MANAGERS AN OPTION,
    EXERCISABLE BY CS  FIRST BOSTON CORPORATION  FOR THIRTY (30)  DAYS FROM  THE
    DATE  OF  THIS PROSPECTUS,  TO PURCHASE  A  MAXIMUM OF  1,050,000 ADDITIONAL
    SHARES TO COVER  OVER-ALLOTMENTS OF SHARES.  IF THE OPTION  IS EXERCISED  IN
    FULL,  THE TOTAL PRICE TO PUBLIC WILL BE $          , UNDERWRITING DISCOUNTS
    AND COMMISSIONS  WILL BE  $              AND  PROCEEDS  TO COMPANY  WILL  BE
    $         .
 
   
    THE U.S. SHARES ARE OFFERED BY THE SEVERAL U.S. UNDERWRITERS WHEN, AS AND IF
ISSUED  BY THE COMPANY, DELIVERED  TO AND ACCEPTED BY  THE U.S. UNDERWRITERS AND
SUBJECT TO THEIR RIGHT TO REJECT ORDERS IN WHOLE OR IN PART. IT IS EXPECTED THAT
THE U.S. SHARES WILL BE READY  FOR DELIVERY ON OR ABOUT  JUNE   , 1996,  AGAINST
PAYMENT IN IMMEDIATELY AVAILABLE FUNDS.
    
 
CS First Boston
                              Merrill Lynch & Co.
 
                                                            Salomon Brothers Inc
 
   
                 THE DATE OF THIS PROSPECTUS IS JUNE   , 1996.
    

<PAGE>
    IN  CONNECTION WITH THE OFFERINGS, CS  FIRST BOSTON CORPORATION ON BEHALF OF
THE U.S. UNDERWRITERS  AND THE  MANAGERS MAY OVER-ALLOT  OR EFFECT  TRANSACTIONS
WHICH  STABILIZE OR  MAINTAIN THE MARKET  PRICE OF  THE COMMON STOCK  AT A LEVEL
ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL  IN THE OPEN MARKET. SUCH  TRANSACTIONS
MAY  BE EFFECTED ON THE  NEW YORK STOCK EXCHANGE,  THE PACIFIC STOCK EXCHANGE OR
OTHERWISE. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
 
    DURING THIS OFFERING, CERTAIN PERSONS AFFILIATED WITH PERSONS  PARTICIPATING
IN THE DISTRIBUTION MAY ENGAGE IN TRANSACTIONS FOR THEIR OWN ACCOUNTS OR FOR THE
ACCOUNTS  OF OTHERS IN  THE COMMON STOCK  OF THE COMPANY  PURSUANT TO EXEMPTIONS
CONTAINED IN RULES 10B-6, 10B-7 AND  10B-8 UNDER THE SECURITIES EXCHANGE ACT  OF
1934.
 
                           FORWARD LOOKING STATEMENTS
 
    THE  FORWARD LOOKING  STATEMENTS CONTAINED  IN THIS  PROSPECTUS, CONCERNING,
AMONG OTHER  THINGS,  FUTURE RESULTS  OF  OPERATIONS, DELIVERIES,  TRENDS,  CASH
FLOWS,  MARKETS  AND PROGRAMS  ARE PROJECTIONS  AND  ARE NECESSARILY  SUBJECT TO
VARIOUS  RISKS  AND  UNCERTAINTIES.  ACTUAL  OUTCOMES  ARE  DEPENDENT  UPON  THE
COMPANY'S  SUCCESSFUL  PERFORMANCE  OF  INTERNAL  PLANS,  GOVERNMENT  CUSTOMERS'
BUDGETARY RESTRAINTS,  CUSTOMER CHANGES  IN SHORT  RANGE AND  LONG RANGE  PLANS,
DOMESTIC AND INTERNATIONAL COMPETITION IN BOTH THE DEFENSE AND COMMERCIAL AREAS,
PRODUCT  PERFORMANCE,  CONTINUED  DEVELOPMENT AND  ACCEPTANCE  OF  NEW PRODUCTS,
PERFORMANCE ISSUES WITH KEY SUPPLIERS AND SUBCONTRACTORS, GOVERNMENT IMPORT  AND
EXPORT  POLICIES,  TERMINATION  OF  GOVERNMENT  CONTRACTS,  POLITICAL PROCESSES,
LEGAL, FINANCIAL AND  GOVERNMENTAL RISKS RELATED  TO INTERNATIONAL  TRANSACTIONS
AND GLOBAL NEEDS FOR MILITARY AND COMMERCIAL AIRCRAFT AND ELECTRONIC SYSTEMS AND
SUPPORT,  AS  WELL  AS OTHER  ECONOMIC,  POLITICAL AND  TECHNOLOGICAL  RISKS AND
UNCERTAINTIES.
 
                             AVAILABLE INFORMATION
 
    The Company is subject to  the informational requirements of the  Securities
Exchange  Act  of  1934, as  amended  (the  "Exchange Act"),  and  in accordance
therewith files  reports,  proxy  statements  and  other  information  with  the
Securities  and  Exchange  Commission (the  "Commission").  Such  reports, proxy
statements and other information may be inspected and copies may be obtained  at
the  principal office  of the Commission  at 450 Fifth  Street, N.W, Washington,
D.C.  20549,  and  at  the   following  regional  offices  of  the   Commission:
Northwestern  Atrium  Center,  500  West Madison  Street,  Suite  1400, Chicago,
Illinois 60661; and 7 World Trade Center, 13th Floor, New York, New York  10048.
Copies  of such materials can  be obtained from the  Public Reference Section of
the Commission, 450  Fifth Street,  N.W, Washington, D.C.  20549, at  prescribed
rates.  Reports, proxy statements  and other information  concerning the Company
can also be inspected at  the offices of the New  York Stock Exchange, Inc.,  20
Broad  Street, New York, New  York 10005; and the  Pacific Stock Exchange, Inc.,
233 South Beaudry Avenue,  Los Angeles, California 90012,  and 301 Pine  Street,
San Francisco, California 94104.
 
    The  Company has filed with the Commission a Registration Statement (herein,
together with all amendments thereto, called the "Registration Statement") under
the Securities Act of 1933, as  amended (the "Securities Act"), with respect  to
the  securities  offered hereby.  This Prospectus  does not  contain all  of the
information  included  in  the  Registration  Statement  and  the  exhibits  and
schedules thereto. Statements contained in this Prospectus as to the contents of
any contract or other document referred to herein and filed as an exhibit to the
Registration  Statement  are not  necessarily  complete, and,  in  each instance
reference is made to  the copy of  such contract or other  document filed as  an
exhibit  to the Registration  Statement, each such  statement being qualified in
all respects by  such reference.  For further  information with  respect to  the
Company and the securities being offered hereby, reference is hereby made to the
Registration Statement and the exhibits and schedules thereto.
 
                                       2

<PAGE>
                INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
 
    The  Company has filed  with the Commission,  pursuant to Section  13 of the
Exchange Act:
 
        (i) an Annual Report on Form 10-K for the year ended December 31, 1995;
 
        (ii) a Current Report on Form 8-K filed March 18, 1996;
 
   
       (iii) a Quarterly  Report on Form  10-Q for the  quarter ended March  31,
    1996;
    
 
   
        (iv)  a description of  the Common Stock  of the Company  set forth in a
    Registration Statement on Form 8-B dated June 20, 1985; and
    
 
   
        (v) a description of the Common Stock Purchase Rights of the Company set
    forth in a Registration Statement on  Form 8-A filed September 22, 1988,  as
    amended  on Form 8  filed August 2,  1991, as further  amended on Form 8-A/A
    filed October 7, 1994;
    
 
    which are  hereby incorporated  by reference  in  and made  a part  of  this
    Prospectus.
 
        All  documents  hereafter  filed  by  the  Company  with  the Commission
    pursuant to Section 13(a), 13(c), 14 or  15(d) of the Exchange Act prior  to
    the filing of a post-effective amendment which indicates that all securities
    offered  hereby  have been  sold or  which  deregisters all  securities then
    remaining unsold shall be deemed to  be incorporated by reference in and  to
    be  a part of this Prospectus from the date of filing of such documents. Any
    statement contained in a document incorporated by reference or deemed to  be
    incorporated  herein  shall  be  deemed to  be  modified  or  superseded for
    purposes of this Prospectus to the extent that a statement contained  herein
    or in any other subsequently filed document which also is or is deemed to be
    incorporated  by reference herein modifies or supersedes such statement. Any
    such statement so modified or superseded  shall not be deemed, except as  so
    modified or superseded, to constitute a part of this Prospectus.
 
        In this Prospectus, references to "dollars" and "$" are to United States
    dollars.
 
        THIS  PROSPECTUS  INCORPORATES  DOCUMENTS  BY  REFERENCE  WHICH  ARE NOT
    PRESENTED HEREIN  OR  DELIVERED  HEREWITH. THESE  DOCUMENTS  (NOT  INCLUDING
    EXHIBITS  TO  SUCH  DOCUMENTS,  UNLESS  SUCH  EXHIBITS  ARE  INCORPORATED BY
    REFERENCE IN SUCH DOCUMENTS)  ARE AVAILABLE WITHOUT  CHARGE UPON WRITTEN  OR
    ORAL  REQUEST DIRECTED  TO: JAMES C.  JOHNSON, CORPORATE  VICE PRESIDENT AND
    SECRETARY,  NORTHROP  GRUMMAN  CORPORATION,  1840  CENTURY  PARK  EAST,  LOS
    ANGELES, CALIFORNIA 90067 (TELEPHONE: (310) 553-6262).
 
                                       3

<PAGE>
                               PROSPECTUS SUMMARY
 
    THE FOLLOWING SUMMARY IS QUALIFIED IN ITS ENTIRETY BY, AND SHOULD BE READ IN
CONJUNCTION  WITH, THE MORE  DETAILED INFORMATION AND  FINANCIAL DATA (INCLUDING
FINANCIAL STATEMENTS, PRO FORMA FINANCIAL  DATA AND THE NOTES THERETO)  INCLUDED
ELSEWHERE IN THIS PROSPECTUS OR INCORPORATED HEREIN BY REFERENCE.
 
                                  THE COMPANY
 
   
    Northrop  Grumman  Corporation  (the "Company")  is  an  advanced technology
aerospace and  defense company  operating primarily  in two  business  segments:
electronics and systems integration and military and commercial aircraft. Within
the  electronics and systems integration segment,  the Company is engaged in the
design, development  and manufacture  of a  wide variety  of complex  electronic
products  such as  airborne radar,  surveillance and  battle management systems,
electronic countermeasures, precision weapons, antisubmarine warfare systems and
air traffic  control  systems.  Within  the  military  and  commercial  aircraft
segment,  the Company  is engaged  in the  design, development,  manufacture and
modification of military aircraft and commercial aerostructures. The Company  is
also  engaged in the design, development and manufacture of information systems,
marine propulsion and power generation systems  and a variety of other  products
and  services. Approximately three-fourths of the Company's revenues in 1996 are
expected to be generated from the  U.S. Department of Defense (the "DOD"),  with
the balance provided by contracts with commercial aerospace manufacturers, other
U.S. government agencies and various foreign customers.
    
 
    The Company has a balance of programs in both the production and development
phases.  While  production programs  generally  involve less  risk  and generate
greater cash flow than development programs, development programs are  essential
for  future growth  opportunities. Based  on its  backlog and  business mix, the
Company believes  that  its  cash  flow  from  operations  as  compared  to  its
investment  requirements will result in significant cash flow available for debt
reduction, dividends and other uses over the next several years.
 
    Many of the  Company's programs  are among  the principal  programs for  the
various  branches of the U.S.  military. The Company is  the prime contractor on
the B-2 Stealth Bomber, the only  strategic bomber currently in production;  the
principal  subcontractor  on  the  F/A-18C/D  Hornet,  the  U.S.  Navy's primary
strike/attack aircraft,  as  well as  on  the next  generation  F/A-18E/F  Super
Hornet;  the prime  contractor on  the E-2C  Hawkeye, the  U.S. Navy's principal
early warning, command and  control aircraft; the prime  contractor for the  E-8
Joint  STARS aircraft  radar system, which  will be the  primary airborne ground
surveillance and battle management system for  the U.S. Air Force and Army;  the
prime   contractor  on   the  BAT  "Brilliant"   self-guided  submunition  under
development for the  U.S. Army; the  supplier of the  APG-68 Fire Control  Radar
used on the F-16, one of the most widely used fighter aircraft in the world; the
supplier of the ARSR-4 Long Range Radar, a three-dimensional air traffic control
radar  system  used  by  the  U.S.  Air  Force  and  the  U.S.  Federal Aviation
Administration; and the  supplier of  the AN/APY-1, 2  surveillance radar  which
provides   real-time,  all-altitude  and  beyond-the-horizon  target  detection,
identification and tracking for the E-3 AWACS surveillance aircraft.
 
    The Company is also one of  the world's leading manufacturers of  commercial
aerostructures  and components. The  Company manufactures major  portions of the
Boeing 747,  757 and  767 jetliners  as well  as significant  subassemblies  and
components for other commercial aircraft, including the Boeing 777 jetliner.
 
                                    STRATEGY
 
    The  Company intends to strengthen its position as a leader in the aerospace
and defense  industry by  pursuing  the following  strategies: (i)  focusing  on
segments  of defense markets that are growing  and where the Company has premier
technological capabilities, particularly in electronics and electronics  systems
integration; and (ii) leveraging its airframe design expertise and manufacturing
strengths  to  remain  a  key competitor  in  military  aircraft  and commercial
aerostructures. The  Company  has  been pursuing  these  strategies  since  1992
through  both internal  initiatives and  acquisitions and,  as a  result, enjoys
leading positions in those market segments  in which it chooses to compete.  The
Company's  primary objective in pursuit of these strategies is to maximize total
return on investment.
 
                                       4

<PAGE>
    The  Company   is   transforming   itself   from   primarily   an   aircraft
designer/manufacturer  to an electronics and  systems integration company with a
leading airframe  and  aerostructures  business.  In  early  1994,  the  Company
significantly  expanded its electronics business with the acquisition of Grumman
Corporation ("Grumman"), a  leading electronic systems  integration company.  In
March   of  1996,  the  Company  acquired   the  Electronics  Systems  Group  of
Westinghouse  Electric  Corporation  ("ESG").  ESG  is  a  leading  producer  of
sophisticated  electronics for defense,  government and commercial applications.
As a result of these acquisitions, the Company expects that its electronics  and
systems  integration revenues will approximate 50% of total revenues in 1996 and
that this percentage will continue to increase in the future.
 
    This strategic  transformation positions  the Company  to meet  the  growing
needs  of the DOD for more  sophisticated electronics and integrated electronics
systems. Since the end of the Cold War, the DOD has recognized the necessity  of
maintaining  an  effective fighting  force with  fewer defense  dollars, thereby
placing a premium on sophisticated systems that provide long-range surveillance,
battle management and  precision-strike capabilities. As  military systems  have
become  more complex,  integration of  the electronic  functions of  the various
platforms, weapons and support systems has become increasingly important. Budget
constraints have also encouraged spending on program modifications, upgrades and
extensions rather than  on new development  programs, further increasing  demand
for  sophisticated electronics systems. As  a technological leader in designing,
manufacturing and integrating the sophisticated electronics systems that provide
long-range surveillance,  battle management  and precision-strike  capabilities,
the  Company believes that it is well positioned to serve the electronic systems
market.
 
    The Company  has  also strengthened  its  military and  commercial  aircraft
segment.   In  1992,  the  Company  acquired  49%  of  Vought  Aircraft  Company
("Vought"), a leading  manufacturer of commercial  and military  aerostructures,
and  in 1994  acquired the  remaining 51%  of Vought  and the  military aircraft
business of Grumman. These acquisitions  and the Company's internal  initiatives
have  enabled the Company  to establish a leading  position in military aircraft
and commercial aerostructures. The Company  believes that it will maintain  this
leadership  position as  a result of  its airframe  design experience, including
stealth technology, as well as its cost-competitive manufacturing capabilities.
 
                               ACQUISITION OF ESG
 
   
    On March  1,  1996,  the  Company  completed  the  acquisition  of  ESG  for
approximately  $2.9  billion in  cash (the  "Acquisition").  For the  year ended
December 31, 1995, ESG  generated revenue of $2.6  billion. The Acquisition  was
financed  with a combination  of bank borrowings  and intermediate and long-term
notes and debentures. The business of ESG  is now operated as the Company's  new
Electronic Sensors and Systems Division ("ESSD").
    
 
    ESSD is a leading supplier of electronic systems for defense, government and
commercial  applications.  It  employs  nearly  12,000  people  worldwide  at 15
operating locations,  primarily in  the United  States. ESSD  has a  diversified
portfolio  of programs with  no single program  accounting for more  than 10% of
revenues  in  1995.  Approximately  one-half   of  ESSD's  1995  revenues   were
attributable  to  radar technology  applied to  surveillance, fire  control, air
traffic control and  other purposes.  ESSD also designs  and manufactures  other
avionics  products, electro-optical  systems, undersea  and marine  products and
material handling systems.
 
    The Acquisition represents  a substantial step  in the Company's  continuing
transformation  from an aircraft designer/manufacturer  to a defense electronics
and systems  integration  company with  a  leading aircraft  and  aerostructures
business.  The Acquisition enables the Company  to serve a larger customer base,
domestically and internationally, and is expected to provide the opportunity  to
achieve  revenue growth  and greater cash  flow stability.  The Acquisition will
also enable the Company to  enhance its role on  important programs such as  E-8
Joint  STARS and BAT, and  to expand its business into  the areas of air traffic
control and anti-submarine warfare systems.
 
                                       5

<PAGE>
                                 THE OFFERINGS
 
   

<TABLE>
<S>                             <C>        <C>
Common Stock Offered (1):
  U.S. Offering...............  5,950,000  shares
  International Offering......  1,050,000  shares
                                ---------
    Total.....................  7,000,000  shares
                                ---------
                                ---------
Common Stock Outstanding:
  Before the Offerings (at
   April 30, 1996)............  49,633,330 shares
  After the Offerings (1).....  56,633,330 shares
Dividends.....................  For historical  information related  to dividends  declared
                                and  the Company's future dividend policy, see "Price Range
                                of Common Stock and Dividends."
Use of Proceeds...............  The net proceeds of the Offerings  will be used to repay  a
                                portion  of the bank borrowings  incurred by the Company in
                                connection with the Acquisition. See "Use of Proceeds"  and
                                "The Company -- Acquisition of ESG."
New York Stock Exchange and
 Pacific Stock Exchange
 Symbol.......................  NOC
</TABLE>

    
 
- ------------------------
(1) Does  not include  up to  1,050,000 shares  of Common  Stock subject  to the
    over-allotment option granted by  the Company to  the U.S. Underwriters  and
    the Managers.
 
                                       6

<PAGE>
                SUMMARY HISTORICAL AND PRO FORMA FINANCIAL DATA
 
   
    The  following summary  historical financial data  with respect  to the five
years ended  December 31,  1995, have  been derived  from and  are qualified  by
reference  to the  audited consolidated  financial statements  and notes thereto
filed by  the Company  with  the Commission  which  are incorporated  herein  by
reference.  The data  for the  three months  ended March  31, 1996  and 1995 are
unaudited but, in the opinion of management, reflect all adjustments, consisting
of normal  recurring  adjustments, necessary  for  a fair  presentation  of  the
results of operations and financial position for such periods. Operating results
for  the three months ended March 31, 1996  may not be indicative of the results
that may  be expected  for the  year ending  December 31,  1996, or  any  future
period. All such summary historical financial data should be read in conjunction
with  "Selected Consolidated  Financial Data"  and "Management's  Discussion and
Analysis  of  Financial  Condition  and  Results  of  Operations,"  included  or
incorporated  by reference herein.  The summary pro forma  data for December 31,
1995 and March 31, 1996  and the periods then ended  have been derived from  the
"Unaudited  Pro Forma Condensed  Combined Financial Data"  included herein which
are based upon the historical  consolidated financial statements of the  Company
and  the  historical  combined  financial  statements  of  ESG  which  are  also
incorporated herein by  reference, adjusted  to give effect  to the  Acquisition
using  the purchase method of  accounting. The pro forma  Operating Data for the
year ended December  31, 1995 and  the three  months ended March  31, 1996  give
effect  to the Acquisition as if it had  occurred as of January 1, 1995. The pro
forma Balance Sheet Data give effect to the Acquisition as if it had occurred on
December 31,  1995. The  pro forma  financial data  do not  give effect  to  the
proposed  issuance of shares in the Offerings and the use of proceeds therefrom.
See  also  "Available  Information,"  "Incorporation  of  Certain  Documents  by
Reference" and "Unaudited Pro Forma Condensed Combined Financial Data."
    
 
   

<TABLE>
<CAPTION>
                                                                            FOR FISCAL YEAR ENDED DECEMBER 31,
                                                           --------------------------------------------------------------------
                                                                         1995        1994        1993       1992        1991
                                                                       --------   ----------   --------   --------   ----------
                                                           PRO FORMA
                                                             1995
                                                           ---------
                                                           (UNAUDITED)    ($ IN MILLIONS, EXCEPT PER SHARE DATA)
<S>                                                        <C>         <C>        <C>          <C>        <C>        <C>
Operating Data:
  Net sales..............................................  $  9,158    $  6,818   $    6,711   $  5,063   $  5,550   $    5,694
  Cost of sales
    Operating costs......................................     7,230       5,319        5,477      4,385      4,877        4,817
    Administrative and general expenses..................     1,283         963          753        485        455          531
    Special termination benefits.........................                                282
    Restructuring charges................................        51
                                                           ---------   --------   ----------   --------   --------   ----------
  Operating margin.......................................       594         536          199        193        218          346
  Other, net.............................................        (5)          9          (31)        13          5
  Interest expense, net..................................      (346)       (136)        (103)       (36)       (43)         (69)
                                                           ---------   --------   ----------   --------   --------   ----------
  Income before income taxes and cumulative effect of
   accounting principle changes..........................       243         409           65        170        180          277
  Federal and foreign income taxes.......................       107         157           30         74         59            9
                                                           ---------   --------   ----------   --------   --------   ----------
  Income before cumulative effect of accounting principle
   changes...............................................       136         252           35         96        121          268
  Cumulative effect of accounting principle changes......                                                                   (67)
                                                           ---------   --------   ----------   --------   --------   ----------
  Net income.............................................  $    136    $    252   $       35   $     96   $    121   $      201
                                                           ---------   --------   ----------   --------   --------   ----------
                                                           ---------   --------   ----------   --------   --------   ----------
  Earnings per share before cumulative effect of
   accounting principle changes..........................  $   2.75    $   5.11   $      .72   $   1.99   $   2.56   $     5.69
  Cumulative effect of accounting principle changes, per
   share.................................................                                                                 (1.43)
                                                           ---------   --------   ----------   --------   --------   ----------
  Earnings per share.....................................  $   2.75    $   5.11   $      .72   $   1.99   $   2.56   $     4.26
                                                           ---------   --------   ----------   --------   --------   ----------
                                                           ---------   --------   ----------   --------   --------   ----------
Balance Sheet Data:
  Total assets...........................................  $  9,646    $  5,455   $    6,047   $  2,939   $  3,162   $    3,128
  Net working capital....................................       321         357          467        481        354          611
  Total debt.............................................     4,344       1,372        1,934        160        510          550
  Shareholders' equity...................................     1,459       1,459        1,290      1,322      1,254        1,182
Other Data:
  Capital expenditures...................................  $    188    $    133   $      134   $    135   $    123   $      118
  Depreciation and amortization..........................       471         283          269        214        160          171
  Funded order backlog...................................    13,433       9,947       12,173      6,919      7,175        8,561
  Dividends per share....................................  $   1.60    $   1.60   $     1.60   $   1.60   $   1.20   $     1.20
  Weighted average shares outstanding (in millions)......      49.4        49.4         49.2       48.1       47.2         47.1
</TABLE>

    
 
                                       7

<PAGE>
   
          SUMMARY HISTORICAL AND PRO FORMA FINANCIAL DATA (CONTINUED)
    
 
   

<TABLE>
<CAPTION>
                                                                                 THREE MONTHS ENDED MARCH 31,
                                                                               ---------------------------------
                                                                                          (UNAUDITED)
                                                                               PRO FORMA
                                                                                 1996        1996        1995
                                                                               ---------   --------   ----------
                                                                               ($ IN MILLIONS, EXCEPT PER SHARE
                                                                                             DATA)
<S>                                                                            <C>         <C>        <C>
Operating Data:
  Net sales..................................................................  $  1,850    $ 1,603    $   1,617
  Cost of sales
    Operating costs..........................................................     1,476      1,273        1,299
    Administrative and general expenses......................................       231        191          201
                                                                               ---------   --------   ----------
  Operating margin...........................................................       143        139          117
  Interest expense, net......................................................       (81)       (46)         (34)
  Other, net.................................................................         8          9            5
                                                                               ---------   --------   ----------
  Income before income taxes.................................................        70        102           88
  Federal and foreign income taxes...........................................        29         41           34
                                                                               ---------   --------   ----------
  Net income.................................................................  $     41    $    61    $      54
                                                                               ---------   --------   ----------
                                                                               ---------   --------   ----------
  Earnings per share.........................................................  $    .83    $  1.23    $    1.10
                                                                               ---------   --------   ----------
                                                                               ---------   --------   ----------
Balance Sheet Data:
  Total assets...............................................................              $ 9,495    $   6,090
  Net working capital........................................................                  339          469
  Total debt.................................................................                4,201        1,787
  Shareholders' equity.......................................................                1,505        1,326
Other Data:
  Capital expenditures.......................................................              $    41    $      45
  Depreciation and amortization..............................................                   71           67
  Funded order backlog.......................................................               12,543       11,477
  Dividends per share........................................................              $   .40    $     .40
  Weighted average shares outstanding (in millions)..........................                 49.6         49.3
</TABLE>

    
 
                                       8

<PAGE>
                                USE OF PROCEEDS
 
   
    The  Company intends to apply the net proceeds from the Offerings, estimated
to be  approximately $420.3  million  (or approximately  $483.4 million  if  the
overallotment option is exercised), assuming an offering price of $62 per share,
to  repay a  portion of  the Company's bank  borrowings incurred  to finance the
Acquisition in March 1996.  The indebtedness to be  repaid with the proceeds  of
the Offerings currently bears interest at 5.94% and has a maturity date of March
1, 1998.
    
 
   
                                 CAPITALIZATION
    
 
   
    The  following table sets forth (i) the  capitalization of the Company as at
March 31, 1996,  and (ii)  the capitalization as  adjusted to  reflect the  sale
pursuant  to  the  Offerings  of  7,000,000  shares  of  Common  Stock  and  the
application of the estimated net proceeds therefrom. See "Use of Proceeds."
    
 
   

<TABLE>
<CAPTION>
                                                                                        AS OF MARCH 31, 1996
                                                                                    -----------------------------
                                                                                       ACTUAL     AS ADJUSTED (A)
                                                                                    ------------  ---------------
                                                                                           ($ IN MILLIONS)
<S>                                                                                 <C>           <C>
Current portion of long-term debt.................................................  $     250        $     250
                                                                                       ------           ------
Long-term debt:
  Bank term loans and revolving credit facility (b)...............................      2,350            1,930
  8 5/8% Notes due 2004...........................................................        350              350
  7% Notes due 2006...............................................................        400              400
  7 3/4% Debentures due 2016......................................................        300              300
  9 3/8% Debentures due 2024......................................................        250              250
  7 7/8% Debentures due 2026......................................................        300              300
  Other...........................................................................          1                1
                                                                                       ------           ------
    Total long-term debt..........................................................      3,951            3,531
                                                                                       ------           ------
    Total debt....................................................................      4,201            3,781
Shareholders' equity:
  Preferred stock, 10,000,000 shares authorized; none issued......................
  Common stock (c), 200,000,000 shares authorized; 49,632,060 shares issued;
   56,632,060 shares issued as adjusted (d).......................................        276              696
  Retained earnings...............................................................      1,241            1,241
  Unfunded pension losses, net of taxes...........................................        (12)             (12)
                                                                                       ------           ------
    Total shareholders' equity....................................................      1,505            1,925
                                                                                       ------           ------
      Total capitalization........................................................  $   5,706        $   5,706
                                                                                       ------           ------
                                                                                       ------           ------
</TABLE>

    
 
- ------------------------
   
(a) Assumes a public offering price of $62  per share, the closing price of  the
    Company's Common Stock on the NYSE on May 15, 1996.
    
 
   
(b) Amended  bank credit facility consisting of  a $1.8 billion revolving credit
    facility expiring in March 2002 and two term loan facilities aggregating  $2
    billion  ($500  million due  March 1998  and $1.5  billion due  in quarterly
    installments of $62.5 million  through March 2002),  the proceeds of  which,
    together  with $1  billion of  institutionally placed  notes and debentures,
    were utilized to finance the Acquisition.
    
 
   
(c) Includes an equal number of  Common Stock Purchase Rights. See  "Description
    of Capital Stock -- Common Stock Purchase Rights."
    
 
   
(d) Excludes  3,959,423 shares of Common Stock reserved for issuance pursuant to
    outstanding options and rights granted under the Company's stock plans.
    
 
                                       9

<PAGE>
   
                   PRICE RANGE OF COMMON STOCK AND DIVIDENDS
    
 
   
    The Company's Common Stock is traded on the New York Stock Exchange and  the
Pacific Stock Exchange under the symbol NOC. The table below sets forth the high
and  low trading prices  of the Common Stock  as reported on  the New York Stock
Exchange Composite  Tape and  quarterly  cash dividends  declared per  share  of
Common  Stock during the  periods indicated. For  a recent closing  price of the
Common Stock, see the cover page of this Prospectus.
    
 
   

<TABLE>
<CAPTION>
                                                                                       PRICE RANGE            CASH
                                                                                      -------------         DIVIDENDS
                                                                                    LOW          HIGH       DECLARED
                                                                                   -----         -----      ---------
<S>                                                                             <C>           <C>           <C>
1994
First Quarter ended March 31, 1994............................................      36  7/8       45  7/8   $    .40
Second Quarter ended June 30, 1994............................................      34  1/2       39  3/4        .40
Third Quarter ended September 30, 1994........................................      35  3/4       45  3/8        .40
Fourth Quarter ended December 31, 1994........................................      40  1/4       47  3/8        .40
1995
First Quarter ended March 31, 1995............................................      39  3/4       49  3/4        .40
Second Quarter ended June 30, 1995............................................      47            54             .40
Third Quarter ended September 30, 1995........................................      51  7/8       62  5/8        .40
Fourth Quarter ended December 31, 1995........................................      56            64  1/4        .40
1996
First Quarter ended March 31, 1996............................................      58  3/8       67  3/8        .40
Second Quarter (through May 15, 1996).........................................      58            63  1/4
</TABLE>

    
 
   
    Dividends on the Common Stock of  the Company are payable at the  discretion
of  the Company's  Board of Directors  out of funds  legally available therefor.
Future  dividend  policy  will  depend   on  the  Company's  earnings,   capital
requirements,  financial condition and other  factors considered relevant by the
Company's Board of Directors. The currently scheduled record date for the second
quarter dividend, if declared, is May 28, 1996.
    
 
                                       10

<PAGE>
                      SELECTED CONSOLIDATED FINANCIAL DATA
 
   
    The following table sets forth certain selected consolidated financial  data
for  the Company for each of the periods indicated which have been derived from,
and are qualified by reference to, the audited consolidated financial statements
and  notes  thereto  filed  by  the  Company  with  the  Commission  which   are
incorporated  herein by reference. The data for the three months ended March 31,
1996 and  1995 are  unaudited but,  in the  opinion of  management, reflect  all
adjustments,  consisting of normal  recurring adjustments, necessary  for a fair
presentation of  the  results of  operations  and financial  position  for  such
periods.  Operating results for the three months ended March 31, 1996 may not be
indicative of the results that may be expected for the year ending December  31,
1996,  or any future period. See also "Available Information," "Incorporation of
Certain Documents  by Reference"  and "Unaudited  Pro Forma  Condensed  Combined
Financial Data."
    
 
   

<TABLE>
<CAPTION>
                                                    THREE MONTHS ENDED
                                                         MARCH 31,                    FISCAL YEAR ENDED DECEMBER 31,
                                                    -------------------     ---------------------------------------------------
                                                    1996(B)       1995       1995      1994(A)      1993       1992       1991
                                                    -------      ------     ------     -------     ------     ------     ------
                                                        (UNAUDITED)   ($ IN MILLIONS, EXCEPT PER SHARE DATA)
<S>                                                 <C>          <C>        <C>        <C>         <C>        <C>        <C>
Operating Data:
  Net sales.......................................  $ 1,603      $1,617     $6,818     $ 6,711     $5,063     $5,550     $5,694
  Cost of sales
    Operating costs...............................    1,273       1,299      5,319       5,477      4,385      4,877      4,817
    Administrative and general expenses...........      191         201        963         753        485        455        531
    Special termination benefits..................                                         282
                                                    -------      ------     ------     -------     ------     ------     ------
  Operating margin................................      139         117        536         199        193        218        346
  Other, net......................................        9           5          9         (31)        13          5
  Interest expense, net...........................      (46)        (34)      (136)       (103)       (36)       (43)       (69)
                                                    -------      ------     ------     -------     ------     ------     ------
  Income before income taxes and cumulative effect
   of accounting principle changes................      102          88        409          65(b)     170        180        277
  Federal and foreign taxes.......................       41          34        157          30         74         59          9
                                                    -------      ------     ------     -------     ------     ------     ------
  Income before cumulative effect of accounting
   principle changes..............................       61          54        252          35         96        121        268
  Cumulative effect of accounting principle
   changes........................................                                                                          (67)(c)
                                                    -------      ------     ------     -------     ------     ------     ------
  Net income......................................  $    61      $   54     $  252     $    35     $   96     $  121     $  201
                                                    -------      ------     ------     -------     ------     ------     ------
                                                    -------      ------     ------     -------     ------     ------     ------
  Earnings per share before cumulative effect of
   accounting principle changes...................  $  1.23      $ 1.10     $ 5.11     $   .72     $ 1.99     $ 2.56     $ 5.69
  Cumulative effect of accounting principle
   changes, per share.............................                                                                        (1.43)(c)
                                                    -------      ------     ------     -------     ------     ------     ------
  Earnings per share..............................  $  1.23      $ 1.10     $ 5.11     $   .72     $ 1.99     $ 2.56     $ 4.26
                                                    -------      ------     ------     -------     ------     ------     ------
                                                    -------      ------     ------     -------     ------     ------     ------
Balance Sheet Data:
  Total assets....................................  $ 9,495      $6,090     $5,455     $ 6,047     $2,939     $3,162     $3,128
  Net working capital.............................      339         469        357         467        481        354        611
  Total debt (d)..................................    4,201       1,787      1,372       1,934        160        510        550
  Shareholders' equity............................    1,505       1,326      1,459       1,290      1,322      1,254      1,182
Other Data:
  Net cash provided by operating activities.......  $   230      $  191     $  744     $   441     $  380     $  284     $  609
  Capital expenditures............................       41          45        133         134        135        123        118
  Depreciation and amortization...................       71          67        283         269        214        160        171
  Funded order backlog............................   12,543      11,477      9,947      12,173      6,919      7,175      8,561
  Dividends per share.............................  $   .40      $  .40     $ 1.60     $  1.60     $ 1.60     $ 1.20     $ 1.20
  Weighted average shares outstanding (in
   millions)......................................     49.6        49.3       49.4        49.2       48.1       47.2       47.1
</TABLE>

    
 
- --------------------------
(a) Includes  Grumman  Corporation  data  from April  1994  and  Vought Aircraft
    Company data from August 1994.
 
   
(b) Includes ESSD data from March 1, 1996.
    
 
   
(c) The Financial Accounting  Standards Board's (FASB)  accounting standard  No.
    106  EMPLOYER'S ACCOUNTING FOR POST-RETIREMENT  BENEFITS OTHER THAN PENSIONS
    was adopted by the  Company in 1991.  The liability representing  previously
    unrecognized  costs of $145 million for all years prior to 1991 was recorded
    as of January 1, 1991, with an after-tax effect on earnings of $88  million.
    In  1991 the Company adopted the FASB standard No. 109 ACCOUNTING FOR INCOME
    TAXES and recorded, as of January 1, 1991, a benefit of $21 million.
    
 
   
(d) Total debt includes long-term, short-term  and current portion of  long-term
    debt.
    
 
                                       11

<PAGE>
             UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL DATA
 
   
    The  following unaudited  pro forma condensed  combined financial statements
reflect the  ESG  acquisition  and  are  based  upon  the  historical  financial
statements  of  the  Company and  ESG  for  the period  indicated,  combined and
adjusted to give  effect to  the ESG acquisition  using the  purchase method  of
accounting.  The unaudited pro  forma condensed combined  statement of financial
position gives effect to the ESG acquisition  as if it had occurred on  December
31,  1995. The unaudited pro forma  condensed combined statements of income give
effect to the  ESG acquisition as  if it had  occurred on January  1, 1995.  The
adjustments  to the unaudited pro forma  financial statements do not give effect
to the proposed  issuance of shares  in the  Offerings and the  use of  proceeds
therefrom. The pro forma adjustments are described in the accompanying notes.
    
 
   
    The purchase price has been allocated to the assets and liabilities acquired
based   upon  preliminary  estimates  of   their  respective  fair  values.  The
liabilities  acquired  include  contingent  liabilities  of  the  type  normally
associated  with  the  conduct  of  the  business  including  product  warranty,
employee,  environmental  and  litigation  claims.  As  to  certain   contingent
liabilities,  the Company's exposure has been limited, above certain thresholds,
by indemnification  from or  a participation  agreement with  the seller  up  to
limits  that the Company believes, based  on its investigations and negotiations
to date,  will not  be exceeded  as  the liabilities  are settled  or  otherwise
satisfied.  Based  upon available  information, the  Company expects  that those
contingent liabilities for which loss provisions  have not been included in  the
purchase  price  adjustment  will not  have  a  material adverse  impact  on the
Company's results  of operations  or financial  position. The  Company does  not
presently anticipate that the changes to the purchase price allocation presented
will  be material. The  unaudited pro forma financial  information does not give
effect to any synergies or cost savings that the Company may realize as a result
of the  ESG  acquisition. The  Company  is  compiling data  to  determine  those
business  areas and  facilities that  do not fit  in its  long-term strategy and
intends to complete this process by  December 31, 1996. During the remainder  of
1996,  the estimates  of fair  value for  other assets  and liabilities  will be
refined and  changes,  if any,  will  be  reflected in  the  Company's  periodic
Exchange Act filings for 1996.
    
 
    The  unaudited  pro forma  condensed combined  financial statements  are not
necessarily indicative of the results of operations or financial position of the
combined company that would  have occurred had the  ESG acquisition occurred  on
the  dates  indicated  above,  nor are  they  necessarily  indicative  of future
operating results or financial position.
 
   
    The unaudited pro  forma condensed combined  financial statements should  be
read   in  conjunction  with  the  audited  consolidated  financial  statements,
including the notes thereto, of  the Company in its  Annual Report on Form  10-K
for  the year  ended December  31, 1995  and of  ESG contained  in the Company's
Current Report on Form 8-K filed March 18, 1996, and the unaudited  consolidated
financial  statements,  including  the  notes thereto,  of  the  Company  in its
Quarterly Report on  Form 10-Q for  the quarterly period  ended March 31,  1996,
which  are  incorporated herein  by reference.  See "Available  Information" and
"Incorporation of Certain Documents by Reference."
    
 
                                       12

<PAGE>
                          PRO FORMA CONDENSED COMBINED
                        STATEMENT OF FINANCIAL POSITION
                                  (UNAUDITED)
                               DECEMBER 31, 1995
                                     ASSETS
 
   

<TABLE>
<CAPTION>
                                                                                  NORTHROP           PRO FORMA       PRO FORMA
                                                                                  GRUMMAN    ESG    ADJUSTMENTS      COMBINED
                                                                                  -------   ------  -----------      ---------
                                                                                                ($ IN MILLIONS)
<S>                                                                               <C>       <C>     <C>              <C>
Cash and cash equivalents.......................................................  $   18    $    4    $               $   22
Accounts receivable.............................................................   1,197       462        66(c)        1,725
Inventoried costs...............................................................     771       182       (85)(a)(c)      868
Deferred income taxes...........................................................      25       136      (121)(a)          40
Prepaid expenses................................................................      61        14                        75
                                                                                  -------   ------  -----------      ---------
Total current assets............................................................   2,072       798      (140)          2,730
Property, plant and equipment, net..............................................   1,176       404       112(a)        1,692
Goodwill........................................................................   1,403       119     1,946(a)        3,468
Other purchased intangibles.....................................................     356                 646(a)        1,002
Prepaid pension cost, intangible pension asset and benefit trust fund...........      99        19       (19)(b)          99
Deferred income taxes...........................................................     255       173        76(a)(b)       504
Investments in and advances to affiliates and sundry assets.....................      94        12        45(a)          151
                                                                                  -------   ------  -----------      ---------
                                                                                  $5,455    $1,525    $2,666          $9,646
                                                                                  -------   ------  -----------      ---------
                                                                                  -------   ------  -----------      ---------
 
                                             LIABILITIES AND SHAREHOLDERS' EQUITY
 
Notes payable...................................................................  $   65    $         $  (65)(a)      $
Current portion of long-term debt...............................................     144                 188(a)          332
Trade accounts payable..........................................................     360       105                       465
Accrued employees' compensation.................................................     203                                 203
Income taxes....................................................................     528                                 528
Other current liabilities.......................................................     415       443        23(a)          881
                                                                                  -------   ------  -----------      ---------
Total current liabilities.......................................................   1,715       548       146           2,409
Long-term debt..................................................................   1,163               2,849(a)        4,012
Accrued retiree benefits........................................................   1,048       648       (40)(b)       1,656
Deferred income taxes...........................................................      31                                  31
Other liabilities and deferred gain.............................................      39        15        25(a)           79
Shareholders' equity
  Common stock..................................................................     272                                 272
  Retained earnings.............................................................   1,187       314      (314)(a)       1,187
                                                                                  -------   ------  -----------      ---------
                                                                                   1,459       314      (314)          1,459
                                                                                  -------   ------  -----------      ---------
                                                                                  $5,455    $1,525    $2,666          $9,646
                                                                                  -------   ------  -----------      ---------
                                                                                  -------   ------  -----------      ---------
</TABLE>

    
 
                                       13

<PAGE>
   
                          PRO FORMA CONDENSED COMBINED
                              STATEMENTS OF INCOME
                                  (UNAUDITED)
                          YEAR ENDED DECEMBER 31, 1995
    
 
   

<TABLE>
<CAPTION>
                                                                                  NORTHROP             PRO FORMA      PRO FORMA
                                                                                  GRUMMAN    ESG      ADJUSTMENTS     COMBINED
                                                                                  -------   ------  ---------------   ---------
                                                                                     ($ IN MILLIONS, EXCEPT PER SHARE DATA)
<S>                                                                               <C>       <C>     <C>               <C>
Net sales.......................................................................  $6,818    $2,554     $ (214)(c)(h)   $9,158
Cost of sales...................................................................
    Operating costs.............................................................   5,319     1,997        (86)(c)(d)(h)   7,230
    Administrative and general expenses.........................................     963       320                      1,283
    Restructuring charges.......................................................                51                         51
                                                                                  -------   ------     ------         ---------
Operating margin................................................................     536       186       (128)            594
Interest expense, net...........................................................    (136)                (210)(e)        (346)
Other, net......................................................................       9       (14)                        (5)
                                                                                  -------   ------     ------         ---------
Income before income taxes......................................................     409       172       (338)            243
Federal and foreign income taxes................................................     157        65       (115)(f)         107
                                                                                  -------   ------     ------         ---------
Net income......................................................................  $  252    $  107     $ (223)         $  136
                                                                                  -------   ------     ------         ---------
                                                                                  -------   ------     ------         ---------
Earnings per share..............................................................  $ 5.11                               $ 2.75
                                                                                  -------                             ---------
                                                                                  -------                             ---------
Weighted average shares outstanding (in millions)...............................    49.4                                 49.4
</TABLE>

    
 
   
                       THREE MONTHS ENDED MARCH 31, 1996
    
 
   

<TABLE>
<CAPTION>
                                                                                  NORTHROP             PRO FORMA      PRO FORMA
                                                                                  GRUMMAN(G) ESG(G)   ADJUSTMENTS     COMBINED
                                                                                  -------   ------  ---------------   ---------
                                                                                     ($ IN MILLIONS, EXCEPT PER SHARE DATA)
<S>                                                                               <C>       <C>     <C>               <C>
Net sales.......................................................................  $1,603    $  259     $  (12)(h)      $1,850
Cost of sales...................................................................
    Operating costs.............................................................   1,273       194          9 (d)(h     1,476
    Administrative and general expenses.........................................     191        40                        231
                                                                                  -------   ------     ------         ---------
Operating margin................................................................     139        25        (21)            143
Interest expense, net...........................................................     (46)                 (35)(e)         (81)
Other, net......................................................................       9        (1)                         8
                                                                                  -------   ------     ------         ---------
Income before income taxes......................................................     102        24        (56)             70
Federal and foreign income taxes................................................      41         8        (20)(f)          29
                                                                                  -------   ------     ------         ---------
Net income......................................................................  $   61    $   16     $  (36)         $   41
                                                                                  -------   ------     ------         ---------
                                                                                  -------   ------     ------         ---------
Earnings per share..............................................................  $ 1.23                               $  .83
                                                                                  -------                             ---------
                                                                                  -------                             ---------
Weighted average shares outstanding (in millions)...............................    49.6                                 49.6
</TABLE>

    
 
                                       14

<PAGE>
           NOTES TO PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS
                                  (UNAUDITED)
 
   
(a)Adjustments to record $3 billion in loans obtained to finance the acquisition
   of ESG, and to assign the  purchase price to assets acquired and  liabilities
   assumed.  The allocation of  the purchase price to  assets and liabilities is
   based upon preliminary estimates of their respective fair values. The Company
   is compiling data to  determine the final allocation  of the purchase  price,
   which  process will be completed  by December 31, 1996.  The Company does not
   presently anticipate material changes in the purchase price allocations.
    
 
(b) Adjustment to  record  the  preliminary estimate  of  ESG  retiree  benefits
    liabilities  in excess of the market value of related assets at December 31,
    1995. The  Company is  reviewing  the actuarial  data  relative to  the  ESG
    retiree  benefit plans and based on the  results of the review the liability
    may be adjusted.
 
   
(c) Adjustment to reflect a change in the method of recognizing contract revenue
    from the  milestone method  applied by  ESG to  conform with  the  Company's
    method  of  revenue  recognition,  the cost-to-cost  type  of  percentage of
    completion, on  similar  type  contracts  (adjustment  for  the  year  ended
    December  31,  1995: net  sales  -- $113  million;  operating costs  -- $103
    million).
    
 
   
(d)Adjustment to  amortize goodwill  over a  40-year period  on a  straight-line
   basis  and other purchased intangibles on  a straight-line basis over periods
   ranging from 1 to 10 years, with a combined weighted average life of 33 years
   which results in amortization for the twelve-month period ended December  31,
   1995  of $118 million and amortization for the three-month period ended March
   31, 1996 of $21 million.
    
 
(e) Adjustment to record interest expense  on $3 billion of borrowings  incurred
    in  connection with  the acquisition of  ESG at an  average annual effective
    interest rate of 7%. A change of 1/8% in the assumed annual interest rate on
    the variable rate debt of approximately  $2 billion would change the  annual
    interest expense by approximately $2.5 million.
 
(f) Adjustment to record the income tax effects of pretax pro forma adjustments.
 
   
(g) Northrop  Grumman data includes one month of combined operations of Northrop
    Grumman and  ESG. ESG  data reflects  operations for  the two  months  ended
    February 29, 1996.
    
 
   
(h)  Adjustment to eliminate intercompany sales between ESG and the Company (for
    the year ended December 31, 1995: net  sales -- $101 million; for the  three
    months ended March 31, 1996: net sales -- $12 million).
    
 
                                       15

<PAGE>
                                  THE COMPANY
 
GENERAL
 
    Northrop  Grumman  Corporation  (the "Company")  is  an  advanced technology
aerospace and  defense company  operating primarily  in two  business  segments:
electronics and systems integration and military and commercial aircraft. Within
the  electronics and systems integration segment,  the Company is engaged in the
design, development  and manufacture  of a  wide variety  of complex  electronic
products  such as  airborne radar,  surveillance and  battle management systems,
electronic countermeasures, precision weapons, antisubmarine warfare systems and
air traffic  control  systems.  Within  the  military  and  commercial  aircraft
segment,  the Company  is engaged  in the  design, development,  manufacture and
modification of military aircraft and commercial aerostructures. The Company  is
also  engaged in the design, development and manufacture of information systems,
marine propulsion and power generation systems  and a variety of other  products
and  services. Approximately three-fourths of the Company's revenues in 1996 are
expected to be generated from the  U.S. Department of Defense (the "DOD"),  with
the balance provided by contracts with commercial aerospace manufacturers, other
U.S. government agencies and various foreign customers.
 
    On  March 1, 1996,  the Company completed the  acquisition of the Electronic
Systems Group of Westinghouse  Electric Corporation which  is now the  Company's
Electronic  Sensors and Systems Division ("ESSD"). ESSD is a leading supplier of
electronics systems for  defense, government and  commercial applications.  This
acquisition  further enhances the Company's  electronics and systems integration
capabilities, broadens  the  Company's  product offerings  and  provides  growth
opportunities in key defense and commercial markets. See "-- Acquisition of ESG"
and "-- Divisions -- Electronic Sensors and Systems Division."
 
    In  1992  the Company  acquired a  49% interest  in Vought  Aircraft Company
("Vought"), a leading manufacturer of commercial and military aerostructures. In
1994 the  Company acquired  Grumman Corporation  ("Grumman") and  the  remaining
portion  of Vought.  With Grumman,  the Company  acquired a  premier supplier of
electronic surveillance and electronic systems  integration products as well  as
military aircraft.
 
    The Company has a balance of programs in both the production and development
phases.  While  production programs  generally  involve less  risk  and generate
greater cash flow than development programs, development programs are  essential
for  future growth  opportunities. Based  on its  backlog and  business mix, the
Company believes  that  its  cash  flow  from  operations  as  compared  to  its
investment  requirements will result in significant cash flow available for debt
reduction, dividends and other uses over the next several years.
 
    Many of the  Company's programs  are among  the principal  programs for  the
various  branches of the U.S.  military. The Company is  the prime contractor on
the B-2 Stealth Bomber, the only  strategic bomber currently in production;  the
principal  subcontractor  on  the  F/A-18C/D  Hornet,  the  U.S.  Navy's primary
strike/attack aircraft,  as  well as  on  the next  generation  F/A-18E/F  Super
Hornet;  the prime  contractor on  the E-2C  Hawkeye, the  U.S. Navy's principal
early warning, command and  control aircraft; the prime  contractor for the  E-8
Joint  STARS aircraft  radar system, which  will be the  primary airborne ground
surveillance and battle management system for  the U.S. Air Force and Army;  the
prime   contractor  on   the  BAT  "Brilliant"   self-guided  submunition  under
development for the  U.S. Army; the  supplier of the  APG-68 Fire Control  Radar
used on the F-16, one of the most widely used fighter aircraft in the world; the
supplier of the ARSR-4 Long Range Radar, a three-dimensional air traffic control
radar  system  used  by  the  U.S.  Air  Force  and  the  U.S.  Federal Aviation
Administration; and the  supplier of  the AN/APY-1, 2  surveillance radar  which
provides   real-time,  all-altitude  and  beyond-the-horizon  target  detection,
identification and tracking for the E-3 AWACS surveillance aircraft.
 
    The Company is also one of  the world's leading manufacturers of  commercial
aerostructures  and components. The  Company manufactures major  portions of the
Boeing 747, 757  and 767  jetliners, as  well as  significant subassemblies  and
components for other commercial aircraft, including the Boeing 777 jetliner.
 
                                       16

<PAGE>
    The  Company was founded in 1939 and reincorporated in 1985 in Delaware. The
Company's executive offices are located at 1840 Century Park East, Los  Angeles,
California 90067 and its telephone number is (310) 553-6262.
 
STRATEGY
 
    The  Company intends to strengthen its position as a leader in the aerospace
and defense  industry by  pursuing  the following  strategies: (i)  focusing  on
segments  of defense markets that are growing  and where the Company has premier
technological capabilities, particularly in electronics and electronics  systems
integration; and (ii) leveraging its airframe design expertise and manufacturing
strengths  to  remain  a  key competitor  in  military  aircraft  and commercial
aerostructures. The  Company  has  been pursuing  these  strategies  since  1992
through  both internal  initiatives and  acquisitions and,  as a  result, enjoys
leading positions in those market segments  in which it chooses to compete.  The
Company's  primary objective in pursuit of these strategies is to maximize total
return on investment.
 
    The  Company  is  transforming  itself  from  being  primarily  an  aircraft
designer/manufacturer  to an electronics and  systems integration company with a
leading airframe  and  aerostructures  business.  In  early  1994,  the  Company
significantly expanded its electronics business with the acquisition of Grumman.
In  March of 1996, the Company acquired ESG, a leading producer of sophisticated
electronics for defense, government and commercial applications. As a result  of
these  acquisitions,  the  Company  expects  that  its  electronics  and systems
integration revenues will approximate nearly 50%  of total revenues in 1996  and
that this percentage will continue to increase in the future.
 
    This  strategic  transformation positions  the Company  to meet  the growing
needs of the DOD for  more sophisticated electronics and integrated  electronics
systems.  Since the end of the Cold War, the DOD has recognized the necessity of
maintaining an  effective fighting  force with  fewer defense  dollars,  thereby
placing a premium on sophisticated systems that provide long-range surveillance,
battle  management and  precision-strike capabilities. As  military systems have
become more  complex, integration  of the  electronic functions  of the  various
platforms, weapons and support systems has become increasingly important. Budget
constraints have also encouraged spending on program modifications, upgrades and
extensions  rather than on  new development programs,  further increasing demand
for sophisticated electronics systems. As  a technological leader in  designing,
manufacturing and integrating the sophisticated electronics systems that provide
long-range  surveillance, battle  management and  precision-strike capabilities,
the Company believes that it is well positioned to serve the electronic  systems
market.
 
    The  Company  has also  strengthened  its military  and  commercial aircraft
segment. In  1992, the  Company acquired  49%  of Vought  and in  1994  acquired
Grumman  and the remaining  51% of Vought. These  acquisitions and the Company's
internal initiatives have enabled the Company to establish a leading position in
military aircraft and  commercial aerostructures. The  Company believes that  it
will  maintain  this leadership  position  as a  result  of its  airframe design
experience, including  stealth  technology,  as  well  as  its  cost-competitive
manufacturing capabilities.
 
ACQUISITION OF ESG
 
   
    On  March  1,  1996,  the  Company  completed  the  acquisition  of  ESG for
approximately $2.9  billion in  cash  (the "Acquisition").  For the  year  ended
December  31, 1995, ESG  generated revenue of $2.6  billion. The Acquisition was
financed with a combination  of bank borrowings  and intermediate and  long-term
notes  and debentures. The business of ESG  is now operated as the Company's new
Electronic Sensors and Systems Division ("ESSD").
    
 
    ESSD is a leading supplier of electronic systems for defense, government and
commercial applications.  It  employs  nearly  12,000  people  worldwide  at  15
operating  locations, primarily  in the  United States.  ESSD has  a diversified
portfolio of programs  with no single  program accounting for  more than 10%  of
revenues   in  1995.  Approximately  one-half   of  ESSD's  1995  revenues  were
attributable to  radar technology  applied to  surveillance, fire  control,  air
traffic  control and  other purposes. ESSD  also designs  and manufactures other
avionics products,  electro-optical systems,  undersea and  marine products  and
material handling systems.
 
                                       17

<PAGE>
    The  Acquisition represents a  substantial step in  the Company's continuing
transformation from  an aircraft  designer/manufacturer  to an  electronics  and
systems integration company with a leading aircraft and aerostructures business.
The   Acquisition  enables  the  Company  to   serve  a  larger  customer  base,
domestically and internationally, and is expected to provide the opportunity  to
achieve  revenue growth  and greater cash  flow stability.  The Acquisition will
also enable the Company to  enhance its role on  important programs such as  E-8
Joint  STARS and BAT, and  to expand its business into  the areas of air traffic
control and anti-submarine warfare systems.
 
DIVISIONS
 
    The Company is  organized into five  operating divisions: Military  Aircraft
Systems  Division;  Electronic  Sensors and  Systems  Division;  Electronics and
Systems Integration Division; Commercial Aircraft Division; and Data Systems and
Services  Division.  In   addition,  the  Company's   Advanced  Technology   and
Development Center provides product development and technology functions for all
of  the operating divisions, drawing  on technologies and skills  in each of the
divisions.
 
    MILITARY AIRCRAFT SYSTEMS DIVISION
 
    The Military Aircraft  Systems Division is  responsible for the  development
and  manufacture of several types of military aircraft. The Company is the prime
contractor for  the B-2,  a  strategic, long-range,  large payload  bomber  with
advanced  stealth technology that is  capable of operating at  both high and low
altitudes. The B-2 is able to penetrate the most sophisticated air-defenses  and
is  capable of  responding more  quickly, from  greater distances  and with more
accurate firepower than any other U.S. aircraft.
 
    The Company is currently  under contract to provide  20 operational and  one
test  B-2 aircraft. All 21  aircraft are fully funded.  To date, the Company has
delivered six test aircraft and 11 of 15 production aircraft. At least five  out
of the six test aircraft will be refurbished to an operational configuration and
delivered  to the U.S.  Air Force. The Clinton  Administration has announced its
intent, and the Company has been asked  to provide a proposal, to refurbish  the
remaining  test aircraft  for subsequent  delivery to the  U.S. Air  Force as an
operational vehicle. The U.S. Air Force currently operates a squadron of 10 B-2s
at Whiteman Air Force Base in Missouri. In addition, the B-2 program is expected
to generate  maintenance and  support revenues  upon completion  of  production.
While  the Company continues  to seek funding  for additional B-2s,  there is no
assurance that such funding will be available.
 
    The Company  is the  prime or  principal subcontractor  on all  of the  U.S.
Navy's  carrier-based fighter, attack and  early warning aircraft, including the
F/A-18. For  more  than two  decades  the Company  has  been teamed  with  prime
contractor  McDonnell Douglas on the F/A-18 program. The F/A-18C/D Hornet is the
U.S. Navy's primary  strike/attack aircraft  and is  deployed by  the Navy  from
aircraft  carriers and by the Marines from  air bases. In total, more than 1,300
F/A-18  Hornets  have  been  delivered  to  the  U.S.  and  to  certain  foreign
governments.  The Company produces  approximately 40% of  each F/A-18C/D Hornet,
including the center and  aft fuselage, twin vertical  tails and all  associated
subsystems.  The Company is also the  principal subcontractor on the U.S. Navy's
newest combat aircraft, the F/A-18E/F Super Hornet, which successfully completed
its first test flight in November  1995. The F/A-18E/F Super Hornet has  greater
range  and payload, more powerful engines  and more advanced avionics and weapon
systems than the F/A-18C/D Hornet.  The Company will also produce  approximately
40%  of  each  F/A-18E/F  Super  Hornet.  The  first  production  deliveries are
scheduled to begin in 1999, with initial operating capability expected in 2001.
 
    Modification and enhancement  of existing airborne  platforms has become  an
important  part of the  military aircraft market. With  U.S. and foreign defense
planners seeking modern systems at affordable costs, upgrading existing aircraft
can be an attractive  alternative to the purchase  of new aircraft. The  Company
provides  a broad array of aircraft  upgrade, modification, overhaul and support
services for several operational  aircraft, including the  F-5, T-38, F-14,  C-2
and  A-10.  The  Company  is also  responsible  for  remanufacturing  Boeing 707
aircraft as  the  platform  for  the Company's  E-8  Joint  STARS  program,  for
structural  enhancements of the  EA-6B Prowler and for  airframe upgrades of the
E-2C Hawkeye.
 
                                       18

<PAGE>
    ELECTRONIC SENSORS AND SYSTEMS DIVISION
 
    The Electronic Sensors and Systems Division ("ESSD") represents the acquired
business of ESG.  ESSD has a  diversified portfolio of  programs with no  single
program accounting for more than 10% of revenues in 1995. Approximately one-half
of  ESSD's  1995  revenues  were attributable  to  radar  technology  applied to
surveillance, fire control, air  traffic control and  other purposes. ESSD  also
designs  and  manufactures  other  avionics  products,  electro-optical systems,
underseas and marine products and material handling systems.
 
    With its state-of-the-art  surveillance and imaging  technologies, ESSD  has
gained  significant positions on  a wide variety of  high priority platforms for
the DOD and certain  foreign governments. ESSD  produces radars and  electronics
for  military aircraft and  battlespace management systems,  including those for
the F-16 fighter, Apache  Longbow helicopter, B-1B  bomber, C-130 transport  and
E-3 AWACS and E-8 Joint STARS surveillance aircraft.
 
    ESSD's  products are also  present on numerous  development programs such as
the F-22 fighter and the Comanche helicopter. Should budget pressures force  the
stretch-out  of these next generation programs, ESSD is expected to benefit from
an increased demand for electronic upgrades and retrofits to existing  aircraft.
For  example, ESSD is  currently providing mid-life  fire control radar upgrades
for the F-16.
 
    ESSD is also a leading  supplier of air traffic  control radars to the  U.S.
Federal  Aviation Administration  and to countries  in Europe,  the Middle East,
Africa, Asia  and South  America. ESSD  is  the prime  contractor on  the  ASR-9
terminal radar system which detects and displays aircraft and weather conditions
simultaneously,   helping  air   traffic  controllers   guide  aircraft  through
traffic-dense  regions  surrounding  airports.  The  international  air  traffic
control  market is expected to increase significantly,  due in large part to the
growth of international air traffic  and infrastructure development in Asia  and
Eastern  Europe. The  Company believes that  ESSD is well  positioned to benefit
from this anticipated growth  in the international  air traffic control  market.
ESSD also develops electronic countermeasures, tactical communication equipment,
space  products and underseas and  marine technologies, including anti-submarine
combat systems, surface ship propulsion and power generation equipment.
 
    International sales are also an  increasingly important component of  ESSD's
military  electronics business.  The F-16  radar system,  ESSD's longest running
program, is installed in  the F-16s of  23 countries. In  addition to the  F-16,
many  other  DOD weapon  systems with  ESSD  subsystems, such  as the  E-3 AWACS
surveillance  aircraft  and  the  AH-64   Apache  helicopter,  have  been   sold
internationally.
 
    ELECTRONICS AND SYSTEMS INTEGRATION DIVISION
 
    The  Electronics and Systems Integration  Division manages major electronics
systems programs.  The  Company is  the  overall systems  integrator  and  prime
contractor  for the E-8 Joint STARS,  the U.S. military's primary airborne radar
system  which   is   designed   to  provide   real-time   detection,   location,
classification and tracking of hostile moving and stationary ground targets. The
surveillance capabilities of the E-8 Joint STARS will enable it to be a critical
part  of future  battle management  systems. The E-8  Joint STARS  program is in
limited production and  funding has been  approved for the  first six E-8  Joint
STARS   production  aircraft  (designated  the  E-8C).  One  aircraft  has  been
delivered, a second is expected to be  delivered in 1996 and the remaining  four
aircraft  are scheduled to be  delivered in 1997 and  1998. The Company believes
that U.S. government support for the E-8  Joint STARS program is strong, due  in
part  to  successful tests  and operational  activity  of prototype  aircraft in
combat conditions  in the  Persian  Gulf and  Bosnia.  The U.S.  government  has
approved  the  sale  of E-8  Joint  STARS  aircraft to  NATO,  although  no such
purchases have been committed to or funded.
 
    The Company is the  prime contractor for the  E-2C Hawkeye, the U.S.  Navy's
principal  early  warning, command  and control  aircraft.  The E-2C  Hawkeye is
designed for missions such as air  defense, strike control, air traffic  control
and search and rescue. The U.S. Navy recently received approval for a program of
36 E-2C aircraft, of which seven are under contract for delivery during 1997 and
1998.  The Company is also involved with the Navy's upgrade program for existing
E-2C aircraft. In response to upgraded threat
 
                                       19

<PAGE>
capabilities,  the  U.S.  Navy  continues  to  plan  additional  E-2C   avionics
improvements including data processing and capacity increases, passive detection
systems,  radar  anti-jamming  improvements, tactical  program  updates  and jam
resistant communication systems.
 
    The Company  is the  prime  contractor on  the BAT  "Brilliant"  self-guided
submunition  program under  development for  the U.S.  Army. This  weapon may be
carried by a  variety of air  vehicles and is  designed to autonomously  locate,
attack  and destroy  tanks, armored vehicles  and other mobile  targets by using
acoustic and infrared sensors working in  combination with a high speed  onboard
computer.  Prototype manufacture began in 1992, and  the BAT is now in a testing
phase to verify that the system meets all established requirements.
 
    COMMERCIAL AIRCRAFT DIVISION
 
    The Commercial Aircraft Division is one of the world's leading suppliers  of
aerostructures,  as  well  as  a  major  supplier  of  aircraft  components  for
commercial and military use. The Company manufactures the fuselage and the  tail
section for the Boeing 747, the tail section for the Boeing 757 and 767, various
other  components  for  the Boeing  757,  767  and 777  and  major subassemblies
(including the tail section) for the McDonnell Douglas C-17 military  transport.
In  April 1995, the  Company entered into  an agreement with  Boeing to continue
production of the major sections of the 747, 757 and 767 aircraft into the  next
century.  The  Company also  produces  wings for  the  new Gulfstream  V ("G-V")
business jet program and components for  other aircraft. The G-V's first  flight
was in November 1995, and aircraft deliveries to customers are expected to begin
in January 1997.
 
    While the Company's commercial aircraft deliveries declined in 1995 compared
to  1994,  the three  leading  jet-airliner manufacturers  collectively recorded
substantially increased  orders  for new  aircraft  in 1995  compared  to  1994.
Boeing,  the Company's largest customer for commercial aerostructures, announced
in December 1995 and March 1996, planned increases in production rates for  1996
and  1997 for  its 747, 767  and 777  models and a  return to  current levels of
production in the second quarter of 1997 for its 757 model following a reduction
in the fourth quarter of 1996. The Boeing labor strike, settled in January 1996,
will cause some deliveries scheduled  for 1996 to be  made in 1997. The  Company
has  made  substantial  investments  in  productivity  improvements  and capital
equipment to further improve its competitive position in the growing  commercial
aerostructure marketplace.
 
    DATA SYSTEMS AND SERVICES DIVISION
 
    The  Data  Systems and  Services  Division provides  data  processing system
services for  external customers  as well  as the  Company's various  divisions.
Included among these services are space station program support services, flight
simulator  maintenance services and  the development of  data processing systems
for a wide variety  of U.S. Government entities  and applications. The  Division
also  provides operational and support services to U.S. Air Force bases, an area
of potential  growth  if  the  U.S.  Government  increases  the  outsourcing  of
maintenance and support activities.
 
RECENT DEVELOPMENT
 
   
    In  the first quarter  of 1996, a  jury trial commenced  with respect to the
remaining issues in the litigation described  in the Company's Annual Report  on
Form  10-K  for 1995  entitled  U.S. EX  REL DAVID  PETERSON  AND JEFF  KROLL V.
NORTHROP  CORPORATION.  The  government  has  asserted  three  separate   claims
totalling approximately $13.5 million, including a claim for alleged mischarging
of  approximately  $12 million  in violation  of the  False Claims  Act. Damages
awarded under  the False  Claims Act  are subject  to doubling  or trebling  and
possible  additional penalties  including disallowance  of attorneys'  fees. The
Company denies  the  material  allegations  of  the  claims  and  is  vigorously
defending the action.
    
 
                                       20

<PAGE>
                          DESCRIPTION OF CAPITAL STOCK
 
AUTHORIZED CAPITAL STOCK
 
   
    Under the Company's Certificate of Incorporation, the total number of shares
of  stock which the Company has authority to issue is 210,000,000, consisting of
200,000,000 shares of Common  Stock, par value $1.00  per share, and  10,000,000
shares  of Preferred  Stock, $1.00 par  value per  share. As of  April 30, 1996,
49,633,330 shares of  Common Stock  were issued and  outstanding, not  including
shares  reserved  for issuance  under the  Company's stock  plans. No  shares of
Preferred Stock were issued  and outstanding on such  date. The Common Stock  is
listed on the New York Stock Exchange and the Pacific Stock Exchange.
    
 
PREFERRED STOCK
 
    Under  the Company's Certificate of Incorporation, the Board of Directors of
the Company is authorized,  without further stockholder  action, to provide  for
the issuance of Preferred Stock in one or more series, with such designations of
titles, dividend rates, redemption provisions, special or relative rights in the
event  of liquidation, dissolution,  distribution or winding  up of the Company,
sinking fund provisions,  conversion provisions,  voting rights,  and any  other
preferences,   privileges,  powers,  rights,   qualifications,  limitations  and
restrictions, as shall  be set forth  as and  when established by  the Board  of
Directors of the Company.
 
DESCRIPTION OF COMMON STOCK
 
    The holders of Common Stock are entitled to receive such dividends as may be
declared  from  time to  time by  the Board  of Directors  out of  funds legally
available therefor subject to  restrictions on the  declaration of dividends  on
the  Common Stock which may be imposed in connection with the issuance of shares
of any  class or  series  of Preferred  Stock.  The Company's  principle  credit
agreement  contains provisions restricting dividends and other distributions and
the  purchase  or   redemption  of   shares  of  Common   Stock  under   certain
circumstances.  Except as otherwise provided by law, the holders of Common Stock
are entitled  to one  vote per  share  on all  matters submitted  to a  vote  of
stockholders  and do not have cumulative  voting rights. Holders of Common Stock
are entitled to  receive, upon  any liquidation  of the  Company, all  remaining
assets  available  for distribution  to stockholders  after satisfaction  of the
Company's liabilities and the  preferential rights of  any Preferred Stock  that
may  then be issued and outstanding. The outstanding shares of Common Stock are,
and the shares offered hereby will be, upon payment therefore by the  purchasers
thereof,  fully  paid and  nonassessable. The  holders of  Common Stock  have no
preemptive, conversion or  redemption rights. The  registrar and transfer  agent
for the Common Stock is Chemical Mellon Shareholders Services, L.L.C., New York.
 
COMMON STOCK PURCHASE RIGHTS
 
    In 1988, the Company's Board of Directors authorized the distribution of one
Common  Stock Purchase  Right (a "Right")  for each outstanding  share of Common
Stock.
 
    As distributed, the Rights trade together with the Common Stock. They may be
exercised or  traded separately  10 business  days after  a person  or group  of
persons  acquires 15% or more of the  outstanding Common Stock, or announces the
intention to make a tender  offer for 30% or  more of the Company's  outstanding
Common  Stock. Upon exercise, each Right entitles  the holder thereof to buy one
share of Common  Stock at  a price  of $105.  If a  Person acquires  15% of  the
outstanding  voting power of the  Company, each Right (other  than those held by
the acquiror)  will entitle  its holder  to purchase,  at the  Right's  exercise
price,  shares of Common  Stock having a  market value of  two times the Right's
exercise price. Additionally, if  the Company is acquired  in a merger or  other
business  combination, each  Right (other  than those  held by  the surviving or
acquiring company) will entitle its holder to purchase, at the Right's  exercise
price,  shares of the acquiring  company's common stock (or  Common Stock of the
Company if it is the surviving corporation)  having a market value of two  times
the Right's exercise price.
 
    Rights  may be redeemed at the option of the Board of Directors for $.02 per
Right at any time prior to the earlier of the expiration of the Rights or within
10 days following the date that a  person or persons acquire 15% of the  general
voting  power of the Company. The Board may amend the Rights at any time without
stockholder approval. The Rights will expire by their terms in October 1998.
 
                                       21

<PAGE>
                 CERTAIN UNITED STATES FEDERAL TAX CONSEQUENCES
                         FOR NON-UNITED STATES HOLDERS
 
    The following  is a  general  discussion of  certain United  States  federal
income  and estate tax  consequences of the ownership  and disposition of Common
Stock by a  holder of  such stock  that, for  United States  federal income  tax
purposes,  is not a "United States  person" (a "Non-United States Holder"). This
discussion  is  not  intended  to  be  exhaustive  and  is  based  on  statutes,
regulations, rulings and court decisions as currently in effect all of which may
be  changed  either retroactively  or  prospectively. This  discussion  does not
consider any specific  facts or  circumstances that  may apply  to a  particular
Non-United  States Holder (including, for example, the fact that, in the case of
a Non-United States Holder that is  a partnership, the U.S. tax consequences  of
purchasing,   holding  and  disposing  of  Common   Stock  may  be  affected  by
determinations made both at the partnership  and the partner level) and  applies
only  to Non-United States  Holders that hold  Common Stock as  a capital asset.
PROSPECTIVE INVESTORS  ARE URGED  TO CONSULT  THEIR TAX  ADVISORS REGARDING  THE
UNITED  STATES FEDERAL TAX  CONSEQUENCES OF ACQUIRING,  HOLDING AND DISPOSING OF
COMMON STOCK (INCLUDING  SUCH INVESTOR'S  STATUS AS  A UNITED  STATES PERSON  OR
NON-UNITED  STATES HOLDER) AS WELL AS ANY  TAX CONSEQUENCES THAT MAY ARISE UNDER
THE LAWS OF ANY STATE, MUNICIPALITY OR OTHER TAXING JURISDICTION.
 
    For purposes of this discussion, "United  States person" means a citizen  or
resident of the United States, a corporation or partnership created or organized
in  the United States or under the laws of the United States or of any political
subdivision thereof, or an estate or  trust whose income is includable in  gross
income  for United States federal income  tax purposes regardless of its source.
An alien  individual generally  is treated  as a  United States  person for  any
calendar  year if either (i) the individual  is present in the United States 183
days or more during such calendar year or (ii) the individual is present in  the
United  States at  least 31 days  during such calendar  year and the  sum of the
number of days present during such  calendar year, one-third the number of  days
present during the first preceding year and one-sixth the number of days present
during the second preceding year is 183 or more.
 
DIVIDENDS
 
    Dividends  paid to a  Non-United States Holder generally  will be subject to
withholding of United States federal income tax  at the rate of 30%, unless  the
withholding  rate is reduced  under an applicable income  tax treaty between the
United States and the country of tax residence of the Non-United States  Holder.
No  U.S. withholding will apply if the  dividend is effectively connected with a
trade or business conducted  within the United States  by the Non-United  States
Holder  (or, alternatively, where an income  tax treaty applies, if the dividend
is effectively connected  with a permanent  establishment maintained within  the
United  States by the Non-United States Holder), but, instead, the dividend will
be subject to the United States federal income tax on net income that applies to
United States  persons (and,  with respect  to corporate  holders, may  also  be
subject  to the branch profits tax). A  Non-United States Holder may be required
to satisfy certain certification requirements in order to claim treaty  benefits
or  to otherwise claim  a reduction of  or exemption from  withholding under the
foregoing rules. A Non-United States Holder that is eligible for a reduced  rate
of  U.S. withholding  tax pursuant to  a tax treaty  may obtain a  refund of any
excess amounts currently withheld by filing an appropriate claim for refund with
the United States Internal Revenue Service (the "Service").
 
GAIN ON DISPOSITION
 
    Subject to special rules  described below, a  Non-United States Holder  will
generally  not be subject to United States federal income tax on gain recognized
on a sale or other  disposition of Common Stock  unless the gain is  effectively
connected  with a trade  or business conducted  within the United  States by the
Non-United States Holder (or, alternatively, where an income tax treaty applies,
unless  the  gain  is  effectively  connected  with  a  permanent  establishment
maintained  within the United States by  the Non-United States Holder). Any such
effectively connected gain would be subject to the United States federal  income
tax  on net income that  applies to United States  persons (and, with respect to
corporate holders, may also be subject to  the branch profits tax). Such tax  is
not collected by withholding.
 
                                       22

<PAGE>
    In  addition, an individual Non-United States  Holder who holds Common Stock
would generally be subject to  tax at a 30% rate  on any gain recognized on  the
disposition  of such Common  Stock if such  individual is present  in the United
States for 183 days or  more in the taxable year  of disposition and either  (i)
has  a "tax home" in the United  States (as specifically defined for purposes of
the United States federal income tax) or (ii) maintains an office or other fixed
place of business in the United States and the income from the sale of the stock
is attributable to such office or other fixed place of business. Individual Non-
United States  Holders may  also be  subject to  tax pursuant  to provisions  of
United  States  federal  income  tax law  applicable  to  certain  United States
expatriates.
 
    Also, special rules apply to Non-United States Holders if the Company is  or
becomes  a "United States  real property holding  corporation" for United States
federal income tax purposes. The Company believes  that it has not been, is  not
currently,  and is not likely  to become, a United  States real property holding
corporation.  If  the  Company  were  a  United  States  real  property  holding
corporation, gain or loss on a sale of the Common Stock by any Non-United States
Holder (other than, in most cases, a Non-United States Holder that owns or owned
(directly or constructively) 5% or less of the Common Stock during the five-year
period  ending on the date of such  sale) would be treated as income effectively
connected with the conduct of  a trade or business  within the United States  by
the holder and subject to the net income tax described above.
 
UNITED STATES FEDERAL ESTATE TAXES
 
    Common Stock owned or treated as owned by an individual who is not a citizen
or resident (as specially defined for United States federal estate tax purposes)
of  the United States at  the date of death, or  Common Stock subject to certain
lifetime transfers  made  by  such  an individual,  will  be  included  in  such
individual's  estate for  United States federal  estate tax purposes  and may be
subject to United  States federal estate  tax, unless an  applicable estate  tax
treaty provides otherwise. Estates of nonresident aliens are generally allowed a
credit  that is equivalent to an exclusion  of $60,000 of assets from the estate
for United States federal estate tax purposes.
 
INFORMATION REPORTING AND BACKUP WITHHOLDING
 
    The Company  must report  annually to  the Service  and to  each  Non-United
States Holder the amount of dividends paid to, and the tax withheld with respect
to,  such  holder, regardless  of whether  any tax  was actually  withheld. That
information may also be made available to the tax authorities of the country  in
which a Non-United States Holder resides.
 
    United  States federal backup withholding  tax (which, generally, is imposed
at the rate of 31% on certain payments to persons not otherwise exempt who  fail
to  furnish  information  required  under  United  States  information reporting
requirements) generally will not apply to dividends paid to a Non-United  States
Holder  either at an address outside the  United States (provided that the payor
does not have actual knowledge that the  payee is a United States person) or  if
the dividends are subject to withholding at the 30% rate (or lower treaty rate).
As  a general matter, information reporting and backup withholding also will not
apply to a payment of the proceeds of a sale of Common Stock by a foreign office
of a  broker.  However,  information  reporting  requirements  (but  not  backup
withholding)  will apply to a payment of the  proceeds of a sale of Common Stock
by a foreign office of a broker that is a United States person, or by a  foreign
office  of a  foreign broker that  derives 50% or  more of its  gross income for
certain periods from the conduct of a trade or business in the United States, or
that is a "controlled foreign corporation"  as to the United States, unless  the
broker  has documentary evidence in its records  that the holder is a Non-United
States  Holder  and  certain  conditions  are  met,  or  the  holder   otherwise
establishes  an exemption. Payment by a United  States office of a broker of the
proceeds of a sale  of Common Stock  is subject to  both backup withholding  and
information  reporting unless the  holder certifies as  to its non-United States
status under penalties of perjury or otherwise establishes an exemption (and the
broker has no actual knowledge to  the contrary.) The backup withholding tax  is
not an additional tax and may be credited against the Non-United States Holder's
United  States federal  income tax  liability or  refunded to  the extent excess
amounts are withheld, provided that the required information is supplied to  the
Service.
 
                                       23

<PAGE>
   
NEW PROPOSED REGULATIONS
    
 
   
    The  United States Treasury recently  proposed new regulations regarding the
withholding  and  information  reporting  rules  discussed  above.  Among  other
changes,   the  proposed   regulations  would  unify   certification  forms  and
procedures, require certification  of residence  to claim  treaty benefits,  and
clarify  reliance standards and make  other changes affecting withholding agents
and intermediaries. If finalized in their current form, the proposed regulations
would generally be effective for payments made after December 31, 1997,  subject
to certain transition rules.
    
 
                                       24

<PAGE>
                                  UNDERWRITING
 
   
    Under  the terms and subject to  the conditions contained in an Underwriting
Agreement dated               ,  1996 (the "U.S.  Underwriting Agreement"),  the
underwriters  named below  (the "U.S. Underwriters"),  for whom  CS First Boston
Corporation, Merrill  Lynch, Pierce,  Fenner &  Smith Incorporated  and  Salomon
Brothers  Inc  are  acting  as  representatives  (the  "Representatives"),  have
severally and not  jointly agreed  to purchase  from the  Company the  following
respective numbers of U.S. Shares:
    
 

<TABLE>
<CAPTION>
                                                                                   NUMBER OF
                                U.S. UNDERWRITER                                  U.S. SHARES
- --------------------------------------------------------------------------------  ------------
<S>                                                                               <C>
CS First Boston Corporation.....................................................
Merrill Lynch, Pierce, Fenner & Smith
          Incorporated..........................................................
Salomon Brothers Inc............................................................
 
                                                                                  ------------
    Total.......................................................................     5,950,000
                                                                                  ------------
                                                                                  ------------
</TABLE>

 
    The  U.S. Underwriting Agreement  provides that the  obligations of the U.S.
Underwriters are  subject to  certain  conditions precedent  and that  the  U.S.
Underwriters will be obligated to purchase all of the U.S. Shares offered hereby
(other than those shares covered by the overallotment option described below) if
any  are purchased. The U.S. Underwriting  Agreement provides that, in the event
of a  default by  a  U.S. Underwriter,  in  certain circumstances  the  purchase
commitments  of non-defaulting  U.S. Underwriters may  be increased  or the U.S.
Underwriting Agreement may be terminated.
 
    The Company has  entered into  a Subscription  Agreement (the  "Subscription
Agreement")  with the  Managers of  the International  Offering (the "Managers")
providing for the concurrent offer and sale of the International Shares  outside
the United States and Canada. The closing of the U.S. Offering is a condition to
the closing of the International Offering and vice versa.
 
    The Company has granted to the U.S. Underwriters and the Managers an option,
exercisable by CS First Boston Corporation, expiring at the close of business on
the  thirtieth (30th) day after  the date of this  Prospectus, to purchase up to
1,050,000 additional  shares at  the  initial public  offering price,  less  the
underwriting  discounts or commissions,  all as set  forth on the  cover page of
this Prospectus. Such option may be  exercised only to cover over-allotments  in
the  sale of the Common Stock offered hereby.  To the extent that this option to
purchase is  exercised,  each U.S.  Underwriter  and each  Manager  will  become
obligated,  subject to  certain conditions,  to purchase  approximately the same
percentage of additional  shares being  sold to  the U.S.  Underwriters and  the
Managers  as the number of U.S. Shares set forth next to such U.S. Underwriter's
name in the preceding table and as the number of International Shares set  forth
next  to  such  Manager's name  in  the  corresponding table  in  the prospectus
relating to the International Offering bears to  the sum of the total number  of
shares of Common Stock in such tables.
 
    The   Company  has  been  advised  by  the  Representatives  that  the  U.S.
Underwriters propose to offer the U.S. Shares to the public in the United States
and Canada initially at the offering price  set forth on the cover page of  this
Prospectus  and, through the  Representatives, to certain  dealers at such price
less a concession of $           per share,  and the U.S. Underwriters and  such
dealers  may allow a discount of $           per share on sales to certain other
dealers. After  the  initial public  offering,  the public  offering  price  and
concession and discount to dealers may be changed by the Representatives.
 
    The  public  offering price  and  the aggregate  underwriting  discounts and
commissions per share and per share  concession and discount to dealers for  the
U.S.  Offering  and the  concurrent  International Offering  will  be identical.
Pursuant to an  Agreement between the  U.S. Underwriters and  the Managers  (the
"Intersyndicate  Agreement") relating  to the  Offerings, changes  in the public
offering price, concession and discount to dealers will be made only upon mutual
agreement of  CS  First  Boston  Corporation,  as  representative  of  the  U.S.
Underwriters, and CS First Boston Limited ("CSFBL") on behalf of the Managers.
 
                                       25

<PAGE>
    Pursuant  to the Intersyndicate Agreement, each of the U.S. Underwriters has
agreed that, as  part of  the distribution  of the  U.S. Shares  and subject  to
certain  exceptions, it  has not offered  or sold,  and will not  offer or sell,
directly or indirectly, any shares of Common Stock or distribute any  prospectus
relating  to the Common Stock to any  person outside the United States or Canada
or to any other dealer who does not so agree. Each of the Managers has agreed or
will agree that,  as part of  the distribution of  the International Shares  and
subject to certain exceptions, it has not offered or sold, and will not offer or
sell,  directly  or indirectly,  any shares  of Common  Stock or  distribute any
prospectus relating to the Common Stock in the United States or Canada or to any
dealer who  does  not  so agree.  The  foregoing  limitations do  not  apply  to
stabilization  transactions or to transactions between the U.S. Underwriters and
the Managers pursuant to the  Intersyndicate Agreement. As used herein,  "United
States"  means  the  United States  of  America  (including the  States  and the
District of Columbia), its territories,  possessions and other areas subject  to
its jurisdiction, "Canada" means Canada, its provinces, territories, possessions
and  other areas subject to  its jurisdiction, and an offer  or sale shall be in
the United States or Canada if it is made to (i) any individual resident of  the
United   States  or  Canada  or  (ii)  any  corporation,  partnership,  pension,
profit-sharing or other trust or other entity (including any such entity  acting
as  an  investment  advisor  with  discretionary  authority)  whose  office most
directly involved with the purchase is located in the United States or Canada.
 
    Pursuant to the Intersyndicate Agreement, sales may be made between the U.S.
Underwriters and the Managers of such number of shares of Common Stock as may be
mutually agreed  upon. The  price  of any  shares so  sold  will be  the  public
offering  price, less  such amount as  may be  mutually agreed upon  by CS First
Boston Corporation, as representative  of the U.S.  Underwriters, and CSFBL,  on
behalf  of the Managers, but such amount  will not exceed the selling concession
applicable to  such shares.  To the  extent  there are  sales between  the  U.S.
Underwriters  and  the Managers  pursuant to  the Intersyndicate  Agreement, the
number of  shares of  Common Stock  initially  available for  sale by  the  U.S.
Underwriters or by the Managers may be more or less than the amount appearing on
the  cover  page  of this  Prospectus.  Neither  the U.S.  Underwriters  nor the
Managers are obligated to  purchase from the other  any unsold shares of  Common
Stock.
 
   
    The  Company has  agreed that  it will  not offer,  sell, contract  to sell,
pledge or  otherwise  dispose of,  directly  or  indirectly, or  file  with  the
Securities and Exchange Commission a registration statement under the Securities
Act  of  1933, as  amended (the  "Securities Act"),  relating to  any additional
shares of its  Common Stock or  securities convertible into  or exchangeable  or
exercisable  for  any  shares of  its  Common  Stock, or  publicly  disclose the
intention to make any such offer, sale, pledge, disposal or filing, without  the
prior  written consent of  CS First Boston  Corporation for a  period of 90 days
after the date of this Prospectus, except for issuances of Common Stock pursuant
to the conversion or exchange of  convertible or exchangeable securities or  the
exercise  of warrants, rights or options in each case outstanding as of the date
of this Prospectus,  grants of employee  stock options or  rights pursuant to  a
plan  in  effect on  the  date of  this  Prospectus, issuances  pursuant  to the
exercise of such options or rights, issuances pursuant to the Company's dividend
reinvestment plan as in effect on the date of this Prospectus, and any filing of
a registration statement  under the Securities  Act with respect  to any of  the
foregoing permitted issuances or grants.
    
 
    The  Company has agreed to indemnify  the U.S. Underwriters and the Managers
against certain liabilities,  including civil liabilities  under the  Securities
Act,  or to contribute to  payments that the U.S.  Underwriters and the Managers
may be required to make in respect thereof.
 
    Certain of the U.S. Underwriters and Managers and their affiliates have from
time to time performed, and continue to perform, various investment banking  and
commercial  banking services for  the Company, for  which customary compensation
has been received.
 
                                       26

<PAGE>
                          NOTICE TO CANADIAN RESIDENTS
 
RESALE RESTRICTIONS
 
    The distribution of  the Common  Stock in  Canada is  being made  only on  a
private placement basis exempt from the requirement that the Company prepare and
file  a prospectus with  the securities regulatory  authorities in each province
where trades of the  Common Stock are effected.  Accordingly, any resale of  the
Common  Stock in  Canada must be  made in accordance  with applicable securities
laws which  will vary  depending on  the relevant  jurisdiction, and  which  may
require  resales to be made in accordance with available statutory exemptions or
pursuant to  a  discretionary  exemption  granted  by  the  applicable  Canadian
securities  regulatory authority.  Purchasers are  advised to  seek legal advice
prior to any resale of the Common Stock.
 
REPRESENTATIONS OF PURCHASERS
 
    Each  purchaser  of  Common  Stock   in  Canada  who  receives  a   purchase
confirmation will be deemed to represent to the Company and the dealer from whom
such purchase confirmation is received that (i) such purchaser is entitled under
applicable  provincial securities laws to purchase such Common Stock without the
benefit of  a  prospectus  qualified  under such  securities  laws,  (ii)  where
required  by law,  that such  purchaser is  purchasing as  principal and  not as
agent, and  (iii) such  purchaser  has reviewed  the  text above  under  "Resale
Restrictions."
 
RIGHTS OF ACTION AND ENFORCEMENT
 
    The  securities  being offered  are those  of a  foreign issuer  and Ontario
purchasers will  not  receive the  contractual  right of  action  prescribed  by
section  32 of the Regulation  under the Securities Act  (Ontario). As a result,
Ontario purchasers must rely on other remedies that may be available,  including
common  law rights of action for damages or rescission or rights of action under
the civil liability provisions of the U.S. federal securities laws.
 
    All of the  issuer's directors  and officers as  well as  the experts  named
herein may be located outside of Canada and, as a result, it may not be possible
for  Ontario  purchasers to  effect service  of process  within Canada  upon the
issuer or such persons. All or a substantial portion of the assets of the issuer
and such persons may be located outside of  Canada and, as a result, it may  not
be  possible to satisfy a judgment against  the issuer or such persons in Canada
or to enforce  a judgment  obtained in Canadian  courts against  such issuer  or
persons outside of Canada.
 
NOTICE TO BRITISH COLUMBIA RESIDENTS
 
    A  purchaser of Common  Stock to whom the  Securities Act (British Columbia)
applies is advised  that such  purchaser is required  to file  with the  British
Columbia  Securities Commission  a report  within ten  days of  the sale  of any
shares of Common  Stock acquired by  such purchaser pursuant  to this  Offering.
Such  report  must  be  in  the form  attached  to  British  Columbia Securities
Commission Blanket Order BOR #95/17,  a copy of which  may be obtained from  the
Company. Only one such report must be filed in respect of shares of Common Stock
acquired on the same date and under the same prospectus exemption.
 
                                    EXPERTS
 
    The  consolidated financial  statements of  the Company  as of  December 31,
1995, 1994, 1993, 1992 and  1991, and for each of  the five years in the  period
ended  December 31,  1995 incorporated  by reference  from the  Company's Annual
Report on Form 10-K for the year  ended December 31, 1995, have been audited  by
Deloitte & Touche LLP, independent auditors, as stated in their report, which is
incorporated herein by reference, and have been so incorporated in reliance upon
the  report of such firm given upon their authority as experts in accounting and
auditing.
 
    The  combined  financial  statements  of  Electronic  Systems  (a  unit   of
Westinghouse  Electric Corporation) incorporated in this Prospectus by reference
to the Current Report on Form 8-K of the Company dated March 18, 1996 have  been
so  incorporated in reliance on the  report of Price Waterhouse LLP, independent
accountants, given upon the authority of said firm as experts in accounting  and
auditing.
 
                                       27

<PAGE>
                                 LEGAL MATTERS
 
    The validity of the issuance of the shares of Common Stock and certain other
legal  matters related to the  Offerings will be passed  upon for the Company by
Sheppard, Mullin,  Richter &  Hampton  LLP, Los  Angeles, California.  Latham  &
Watkins,  Los Angeles,  California, will pass  on certain legal  matters for the
U.S. Underwriters and Managers.
 
                                       28

<PAGE>
- -------------------------------------------
                                     -------------------------------------------
 
    NO  DEALER,  SALESPERSON  OR  OTHER  PERSON  HAS  BEEN  AUTHORIZED  TO  GIVE
INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS  AND,
IF  GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS
HAVING BEEN  AUTHORIZED BY  THE  COMPANY OR  ANY  UNDERWRITER OR  MANAGER.  THIS
PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO
BUY  ANY OF THE SECURITIES  OFFERED HEREBY IN ANY  JURISDICTION TO ANY PERSON TO
WHOM IT  IS  UNLAWFUL TO  MAKE  SUCH OFFER  IN  SUCH JURISDICTION.  NEITHER  THE
DELIVERY  OF  THIS  PROSPECTUS NOR  ANY  SALE  MADE HEREUNDER  SHALL,  UNDER ANY
CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THE INFORMATION HEREIN IS CORRECT  AS
OF  ANY TIME SUBSEQUENT TO THE  DATE HEREOF OR THAT THERE  HAS BEEN NO CHANGE IN
THE AFFAIRS OF THE COMPANY SINCE SUCH DATE.
 
                                 --------------
 
                               TABLE OF CONTENTS
 
   

<TABLE>
<CAPTION>
                                                    PAGE
                                                    -----
<S>                                              <C>
Forward Looking Statements.....................           2
Available Information..........................           2
Incorporation of Certain Documents by
 Reference.....................................           3
Prospectus Summary.............................           4
Use of Proceeds................................           9
Capitalization.................................           9
Price Range of Common Stock and Dividends......          10
Selected Consolidated Financial Data...........          11
Unaudited Pro Forma Condensed Combined
 Financial Data................................          12
The Company....................................          16
Description of Capital Stock...................          21
Certain United States Federal Tax Consequences
 For Non-United States Holders.................          22
Underwriting...................................          25
Notice to Canadian Residents...................          27
Experts........................................          27
Legal Matters..................................          28
</TABLE>

    
 
                                NORTHROP GRUMMAN
 
                                7,000,000 Shares
 
                                  Common Stock
                               ($1.00 PAR VALUE)
 
                              P R O S P E C T U S
 
                                CS First Boston
                              Merrill Lynch & Co.
                              Salomon Brothers Inc
 
- -------------------------------------------
                                     -------------------------------------------

<PAGE>
   
Information   contained  herein  is  subject   to  completion  or  amendment.  A
registration statement  relating to  these securities  has been  filed with  the
Securities  and Exchange  Commission. These securities  may not be  sold nor may
offers to buy be accepted prior  to the time the registration statement  becomes
effective.  This  Prospectus  shall  not  constitute an  offer  to  sell  or the
solicitation of an offer to buy nor shall there be any sale of these  securities
in  any jurisdiction in which such offer, solicitation or sale would be unlawful
prior to registration  or qualification under  the securities laws  of any  such
jurisdiction.
    

<PAGE>
   
                   SUBJECT TO COMPLETION, DATED MAY 16, 1996
    
 
                                7,000,000 Shares
                                NORTHROP GRUMMAN
                                  Common Stock
                               ($1.00 PAR VALUE)
 
                                 --------------
 
ALL  OF THE SHARES OF COMMON STOCK,  PAR VALUE $1.00 PER SHARE ("COMMON STOCK"),
OF NORTHROP GRUMMAN CORPORATION (THE  "COMPANY") OFFERED HEREBY ARE BEING  SOLD
 BY  THE  COMPANY. OF  THE 7,000,000  SHARES OF  COMMON STOCK  BEING OFFERED,
   1,050,000 SHARES ARE INITIALLY BEING OFFERED OUTSIDE THE UNITED STATES AND
    CANADA (THE "INTERNATIONAL SHARES") BY THE MANAGERS (THE  "INTERNATIONAL
    OFFERING")  AND  5,950,000  SHARES  ARE  INITIALLY  BEING  CONCURRENTLY
     OFFERED IN THE UNITED STATES AND  CANADA (THE "U.S. SHARES") BY  THE
       U.S.  UNDERWRITERS  (THE "U.S.  OFFERING"  AND, TOGETHER  WITH THE
       INTERNATIONAL OFFERING, THE "OFFERINGS").  THE OFFERING PRICE  AND
       UNDERWRITING  DISCOUNTS AND   COMMISSIONS  OF THE INTERNATIONAL
                 OFFERING AND THE U.S. OFFERING ARE IDENTICAL.
 
   
THE COMMON STOCK OF THE  COMPANY IS LISTED ON THE  NEW YORK STOCK EXCHANGE  (THE
"NYSE")  AND THE  PACIFIC STOCK  EXCHANGE UNDER THE  SYMBOL "NOC."  ON MAY 15,
  1996, THE LAST REPORTED SALE PRICE  OF THE COMMON       STOCK ON THE  NYSE
           WAS $62. SEE "PRICE RANGE OF COMMON STOCK AND DIVIDENDS."
    
 
                                 --------------
 
THESE  SECURITIES  HAVE  NOT  BEEN APPROVED  OR  DISAPPROVED  BY  THE SECURITIES
   AND  EXCHANGE   COMMISSION  OR   ANY  STATE   SECURITIES  COMMISSION   NOR
     HAS   THE   SECURITIES   AND   EXCHANGE   COMMISSION   OR   ANY  STATE
        SECURITIES  COMMISSION   PASSED  UPON   THE  ACCURACY   OR   AD-
            EQUACY    OF   THIS   PROSPECTUS.   ANY   REPRESENTATION
                       TO THE CONTRARY IS A CRIMINAL OFFENSE.
 

<TABLE>
<CAPTION>
                                                                             UNDERWRITING
                                                            PRICE TO         DISCOUNTS AND       PROCEEDS TO
                                                             PUBLIC           COMMISSIONS        COMPANY(1)
                                                        -----------------  -----------------  -----------------
<S>                                                     <C>                <C>                <C>
PER SHARE.............................................          $                  $                  $
TOTAL (2).............................................          $                  $                  $
</TABLE>

 
(1) BEFORE DEDUCTION OF EXPENSES PAYABLE BY THE COMPANY, ESTIMATED AT $700,000.
 
(2) THE COMPANY HAS  GRANTED THE MANAGERS AND  THE U.S. UNDERWRITERS AN  OPTION,
    EXERCISABLE  BY CS  FIRST BOSTON CORPORATION  FOR THIRTY (30)  DAYS FROM THE
    DATE OF THIS PROSPECTUS TO PURCHASE A MAXIMUM OF 1,050,000 ADDITIONAL SHARES
    TO COVER OVER-ALLOTMENTS OF SHARES. IF THE OPTION IS EXERCISED IN FULL,  THE
    TOTAL  PRICE TO  PUBLIC WILL  BE $             ,  UNDERWRITING DISCOUNTS AND
    COMMISSIONS WILL BE $         AND PROCEEDS TO COMPANY WILL BE $         .
 
   
    THE INTERNATIONAL SHARES ARE OFFERED BY THE SEVERAL MANAGERS WHEN, AS AND IF
ISSUED BY THE COMPANY, DELIVERED TO AND ACCEPTED BY THE MANAGERS AND SUBJECT  TO
THEIR  RIGHT TO  REJECT ORDERS  IN WHOLE  OR IN  PART. IT  IS EXPECTED  THAT THE
INTERNATIONAL SHARES WILL  BE READY  FOR DELIVERY  ON OR ABOUT  JUNE    ,  1996,
AGAINST PAYMENT IN IMMEDIATELY AVAILABLE FUNDS.
    
 
CS First Boston                                      Merrill Lynch International
 
                     Salomon Brothers International Limited
 
   
                 THE DATE OF THIS PROSPECTUS IS JUNE   , 1996.
    

<PAGE>
    IN  CONNECTION WITH THE OFFERINGS, CS  FIRST BOSTON CORPORATION ON BEHALF OF
THE U.S. UNDERWRITERS  AND THE  MANAGERS MAY OVER-ALLOT  OR EFFECT  TRANSACTIONS
WHICH  STABILIZE OR  MAINTAIN THE MARKET  PRICE OF  THE COMMON STOCK  AT A LEVEL
ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL  IN THE OPEN MARKET. SUCH  TRANSACTIONS
MAY  BE EFFECTED ON THE  NEW YORK STOCK EXCHANGE,  THE PACIFIC STOCK EXCHANGE OR
OTHERWISE. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
 
    DURING THIS OFFERING, CERTAIN PERSONS AFFILIATED WITH PERSONS  PARTICIPATING
IN THE DISTRIBUTION MAY ENGAGE IN TRANSACTIONS FOR THEIR OWN ACCOUNTS OR FOR THE
ACCOUNTS  OF OTHERS IN  THE COMMON STOCK  OF THE COMPANY  PURSUANT TO EXEMPTIONS
CONTAINED IN RULES 10B-6, 10B-7 AND  10B-8 UNDER THE SECURITIES EXCHANGE ACT  OF
1934.
 
                           FORWARD LOOKING STATEMENTS
 
    THE  FORWARD LOOKING  STATEMENTS CONTAINED  IN THIS  PROSPECTUS, CONCERNING,
AMONG OTHER  THINGS,  FUTURE RESULTS  OF  OPERATIONS, DELIVERIES,  TRENDS,  CASH
FLOWS,  MARKETS  AND PROGRAMS  ARE PROJECTIONS  AND  ARE NECESSARILY  SUBJECT TO
VARIOUS  RISKS  AND  UNCERTAINTIES.  ACTUAL  OUTCOMES  ARE  DEPENDENT  UPON  THE
COMPANY'S  SUCCESSFUL  PERFORMANCE  OF  INTERNAL  PLANS,  GOVERNMENT  CUSTOMERS'
BUDGETARY RESTRAINTS,  CUSTOMER CHANGES  IN SHORT  RANGE AND  LONG RANGE  PLANS,
DOMESTIC AND INTERNATIONAL COMPETITION IN BOTH THE DEFENSE AND COMMERCIAL AREAS,
PRODUCT  PERFORMANCE,  CONTINUED  DEVELOPMENT AND  ACCEPTANCE  OF  NEW PRODUCTS,
PERFORMANCE ISSUES WITH KEY SUPPLIERS AND SUBCONTRACTORS, GOVERNMENT IMPORT  AND
EXPORT  POLICIES,  TERMINATION  OF  GOVERNMENT  CONTRACTS,  POLITICAL PROCESSES,
LEGAL, FINANCIAL AND  GOVERNMENTAL RISKS RELATED  TO INTERNATIONAL  TRANSACTIONS
AND GLOBAL NEEDS FOR MILITARY AND COMMERCIAL AIRCRAFT AND ELECTRONIC SYSTEMS AND
SUPPORT,  AS  WELL  AS OTHER  ECONOMIC,  POLITICAL AND  TECHNOLOGICAL  RISKS AND
UNCERTAINTIES.
 
                               TABLE OF CONTENTS
   

<TABLE>
<CAPTION>
                                                    PAGE
                                                    -----
<S>                                              <C>
Forward Looking Statements.....................           2
Available Information..........................           3
Incorporation of Certain Documents by
 Reference.....................................           3
Prospectus Summary.............................           4
Use of Proceeds................................           9
Capitalization.................................           9
Price Range of Common Stock and Dividends......          10
Selected Consolidated Financial Data...........          11
 
<CAPTION>
                                                    PAGE
                                                    -----
<S>                                              <C>
 
Unaudited Pro Forma Condensed Combined
 Financial Data................................          12
The Company....................................          16
Description of Capital Stock...................          21
Certain United States Federal Tax Consequences
 For Non-United States Holders.................          22
Subscription and Sale..........................          25
Experts........................................          27
Legal Matters..................................          27
</TABLE>

    
 
                                       2

<PAGE>
                             AVAILABLE INFORMATION
 
    The Company is subject to  the informational requirements of the  Securities
Exchange  Act  of  1934, as  amended  (the  "Exchange Act"),  and  in accordance
therewith files  reports,  proxy  statements  and  other  information  with  the
Securities  and  Exchange  Commission (the  "Commission").  Such  reports, proxy
statements and other information may be inspected and copies may be obtained  at
the  principal office  of the Commission  at 450 Fifth  Street, N.W, Washington,
D.C.  20549,  and  at  the   following  regional  offices  of  the   Commission:
Northwestern  Atrium  Center,  500  West Madison  Street,  Suite  1400, Chicago,
Illinois 60661; and 7 World Trade Center, 13th Floor, New York, New York  10048.
Copies  of such materials can  be obtained from the  Public Reference Section of
the Commission, 450  Fifth Street,  N.W, Washington, D.C.  20549, at  prescribed
rates.  Reports, proxy statements  and other information  concerning the Company
can also be inspected at  the offices of the New  York Stock Exchange, Inc.,  20
Broad  Street, New York, New  York 10005; and the  Pacific Stock Exchange, Inc.,
233 South Beaudry Avenue,  Los Angeles, California 90012,  and 301 Pine  Street,
San Francisco, California 94104.
 
    The  Company has filed with the Commission a Registration Statement (herein,
together with all amendments thereto, called the "Registration Statement") under
the Securities Act of 1933, as  amended (the "Securities Act"), with respect  to
the  securities  offered hereby.  This Prospectus  does not  contain all  of the
information  included  in  the  Registration  Statement  and  the  exhibits  and
schedules thereto. Statements contained in this Prospectus as to the contents of
any contract or other document referred to herein and filed as an exhibit to the
Registration  Statement  are not  necessarily  complete, and,  in  each instance
reference is made to  the copy of  such contract or other  document filed as  an
exhibit  to the Registration  Statement, each such  statement being qualified in
all respects by  such reference.  For further  information with  respect to  the
Company and the securities being offered hereby, reference is hereby made to the
Registration Statement and the exhibits and schedules thereto.
 
                INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
 
    The  Company has filed  with the Commission,  pursuant to Section  13 of the
Exchange Act:
 
        (i) an Annual Report on Form 10-K for the year ended December 31, 1995;
 
        (ii) a Current Report on Form 8-K filed March 18, 1996;
 
   
       (iii) a Quarterly  Report on Form  10-Q for the  quarter ended March  31,
    1996;
    
 
   
        (iv)  a description of  the Common Stock  of the Company  set forth in a
    Registration Statement on Form 8-B dated June 20, 1985; and
    
 
   
        (v) a description of the Common Stock Purchase Rights of the Company set
    forth in a Registration Statement on  Form 8-A filed September 22, 1988,  as
    amended  on Form 8  filed August 2,  1991, as further  amended on Form 8-A/A
    filed October 7, 1994;
    
 
    which are  hereby incorporated  by reference  in  and made  a part  of  this
    Prospectus.
 
        All  documents  hereafter  filed  by  the  Company  with  the Commission
    pursuant to Section 13(a), 13(c), 14 or  15(d) of the Exchange Act prior  to
    the filing of a post-effective amendment which indicates that all securities
    offered  hereby  have been  sold or  which  deregisters all  securities then
    remaining unsold shall be deemed to  be incorporated by reference in and  to
    be  a part of this Prospectus from the date of filing of such documents. Any
    statement contained in a document incorporated by reference or deemed to  be
    incorporated  herein  shall  be  deemed to  be  modified  or  superseded for
    purposes of this Prospectus to the extent that a statement contained  herein
    or in any other subsequently filed document which also is or is deemed to be
    incorporated  by reference herein modifies or supersedes such statement. Any
    such statement so modified or superseded  shall not be deemed, except as  so
    modified or superseded, to constitute a part of this Prospectus.
 
        In this Prospectus, references to "dollars" and "$" are to United States
    dollars.
 
        THIS  PROSPECTUS  INCORPORATES  DOCUMENTS  BY  REFERENCE  WHICH  ARE NOT
    PRESENTED HEREIN  OR  DELIVERED  HEREWITH. THESE  DOCUMENTS  (NOT  INCLUDING
    EXHIBITS  TO  SUCH  DOCUMENTS,  UNLESS  SUCH  EXHIBITS  ARE  INCORPORATED BY
    REFERENCE IN SUCH DOCUMENTS)  ARE AVAILABLE WITHOUT  CHARGE UPON WRITTEN  OR
    ORAL  REQUEST DIRECTED  TO: JAMES C.  JOHNSON, CORPORATE  VICE PRESIDENT AND
    SECRETARY,  NORTHROP  GRUMMAN  CORPORATION,  1840  CENTURY  PARK  EAST,  LOS
    ANGELES, CALIFORNIA 90067 (TELEPHONE: (310) 553-6262).
 
                                       3

<PAGE>
                             SUBSCRIPTION AND SALE
 
    The   Institutions  named  below  (the  "Managers"),  have,  pursuant  to  a
Subscription Agreement dated             , 1996 (the "Subscription  Agreement"),
severally  but  not  jointly agreed  to  subscribe  and pay  for,  the following
respective numbers of International Shares as set forth opposite their names:
 
   

<TABLE>
<CAPTION>
                                                                                   NUMBER OF
                                                                                  INTERNATIONAL
                                    MANAGER                                          SHARES
- --------------------------------------------------------------------------------  ------------
<S>                                                                               <C>
CS First Boston Limited
Merrill Lynch International
Salomon Brothers International Limited
 
                                                                                  ------------
Total                                                                               1,050,000
                                                                                  ------------
                                                                                  ------------
</TABLE>

    
 
    The Subscription Agreement provides that the obligations of the Managers are
such that,  subject  to  certain  conditions precedent,  the  Managers  will  be
obligated to purchase all of the International Shares offered hereby (other than
those  shares covered by the  over allotment option described  below) if any are
purchased. The Subscription Agreement provides that,  in the event of a  default
by   a   Manager,  in   certain  circumstances   the  purchase   commitments  of
non-defaulting Managers may be  increased or the  Subscription Agreement may  be
terminated.
 
    The  Company has entered  into an Underwriting  Agreement (the "Underwriting
Agreement")  with  the  U.S.  Underwriters  of  the  U.S.  Offering  (the  "U.S.
Underwriters") providing for the concurrent offer and sale of the U.S. Shares in
the United States and Canada. The closing of the U.S. Offering is a condition to
the closing of the International Offering and vice versa.
 
   
    The Company has granted to the Managers and the U.S. Underwriters an option,
exercisable  by CS First Boston Corporation  ("CSFBC"), expiring at the close of
business on  the thirtieth  (30th) day  after the  date of  this Prospectus,  to
purchase  up  to 1,050,000  additional shares,  at  the initial  public offering
price, less the underwriting discounts or  commissions, all as set forth on  the
cover  page  of this  Prospectus. Such  option  may be  exercised only  to cover
over-allotments in the sale of the shares of Common Stock offered hereby. To the
extent that  this  option  to  purchase is  exercised,  each  Manager  and  U.S.
Underwriter  will become obligated,  subject to certain  conditions, to purchase
approximately the  same  percentage  of  additional shares  being  sold  to  the
Managers  and the  U.S. Underwriters as  the number of  International Shares set
forth next to such Manager's  name in the preceding table  and as the number  of
U.S.  Shares set forth next to such U.S. Underwriter's name in the corresponding
table in the prospectus relating  to the U.S. Offering bears  to the sum of  the
total number of shares of Common Stock in such tables.
    
 
    The Company has been advised by CS First Boston Limited ("CSFBL"), on behalf
of  the Managers,  that the Managers  propose to offer  the International Shares
outside the United States and Canada initially at the public offering price  set
forth on the cover page of this Prospectus and, through the Managers, to certain
dealers at such price less a commission of $         per share, and the Managers
and  such dealers may  allow a commission of  $           per  share on sales to
certain other dealers. After  the initial public  offering, the public  offering
price and commission and reallowance may be changed by the Managers.
 
   
    The  offering price and the aggregate underwriting discounts and commissions
per  share  and  per  share  commission  and  reallowance  to  dealers  for  the
International  Offering  and the  concurrent  U.S. Offering  will  be identical.
Pursuant to an  Agreement between the  U.S. Underwriters and  the Managers  (the
"Intersyndicate  Agreement") relating to the  Offerings, changes in the offering
price, the aggregate Underwriting  discounts and commissions  per share and  per
share  commission  and reallowance  to dealers,  will be  made only  upon mutual
agreement of CSFBL, on behalf of the  Managers, and CSFBC on behalf of the  U.S.
Underwriters.
    
 
                                       25

<PAGE>
    Pursuant  to the Intersyndicate  Agreement, each of  the Managers has agreed
that, as part  of the distribution  of the International  Shares and subject  to
certain  exceptions, it  has not offered  or sold,  and will not  offer or sell,
directly or indirectly, any shares of Common Stock or distribute any  prospectus
relating  to the Common Stock to any person in the United States or Canada or to
any other dealer who does not so agree. Each of the U.S. Underwriters has agreed
that, as part  of the distribution  of the  U.S. Shares and  subject to  certain
exceptions,  it has not offered or sold, and will not offer or sell, directly or
indirectly, any shares of Common Stock or distribute any prospectus relating  to
the  Common Stock to  any person outside the  United States or  Canada or to any
dealer who  does  not  so agree.  The  foregoing  limitations do  not  apply  to
stabilization  transactions or to transactions between the Managers and the U.S.
Underwriters pursuant to the Intersyndicate  Agreement. As used herein,  "United
States"  means  the  United States  of  America  (including the  States  and the
District of Columbia), its territories  and possessions and other areas  subject
to  its  jurisdiction, "Canada"  means  Canada, its  provinces,  territories and
possessions and other areas  subject to its jurisdiction,  and an offer or  sale
shall  be in the  United States or  Canada if it  is made to  (i) any individual
resident of the United  States or Canada or  (ii) any corporation,  partnership,
pension,  profit-sharing  or other  trust or  other  entity (including  any such
entity acting  as  an investment  advisor  with discretionary  authority)  whose
office  most directly involved with the purchase is located in the United States
or Canada.
 
   
    Pursuant to  the Intersyndicate  Agreement, sales  may be  made between  the
Managers  and the U.S. Underwriters of such  number of shares of Common Stock as
may be mutually agreed  upon. The price  of any shares of  Common Stock so  sold
will  be the  public offering price  less such  amount agreed upon  by CSFBL, on
behalf of the Managers, and CSFBC,  as representative of the U.S.  Underwriters,
but  such  amount will  not  exceed the  selling  concession applicable  to such
shares. To  the  extent  there are  sales  between  the Managers  and  the  U.S.
Underwriters  pursuant to the Intersyndicate Agreement,  the number of shares of
Common Stock  initially  available for  sale  by the  Managers  or by  the  U.S.
Underwriters  may be more or less than the amount appearing on the cover page of
this Prospectus. Neither the Managers nor the U.S. Underwriters are obligated to
purchase from the other any unsold shares of Common Stock.
    
 
   
    Prior to the  expiry of the  period of six  months from the  closing of  the
Offerings no Common Stock may be offered or sold in the United Kingdom except to
persons  whose ordinary activities involve  them in acquiring, holding, managing
or disposing of investments  (as principal or agent)  for the purposes of  their
businesses  or otherwise  in circumstances that  have not resulted  and will not
result in an offer to the public in the United Kingdom within the meaning of the
Public Offers of Securities Regulations  1995. All applicable provisions of  the
Public Offers of Securities Regulations 1995 and the Financial Services Act 1986
must  be complied  with in respect  of anything  done in relation  to any Common
Stock in, from or otherwise involving the United Kingdom. No document issued  in
connection  with the issue of any Common Stock may be issued or passed on in the
United Kingdom to a person, unless that person is of a kind described in Article
11(3)  of   the  Financial   Services  Act   1986  (Investment   Advertisements)
(Exemptions)  Order  1995 or  is a  person  to whom  the document  may otherwise
lawfully be issued or  passed on. The  Company has not  authorized any offer  of
Common  Stock to  the public  in the  United Kingdom  within the  meaning of the
Public Offers of  Securities Regulations  1995 (the  "Regulations"). The  Common
Stock  may not  lawfully be  offered or  sold to  persons in  the United Kingdom
except in circumstances  that do not  result in an  offer to the  public in  the
United  Kingdom within the meaning of the Regulations or otherwise in compliance
with all applicable provisions of the Regulations.
    
 
   
    The Company  has agreed  that it  will not  offer, sell,  contract to  sell,
pledge  or  otherwise  dispose of,  directly  or  indirectly, or  file  with the
Securities and Exchange Commission a registration statement under the Securities
Act of  1933, as  amended (the  "Securities Act"),  relating to  any  additional
shares  of its  Common Stock or  securities convertible into  or exchangeable or
exercisable for  any  shares of  its  Common  Stock, or  publicly  disclose  the
intention  to make any such offer, sale, pledge, disposal or filing, without the
prior written consent of CSFBC  for a period of 90  days after the date of  this
Prospectus,  except for issuances of Common  Stock pursuant to the conversion or
exchange of convertible or exchangeable securities or the exercise of  warrants,
rights  or options in each  case outstanding as of  the date of this Prospectus,
grants of employee stock options or rights  pursuant to a plan in effect on  the
date  of this Prospectus, issuances pursuant to  the exercise of such options or
rights, issuances pursuant  to the  Company's dividend reinvestment  plan as  in
effect  on  the  date of  this  Prospectus,  and any  filing  of  a registration
statement under  the  Securities  Act  with respect  to  any  of  the  foregoing
permitted issuances or grants.
    
 
                                       26

<PAGE>
    The  Company has agreed to indemnify  the Managers and the U.S. Underwriters
against certain liabilities,  including civil liabilities  under the  Securities
Act,  or to contribute to  payments that the Managers  and the U.S. Underwriters
may be required to make in respect thereof.
 
    Certain of the Managers and U.S. Underwriters and their affiliates have from
time to time performed, and continue to perform, various investment banking  and
commercial  banking services for  the Company, for  which customary compensation
has been received.
 
                                    EXPERTS
 
    The consolidated  financial statements  of the  Company as  of December  31,
1995,  1994, 1993, 1992 and 1991,  and for each of the  five years in the period
ended December  31, 1995  incorporated by  reference from  the Company's  Annual
Report  on Form 10-K for the year ended  December 31, 1995, have been audited by
Deloitte & Touche LLP, independent auditors, as stated in their report, which is
incorporated herein by reference, and have been so incorporated in reliance upon
the report of such firm given upon their authority as experts in accounting  and
auditing.
 
    The   combined  financial  statements  of  Electronic  Systems  (a  unit  of
Westinghouse Electric Corporation) incorporated in this Prospectus by  reference
to  the Current Report on Form 8-K of the Company dated March 18, 1996 have been
so incorporated in reliance on the  report of Price Waterhouse LLP,  independent
accountants,  given upon the authority of said firm as experts in accounting and
auditing.
 
                                 LEGAL MATTERS
 
    The validity of the issuance of the shares of Common Stock and certain other
legal matters related to the  Offerings will be passed  upon for the Company  by
Sheppard,  Mullin,  Richter &  Hampton LLP,  Los  Angeles, California.  Latham &
Watkins, Los Angeles,  California, will pass  on certain legal  matters for  the
U.S. Underwriters and Managers.
 
                                       27

<PAGE>

                                    PART II
                     INFORMATION NOT REQUIRED IN PROSPECTUS
 
ITEM 14.  OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
 
    An  itemized statement of  the estimated amount of  the expenses, other than
underwriting discounts  and commissions,  incurred  and to  be incurred  by  the
Company  in  connection with  the issuance  and  distribution of  the Securities
registered pursuant to this registration statement is as follows:
 

<TABLE>
<S>                                                                 <C>
SEC registration fee..............................................  $ 164,470
Printing and engraving expenses...................................      *
Accounting fees and expenses......................................      *
Legal fees and expenses...........................................      *
Listing fees......................................................      *
Blue sky fees and expenses and legal fees.........................      *
Miscellaneous.....................................................      *
                                                                    ---------
    Total.........................................................  $   *
                                                                    ---------
                                                                    ---------
</TABLE>

 
- ------------------------
 
* To be provided by amendment
 
ITEM 15.  INDEMNIFICATION OF DIRECTORS AND OFFICERS
 
    Section 145 of the Delaware General Corporation Law (the "Act"), and Article
V of  the  Company's Bylaws  relate  to  the indemnification  of  the  Company's
directors  and officers,  among others,  in a  variety of  circumstances against
liabilities arising in connection with the performance of their duties.
 
    The Act permits  indemnification of  directors and officers  acting in  good
faith  and in a  manner they reasonably believe  to be in or  not opposed to the
best interests  of the  Company or  its  shareholders (and,  with respect  to  a
criminal  proceeding, if they have no  reasonable cause to believe their conduct
to be unlawful)  against (i)  expenses (including  attorney's fees),  judgments,
penalties, fines and amounts paid in settlement actually and reasonably incurred
in  connection  with  any  threatened, pending  or  completed  action,  suit, or
proceeding (other than an action by or in the right of the Company) arising  out
of  a position  with the  Company (or  with some  other entity  at the Company's
request) and  (ii) expenses  (including  attorneys' fees)  and amounts  paid  in
settlement  actually and  reasonably incurred  in connection  with a threatened,
pending, or completed action or suit by  or in the right of the Company,  unless
the  director or officer is found liable to the Company and an appropriate court
does not determine that he or she is nevertheless fairly and reasonably entitled
to indemnification.
 
    The Act requires indemnification for expenses to the extent that a  director
or  officer is successful  on the merits  in defending against  any such action,
suit or proceeding, and otherwise  requires in general that the  indemnification
provided for in (i) and (ii) above be made only on a determination by a majority
vote of a quorum of the Board of Directors who were not parties or threatened to
be  made parties to  the action, suit or  proceeding, or, if  a quorum cannot be
obtained, (a)  by independent  legal counsel,  or (b)  by the  shareholders.  In
certain  circumstances, the Act further permits  advances to cover such expenses
before a final determination that  indemnification is permissible, upon  receipt
of  a written undertaking  by or on behalf  of the director  or officer to repay
such amounts if it shall ultimately be determined that they are not entitled  to
indemnification.
 
    Indemnification   under  the  Act  is  not  exclusive  of  other  rights  to
indemnification  to  which  a  person  may  be  entitled  under  the   Company's
Certificate of Incorporation, Bylaws or a contractual agreement. The Act permits
the  Company  to purchase  insurance  on behalf  of  its directors  and officers
against liabilities arising out of their  positions with the Company whether  or
not such liabilities would be within the foregoing indemnification provisions.
 
    Under  the Company's Bylaws, the Company is required to indemnify any person
who was or is  a party or is  threatened to be made  a party to any  threatened,
pending or completed action, suit or proceeding, whether
 
                                      II-1

<PAGE>
civil,  criminal, administrative or investigative (other than an action by or in
the right  of the  Company, a  "derivative action")  and any  appeal thereof  by
reason  of the fact that such  person is, was or agreed  to become a director or
officer of the Company, against expenses (including attorneys' fees), judgments,
penalties, fines and amounts paid in settlement actually and reasonably incurred
by such person in connection with such action, suit or proceeding to the fullest
extent allowed under Delaware or other  applicable state law. The Company  shall
indemnify  an indemnitee  in connection with  a suit brought  by such indemnitee
only if the proceeding was authorized by the Company or is instituted to enforce
the indemnification  rights herein  above  mentioned. The  Company may  pay  the
expenses (including attorney's fees) incurred by any officer, director, employee
or  agent who is interviewed,  subpoenaed or deposed as  a witness, or otherwise
incurs expenses,  in  connection  with  any  action  or  proceeding,  if  it  is
determined that such payments will benefit the Company.
 
    The  Company's Bylaws  provide that the  Company shall pay  for the expenses
incurred by  an indemnified  director or  officer in  defending the  proceedings
specified above, in advance of their final disposition, provided that the person
furnishes  the Company  with an  undertaking to reimburse  the Company  if it is
ultimately determined that such person  is not entitled to indemnification.  The
Company  may provide indemnification at the discretion of the Board of Directors
and on such terms and under such conditions as the Board shall deem  appropriate
to  any person who is or  was serving as an employee  or agent. In addition, the
Company may purchase and maintain  insurance on behalf of  any person who is  or
was  a director, officer, employee or agent of the Company (or is serving or was
serving at the request of an executive officer the Company in such a position at
a related entity) against  any liability asserted against  and incurred by  such
person  in such capacity, or arising out  of the person's status as such whether
or not the  Company would have  the power  or the obligation  to indemnify  such
person against such liability under the provisions of the Company's Bylaws.
 
    The  Company has entered  into an agreement  with each of  its directors and
certain of its officers indemnifying them to the fullest extent permitted by the
foregoing. The  Company  has  also  purchased  director  and  officer  liability
insurance.  Reference  is  made  to  the  forms  of  Underwriting  Agreement and
Subscription Agreement  filed as  Exhibits 1.1  and 1.2,  respectively, to  this
Registration  Statement for certain provisions  regarding the indemnification of
officers and directors of the Company by the U.S. Underwriters and Managers.
 
ITEM 16.  EXHIBITS
 
   

<TABLE>
<C>        <S>
      1.1  Form of Underwriting Agreement
      1.2  Form of Subscription Agreement
      3.1  Certificate of Incorporation, as amended (incorporated by  reference
           to Form S-3 Registration Statement, Registration No. 33-55143)*
      3.2  Bylaws,   as  amended   (incorporated  by  reference   to  Form  S-3
           Registration Statement, Registration No. 33-55143)*
      4.1  Common Stock Purchase Rights Plan (incorporated by reference to Form
           8-A  filed  September   22,  1988,   amended  on   August  2,   1991
           (incorporated  by  reference to  Form 8  filed  August 2,  1991) and
           amended on September  28, 1994  (incorporated by  reference to  Form
           8-A/A filed October 7, 1994)*
      4.2  Amended   and  Restated   Credit  Agreement  dated   March  1,  1996
           (incorporated by reference to Form 8-K filed March 18, 1996)*
      4.3  Form of Certificate for Common  Stock (incorporated by reference  to
           Form S-3 Registration Statement, Registration No. 33-55143)*
      5.1  Opinion of Sheppard, Mullin, Richter & Hampton LLP*
     23.1  Consent of Deloitte & Touche LLP, independent auditors
     23.2  Consent of Price Waterhouse LLP, independent accountants*
</TABLE>

    
 
                                      II-2

<PAGE>
   

<TABLE>
<C>        <S>
     23.3  Consent  of  Sheppard, Mullin,  Richter &  Hampton LLP  (included in
           Exhibit 5.1)*
     24.1  Power of Attorney*
</TABLE>

    
 
- ------------------------
   
* Previously filed.
    
 
ITEM 17.  UNDERTAKINGS
 
    The undersigned registrant hereby undertakes that:
 
        (a) for purposes of determining  any liability under the Securities  Act
    of  1933, each filing of the  registrant's annual report pursuant to Section
    13(a)  or  15(d)  of  the  Securities  Exchange  Act  of  1934  (and,  where
    applicable, each filing of an employee benefit plan's annual report pursuant
    to   Section  15(d)  of  the  Securities  Exchange  Act  of  1934)  that  is
    incorporated by reference in the  registration statement shall be deemed  to
    be  a new registration statement relating to the securities offered therein,
    and the offering of such securities at  that time shall be deemed to be  the
    initial bona fide offering thereof;
 
        (b)  insofar  as  indemnification  for  liabilities  arising  under  the
    Securities  Act  of  1933  may  be  permitted  to  directors,  officers  and
    controlling  persons of the registrant  pursuant to the provisions described
    under Item 15 above, or otherwise,  the registrant has been advised that  in
    the  opinion of the Securities  and Exchange Commission such indemnification
    is against  public  policy as  expressed  in  such Act  and  is,  therefore,
    unenforceable.  In the event  that a claim  for indemnification against such
    liabilities (other than the payment  by the registrant of expenses  incurred
    or  paid by a director,  officer or controlling person  of the registrant in
    the successful defense  of any action,  suit or proceeding)  is asserted  by
    such  director,  officer  or  controlling  person  in  connection  with  the
    securities being registered, the registrant  will, unless in the opinion  of
    its  counsel the matter has been settled by controlling precedent, submit to
    a  court   of   appropriate   jurisdiction   the   question   whether   such
    indemnification  by it is against public policy as expressed in such Act and
    will be governed by the final adjudication of such issue;
 
        (c) for purposes of determining  any liability under the Securities  Act
    of  1933, the information omitted from the  form of prospectus filed as part
    of this registration statement in reliance upon Rule 430A and contained in a
    form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4)
    or 497(h)  under the  Securities Act  shall be  deemed to  be part  of  this
    registration statement as of the time it was declared effective; and
 
        (d)  for purposes of determining any  liability under the Securities Act
    of 1933, each post-effective  amendment that contains  a form of  prospectus
    shall  be  deemed  to  be  a  new  registration  statement  relating  to the
    securities offered therein, and the offering of such securities at that time
    shall be deemed to be the initial bona fide offering thereof.
 
                                      II-3

<PAGE>

                                   SIGNATURES
 
   
    Pursuant  to the requirements of the  Securities Act of 1933, the Registrant
has duly caused this Amendment No. 1 to its Registration Statement to be  signed
on  its behalf by the undersigned, thereunto duly authorized, in the City of Los
Angeles, California on May 15, 1996.
    
 
                                    NORTHROP GRUMMAN CORPORATION
 
                                    By:              NELSON F. GIBBS*
                                          --------------------------------------
                                                     Nelson F. Gibbs,
                                                 CORPORATE VICE PRESIDENT
                                                      AND CONTROLLER
 
   
    Pursuant to the requirements of the  Securities Act of 1933, this  Amendment
No.  1 to  its Registration  Statement has  been signed  below by  the following
persons in the capacities and on the dates indicated.
    
 
   

<TABLE>
<CAPTION>
                  NAME                       TITLE                   DATE
      ----------------------------  ------------------------  ------------------
<S>   <C>                           <C>                       <C>
                                    Chairman of the Board,
            KENT KRESA*              President and Chief
- ----------------------------------   Executive Officer and          May 15, 1996
            Kent Kresa               Director (Principal
                                     Executive Officer)
 
      RICHARD B. WAUGH, JR.*        Corporate Vice President
- ----------------------------------   and Chief Financial            May 15, 1996
      Richard B. Waugh, Jr.          Officer
 
                                    Corporate Vice President
         NELSON F. GIBBS*            and Controller
- ----------------------------------   (Principal Accounting          May 15, 1996
         Nelson F. Gibbs             Officer)
 
         JACK R. BORSTING*
- ----------------------------------  Director                        May 15, 1996
         Jack R. Borsting
 
        JOHN T. CHAIN, JR.*
- ----------------------------------  Director                        May 15, 1996
        John T. Chain, Jr.
 
           JACK EDWARDS*
- ----------------------------------  Director                        May 15, 1996
           Jack Edwards
 
           PHILIP FROST*
- ----------------------------------  Director                        May 15, 1996
           Philip Frost
 
         AULANA L. PETERS*
- ----------------------------------  Director                        May 15, 1996
         Aulana L. Peters
 
          JOHN E. ROBSON*
- ----------------------------------  Director                        May 15, 1996
          John E. Robson
</TABLE>

    
 
                                      II-4

<PAGE>
   

<TABLE>
<CAPTION>
                  NAME                       TITLE                   DATE
      ----------------------------  ------------------------  ------------------
<S>   <C>                           <C>                       <C>
       RICHARD M. ROSENBERG*
- ----------------------------------  Director                        May 15, 1996
       Richard M. Rosenberg
- ----------------------------------  Director
         Brent Scowcroft
 
      JOHN BROOKS SLAUGHTER*
- ----------------------------------  Director                        May 15, 1996
      John Brooks Slaughter
 
        WALLACE C. SOLBERG*
- ----------------------------------  Director                        May 15, 1996
        Wallace C. Solberg
 
      RICHARD J. STEGEMEIER*
- ----------------------------------  Director                        May 15, 1996
      Richard J. Stegemeier
 
*By:        JAMES C. JOHNSON
      ----------------------------
            James C. Johnson
           ATTORNEY-IN-FACT**
</TABLE>

    
 
- ------------------------
** By authority of power of attorney filed with this registration statement.
 
                                      II-5

<PAGE>

                                 EXHIBIT INDEX
 
   

<TABLE>
<CAPTION>
  EXHIBIT
  NUMBER                                  DESCRIPTION                                PAGE
- -----------  ----------------------------------------------------------------------  ----
<C>          <S>                                                                     <C>
       1.1   Form of Underwriting Agreement........................................
       1.2   Form of Subscription Agreement........................................
       3.1   Certificate of Incorporation, as amended (incorporated by reference to
              Form S-3 Registration Statement, Registration No. 33-55143)*
       3.2   Bylaws, as amended (incorporated by reference to Form S-3 Registration
              Statement, Registration No. 33-55143)*
       4.1   Common Stock Purchase Rights Plan (incorporated by reference to Form
              8-A filed September 22, 1988, amended on August 2, 1991 (incorporated
              by reference to Form 8 filed August 2, 1991) and amended on September
              28, 1994 (incorporated by reference to Form 8-A/A filed October 7,
              1994)*
       4.2   Amended and Restated Credit Agreement dated March 1, 1996
              (incorporated by reference to Form 8-K filed March 18, 1996)*
       4.3   Form of Certificate for Common Stock (incorporated by reference to
              Form S-3 Registration Statement, Registration No. 33-55143)*
       5.1   Opinion of Sheppard, Mullin, Richter & Hampton LLP*
      23.1   Consent of Deloitte & Touche LLP, independent auditors................
      23.2   Consent of Price Waterhouse LLP, independent accountants*
      23.3   Consent of Sheppard, Mullin, Richter & Hampton LLP (included in
              Exhibit 5.1)*
      24.1   Power of Attorney*
</TABLE>

    
 
- ------------------------
   
* Previously filed.
    





<PAGE>

                                                                     Exhibit 1.1


                               ____________ SHARES

                          NORTHROP GRUMMAN CORPORATION

                                  COMMON STOCK


                             UNDERWRITING AGREEMENT

                                                              NEW YORK, NEW YORK
                                                                    MAY __, 1996


CS FIRST BOSTON CORPORATION
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
SALOMON BROTHERS INC,
  As Representatives of the Several Underwriters,
    c/o CS First Boston Corporation,
        Park Avenue Plaza,
        New York, N.Y. 10055.

Dear Sirs:

     1.  INTRODUCTORY.  Northrop Grumman Corporation, a Delaware corporation
(the "Company"), proposes to issue and sell (the "U.S. Offering") to the several
Underwriters named in Schedule A hereto (the "Underwriters") ____________ shares
(the "U.S. Firm Securities") of its common stock, $1.00 par value (the
"Securities").

     It is understood that the Company is concurrently entering into a
Subscription Agreement, dated the date hereof (the "Subscription Agreement"),
with CS First Boston Limited ("CSFBL"), Merrill Lynch International Limited and
Salomon Brothers International Limited, and the other managers named therein
(the "Managers") relating to the concurrent offering and sale of _________
shares of Securities (the "International Firm Securities") outside the United
States and Canada (the "International Offering").

     In addition, as set forth below the Company proposes to issue and sell (i)
to the Underwriters, at the option
 of the Underwriters, an aggregate of not more
than ________ additional shares of Securities (the "U.S. Optional Securities")
and (ii) to the Managers, at the option of the Managers, an aggregate of not
more than ____________ additional shares of Securities (the "International
Optional Securities").  The U.S. Firm Securities and the U.S. Optional
Securities are hereinafter called the "U.S. Securities"; the International Firm
Securities and the International Optional Securities are hereinafter called the
"International Securities"; the U.S. Firm Securities and the International Firm
Securities are hereinafter called the "Firm Securities"; the U.S. Optional
Securities and the International Optional Securities are hereinafter called the
"Optional Securities."  The U.S. Securities and the International Securities are
collectively referred to as the "Offered Securities."

     The Company hereby agrees with the several Underwriters as follows:

     2.  REPRESENTATIONS AND WARRANTIES OF THE COMPANY.  The Company represents
and warrants to, and agrees with, the several Underwriters that:


<PAGE>

          (a)  A registration statement (No. 333-_______) relating to the
     Offered Securities, including a form of prospectus relating to the U.S.
     Securities and a form of prospectus relating to the International
     Securities being offered in the International Offering, has been filed with
     the Securities and Exchange Commission (the "Commission") and either (i)
     has been declared effective under the Securities Act of 1933 (the "Act")
     and is not proposed to be amended or (ii) is proposed to be amended by
     amendment or post- effective amendment.  If such registration statement
     (the "initial registration statement") has been declared effective, either
     (A) an additional registration statement (the "additional registration
     statement") relating to the Offered Securities may have been filed with the
     Commission pursuant to Rule 462(b) ("Rule 462(b)") under the Act and, if so
     filed, has become effective upon filing pursuant to such Rule and the
     Offered Securities all have been duly registered under the Act pursuant to
     the initial registration statement and, if applicable, the additional
     registration statement or (B) such an additional registration statement is
     proposed to be filed with the Commission pursuant to Rule 462(b) and will
     become effective upon filing pursuant to such Rule and upon such filing the
     Offered Securities will all have been duly registered under the Act
     pursuant to the initial registration statement and such additional
     registration statement.  If the Company does not propose to amend the
     initial registration statement or if an additional registration statement
     has been filed and the Company does not propose to amend it, and if any
     post-effective amendment to either such registration statement has been
     filed with the Commission prior to the execution and delivery of this
     Agreement, the most recent amendment (if any) to each such registration
     statement has been declared effective by the Commission or has become
     effective upon filing pursuant to Rule 462(c) ("Rule 462(c)") under the Act
     or, in the case of the additional registration statement, Rule 462(b).  For
     purposes of this Agreement, "Effective Time" with respect to the initial
     registration statement or, if filed prior to the execution and delivery of
     this Agreement, the additional registration statement, means (i) if the
     Company has advised the Representatives that it does not propose to amend
     such registration statement, the date and time as of which such
     registration statement, or the most recent post-effective amendment thereto
     (if any) filed prior to the execution and delivery of this Agreement, was
     declared effective by the Commission or has become effective upon filing
     pursuant to Rule 462(c), or (ii) if the Company has advised the
     Representatives that it proposes to file an amendment or post-effective
     amendment to such registration statement, the date and time as of which
     such registration statement, as amended by such amendment or post-effective
     amendment, as the case may be, is declared effective by the Commission.  If
     an additional registration statement has not been filed prior to the
     execution and delivery of this Agreement but the Company has advised the
     Representatives that it proposes to file one, "Effective Time" with respect
     to such additional registration statement means the date and time as of
     which such registration statement is filed and becomes effective pursuant
     to Rule 462(b). "Effective Date" with respect to the initial registration
     statement or the additional registration statement (if any) means the date
     of the Effective Time thereof.  The initial registration statement, as
     amended at its Effective Time, including all material incorporated by
     reference therein, including all information contained in the additional
     registration statement (if any) and deemed to be a part of the initial
     registration statement as of the Effective Time of the additional
     registration statement pursuant to the General Instructions of the Form on
     which it is filed and including all information (if any) deemed to be a
     part of the initial registration statement as of its Effective Time
     pursuant to Rule 430A(b) ("Rule 430A(b)") under the Act, is hereinafter
     referred to as the "Initial Registration Statement."  The additional
     registration statement, as amended at its Effective Time, including the
     contents of the Initial Registration Statement incorporated by reference
     therein and including all information (if any) deemed to be a part of the
     additional registration statement as of its Effective Time pursuant to Rule
     430A(b), is hereinafter referred to as the "Additional Registration
     Statement."  The Initial Registration Statement and the Additional
     Registration Statement are hereinafter


                                        2



<PAGE>

     referred to collectively as the "Registration Statements" and individually
     as a "Registration Statement."  The form of prospectus relating to the U.S.
     Securities and the form of prospectus relating to the International
     Securities, each as first filed with the Commission pursuant to and in
     accordance with Rule 424(b) ("Rule 424(b)") under the Act or (if no such
     filing is required) as included in the Registration Statement, including
     all material incorporated by reference in each such prospectus, are
     hereinafter referred to as the "U.S. Prospectus" and the "International
     Prospectus," respectively, and collectively as the "Prospectuses."  No
     document has been or will be prepared or distributed in reliance on
     Rule 434 under the Act.

          (b)  If the Effective Time of the Initial Registration Statement is
     prior to the execution and delivery of this Agreement:  (i) on the
     Effective Date of the Initial Registration Statement, the Initial
     Registration Statement conformed in all material respects to the
     requirements of the Act and the rules and regulations of the Commission
     (the "Rules and Regulations") and did not include any untrue statement of a
     material fact or omit to state any material fact required to be stated
     therein or necessary to make the statements therein not misleading, (ii) on
     the Effective Date of the Additional Registration Statement (if any), each
     Registration Statement conformed, or will conform, in all material respects
     to the requirements of the Act and the Rules and Regulations and did not
     include, or will not include, any untrue statement of a material fact and
     did not omit, or will not omit, to state any material fact required to be
     stated therein or necessary to make the statements therein not misleading,
     and (iii) on the date of this Agreement, the Initial Registration Statement
     and, if the Effective Time of the Additional Registration Statement is
     prior to the execution and delivery of this Agreement, the Additional
     Registration Statement, each conforms, and at the time of filing of each of
     the Prospectuses pursuant to Rule 424(b) or (if no such filing is required)
     at the Effective Date of the Additional Registration Statement in which the
     Prospectuses are included, each Registration Statement and each of the
     Prospectuses will conform, in all material respects to the requirements of
     the Act and the Rules and Regulations, and none of such documents includes,
     or will include, any untrue statement of a material fact or omits, or will
     omit, to state any material fact required to be stated therein or necessary
     to make the statements therein not misleading.  If the Effective Time of
     the Initial Registration Statement is subsequent to the execution and
     delivery of this Agreement: on the Effective Date of the Initial
     Registration Statement, the Initial Registration Statement and each of the
     Prospectuses will conform in all material respects to the requirements of
     the Act and the Rules and Regulations, none of such documents will include
     any untrue statement of a material fact or will omit to state any material
     fact required to be stated therein or necessary to make the statements
     therein not misleading, and no Additional Registration Statement has been
     or will be filed.  The two preceding sentences do not apply to statements
     in or omissions from a Registration Statement or either of the Prospectuses
     based upon written information furnished to the Company by any Underwriter
     through the Representatives or by any Manager through CSFBL specifically
     for use therein, it being understood and agreed that the only such
     information is that described as such in Section 7(b).

          (c) The Company has been duly incorporated and is an existing
     corporation in good standing under the laws of the state of Delaware, with
     power and authority (corporate and other) to own its properties and conduct
     its business as described in the Prospectuses; and the Company is duly
     qualified to do business as a foreign corporation in good standing in all
     other jurisdictions in which its ownership or lease of property or the
     conduct of its business requires such qualification, except where the
     failure to be so qualified would not, individually or in the aggregate,
     have a material adverse effect on the properties, business, results of
     operations, condition (financial or otherwise), affairs or prospects of the
     Company and its significant



                                        3


<PAGE>

     subsidiaries listed on Schedule B hereto (each a "Subsidiary" and,
     collectively, the "Subsidiaries"), taken as a whole (a "Material Adverse
     Effect").

          (d) Each Subsidiary of the Company has been duly incorporated and is
     an existing corporation in good standing under the laws of the jurisdiction
     of its incorporation, with power and authority (corporate and other) to own
     its properties and conduct its business as described in the Prospectuses;
     and each Subsidiary of the Company is duly qualified to do business as a
     foreign corporation in good standing in all other jurisdictions in which
     its ownership or lease of property or the conduct of its business requires
     such qualification, except where such failure would not, individually or in
     the aggregate, have a Material Adverse Effect; all of the issued and
     outstanding capital stock of each Subsidiary of the Company has been duly
     authorized and validly issued and is fully paid and nonassessable; and the
     capital stock of each Subsidiary owned by the Company, directly or through
     Subsidiaries, is owned free from liens, encumbrances and defects.

          (e) The Offered Securities and all other outstanding shares of capital
     stock of the Company have been duly authorized; all outstanding shares of
     capital stock of the Company are, and, when the Offered Securities have
     been delivered and paid for in accordance with this Agreement and the
     Subscription Agreement on each Closing Date (as defined below), such
     Offered Securities will have been, validly issued, fully paid and
     nonassessable and will conform to the description thereof contained in the
     Prospectuses; and the stockholders of the Company have no preemptive rights
     with respect to the Securities.

          (f) Except as disclosed in the Prospectuses, there are no contracts,
     agreements or understandings between the Company and any person that would
     give rise to a valid claim against the Company or any Underwriter or
     Manager for a brokerage commission, finder's fee or other like payment.

          (g) Other than the Registration Rights Agreement, dated as of March 1,
     1996 (the "Registration Rights Agreement"), by and among the Company, the
     Representatives and J.P. Morgan Securities Inc. related to the Company's 7%
     Notes Due 2006, 7 1/2% Debentures Due 2016 and 7 3/4% Debentures Due 2026,
     there are no contracts, agreements or understandings between the Company
     and any person granting such person the right to require the Company to
     file a registration statement under the Act with respect to any securities
     of the Company owned or to be owned by such person or to require the
     Company to include such securities in the securities registered pursuant to
     a Registration Statement or in any securities being registered pursuant to
     any other registration statement filed by the Company under the Act.

          (h) The Offered Securities have been approved for listing on The New
     York Stock Exchange and the Pacific Stock Exchange subject to notice of
     issuance.

          (i) No consent, approval, authorization, or order of, or filing with,
     any governmental agency or body, including, without limitation, the United
     States Department of Defense, or any court is required for the consummation
     of the transactions contemplated by this Agreement or the Subscription
     Agreement in connection with the issuance and sale of the Offered
     Securities by the Company, except such as have been obtained and made under
     the Act and such as may be required under state or foreign securities laws.

          (j) The execution, delivery and performance of this Agreement and the
     Subscription Agreement, and the issuance and sale of the Offered Securities
     will not result in a breach or



                                        4


<PAGE>

     violation of any of the terms and provisions of, or constitute a default
     under, (i) any statute, any rule, regulation or order of any governmental
     agency or body or any court, domestic or foreign, having jurisdiction over
     the Company or any Subsidiary of the Company or any of their properties, or
     any agreement or instrument to which the Company or any such Subsidiary is
     a party or by which the Company or any such Subsidiary is bound or to which
     any of the properties of the Company or any such Subsidiary is subject,
     except for any such breach, violation or default which would not have a
     Material Adverse Effect, or (ii) the charter or bylaws of the Company or
     any such Subsidiary, and the Company has full power and authority to
     authorize, issue and sell the Offered Securities as contemplated by this
     Agreement and the Subscription Agreement, respectively.

          (k) This Agreement and the Subscription Agreement have been duly
     authorized, executed and delivered by the Company.

          (l) Except as disclosed in the Prospectuses, the Company and its
     Subsidiaries have good and marketable title to all real properties and all
     other properties and assets owned by them, in each case free from liens,
     encumbrances and defects that would materially affect the value thereof or
     materially interfere with the use made or to be made thereof by them; and
     except as disclosed in the Prospectuses, the Company and its Subsidiaries
     hold any leased real or personal property under valid and enforceable
     leases with no exceptions that would materially interfere with the use made
     or to be made thereof by them unless such failure or failures to have good
     and marketable title, free from liens, encumbrances and defects or such
     failure to hold such valid and enforceable leases, would not, individually
     or in the aggregate, have a Material Adverse Effect.

          (m) The Company and its Subsidiaries possess adequate certificates,
     authorities or permits issued by appropriate governmental agencies or
     bodies necessary to conduct the business now operated by them except for
     such certificates, authorities or permits, the absence of which would not
     have a Material Adverse Effect, and have not received any notice of
     proceedings relating to the revocation or modification of any such
     certificate, authority or permit that, if determined adversely to the
     Company or any of its Subsidiaries, would individually or in the aggregate
     have a Material Adverse Effect.

          (n) No labor dispute with the employees of the Company or any
     Subsidiary exists or, to the knowledge of the Company, is imminent, that
     might have a Material Adverse Effect.

          (o) Except as disclosed in the Prospectuses, neither the Company nor
     any of its Subsidiaries is in violation of any statute, any rule,
     regulation, decision or order of any governmental agency or body or any
     court, domestic or foreign, relating to the use, disposal or release of
     hazardous or toxic substances or relating to the protection or restoration
     of the environment or human exposure to hazardous or toxic substances
     (collectively, "environmental laws"), owns or operates any real property
     contaminated with any substance that is subject to any environmental laws,
     is liable for any off-site disposal or contamination pursuant to any
     environmental laws, or is subject to any claim relating to any
     environmental laws, which violation, contamination, liability or claim
     would individually or in the aggregate have a Material Adverse Effect; and
     the Company is not aware of any pending investigation which might lead to
     such a claim.

          (p) Except as disclosed in the Prospectuses, there are no pending
     actions, suits or proceedings against or affecting the Company, any of its
     Subsidiaries or any of their respective


                                        5


<PAGE>

     properties that are required to be described in the Prospectuses or which
     challenge the right of the Company or the ability of the Company to perform
     its obligations under this Agreement or the Subscription Agreement.

          (q) The financial statements included in each Registration Statement
     and the Prospectuses present fairly the financial position of the Company
     and its consolidated subsidiaries as of the dates shown and their results
     of operations and cash flows for the periods shown, and such financial
     statements have been prepared in conformity with the generally accepted
     accounting principles in the United States applied on a consistent basis;
     the schedules included in each Registration Statement present fairly the
     information required to be stated therein; and the assumptions used in
     preparing the pro forma financial statements included in each Registration
     Statement and the Prospectus provide a reasonable basis for presenting the
     significant effects directly attributable to the transactions or events
     described therein, the related pro forma adjustments give appropriate
     effect to those assumptions, and the pro forma columns therein reflect the
     proper application of those adjustments to the corresponding historical
     financial statement amounts.

          (r) Except as disclosed in the Prospectuses, since the date of the
     latest audited financial statements included in the Prospectuses there has
     been no material adverse change, nor any development or event involving a
     prospective material adverse change, in the condition (financial or other),
     business, properties or results of operations of the Company and its
     Subsidiaries taken as a whole, and, except as disclosed in or contemplated
     by the Prospectuses, there has been no dividend or distribution of any kind
     declared, paid or made by the Company on any class of its capital stock.

          (s) The Company is not and, after giving effect to the offering and
     sale of the Offered Securities and the application of the proceeds thereof
     as described in the Prospectuses, will not be an "investment company" as
     defined in the Investment Company Act of 1940.

          (t) Neither the Company nor any of its affiliates does business with
     the government of Cuba or with any person or affiliate located in Cuba
     within the meaning of Section 517.075, Florida Statutes and the Company
     agrees to comply with such Section if prior to the completion of the
     distribution of the Offered Securities it commences doing such business.

     3.  PURCHASE, SALE AND DELIVERY OF OFFERED SECURITIES.  On the basis of the
representations, warranties and agreements herein contained, but subject to the
terms and conditions herein set forth, the Company agrees to sell to the
Underwriters, and the Underwriters agree, severally and not jointly, to purchase
from the Company, at a purchase price of U.S. $_______ per share, the respective
numbers of shares of U.S. Firm Securities set forth opposite the names of the
Underwriters in Schedule A hereto.

     The Company will deliver the U.S. Firm Securities to the Representatives
for the accounts of the Underwriters, at the office of CS First Boston
Corporation, Park Avenue Plaza, New York, NY  10055, against payment of the
purchase price in funds available on the same day by wire transfer to the
account of the Company at a bank acceptable to CSFBC or by official Federal
Reserve Bank check or checks drawn to the order of the Company at the office of
Latham & Watkins, 633 W. Fifth Street, Suite 4000, Los Angeles, CA 90071-2007,
at 10:00 A.M., New York time, on May __, 1996, or at such other time not later
than seven full business days thereafter as CS First Boston Corporation
("CSFBC") and the Company determine, such time being herein referred to as the
"First Closing Date."  For purposes of Rule 15c6-1 under the Securities Exchange
Act of 1934, the First Closing Date (if later than the otherwise applicable
settlement date) shall be the settlement date for payment of funds and delivery
of


                                        6


<PAGE>

securities for all the Offered Securities sold pursuant to the U.S. Offering and
the International Offering.  The certificates for the U.S. Firm Securities
evidencing the U.S. Firm Securities so to be delivered will be in definitive
form, in such denominations and registered in such names as CSFBC requests and
will be made available for checking and packaging at the office of CSFBC, at
least 24 hours prior to the First Closing Date.

     In addition, upon written notice from CSFBC given to the Company from time
to time not more than 30 days subsequent to the date of the Prospectuses, the
Underwriters may purchase all or less than all of the U.S. Optional Securities
at the purchase price per Security to be paid for the U.S. Firm Securities.  The
U.S. Optional Securities to be purchased by the Underwriters on any Optional
Closing Date shall be in the same proportion to all the Optional Securities to
be purchased by the Underwriters and the Managers on such Optional Closing Date
as the U.S. Firm Securities bear to all the Firm Securities.  The Company agrees
to sell to the Underwriters such U.S. Optional Securities and the Underwriters
agree, severally and not jointly, to purchase such U.S. Optional Securities.
Such U.S. Optional Securities shall be purchased for the account of each
Underwriter in the same proportion as the number of shares of U.S. Firm
Securities set forth opposite such Underwriter's name bears to the total number
of shares of U.S. Firm Securities (subject to adjustment by CSFBC to eliminate
fractions) and may be purchased by the Underwriters only for the purpose of
covering over-allotments made in connection with the sale of the U.S. Firm
Securities.  No Optional Securities shall be sold or delivered unless the U.S.
Firm Securities and the International Firm Securities previously have been, or
simultaneously are, sold and delivered.  The right to purchase the Optional
Securities or any portion thereof may be exercised from time to time and to the
extent not previously exercised may be surrendered and terminated at any time
upon notice by CSFBC on behalf of Underwriters and the Managers to the Company.
It is understood that CSFBC is authorized to make payment for and accept
delivery of such Optional Securities on behalf of the Underwriters and Managers
pursuant to the terms of CSFBC's instructions to the Company.

     Each time for the delivery of and payment for the U.S. Optional Securities,
being herein referred to as an "Optional Closing Date," which may be the First
Closing Date (the First Closing Date and each Optional Closing Date, if any,
being sometimes referred to as a "Closing Date"), shall be determined by CSFBC
but shall be not later than five full business days after written notice of
election to purchase Optional Securities is given.  The Company will deliver the
U.S. Optional Securities being purchased on each Optional Closing Date to the
Representatives for the accounts of the several Underwriters, at the office of
CSFBC, against payment of the purchase price in funds available on the same day
by wire transfer to the account of the Company at a bank acceptable to CSFBC or
by official Federal Reserve Bank check or checks drawn to the order of the
Company, at the office of Latham & Watkins, 633 W. Fifth Street, Suite 4000, Los
Angeles, CA  90071-2007.  The certificates for the U.S. Optional Securities will
be in definitive fully registered form, in such denominations and registered in
such names as CSFBC requests upon reasonable notice prior to such Optional
Closing Date and will be made available for checking and packaging at the office
of CSFBC, at a reasonable time in advance of such Optional Closing Date.

     4.  OFFERING BY UNDERWRITERS.  It is understood that the several
Underwriters propose to offer the U.S. Securities for sale to the public as set
forth in the U.S. Prospectus.

     5.  CERTAIN AGREEMENTS OF THE COMPANY.  The Company agrees with the several
Underwriters that:

          (a)  If the Effective Time of the Initial Registration Statement is
     prior to the execution and delivery of this Agreement, the Company will
     file each of the Prospectuses with the


                                        7


<PAGE>

     Commission pursuant to and in accordance with subparagraph (1) (or, if
     applicable and if consented to by CSFBC, subparagraph (4)) of Rule 424(b)
     not later than the earlier of (A) the second business day following the
     execution and delivery of this Agreement or (B) the fifteenth business day
     after the Effective Date of the Initial Registration Statement.

          The Company will advise CSFBC promptly of any such filing pursuant to
     Rule 424(b). If the Effective Time of the Initial Registration Statement is
     prior to the execution and delivery of this Agreement and an additional
     registration statement is necessary to register a portion of the Offered
     Securities under the Act but the Effective Time thereof has not occurred as
     of such execution and delivery, the Company will file the additional
     registration statement or, if filed, will file a post-effective amendment
     thereto with the Commission pursuant to and in accordance with Rule 462(b)
     on or prior to 10:00 P.M., New York time, on the date of this Agreement or,
     if earlier, on or prior to the time either Prospectus is printed and
     distributed to any Underwriter or Manager, or will make such filing at such
     later date as shall have been consented to by CSFBC.

          (b)  The Company will advise CSFBC promptly of any proposal to amend
     or supplement the initial or any additional registration statement as filed
     or either of the related prospectuses or the Initial Registration
     Statement, the Additional Registration Statement (if any) or either of the
     Prospectuses and will not effect such amendment or supplementation without
     CSFBC's prior consent; and the Company will also advise CSFBC promptly of
     the effectiveness of each Registration Statement (if its Effective Time is
     subsequent to the execution and delivery of this Agreement) and of any
     amendment or supplementation of a Registration Statement or either of the
     Prospectuses and of the institution by the Commission of any stop order
     proceedings in respect of a Registration Statement and will use its best
     efforts to prevent the issuance of any such stop order and to obtain as
     soon as possible its lifting, if issued.

          (c)  If, at any time when a prospectus relating to the Offered
     Securities is required to be delivered under the Act in connection with
     sales by any Underwriter, Manager or dealer, any event occurs as a result
     of which either or both of the Prospectuses as then amended or supplemented
     would include an untrue statement of a material fact or omit to state any
     material fact necessary to make the statements therein, in the light of the
     circumstances under which they were made, not misleading, or if it is
     necessary at any time to amend either or both of the Prospectuses to comply
     with the Act, the Company will promptly notify CSFBC of such event and will
     promptly prepare and file with the Commission, at its own expense, an
     amendment or supplement which will correct such statement or omission or an
     amendment which will effect such compliance.  Neither CSFBC's consent to,
     nor the Underwriters' delivery of, any such amendment or supplement shall
     constitute a waiver of any of the conditions set forth in Section 6.

          (d)  As soon as practicable, but not later than the Availability Date
     (as defined below), the Company will make generally available to its
     security holders an earnings statement covering a period of at least 12
     months beginning after the Effective Date of the Initial Registration
     Statement (or, if later, the Effective Date of the Additional Registration
     Statement) which will satisfy the provisions of Section 11(a) of the Act.
     For the purpose of the preceding sentence, "Availability Date" means the
     45th day after the end of the fourth fiscal quarter following the fiscal
     quarter that includes such Effective Date, except that, if such fourth
     fiscal quarter is the last quarter of the Company's fiscal year,
     "Availability Date" means the 90th day after the end of such fourth fiscal
     quarter.


                                        8


<PAGE>

          (e)  The Company will furnish to the Representatives copies of the
     Registration Statement (one of which will be signed and will include all
     exhibits), each preliminary prospectus relating to the U.S. Securities,
     and, so long as delivery of a prospectus relating to the Offered Securities
     is required to be delivered under the Act in connection with sales by any
     Underwriter or dealer, the U.S. Prospectus and all amendments and
     supplements to such documents, in each case in such quantities as CSFBC
     requests.  The U.S. Prospectus shall be so furnished on or prior to 3:00
     P.M., New York time, on the business day following the later of the
     execution and delivery of this Agreement or the Effective Time of the
     Initial Registration Statement.  All other such documents shall be so
     furnished as soon as available.  The Company will pay the expenses of
     printing and distributing to the Underwriters all such documents.

          (f)  The Company will arrange for the qualification of the Offered
     Securities for sale  under the laws of such jurisdictions in the
     United States as CSFBC designates and will continue such qualifications in
     effect so long as required for the distribution; provided that the Company
     shall not be required to qualify to do business in any jurisdiction where
     it is not now qualified or to file a general consent to service or process
     in any jurisdiction.

          (g)  During the period of five years hereafter, the Company will
     furnish to the Representatives and, upon request, to each of the other
     Underwriters, as soon as practicable after the end of each fiscal year, a
     copy of its annual report to stockholders for such year; and the Company
     will furnish to the Representatives (i) as soon as available, a copy of
     each report and any definitive proxy statement of the Company filed with
     the Commission under the Securities Exchange Act of 1934, as amended (the
     "Exchange Act"), or mailed to stockholders, and (ii) from time to time,
     such other information concerning the Company as CSFBC may reasonably
     request.

          (h)  The Company will pay all expenses incident to the performance of
     its obligations under this Agreement and will reimburse the Underwriters
     (if and to the extent incurred by them) for any filing fees and other
     expenses (including fees and disbursements of counsel) incurred by them in
     connection with qualification of the Offered Securities for sale under the
     laws of such jurisdictions in the United States as CSFBC designates and the
     printing of memoranda relating thereto, for the filing fee of the National
     Association of Securities Dealers, Inc. relating to the Offered Securities,
     for any travel expenses of the Company's officers and employees and any
     other expenses of the Company in connection with attending or hosting
     meetings with prospective purchasers of the Offered Securities and for
     expenses incurred in distributing preliminary prospectuses and the
     Prospectuses (including any amendments and supplements thereto) to the
     Underwriters.

          (i)  For a period of 90 days after the date of the initial public
     offering of the Offered Securities, the Company will not offer, sell,
     contract to sell, pledge or otherwise dispose of, directly or indirectly,
     or file with the Commission a registration statement under the Act relating
     to, any additional shares of its Securities or securities convertible into
     or exchangeable or exercisable for any shares of its Securities, or
     publicly disclose the intention to make any such offer, sale, pledge,
     disposal or filing, without the prior written consent of CSFBC, except
     issuances of Securities pursuant to the conversion or exchange of
     convertible or exchangeable securities or the exercise of warrants, rights
     or options, in each case outstanding on the date hereof, grants of employee
     stock options or rights pursuant to the terms of a plan in effect on the
     date hereof, issuances of Securities pursuant to the exercise of such
     options or rights, issuances of Securities pursuant to the Company's
     dividend reinvestment plan as in effect on the date hereof, and any filing


                                        9


<PAGE>

     of a registration statement under the Act with respect to any of the
     foregoing permitted issuances or grants.

     6.  CONDITIONS OF THE OBLIGATIONS OF THE UNDERWRITERS.  The obligations of
the several Underwriters to purchase and pay for the U.S. Firm Securities on the
First Closing Date and the U.S. Optional Securities to be purchased on each
Optional Closing Date will be subject to the accuracy of the representations and
warranties on the part of the Company herein, to the accuracy of the statements
of Company officers made pursuant to the provisions hereof, to the performance
by the Company of its obligations hereunder and to the following additional
conditions precedent:

          (a)  The Representatives shall have received a letter, dated the date
     of delivery thereof (which, if the Effective Time of the Initial
     Registration Statement is prior to the execution and delivery of this
     Agreement, shall be on or prior to the date of this Agreement or, if the
     Effective Time of the Initial Registration Statement is subsequent to the
     execution and delivery of this Agreement, shall be prior to the filing of
     the amendment or post-effective amendment to the registration statement to
     be filed shortly prior to such Effective Time), of Deloitte & Touche LLP
     confirming that they are independent public accountants within the meaning
     of the Act and the applicable published Rules and Regulations thereunder
     and stating to the effect that:

               (i)  in their opinion the financial statements and schedules and
          summary of earnings examined by them and included in the Registration
          Statements comply as to form in all material respects with the
          applicable accounting requirements of the Act and the related
          published Rules and Regulations;

               (ii) they have performed the procedures specified by the American
          Institute of Certified Public Accountants for a review of interim
          financial information as described in Statement of Auditing Standards
          No. 71, Interim Financial Information, on the unaudited financial
          statements, if any, included in the Registration Statements;

               (iii) on the basis of the review referred to in clause (ii)
          above, a reading of the latest available interim financial statements
          of the Company, inquiries of officials of the Company who have
          responsibility for financial and accounting matters and other
          specified procedures, nothing came to their attention that caused them
          to believe that:

                    (A)  the unaudited financial statements and summary of
               earnings, if any, included in the Registration Statements do not
               comply as to form in all material respects with the applicable
               accounting requirements of the Act and the related published
               Rules and Regulations or any material modifications should be
               made to such unaudited financial statements and summary of
               earnings for them to be in conformity with generally accepted
               accounting principles;

                    (B)  the unaudited consolidated net sales, net income and
               net income per share amounts for the interim periods included in
               the Prospectuses, if any, do not agree with the amounts set forth
               in the unaudited consolidated financial statements for those same
               periods or were not determined on a basis substantially
               consistent with that of the corresponding amounts in the audited
               statements of income;



                                       10


<PAGE>


                    (C)  at the date of the latest available balance sheet read
               by such accountants, or at a subsequent specified date not more
               than five days prior to the date of this Agreement, there was any
               change in the shareholders' equity or any increase in short-term
               indebtedness or long-term debt of the Company and its
               consolidated subsidiaries or, at the date of the latest available
               balance sheet read by such accountants, there was any decrease in
               consolidated net current assets or net assets, as compared with
               amounts shown on the latest balance sheet included in the
               Prospectuses; or

                    (D)  for the period from the closing date of the latest
               income statement included in the Prospectuses to the closing date
               of the latest available income statement read by such accountants
               there were any decreases, as compared with the corresponding
               period of the previous year and with the period of corresponding
               length ended the date of the latest income statement included in
               the Prospectuses, in consolidated net sales or in the total or
               per share amounts of consolidated income before extraordinary
               items or net income,

          except in all cases set forth in clauses (C) and (D) above for
          changes, increases or decreases which the Prospectuses disclose have
          occurred or may occur or which are described in such letter; and

               (iv) they have compared specified dollar amounts (or percentages
          derived from such dollar amounts) and other financial information
          contained in the Registration Statements (in each case to the extent
          that such dollar amounts, percentages and other financial information
          are derived from the general accounting records of the Company and its
          subsidiaries subject to the internal controls of the Company's
          accounting system or are derived directly from such records by
          analysis or computation) with the results obtained from inquiries, a
          reading of such general accounting records and other procedures
          specified in such letter and have found such dollar amounts,
          percentages and other financial information to be in agreement with
          such results, except as otherwise specified in such letter.

          For purposes of this subsection, (i) if the Effective Time of the
     Initial Registration Statement is subsequent to the execution and delivery
     of this Agreement, "Registration Statements" shall mean the initial
     registration statement as proposed to be amended by the amendment or post-
     effective amendment to be filed shortly prior to its Effective Time,
     (ii) if the Effective Time of the Initial Registration Statement is prior
     to the execution and delivery of this Agreement but the Effective Time of
     the Additional Registration is subsequent to such execution and delivery,
     "Registration Statements" shall mean the Initial Registration Statement and
     the additional registration statement as proposed to be filed or as
     proposed to be amended by the post-effective amendment to be filed shortly
     prior to its Effective Time, and (iii) "Prospectuses" shall mean the
     prospectuses included in the Registration Statements.  All financial
     statements and schedules included in material incorporated by reference
     into the Prospectuses shall be deemed included in the Registration
     Statements for purposes of this subsection.

          (b)  The Representatives shall have received a letter, dated the date
     of delivery thereof (which, if the Effective Time of the Initial
     Registration Statement is prior to the execution and delivery of this
     Agreement, shall be on or prior to the date of this Agreement or, if the
     Effective Time of the Initial Registration Statement is subsequent to the
     execution and delivery of this


                                          11


<PAGE>

     Agreement, shall be prior to the filing of the amendment or post-effective
     amendment to the registration statement to be filed shortly prior to such
     Effective Time), of Price Waterhouse LLP confirming that they are
     independent public accountants within the meaning of the Act and the
     applicable published Rules and Regulations thereunder and stating to the
     effect that:

               (i)  in their opinion the financial statements of the Electronic
          Systems Group, formerly a business unit of Westinghouse Electric
          Corporation ("ESG"), examined by them and included in the Registration
          Statements comply as to form in all material respects with the
          applicable accounting requirements of the Act and the related
          published Rules and Regulations;

          For purposes of this subsection, (i) if the Effective Time of the
     Initial Registration Statement is subsequent to the execution and delivery
     of this Agreement, "Registration Statements" shall mean the initial
     registration statement as proposed to be amended by the amendment or post-
     effective amendment to be filed shortly prior to its Effective Time, (ii)
     if the Effective Time of the Initial Registration Statement is prior to the
     execution and delivery of this Agreement but the Effective Time of the
     Additional Registration is subsequent to such execution and delivery,
     "Registration Statements" shall mean the Initial Registration Statement and
     the additional registration statement as proposed to be filed or as
     proposed to be amended by the post-effective amendment to be filed shortly
     prior to its Effective Time, and (iii) "Prospectuses" shall mean the
     prospectuses included in the Registration Statements.  All financial
     statements and schedules included in material incorporated by reference
     into the Prospectuses shall be deemed included in the Registration
     Statements for purposes of this subsection.

          (c)  If the Effective Time of the Initial Registration Statement is
     not prior to the execution and delivery of this Agreement, such Effective
     Time shall have occurred not later than 10:00 P.M., New York time, on the
     date of this Agreement or such later date as shall have been consented to
     by CSFBC.  If the Effective Time of the Additional Registration Statement
     (if any) is not prior to the execution and delivery of this Agreement, such
     Effective Time shall have occurred not later than 10:00 P.M., New York
     time, on the date of this Agreement or, if earlier, the time either
     Prospectus is printed and distributed to any Underwriter or Manager, or
     shall have occurred at such later date as shall have been consented to by
     CSFBC.  If the Effective Time of the Initial Registration Statement is
     prior to the execution and delivery of this Agreement, each of the
     Prospectuses shall have been filed with the Commission in accordance with
     the Rules and Regulations and Section 5(a) of this Agreement.  Prior to
     such Closing Date, no stop order suspending the effectiveness of a
     Registration Statement shall have been issued and no proceedings for that
     purpose shall have been instituted or, to the knowledge of the Company or
     the Representatives, shall be contemplated by the Commission.

          (d)  Subsequent to the execution and delivery of this Agreement, there
     shall not have occurred (i) any change, or any development or event
     involving a prospective change, in the condition (financial or other),
     business, properties or results of operations of the Company or its
     Subsidiaries which, in the judgment of a majority in interest of the
     Underwriters including the Representatives, is material and adverse and
     makes it impractical or inadvisable to proceed with completion of the
     public offering or the sale of and payment for the U.S. Securities;
     (ii) any downgrading in the rating of any debt securities of the Company by
     any "nationally recognized statistical rating organization" (as defined for
     purposes of Rule 436(g) under the Act), or any public announcement that any
     such organization has under surveillance or review its rating of any debt
     securities of the Company (other than an announcement with positive
     implications of a possible upgrading, and no implication of a possible
     downgrading, of such


                                          12


<PAGE>

     rating); (iii) any suspension or limitation of trading in securities
     generally on the New York Stock Exchange, or any setting of minimum prices
     for trading on such exchange, or any suspension of trading of any
     securities of the Company on any exchange or in the over-the-counter
     market; (iv) any banking moratorium declared by U.S. Federal or New York
     authorities; or (v) any outbreak or escalation of major hostilities in
     which the United States is involved, any declaration of war by Congress or
     any other substantial national or international calamity or emergency if,
     in the judgment of a majority in interest of the Underwriters including the
     Representatives, the effect of any such outbreak, escalation, declaration,
     calamity or emergency makes it impractical or inadvisable to proceed with
     completion of the public offering or the sale of and payment for the U.S.
     Securities.

          (e)  The Representatives shall have received an opinion, dated such
     Closing Date, of Sheppard, Mullin, Richter & Hampton LLP, counsel for the
     Company, to the effect that:

                    (i)  Each of the Company and its Subsidiaries has been duly
          incorporated and is an existing corporation in good standing under the
          laws of the State of its jurisdiction of incorporation, with corporate
          power and authority to own its properties and conduct its business as
          described in the Prospectuses; and, to the best of such counsel's
          knowledge, each of the Company and its Subsidiaries is duly qualified
          to do business as a foreign corporation in good standing in all other
          jurisdictions in which its ownership or lease property or the conduct
          of its business requires such qualification, except where the failure
          to qualify would not have a Material Adverse Effect;

                    (ii) The Company has authorized capitalization as set forth
          in the Prospectuses;

                    (iii)The Offered Securities delivered on such Closing Date
          [and all other outstanding shares of the Common Stock of the Company]
          have been duly authorized and validly issued, are fully paid and
          nonassessable and conform to the description thereof contained in the
          Prospectuses; and the stockholders of the Company have no preemptive
          rights with respect to the Offered Securities;

                    (iv) Other than the Registration Rights Agreement, there are
          no contracts, agreements or understandings known to such counsel
          between the Company and any person granting such person the right to
          require the Company to file a registration statement under the Act
          with respect to any securities of the Company owned or to be owned by
          such person or to require the Company to include such securities in
          the securities registered pursuant to the Registration Statement or in
          any securities being registered pursuant to any other registration
          statement filed by the Company under the Act;

                    (v)  The Company is not and, after giving effect to the
          offering and sale of the Offered Securities and the application of the
          proceeds thereof as described in the Prospectus, will not be an
          "investment company" as defined in the Investment Company Act of 1940;

                    (vi) To the best of our knowledge, no consent, approval,
          authorization or order of, or filing with, any governmental agency or
          body or any court is required for the consummation of the transactions
          contemplated by this Agreement or the Subscription Agreement in
          connection with the issuance or sale of the Offered


                                          13


<PAGE>

          Securities by the Company, except such as have been obtained and made
          under the Act and such as may be required under state or foreign
          securities laws;

                    (vii)  The execution, delivery and performance of this
          Agreement and the Subscription Agreement and the issuance and sale of
          the Offered Securities will not, to our knowledge result in a breach
          or violation of any of the terms and provisions of, or constitute a
          default under, any Federal or California statute, rule or regulation,
          the Delaware General Corporation Law, or any order of any governmental
          agency or body, or any court having jurisdiction over the Company or
          any Subsidiary of the Company or any of their properties, or any
          agreement or instrument to which the Company or any such Subsidiary is
          a party or by which the Company or any such Subsidiary is bound or to
          which any of the properties of the Company or any such Subsidiary is
          subject, or the charter or bylaws of the Company or any such
          Subsidiary, and the Company has full power and authority to authorize,
          issue and sell the Offered Securities as contemplated by this
          Agreement and the Subscription Agreement, respectively;

                    (viii)  The Initial Registration Statement was declared
          effective under the Act as of the date and time specified in such
          opinion, the Additional Registration Statement (if any) was filed and
          became effective under the Act as of the date and time (if
          determinable) specified in such opinion, each of the Prospectuses
          either were filed with the Commission pursuant to the subparagraph of
          Rule 424(b) specified in such opinion on the date specified therein or
          was included in the Initial Registration Statement or the Additional
          Registration Statement (as the case may be), and, to the best of such
          counsel's knowledge, no stop order suspending the effectiveness of a
          Registration Statement or any part thereof has been issued and no
          proceedings for that purpose have been instituted or are pending or
          contemplated under the Act, and each Registration Statement and each
          of the Prospectuses, and each amendment or supplement thereto, as of
          their respective effective or issue dates, complied as to form in all
          material respects with the requirements of the Act and the Rules and
          Regulations;

                    (ix) After due inquiry, such counsel does not know of any
          legal or governmental proceedings required to be described in a
          Registration Statement or the Prospectuses which are not described as
          required or of any contracts or documents of a character required to
          be described in a Registration Statement or the Prospectuses or to be
          filed as exhibits to a Registration Statement which are not described
          and filed as required; and

                    (x)  This Agreement and the Subscription Agreement have been
          duly authorized, executed and delivered by the Company.

          Such counsel shall also state that on the basis of their involvement
     in the preparation of the Registration Statements and the amendments
     thereto, and the Prospectuses and any amendments or supplements thereto,
     and although they have not verified the accuracy or completeness of the
     statements contained therein or in any amendment thereto, nothing has come
     to the attention of such counsel which causes them to believe that the
     Registration Statement, as amended (other than the financial statements and
     notes thereto and supporting schedules and other financial and statistical
     information contained therein), contained any untrue statement of a
     material fact or omitted to state any material fact required to be stated
     therein or necessary to make the statements therein not misleading or that
     either of the Prospectuses, or any amendment or supplement thereto (other
     than the financial statements and notes thereto and supporting


                                          14


<PAGE>

     schedules and other financial and statistical information contained
     therein), as of its issue date or as of such Closing Date, contained any
     untrue statement of a material fact or omitted to state any material fact
     necessary in order to make the statements therein, in light of the
     circumstances under which they were made, not misleading; and such counsel
     does not know of any contracts or documents of a character required to be
     described in or to be filed as exhibits to any Registration Statement which
     are not described and filed as required.

          In rendering such opinion, such counsel may rely (A) as to matters
     involving the application of laws other than the laws of the United States
     and jurisdictions in which they are admitted, to the extent such counsel
     deems proper and to the extent specified in such opinion, if at all, upon
     an opinion or opinions (in form and substance reasonably satisfactory to
     Underwriters' counsel) of other counsel reasonably acceptable to
     Underwriters' counsel, familiar with the applicable laws, and (B) as to
     matters of fact, to the extent they deem proper, on certificates of
     responsible officers of the Company, PROVIDED, that copies of any such
     statements or certificates shall be delivered to Underwriters' counsel.
     The opinions of such counsel for the Company shall state that the opinion
     of any such other counsel is in form satisfactory to such counsel and, in
     their opinion, you and they are justified in relying thereon.

          (f)  The Underwriters shall have received an opinion, dated such
     Closing Date, of Richard R. Molleur, Corporate Vice President and General
     Counsel of the Company, to the effect that:

                         (i)  The execution, delivery and performance of this
          Agreement and the Subscription Agreement will not result in a breach
          or violation of any of the terms and provisions of, or constitute a
          default under, any Federal or California statute, rule or regulation,
          the Delaware General Corporation Law, or any order of any governmental
          agency or body or any court having jurisdiction over the Company or
          any Subsidiary of the Company or any of their properties, or any
          material agreement or instrument to which the Company or any such
          Subsidiary is a party or by which the Company or any such Subsidiary
          is bound or to which any of the properties of the Company or any such
          Subsidiary is subject, or the charter or bylaws of the Company or any
          such Subsidiary; and the Company has full corporate power and
          authority to authorize, issue and sell the Offered Securities as
          contemplated by this Agreement and the Subscription Agreement,
          respectively; and

                         (ii) To the knowledge of such counsel, there is no
          legal or governmental proceeding, pending or threatened, to which the
          Company or any of its Subsidiaries is subject which is required to be
          described in a Registration Statement or the Prospectuses and is not
          so described, and there is no contract or other document which is
          required to be described in a Registration Statement or the
          Prospectuses or is required to be filed as an exhibit to a
          Registration Statement which is not so described and filed as
          required.

          In rendering such opinion, such counsel shall opine as to the effect
     of the federal laws of the United States, the internal laws of the State of
     California and the General Corporation Law of the State of Delaware, and
     such counsel may assume that as to matters involving the application of
     laws of jurisdictions other than the laws of the State of California and
     the General Corporation Law of the State of Delaware, the laws of any such
     other jurisdiction are the same as the laws of the State of California.


                                          15


<PAGE>

          (g)  The Representatives shall have received from Latham & Watkins,
     counsel for the Underwriters, such opinion or opinions, dated such Closing
     Date, with respect to the incorporation of the Company, the validity of the
     Offered Securities delivered on such Closing Date, the Registration
     Statements, the Prospectuses and other related matters as the
     Representatives may require, and the Company shall have furnished to such
     counsel such documents as they request for the purpose of enabling them to
     pass upon such matters.

          (h)  The Representatives shall have received a certificate, dated such
     Closing Date, of the President or any Vice President and a principal
     financial or accounting officer of the Company in which such officers, to
     the best of their knowledge after reasonable investigation, shall state
     that: the representations and warranties of the Company in this Agreement
     are true and correct; the Company has complied with all agreements and
     satisfied all conditions on its part to be performed or satisfied hereunder
     at or prior to such Closing Date; no stop order suspending the
     effectiveness of any Registration Statement has been issued and no
     proceedings for that purpose have been instituted or are contemplated by
     the Commission; and, subsequent to the respective dates of the most recent
     financial statements in the Prospectuses, there has been no material
     adverse change, nor any development or event involving a prospective
     material adverse change, in the condition (financial or other), business,
     properties or results of operations of the Company and its subsidiaries
     taken as a whole except as set forth in or contemplated by the Prospectuses
     or as described in such certificate.

          (i)  The Representatives shall have received a letter, dated such
     Closing Date, of Deloitte & Touche LLP which meets the requirements of
     subsection (a) of this Section, except that the specified date referred to
     in such subsection will be a date not more than three days prior to such
     Closing Date for the purposes of this subsection.

          (j)  The Representatives shall have received a letter, dated such
     Closing Date, of Price Waterhouse LLP which meets the requirements of
     subsection (b) of this Section, except that the specified date referred to
     in such subsection will be a date not more than three days prior to such
     Closing Date for the purposes of this subsection.

          (k)  On such Closing Date, the Managers shall have purchased the
     International Firm Securities or the International Optional Securities, as
     the case may be, pursuant to the Subscription Agreement.

     The Company will furnish the Representatives with such conformed copies 
of such opinions, certificates, letters and documents as the Representatives 
reasonably requests. CSFBC may in its sole discretion waive on behalf of the 
Underwriters compliance with any conditions to the obligations of the 
Underwriters hereunder, whether in respect of an Optional Closing Date or 
otherwise.

    7.    INDEMNIFICATION AND CONTRIBUTION.  (a)  The Company will indemnify and
hold harmless each Underwriter against any losses, claims, damages or
liabilities, joint or several, to which such Underwriter may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
any Registration Statement, either of the Prospectuses, or any amendment or
supplement thereto, or any related preliminary prospectus, or arise out of or
are based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, and will reimburse each Underwriter for any legal or other expenses
reasonably incurred by such Underwriter in connection with investigating or
defending any such loss, claim, damage, liability or action as such expenses are
incurred; provided,


                                          16


<PAGE>

however, that the Company will not be liable in any such case to the extent that
any such loss, claim, damage or liability arises out of or is based upon an
untrue statement or alleged untrue statement in or omission or alleged omission
from any of such documents in reliance upon and in conformity with written
information furnished to the Company by any Underwriter through the
Representatives specifically for use therein, it being understood and agreed
that the only information furnished by any Underwriter consists of the
information described as such in subsection (b) below.

    (b)   Each Underwriter will severally and not jointly indemnify and hold
harmless the Company against any losses, claims, damages or liabilities to which
the Company may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon any untrue statement or alleged untrue statement of any
material fact contained in any Registration Statement, either of the
Prospectuses, or any amendment or supplement thereto, or any related preliminary
prospectus, or arise out of or are based upon the omission or the alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with written information furnished to the Company by such Underwriter
through the Representatives specifically for use therein, and will reimburse any
legal or other expenses reasonably incurred by the Company in connection with
investigating or defending any such loss, claim, damage, liability or action as
such expenses are incurred, it being understood and agreed that the only such
information furnished by any Underwriter consists of the following information
in the U.S. Prospectus furnished on behalf of each Underwriter: the last
paragraph at the bottom of the cover page concerning the terms of the offering
by the Underwriters, the legend concerning over-allotments and stabilizing on
the inside front cover page and the concession and reallowance figures appearing
in the fifth paragraph under the caption "Underwriting."

    (c)   Promptly after receipt by an indemnified party under this Section of
notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under
subsection (a) or (b) above, notify the indemnifying party of the commencement
thereof; but the omission so to notify the indemnifying party will not relieve
it from any liability which it may have to any indemnified party otherwise than
under subsection (a) or (b) above.  In case any such action is brought against
any indemnified party and it notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate therein and, to
the extent that it may wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel satisfactory to such
indemnified party (who shall not, except with the consent of the indemnified
party, be counsel to the indemnifying party), and after notice from the
indemnifying party to such indemnified party of its election so to assume the
defense thereof, the indemnifying party will not be liable to such indemnified
party under this Section for any legal or other expenses subsequently incurred
by such indemnified party in connection with the defense thereof other than
reasonable costs of investigation.  No indemnifying party shall, without the
prior written consent of the indemnified party, effect any settlement of any
pending or threatened action in respect of which any indemnified party is or
could have been a party and indemnity could have been sought hereunder by such
indemnified party unless such settlement includes an unconditional release of
such indemnified party from all liability on any claims that are the subject
matter of such action.

    (d)   If the indemnification provided for in this Section is unavailable or
insufficient to hold harmless an indemnified party under subsection (a) or (b)
above, then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of the losses, claims, damages or
liabilities referred to in subsection (a) or (b) above (i) in such proportion as
is appropriate to reflect the relative benefits received by the Company on the
one hand and the Underwriters on the


                                          17


<PAGE>

other from the offering of the U.S. Securities or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the Company on the one
hand and the Underwriters on the other in connection with the statements or
omissions which resulted in such losses, claims, damages or liabilities as well
as any other relevant equitable considerations.  The relative benefits received
by the Company on the one hand and the Underwriters on the other shall be deemed
to be in the same proportion as the total net proceeds from the offering of the
U.S. Securities (before deducting expenses) received by the Company bear to the
total underwriting discounts and commissions received by the Underwriters.  The
relative fault shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by the
Company or the Underwriters and the parties' relative intent, knowledge, access
to information and opportunity to correct or prevent such untrue statement or
omission.  The amount paid by an indemnified party as a result of the losses,
claims, damages or liabilities referred to in the first sentence of this
subsection (d) shall be deemed to include any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or defending
any action or claim which is the subject of this subsection (d).
Notwithstanding the provisions of this subsection (d), no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the U.S. Securities underwritten by it and distributed to the
public were offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission.  No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.  The Underwriters' obligations in this
subsection (d) to contribute are several in proportion to their respective
underwriting obligations and not joint.

    (e)   The obligations of the Company under this Section shall be in addition
to any liability which the Company may otherwise have and shall extend, upon the
same terms and conditions, to each person, if any, who controls any Underwriter
within the meaning of the Act or the Exchange Act; and the obligations of the
Underwriters under this Section shall be in addition to any liability which the
respective Underwriters may otherwise have and shall extend, upon the same terms
and conditions, to each director of the Company, to each officer of the Company
who has signed a Registration Statement and to each person, if any, who controls
the Company within the meaning of the Act or the Exchange Act.

    8.    DEFAULT OF UNDERWRITERS.  If any Underwriter or Underwriters default
in their obligations to purchase U.S. Securities hereunder on either the First
or any Optional Closing Date and the aggregate number of shares of U.S.
Securities that such defaulting Underwriter or Underwriters agreed but failed to
purchase does not exceed 10% of the total number of shares of U.S. Securities
that the Underwriters are obligated to purchase on such Closing Date, CSFBC may
make arrangements satisfactory to the Company for the purchase of such U.S.
Securities by other persons, including any of the Underwriters, but if no such
arrangements are made by such Closing Date the non-defaulting Underwriters shall
be obligated severally, in proportion to their respective commitments hereunder,
to purchase the U.S. Securities that such defaulting Underwriters agreed but
failed to purchase on such Closing Date.  If any Underwriter or Underwriters so
default and the aggregate number of shares of U.S. Securities with respect to
which such default or defaults occur exceeds 10% of the total number of shares
of U.S. Securities that the Underwriters are obligated to purchase on such
Closing Date and arrangements satisfactory to CSFBC and the Company for the
purchase of such U.S. Securities by other persons are not made within 36 hours
after such default, this Agreement will terminate without liability on the part
of any non-defaulting Underwriter or the Company, except as provided in
Section 9 (provided that if such default occurs with respect to U.S. Optional
Securities after the First Closing Date, this Agreement


                                          18


<PAGE>

will not terminate as to the U.S. Firm Securities or any U.S. Optional
Securities purchased prior to such termination).  As used in this Agreement, the
term "Underwriter" includes any person substituted for an Underwriter under this
Section.  Nothing herein will relieve a defaulting Underwriter from liability
for its default.

    9.    SURVIVAL OF CERTAIN REPRESENTATIONS AND OBLIGATIONS.  The respective
indemnities, agreements, representations, warranties and other statements of the
Company or its officers and of the several Underwriters set forth in or made
pursuant to this Agreement will remain in full force and effect, regardless of
any investigation, or statement as to the results thereof, made by or on behalf
of any Underwriter, the Company or any of their respective representatives,
officers or directors or any controlling person, and will survive delivery of
and payment for the U.S. Securities.  If this Agreement is terminated pursuant
to Section 8 or if for any reason the purchase of the U.S. Securities by the
Underwriters is not consummated, the Company shall remain responsible for the
expenses to be paid or reimbursed by it pursuant to Section 5 and the respective
obligations of the Company and the Underwriters pursuant to Section 7 shall
remain in effect and if any U.S. Securities have been purchased hereunder the
representations and warranties in Section 2 and all obligations under Section 5
shall also remain in effect.  If the purchase of the U.S. Securities by the
Underwriters is not consummated for any reason other than solely because of the
termination of this Agreement pursuant to Section 8 or the occurrence of any
event specified in clause (iii), (iv), or (v) of Section 6(d), the Company will
reimburse the Underwriters for all out-of-pocket expenses (including fees and
disbursements of counsel) reasonably incurred by them in connection with the
offering of the U.S. Securities.

    10.   NOTICES.  All communications hereunder will be in writing and, if sent
to the Underwriters, will be mailed, delivered, telegraphed or transmitted by
facsimile and confirmed to the Representatives, c/o CS First Boston Corporation,
Park Avenue Plaza, New York, N.Y. 10055, Attention:  Investment Banking
Department -- Transactions Advisory Group, or, if sent to the Company, will be
mailed, delivered, telegraphed or transmitted by facsimile and confirmed to it
at Northrop Grumman Corporation, 1840 Century Park East, Los Angeles, CA  90067,
Attention:  Albert F. Myers, Corporate Vice President and Treasurer; provided,
however, that any notice to an Underwriter pursuant to Section 7 will be mailed,
delivered, telegraphed or transmitted by facsimile and confirmed to such
Underwriter.

    11.   SUCCESSORS.  This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the officers
and directors and controlling persons referred to in Section 7, and no other
person will have any right or obligation hereunder.

    12.   REPRESENTATION OF UNDERWRITERS.  The Representatives will act for the
several Underwriters in connection with this financing, and any action under
this Agreement taken by the Representatives jointly or by CSFBC will be binding
upon all the Underwriters.

    13.   COUNTERPARTS.  This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.

    14.   APPLICABLE LAW.  THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES
OF CONFLICTS OF LAWS.

    The Company hereby submits to the non-exclusive jurisdiction of the Federal
and state courts in the Borough of Manhattan in The City of New York in any suit
or proceeding arising out of or relating to this Agreement or the transactions
contemplated hereby.


                                          19


<PAGE>

                              [Signature Page Follows.]


<PAGE>

    If the foregoing is in accordance with the Representatives' understanding
of our agreement, kindly sign and return to the Company one of the counterparts
hereof, whereupon it will become a binding agreement between the Company and the
several Underwriters in accordance with its terms.

                             Very truly yours,

                             NORTHROP GRUMMAN CORPORATION


                             By
                                ----------------------------
                                NAME:  JAMES L. SANFORD
                                TITLE:  ASSISTANT TREASURER

The foregoing Underwriting Agreement
    is hereby confirmed and accepted
    as of the date first above written.

    CS FIRST BOSTON CORPORATION
    MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
    SALOMON BROTHERS INC

         Acting on behalf of themselves
           and as the Representatives of the several Underwriters.

    By CS FIRST BOSTON CORPORATION

     By
       ------------------------------
       NAME:  GERALD M. LODGE
       TITLE:  MANAGING DIRECTOR


<PAGE>

                                      SCHEDULE A


                             Underwriter                        Number of
                             -----------                  U.S. Firm Securities
                                                          --------------------

CS FIRST BOSTON CORPORATION . . . . . . . . . . . . . . .

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED. . . .

SALOMON BROTHERS INC  . . . . . . . . . . . . . . . . . .
                                                           --------------------

TOTAL . . . . . . . . . . . . . . . . . . . . . . . . . .
                                                           --------------------
                                                           --------------------


<PAGE>


                                      SCHEDULE B

                           LIST OF SIGNIFICANT SUBSIDIARIES


1.  Grumman Corporation, a New York corporation.




<PAGE>

                                                                     EXHIBIT 1.2


                             _____________________ SHARES

                             NORTHROP GRUMMAN CORPORATION

                                     COMMON STOCK


                                SUBSCRIPTION AGREEMENT
                                                                 LONDON, ENGLAND
                                                                   MAY ___, 1996


TO:    CS FIRST BOSTON LIMITED
       MERRILL LYNCH INTERNATIONAL
       SALOMON BROTHERS INTERNATIONAL LIMITED
       [Other Managers],


C/O:   CS FIRST BOSTON LIMITED ("CSFBL")
       One Cabot Square
       London, England E14 4QJ

Dear Sirs:

       1.  INTRODUCTORY.  Northrop Grumman Corporation, a Delaware corporation
(the "Company"), proposes to issue and sell (the "International Offering") to
the several Managers named in Schedule A hereto (the "Managers") _______ shares
(the "International Firm Securities") of its common stock, $1.00 par value (the
"Securities").

       It is understood that the Company is concurrently entering into an
Underwriting Agreement, dated the date hereof (the "Underwriting Agreement"),
with certain United States underwriters listed in Schedule A thereto (the "U.S.
Underwriters"), for whom CS First Boston Corporation ("CSFBC"), Merrill Lynch,
Pierce, Fenner & Smith Incorporated and Salomon Brothers Inc are acting as
representatives (the "U.S. Representatives"), relating to the concurrent
offering and sale of ______ shares of Securities (the " U.S. Firm Securities")
in the United States and Canada (the "U.S. Offering").

       In addition, the Company proposes to issue and sell
 (i) to the U.S.
Underwriters, at the option of the U.S. Underwriters, an aggregate of not more
than _____ additional shares of Securities (the "U.S. Optional Securities") and
(ii) to the Managers, at the option of the Managers, an aggregate of not more
than _____ additional shares of Securities (the "International Optional
Securities").  The U.S. Firm Securities and the U.S. Optional Securities are
hereinafter called the "U.S. Securities"; the International Firm Securities and
the International Optional Securities are hereinafter called the "International
Securities"; the U.S. Firm Securities and the International Firm Securities are
hereinafter called the "Firm Securities"; the U.S. Optional Securities and the
International Optional Securities are hereinafter called the "Optional
Securities."  The U.S. Securities and the International Securities are
collectively referred to as the "Offered Securities."  To provide for the
coordination of their activities, the U.S. Underwriters and the Managers have
entered into an Agreement Between U.S. Underwriters and Managers which permits
them, among other things, to sell the Offered Securities to each other for
purposes of resale.


<PAGE>

       The Company hereby agrees with the several Managers as follows:


       2.  REPRESENTATIONS AND WARRANTIES OF THE COMPANY.  The Company
represents and warrants to, and agrees with, the several Managers that:

            (a)  A registration statement (No. 333-________) relating to the
       Offered Securities, including a form of prospectus relating to the U.S.
       Securities and a form of prospectus relating to the International
       Securities being offered in the International Offering, has been filed
       with the Securities and Exchange Commission (the "Commission") and
       either (i) has been declared effective under the Securities Act of 1933
       (the "Act") and is not proposed to be amended or (ii) is proposed to be
       amended by amendment or post-effective amendment.  If such registration
       statement (the "initial registration statement") has been declared
       effective, either (A) an additional registration statement (the
       "additional registration statement") relating to the Offered Securities
       may have been filed with the Commission pursuant to Rule 462(b) ("Rule
       462(b)") under the Act and, if so filed, has become effective upon
       filing pursuant to such Rule and the Offered Securities all have been
       duly registered under the Act pursuant to the initial registration
       statement and, if applicable, the additional registration statement or
       (B) such an additional registration statement is proposed to be filed
       with the Commission pursuant to Rule 462(b) and will become effective
       upon filing pursuant to such Rule and upon such filing the Offered
       Securities will all have been duly registered under the Act pursuant to
       the initial registration statement and such additional registration
       statement.  If the Company does not propose to amend the initial
       registration statement or, if an additional registration statement has
       been filed and the Company does not propose to amend it, and if any
       post-effective amendment to either such registration statement has been
       filed with the Commission prior to the execution and delivery of this
       Agreement, the most recent amendment (if any) to each such registration
       statement has been declared effective by the Commission or has become
       effective upon filing pursuant to Rule 462(c) ("Rule 462(c)") under the
       Act or, in the case of the additional registration statement, Rule
       462(b).  For purposes of this Agreement, "Effective Time" with respect
       to the initial registration statement or, if filed prior to the
       execution and delivery of this Agreement, the additional registration
       statement, means (i) if the Company has advised CSFBL that it does not
       propose to amend such registration statement, the date and time as of
       which such registration statement, or the most recent post-effective
       amendment thereto (if any) filed prior to the execution and delivery of
       this Agreement, was declared effective by the Commission or has become
       effective upon filing pursuant to Rule 462(c), or (ii) if the Company
       has advised CSFBL that it proposes to file an amendment or post-
       effective amendment to such registration statement, the date and time
       as of which such registration statement, as amended by such amendment
       or post-effective amendment, as the case may be, is declared effective
       by the Commission.  If an additional registration statement has not been 
       filed prior to the execution and delivery of this Agreement but the 
       Company has advised CSFBL that it proposes to file one, "Effective 
       Time" with respect to such additional registration statement means the 
       date and time as of which such registration statement is filed and 
       becomes effective pursuant to Rule 462(b).  "Effective Date" with 
       respect to the initial registration statement or the additional
       registration statement (if any) means the date of the Effective Time
       thereof.  The initial registration statement, as amended at its Effective
       Time, including all material incorporated by reference therein, including
       all information contained in the additional registration statement (if 
       any) and deemed to be a part of the initial registration statement as 
       of the Effective Time of the additional registration statement 
       pursuant to the General Instructions of the Form on which it is filed 
       and including all information (if any)


                                          2


<PAGE>

       deemed to be a part of the initial registration statement as of its
       Effective Time pursuant to Rule 430A(b) ("Rule 430A(b)") under the Act,
       is hereinafter referred to as the "Initial Registration Statement."  The
       additional registration statement, as amended at its Effective Time,
       including the contents of the Initial Registration Statement
       incorporated by reference therein and including all information (if any)
       deemed to be a part of the additional registration statement as of its
       Effective Time pursuant to Rule 430A(b), is hereinafter referred to as
       the "Additional Registration Statement." The Initial Registration
       Statement and the Additional Registration Statement are hereinafter
       referred to collectively as the "Registration Statements" and
       individually as a "Registration Statement."  The form of prospectus
       relating to the U.S. Securities and the form of prospectus relating to
       the International Securities, each as first filed with the Commission
       pursuant to and in accordance with Rule 424(b) ("Rule 424(b)") under the
       Act or (if no such filing is required) as included in the Registration
       Statement, including all material incorporated by reference in each such
       prospectus, are hereinafter referred to as the "U.S. Prospectus" and the
       "International Prospectus," respectively, and collectively as the
       "Prospectuses," including all material incorporated by reference in such
       prospectus, is hereinafter referred to as the "U.S. Prospectus," and the
       form of prospectus relating to the International Securities, which is
       identical to the U.S. Prospectus except for the outside front cover
       page, the inside front cover page, the outside back cover page and the
       text under the captions "Underwriting" and "Subscription and Sale" in
       the U.S. Prospectus and the form of prospectus relating to the
       International Securities, respectively (copies of such pages and text
       having been heretofore delivered to CSFBL on behalf of the Managers), is
       hereinafter referred to as the "International Prospectus"; and the U.S.
       Prospectus and the International Prospectus are hereinafter collectively
       referred to as the "Prospectuses."  No document has been or will be
       prepared or distributed in reliance on Rule 434 under the Act.

            (b)  If the Effective Time of the Initial Registration Statement is
       prior to the execution and delivery of this Agreement:  (i) on the
       Effective Date of the Initial Registration Statement, the Initial
       Registration Statement conformed in all material respects to the
       requirements of the Act and the rules and regulations of the Commission
       (the "Rules and Regulations") and did not include any untrue statement
       of a material fact or omit to state any material fact required to be
       stated therein or necessary to make the statements therein not
       misleading, (ii) on the Effective Date of the Additional Registration
       Statement (if any), each Registration Statement conformed, or will
       conform, in all material respects to the requirements of the Act and the
       Rules and Regulations and did not include, or will not include, any
       untrue statement of a material fact and did not omit, or will not omit,
       to state any material fact required to be stated therein or necessary to
       make the statements therein not misleading, and (iii) on the date of
       this Agreement, the Initial Registration Statement and, if the Effective
       Time of the Additional Registration Statement is prior to the execution
       and delivery of this Agreement, the Additional Registration Statement
       each conforms, and at the time of filing of each of the Prospectuses
       pursuant to Rule 424(b) or (if no such filing is required) at the
       Effective Date of the Additional Registration Statement in which the
       Prospectuses are included, each Registration Statement and each of the
       Prospectuses will conform, in all material respects to the requirements
       of the Act and the Rules and Regulations, and none of such documents
       includes, or will include, any untrue statement of a material fact or
       omits, or will omit, to state any material fact required to be stated
       therein or necessary to make the statements therein not misleading.  If
       the Effective Time of the Initial Registration Statement is subsequent
       to the execution and delivery of this Agreement: on the Effective Date
       of the Initial Registration Statement, the Initial Registration
       Statement and each


                                          3


<PAGE>

       of the Prospectuses will conform in all material respects to the
       requirements of the Act and the Rules and Regulations, none of such
       documents will include any untrue statement of a material fact or will
       omit to state any material fact required to be stated therein or
       necessary to make the statements therein not misleading, and no
       Additional Registration Statement has been or will be filed.  The two
       preceding sentences do not apply to statements in or omissions from a
       Registration Statement or either of the Prospectuses based upon written
       information furnished to the Company by any Manager through CSFBL or by
       any U.S. Underwriter through the U.S. Representatives  specifically for
       use therein, it being understood and agreed that the only such
       information is that described as such in Section 7(b).

            (c)  The Company has been duly incorporated and is an existing
       corporation in good standing under the laws of the State of Delaware,
       with power and authority (corporate and other) to own its properties and
       conduct its business as described in the Prospectuses; and the Company
       is duly qualified to do business as a foreign corporation in good
       standing in all other jurisdictions in which its ownership or lease of
       property or the conduct of its business requires such qualification,
       except where the failure to be so qualified would not, individually or
       in the aggregate, have a material adverse effect on the properties,
       business, results of operations, condition (financial or otherwise),
       affairs or prospects of the Company and its significant subsidiaries
       listed on Schedule B hereto, (each a "Subsidiary" and, collectively, the
       "Subsidiaries"), taken as a whole (a "Material Adverse Effect").

            (d)  Each Subsidiary of the Company has been duly incorporated and
       is an existing corporation in good standing under the laws of the
       jurisdiction of its incorporation, with power and authority (corporate
       and other) to own its properties and conduct its business as described
       in the Prospectuses; and each Subsidiary of the Company is duly
       qualified to do business as a foreign corporation in good standing in
       all other jurisdictions in which its ownership or lease of property or
       the conduct of its business requires such qualification, except where
       such failure would not, individually or in the aggregate, have a
       Material Adverse Effect; all of the issued and outstanding capital stock
       of each Subsidiary of the Company has been duly authorized and validly
       issued and is fully paid and nonassessable; and the capital stock of
       each Subsidiary owned by the Company, directly or through Subsidiaries,
       is owned free from liens, encumbrances and defects.

            (e)  The Offered Securities and all other outstanding shares of
       capital stock of the Company have been duly authorized; all outstanding
       shares of capital stock of the Company are, and, when the Offered
       Securities have been delivered and paid for in accordance with this
       Agreement and the Underwriting Agreement on each Closing Date (as
       defined below), such Offered Securities will have been, validly issued,
       fully paid and nonassessable and will conform to the description thereof
       contained in the Prospectuses; and the stockholders of the Company have
       no preemptive rights with respect to the Securities.

            (f)  Except as disclosed in the Prospectuses, there are no
       contracts, agreements or understandings between the Company and any
       person that would give rise to a valid claim against the Company or any
       Manager or U.S. Underwriter for a brokerage commission, finder's fee or
       other like payment.


                                          4


<PAGE>

            (g)  Other than the Registration Rights Agreement, dated as of
       March 1, 1996, by and among the Company, the Representatives and J.P.
       Morgan Securities Inc. related to the Company's 7% Notes Due 2006, 7-1/2%
       Debentures Due 2016 and 7-3/4% Debentures Due 2026, there are no
       contracts, agreements or understandings between the Company and any
       person granting such person the right to require the Company to file a
       registration statement under the Act with respect to any securities of
       the Company owned or to be owned by such person or to require the
       Company to include such securities in the securities registered pursuant
       to a Registration Statement or in any securities being registered
       pursuant to any other registration statement filed by the Company under
       the Act.

            (h)  The Offered Securities have been approved for listing on The
       New York Stock Exchange and the Pacific Stock Exchange subject to notice
       of issuance.

            (i)  No consent, approval, authorization, or order of, or filing
       with, any governmental agency or body, including, without limitation,
       the United States Department of Defense, or any court is required for
       the consummation of the transactions contemplated by this Agreement or
       the Underwriting Agreement in connection with the issuance and sale of
       the Offered Securities by the Company, except such as have been obtained
       and made under the Act and such as may be required under state or
       foreign securities laws.

            (j)  The execution, delivery and performance of this Agreement and
       the Underwriting Agreement, and the issuance and sale of the Offered
       Securities will not result in a breach or violation of any of the terms
       and provisions of, or constitute a default under, (i) any statute, any
       rule, regulation or order of any governmental agency or body or any
       court, domestic or foreign, having jurisdiction over the Company or any
       Subsidiary of the Company or any of their properties, or any agreement
       or instrument to which the Company or any such Subsidiary is a party or
       by which the Company or any such Subsidiary is bound or to which any of
       the properties of the Company or any such Subsidiary is subject, except
       for any such breach, violation or default which would not have a
       Material Adverse Effect, or (ii) the charter or bylaws of the Company or
       any such Subsidiary, and the Company has full power and authority to
       authorize, issue and sell the Offered Securities as contemplated by this
       Agreement and the Underwriting Agreement, respectively.

            (k)  This Agreement and the Underwriting Agreement have been duly
       authorized, executed and delivered by the Company.

            (l)  Except as disclosed in the Prospectuses, the Company and its
       Subsidiaries have good and marketable title to all real properties and
       all other properties and assets owned by them, in each case free from
       liens, encumbrances and defects that would materially affect the value
       thereof or materially interfere with the use made or to be made thereof
       by them; and except as disclosed in the Prospectuses, the Company and
       its Subsidiaries hold any leased real or personal property under valid
       and enforceable leases with no exceptions that would materially
       interfere with the use made or to be made thereof by them unless such
       failure or failures to have good and marketable title, free from liens,
       encumbrances and defects or such failure to hold such valid and
       enforceable leases, would not, individually or in the aggregate, have a
       Material Adverse Effect.


                                          5


<PAGE>

            (m)  The Company and its Subsidiaries possess adequate
       certificates, authorities or permits issued by appropriate governmental
       agencies or bodies necessary to conduct the business now operated by
       them except for such certificates, authorities or permits, the absence
       of which would not have a Material Adverse Effect, and have not received
       any notice of proceedings relating to the revocation or modification of
       any such certificate, authority or permit that, if determined adversely
       to the Company or any of its Subsidiaries, would individually or in the
       aggregate have a Material Adverse Effect.

            (n)  No labor dispute with the employees of the Company or any
       Subsidiary exists or, to the knowledge of the Company, is imminent that
       might have a Material Adverse Effect.

            (o)  Except as disclosed in the Prospectuses, neither the Company
       nor any of its Subsidiaries is in violation of any statute, any rule,
       regulation, decision or order of any governmental agency or body or any
       court, domestic or foreign, relating to the use, disposal or release of
       hazardous or toxic substances or relating to the protection or
       restoration of the environment or human exposure to hazardous or toxic
       substances  (collectively, "environmental laws"), owns or operates any
       real property contaminated with any substance that is subject to any
       environmental laws, is liable for any off-site disposal or contamination
       pursuant to any environmental laws, or is subject to any claim relating
       to any environmental laws, which violation, contamination, liability or
       claim would individually or in the aggregate have a Material Adverse
       Effect; and the Company is not aware of any pending investigation which
       might lead to such a claim.

            (p)  Except as disclosed in the Prospectuses, there are no pending
       actions, suits or proceedings against or affecting the Company, any of
       its Subsidiaries or any of their respective properties that are required
       to be described in the Prospectuses or which challenge the right of the
       Company or the ability of the Company to perform its obligations under
       this Agreement or the Underwriting Agreement.

            (q)  The financial statements included in each Registration
       Statement and the Prospectuses present fairly the financial position of
       the Company and its consolidated subsidiaries as of the dates shown and
       their results of operations and cash flows for the periods shown, and
       such financial statements have been prepared in conformity with the
       generally accepted accounting principles in the United States applied on
       a consistent basis; the schedules included in each Registration
       Statement present fairly the information required to be stated therein;
       and the assumptions used in preparing the pro forma financial statements
       included in each Registration Statement and the Prospectus provide a
       reasonable basis for presenting the significant effects directly
       attributable to the transactions or events described therein, the
       related pro forma adjustments give appropriate effect to those
       assumptions, and the pro forma columns therein reflect the proper
       application of those adjustments to the corresponding historical
       financial statement amounts.

            (r)  Except as disclosed in the Prospectuses, since the date of the
       latest audited financial statements included in the Prospectuses there
       has been no material adverse change, nor any development or event
       involving a prospective material adverse change, in the condition
       (financial or other), business, properties or results of operations of
       the Company and its Subsidiaries taken as a whole, and, except as
       disclosed in or contemplated by the Prospectuses,


                                          6


<PAGE>

       there has been no dividend or distribution of any kind declared, paid or
       made by the Company on any class of its capital stock.

            (s)  The Company is not and, after giving effect to the offering
       and sale of the Offered Securities and the application of the proceeds
       thereof as described in the Prospectuses, will not be an "investment
       company" as defined in the Investment Company Act of 1940.

            (t)  Neither the Company nor any of its affiliates does business
       with the government of Cuba or with any person or affiliate located in
       Cuba within the meaning of Section 517.075, Florida Statutes and the
       Company agrees to comply with such Section if prior to the completion of
       the distribution of the Offered Securities it commences doing such
       business.

       3.  PURCHASE, SALE AND DELIVERY OF OFFERED SECURITIES.  On the basis of
the representations, warranties and agreements herein contained, but subject to
the terms and conditions herein set forth, the Company agrees to sell to the
Managers, and the Managers agree, severally and not jointly, to purchase from
the Company, at a purchase price of U.S. $_____ per share, the respective
numbers of shares of International Firm Securities set forth opposite the names
of the Managers in Schedule A hereto.

       The Company will deliver the International Firm Securities to CSFBL for
the accounts of the Managers, at the office of CSFBC, against payment of the
purchase price in U.S. dollars in funds available on the same day by wire
transfer to the account of the Company at a bank acceptable to CSFBL or by
official Federal Reserve Bank check or checks drawn to the order of the Company
at the office of Latham & Watkins, 633 W. Fifth Street, Suite 4000, Los Angeles,
CA  90071-2007, at 10:00 A.M., New York time, on May ___, 1996, or at such other
time not later than seven full business days thereafter as CSFBL and the Company
determine, such time being herein referred to as the "First Closing Date." For
purposes of Rule 15c6-1 under the Securities Exchange Act of 1934, the First
Closing Date (if later than the otherwise applicable settlement date) shall be
the settlement date for payment of funds and delivery of securities for all the
Offered Securities sold pursuant to the U.S. Offering and the International
Offering.  The certificates for the International Firm Securities so to be
delivered will be in definitive form, in such denominations and registered in
such names as CSFBL requests and will be made available for checking and
packaging at the office of CSFBC, at least 24 hours prior to the First Closing
Date.

       In addition, upon written notice from CSFBC given to the Company from
time to time not more than 30 days subsequent to the date of the Prospectuses,
the Managers may purchase all or less than all of the International Optional
Securities at the purchase price per Security to be paid for the International
Firm Securities.  The International Optional Securities to be purchased by the
Managers on any Optional Closing Date shall be in the same proportion to all the
Optional Securities to be purchased by the Managers and U.S. Underwriters on
such Optional Closing Date as the International Firm Securities bear to all the
Firm Securities.  The Company agrees to sell to the Managers such International
Optional Securities and the Managers agree, severally and not jointly, to
purchase such International Optional Securities.  Such International Optional
Securities shall be purchased for the account of each Manager in the same
proportion as the number of shares of International Firm Securities set forth
opposite such Manager's name bears to the total number of shares of
International Firm Securities (subject to adjustment by CSFBC to eliminate
fractions) and may be purchased by the Managers only for the purpose of covering
over-allotments made in connection with the sale of the International Firm
Securities.  No Optional Securities shall be sold or delivered unless the
International Firm Securities and the U.S.


                                          7


<PAGE>

Firm Securities previously have been, or simultaneously are, sold and delivered.
The right to purchase the Optional Securities or any portion thereof may be
exercised from time to time and to the extent not previously exercised may be
surrendered and terminated at any time upon notice by CSFBC on behalf of the
Managers and the U.S. Underwriters to the Company.  It is understood that CSFBC
is authorized to make payment for and accept delivery of such Optional
Securities on behalf of the U.S. Underwriters and Managers pursuant to the terms
of CSFBC's instructions to the Company.

       Each time for the delivery of and payment for the International Optional
Securities, being herein referred to as an "Optional Closing Date," which may be
the First Closing Date (the First Closing Date and each Optional Closing Date,
if any, being sometimes referred to as a "Closing Date"), shall be determined by
CSFBC but shall be not later than five full business days after written notice
of election to purchase Optional Securities is given.  The Company will deliver
the International Optional Securities being purchased on each Optional Closing
Date to CSFBL for the accounts of the several Managers, at the office of CSFBC,
against payment of the purchase price in U.S. dollars in funds available on the
same day by wire transfer to the account of the Company at a bank acceptable to
CSFBL or by official Federal Reserve Bank check or checks drawn to the order of
the Company, at the office of Latham & Watkins, 633 W. Fifth Street, Los
Angeles, CA  90071-2007.  The certificates for the International Optional
Securities will be in definitive form, in such denominations and registered in
such names as CSFBL requests upon reasonable notice prior to such Optional
Closing Date and will be made available for checking and packaging at the office
of CSFBC, at a reasonable time in advance of such Optional Closing Date.

       The Company will pay to the Managers as aggregate compensation for their
commitments hereunder and for their services in connection with the purchase of
the International Securities and the management of the offering thereof, if the
sale and delivery of the International Securities to the Managers provided
herein is consummated, an amount equal to U.S. $ _____ per International
Security purchased, which may be divided among the Managers in such proportions
as they may determine.  Such payment will be made on the First Closing Date in
the case of the International Firm Securities and on each Optional Closing Date
in the case of the International Optional Securities sold to the Manager on such
Closing Date, in each case by way of deduction by the Managers of said amount
from the purchase price for the International Securities referred to above.

       4.  OFFERING BY MANAGERS.  It is understood that the several Managers
propose to offer the International Securities for sale to the public as set
forth in the International Prospectus.

       In connection with the distribution of the International Securities, the
Managers, through a stabilizing manager, may over-allot or effect transactions
on any exchange, in any over-the-counter market or otherwise which stabilize or
maintain the market prices of the International Securities at levels other than
those which might otherwise prevail, but in such event and in relation thereto,
the Managers will act for themselves and not as agents of the Company, and any
loss resulting from over-allotment and stabilization will be borne, and any
profit arising therefrom will be beneficially retained, by the Managers.  Such
stabilizing, if commenced, may be discontinued at any time.

       5.  CERTAIN AGREEMENTS OF THE COMPANY.  The Company agrees with the
several Managers that:

            (a)  If the Effective Time of the Initial Registration Statement is
       prior to the execution and delivery of this Agreement, the Company will
       file each of the Prospectuses with the


                                          8


<PAGE>

       Commission pursuant to and in accordance with subparagraph (1) (or, if
       applicable and if consented to by CSFBL, subparagraph (4)) of
       Rule 424(b) not later than the earlier of (A) the second business day
       following the execution and delivery of this Agreement or (B) the
       fifteenth business day after the Effective Date of the Initial
       Registration Statement.  

       The Company will advise CSFBL promptly of any such filing pursuant to
       Rule 424(b).  If the Effective Time of the Initial Registration
       Statement is prior to the execution and delivery of this Agreement and
       an additional registration statement is necessary to register a portion
       of the Offered Securities under the Act but the Effective Time thereof
       has not occurred as of such execution and delivery, the Company will
       file the additional registration statement or, if filed, will file a
       post-effective amendment thereto with the Commission pursuant to and in
       accordance with Rule 462(b) on or prior to 10:00 P.M., New York time, on
       the date of this Agreement or, if earlier, on or prior to the time
       either Prospectus is printed and distributed to any Manager or U.S.
       Underwriter, or will make such filing at such later date as shall have
       been consented to by CSFBL.

            (b)  The Company will advise CSFBL promptly of any proposal to
       amend or supplement the initial or any additional registration statement
       as filed or either of the related prospectuses or the Initial
       Registration Statement, the Additional Registration Statement (if any)
       or either of the Prospectuses and will not effect such amendment or
       supplementation without CSFBL's prior consent; and the Company will also
       advise CSFBL promptly of the effectiveness of each Registration
       Statement (if its Effective Time is subsequent to the execution and
       delivery of this Agreement) and of any amendment or supplementation of a
       Registration Statement or either of the Prospectuses and of the
       institution by the Commission of any stop order proceedings in respect
       of a Registration Statement and will use its best efforts to prevent the
       issuance of any such stop order and to obtain as soon as possible its
       lifting, if issued.

            (c)  If, at any time when a prospectus relating to the Offered
       Securities is required to be delivered under the Act in connection with
       sales by any U.S. Underwriter, Manager or dealer, any event occurs as a
       result of which either or both of the Prospectuses as then amended or
       supplemented would include an untrue statement of a material fact or
       omit to state any material fact necessary to make the statements
       therein, in the light of the circumstances under which they were made,
       not misleading, or if it is necessary at any time to amend either or
       both of the Prospectuses to comply with the Act, the Company will
       promptly notify CSFBL of such event and will promptly prepare and file
       with the Commission, at its own expense, an amendment or supplement
       which will correct such statement or omission or an amendment which will
       effect such compliance.  Neither CSFBL's consent to, nor the Managers'
       delivery of, any such amendment or supplement shall constitute a waiver
       of any of the conditions set forth in Section 6.

            (d)  As soon as practicable, but not later than the Availability
       Date (as defined below), the Company will make generally available to
       its security holders an earnings statement covering a period of at least
       12 months beginning after the Effective Date of the Initial Registration
       Statement (or, if later, the Effective Date of the Additional
       Registration Statement) which will satisfy the provisions of
       Section 11(a) of the Act.  For the purpose of the preceding sentence,
       "Availability Date" means the 45th day after the end of the fourth
       fiscal quarter following the fiscal quarter that includes such Effective
       Date, except that, if such fourth fiscal quarter is the


                                          9


<PAGE>


       last quarter of the Company's fiscal year, "Availability Date" means the
       90th day after the end of such fourth fiscal quarter.

               (e)  The Company will furnish to the Managers copies of the
       Registration Statement one of which will be signed and will include all
       exhibits), each preliminary prospectus relating to the International
       Securities, and, until completion of the distribution of the
       International Securities as determined by CSFBL, the International
       Prospectus and all amendments and supplements to such documents, in each
       case in such quantities as CSFBL requests.  The International Prospectus
       shall be so furnished on or prior to 3:00 P.M., New York time, on the
       business day following the later of the execution and delivery of this
       Agreement or the Effective Time of the Initial Registration Statement. 
       All other such documents shall be so furnished as soon as available. 
       The Company will pay the expenses of printing and distributing to the
       Managers all such documents.

               (f)  No action has been or, prior to the completion of the
       distribution of the Offered Securities, will be taken by the Company in
       any jurisdiction outside the United States and Canada that would permit
       a public offering of the Offered Securities, or possession or
       distribution of the International Prospectus, or any amendment or
       supplement thereto, or any related preliminary prospectus issued in
       connection with the offering of the Offered Securities, or any other
       offering material, in any country or jurisdiction where action for that
       purpose is required.

               (g)  During the period of five years hereafter, the Company will
       furnish to CSFBL and, upon request, to each of the other Managers, as
       soon as practicable after the end of each fiscal year, a copy of its
       annual report to stockholders for such year; and the Company will
       furnish to CSFBL (i) as soon as available, a copy of each report and any
       definitive proxy statement of the Company filed with the Commission
       under the Securities Exchange Act of 1934, as amended (the "Exchange
       Act"), or mailed to stockholders, and (ii) from time to time, such other
       information concerning the Company as CSFBL may reasonably request.

               (h)  The Company will pay all expenses incident to the
       performance of its obligations under this Agreement and will reimburse
       the Managers (if and to the extent incurred by them)  for the filing fee
       of the National Association of Securities Dealers, Inc. relating to the
       Offered Securities, for any travel expenses of the Company's officers
       and employees and any other expenses of the Company in connection with
       attending or hosting meetings with prospective purchasers of the Offered
       Securities and for expenses incurred in distributing preliminary
       prospectuses and the Prospectuses (including any amendments and
       supplements thereto) to the Managers. 

               (i)  For a period of 90 days after the date of the initial
       public offering of the Offered Securities, the Company will not offer,
       sell, contract to sell, pledge or otherwise dispose of, directly or
       indirectly, or file with the Commission a registration statement under
       the Act relating to, any additional shares of its Securities or
       securities convertible into or exchangeable or exercisable for any
       shares of its Securities, or publicly disclose the intention to make any
       such offer, sale, pledge, disposal or filing, without the prior written
       consent of CSFBC, except issuances of Securities pursuant to the
       conversion or exchange of convertible or exchangeable securities or the
       exercise of warrants, rights or options, in each case outstanding on the
       date


                                          10



<PAGE>

       hereof, grants of employee stock options or rights pursuant to the terms
       of a plan in effect on the date hereof, issuances of Securities pursuant
       to the exercise of such options or rights, issuances of Securities
       pursuant to the Company's dividend reinvestment plan as in effect on the
       date hereof, and any filing of a registration statement under the Act
       with respect to any of the foregoing permitted issuances or grants.

       6.  CONDITIONS OF THE OBLIGATIONS OF THE MANAGERS.  The obligations of
the several Managers to purchase and pay for the International Firm Securities
on the First Closing Date and the International Optional Securities to be
purchased on each Optional Closing Date will be subject to the accuracy of the
representations and warranties on the part of the Company herein, to the
accuracy of the statements of Company officers made pursuant to the provisions
hereof, to the performance by the Company of its obligations hereunder and to
the following additional conditions precedent:

               (a)  The Managers shall have received a letter, dated the date
       of delivery thereof (which, if the Effective Time of the Initial
       Registration Statement is prior to the execution and delivery of this
       Agreement, shall be on or prior to the date of this Agreement or, if the
       Effective Time of the Initial Registration Statement is subsequent to
       the execution and delivery of this Agreement, shall be prior to the
       filing of the amendment or post-effective amendment to the registration
       statement to be filed shortly prior to such Effective Time), of Deloitte
       & Touche LLP to the effect set forth in Section 6(a) of the Underwriting
       Agreement.

               (b)  The Managers shall have received a letter, dated the date
       of delivery thereof (which, if the Effective Time of the Initial
       Registration Statement is prior to the execution and delivery of this
       Agreement, shall be on or prior to the date of this Agreement or, if the
       Effective Time of the Initial Registration Statement is subsequent to
       the execution and delivery of this Agreement, shall be prior to the
       filing of the amendment or post-effective amendment to the registration
       statement to be filed shortly prior to such Effective Time), of Price
       Waterhouse LLP to the effect set forth in Section 6(b) of the
       Underwriting Agreement.

               (c)  If the Effective Time of the Initial Registration Statement
       is not prior to the execution and delivery of this Agreement, such
       Effective Time shall have occurred not later than 10:00 P.M., New York
       time, on the date of this Agreement or such later date as shall have
       been consented to by CSFBL.  If the Effective Time of the Additional
       Registration Statement (if any) is not prior to the execution and
       delivery of this Agreement, such Effective Time shall have occurred not
       later than 10:00 P.M., New York time, on the date of this Agreement or,
       if earlier, the time either Prospectus is printed and distributed to any
       Manager or U.S. Underwriter, or shall have occurred at such later date
       as shall have been consented to by CSFBL.  If the Effective Time of the
       Initial Registration Statement is prior to the execution and delivery of
       this Agreement, each of the Prospectuses shall have been filed with the
       Commission in accordance with the Rules and Regulations and Section 5(a)
       of this Agreement.  Prior to such Closing Date, no stop order suspending
       the effectiveness of a Registration Statement shall have been issued and
       no proceedings for that purpose shall have been instituted or, to the
       knowledge of the Company or the Managers, shall be contemplated by the
       Commission.

               (d)  Subsequent to the execution and delivery of this Agreement,
       there shall not have occurred (A) a change in U.S. or international
       financial, political or economic conditions or currency exchange rates
       or exchange controls as would, in the judgment of CSFBL, be likely


                                          11


<PAGE>

       to prejudice materially the success of the proposed issue, sale or
       distribution of the International Securities, whether in the primary
       market or in respect of dealings in the secondary market, or (B)(i) any
       change, or any development or event involving a prospective change, in
       the condition (financial or other), business, properties or results of
       operations of the Company or its subsidiaries which, in the judgment of
       CSFBL, is material and adverse and makes it impractical or inadvisable
       to proceed with completion of the public offering or the sale of and
       payment for the International Securities; (ii) any downgrading in the
       rating of any debt securities of the Company by any "nationally
       recognized statistical rating organization" (as defined for purposes of
       Rule 436(g) under the Act), or any public announcement that any such
       organization has under surveillance or review its rating of any debt
       securities of the Company (other than an announcement with positive
       implications of a possible upgrading, and no implication of a possible
       downgrading, of such rating); (iii) any suspension or limitation of
       trading in securities generally on the New York Stock Exchange, or any
       setting of minimum prices for trading on such exchange, or any
       suspension of trading of any securities of the Company on any exchange
       or in the over-the-counter market; (iv) any banking moratorium declared
       by U.S. Federal or New York authorities; or (v) any outbreak or
       escalation of major hostilities in which the United States is involved,
       any declaration of war by the United States Congress or any other
       substantial national or international calamity or emergency if, in the
       judgment of CSFBL, the effect of any such outbreak, escalation,
       declaration, calamity or emergency makes it impractical or inadvisable
       to proceed with completion of the public offering or the sale of and
       payment for the International Securities.

               (e)  The Managers shall have received an opinion, dated such
       Closing Date, of Sheppard, Mullin, Richter & Hampton LLP, counsel for
       the Company, to the effect set forth in Section 6(e) of the Underwriting
       Agreement.

               (f)  The Managers shall have received an opinion, dated such
       Closing Date, of Richard R. Molleur, Corporate Vice President and
       General Counsel of the Company, to the effect set forth in Section 6(f)
       of the Underwriting Agreement.

               (g)  The Managers shall have received from Latham & Watkins,
       counsel for the Managers, such opinion or opinions, dated such Closing
       Date, with respect to the incorporation of the Company, the validity of
       the Offered Securities delivered on such Closing Date, the Registration
       Statement, the Prospectuses and other related matters as the Managers
       may require, and the Company shall have furnished to such counsel such
       documents as they request for the purpose of enabling them to pass upon
       such matters. 

               (h)  The Managers shall have received a certificate, dated such
       Closing Date, of the President or any Vice President and a principal
       financial or accounting officer of the Company in which such officers,
       to the best of their knowledge after reasonable investigation, shall
       state that: the representations and warranties of the Company in this
       Agreement are true and correct; the Company has complied with all
       agreements and satisfied all conditions on its part to be performed or
       satisfied hereunder at or prior to such Closing Date; no stop order
       suspending the effectiveness of any Registration Statement has been
       issued and no proceedings for that purpose have been instituted or are
       contemplated by the Commission; and, subsequent to the respective dates
       of the most recent financial statements in the Prospectuses, there has
       been no material adverse change, nor any development or event involving
       a prospective material adverse change,


                                          12


<PAGE>

       in the condition (financial or other), business, properties or results
       of operations of the Company and its subsidiaries taken as a whole
       except as set forth in or contemplated by the Prospectuses or as
       described in such certificate.

               (i)  The Managers shall have received a letter, dated such
       Closing Date, of Deloitte & Touche LLP which meets the requirements of
       subsection (a) of this Section, except that the specified date referred
       to in such subsection will be a date not more than three days prior to
       such Closing Date for the purposes of this subsection.

               (j)  The Managers shall have received a letter, dated such
       Closing Date, of Price Waterhouse LLP which meets the requirements of
       subsection (b) of this Section, except that the specified date referred
       to in such subsection will be a date not more than three days prior to
       such Closing Date for the purposes of this subsection.

               (k)  On such Closing Date, the U.S. Underwriters shall have
       purchased the U.S. Firm Securities or the U.S. Optional Securities, as
       the case may be, pursuant to the Underwriting Agreement.

       The Company will furnish the Managers with such conformed copies of such
opinions, certificates, letters and documents as the Managers reasonably
request.  CSFBL may in its sole discretion waive on behalf of the Managers
compliance with any conditions to the obligations of the Managers hereunder,
whether in respect of an Optional Closing Date or otherwise.

       7.  INDEMNIFICATION AND CONTRIBUTION.  (a)  The Company will indemnify
and hold harmless each Manager against any losses, claims, damages or
liabilities, joint or several, to which such Manager may become subject, under
the Act or otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon any untrue statement
or alleged untrue statement of any material fact contained in any Registration
Statement, either of the Prospectuses, or any amendment or supplement thereto,
or any related preliminary prospectus, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, and
will reimburse each Manager for any legal or other expenses reasonably incurred
by such Manager in connection with investigating or defending any such loss,
claim, damage, liability or action as such expenses are incurred; provided,
however, that the Company will not be liable in any such case to the extent that
any such loss, claim, damage or liability arises out of or is based upon an
untrue statement or alleged untrue statement in or omission or alleged omission
from any of such documents in reliance upon and in conformity with written
information furnished to the Company by any Manager through CSFBL specifically
for use therein, it being understood and agreed that the only information
furnished by any Manager consists of the information described as such in
subsection (b) below.

       (b)  Each Manager will severally and not jointly indemnify and hold
harmless the Company against any losses, claims, damages or liabilities to which
the Company may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon any untrue statement or alleged untrue statement of any
material fact contained in any Registration Statement, either of the
Prospectuses, or any amendment or supplement thereto, or any related preliminary
prospectus, or arise out of or are based upon the omission or the alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein


                                          13


<PAGE>

not misleading, in each case to the extent, but only to the extent, that such 
untrue statement or alleged untrue statement or omission or alleged omission 
was made in reliance upon and in conformity with written information 
furnished to the Company by such Manager through CSFBL specifically for use 
therein, and will reimburse any legal or other expenses reasonably incurred 
by the Company in connection with investigating or defending any such loss, 
claim, damage, liability or action as such expenses are incurred, it being 
understood and agreed that the only such information furnished by any Manager 
consists of the following information in the International Prospectus 
furnished on behalf of each Manager: the last paragraph at the bottom of the 
cover page concerning the terms of the offering by the Managers, the legend 
concerning over-allotments and stabilizing on the inside front cover page and 
the concession and reallowance figures appearing in the fifth paragraph under 
the caption "Subscription and Sale." 

       (c)  Promptly after receipt by an indemnified party under this Section
of notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under
subsection (a) or (b) above, notify the indemnifying party of the commencement
thereof; but the omission so to notify the indemnifying party will not relieve
it from any liability which it may have to any indemnified party otherwise than
under subsection (a) or (b) above.  In case any such action is brought against
any indemnified party and it notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate therein and, to
the extent that it may wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel satisfactory to such
indemnified party (who shall not, except with the consent of the indemnified
party, be counsel to the indemnifying party), and after notice from the
indemnifying party to such indemnified party of its election so to assume the
defense thereof, the indemnifying party will not be liable to such indemnified
party under this Section for any legal or other expenses subsequently incurred
by such indemnified party in connection with the defense thereof other than
reasonable costs of investigation.  No indemnifying party shall, without the
prior written consent of the indemnified party, effect any settlement of any
pending or threatened action in respect of which any indemnified party is or
could have been a party and indemnity could have been sought hereunder by such
indemnified party unless such settlement includes an unconditional release of
such indemnified party from all liability on any claims that are the subject
matter of such action.

       (d)  If the indemnification provided for in this Section is unavailable
or insufficient to hold harmless an indemnified party under subsection (a) or
(b) above, then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of the losses, claims, damages or
liabilities referred to in subsection (a) or (b) above (i) in such proportion as
is appropriate to reflect the relative benefits received by the Company on the
one hand and the Managers on the other from the offering of the International
Securities or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the relative
fault of the Company on the one hand and the Managers on the other in connection
with the statements or omissions which resulted in such losses, claims, damages
or liabilities as well as any other relevant equitable considerations.  The
relative benefits received by the Company on the one hand and the Managers on
the other shall be deemed to be in the same proportion as the total net proceeds
from the offering of the International Securities (before deducting expenses)
received by the Company bear to the total underwriting discounts and commissions
received by the Managers.  The relative fault shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company or the Managers and the parties'


                                          14


<PAGE>

relative intent, knowledge, access to information and opportunity to correct or
prevent such untrue statement or omission.  The amount paid by an indemnified
party as a result of the losses, claims, damages or liabilities referred to in
the first sentence of this subsection (d) shall be deemed to include any legal
or other expenses reasonably incurred by such indemnified party in connection
with investigating or defending any action or claim which is the subject of this
subsection (d).  Notwithstanding the provisions of this subsection (d), no
Manager shall be required to contribute any amount in excess of the amount by
which the total price at which the International Securities underwritten by it
and distributed to the public were offered to the public exceeds the amount of
any damages which such Manager has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission.  No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.  The Managers' obligations in this
subsection (d) to contribute are several in proportion to their respective
underwriting obligations and not joint.

       (e)  The obligations of the Company under this Section shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls any
Manager within the meaning of the Act or the Exchange Act; and the obligations
of the Managers under this Section shall be in addition to any liability which
the respective Managers may otherwise have and shall extend, upon the same terms
and conditions, to each director of the Company, to each officer of the Company
who has signed a Registration Statement and to each person, if any, who controls
the Company within the meaning of the Act or the Exchange Act.

       8.  DEFAULT OF MANAGERS.  If any Manager or Managers default in their
obligations to purchase International Securities hereunder on either the First
or any Optional Closing Date and the aggregate number of shares of International
Securities that such defaulting Manager or Managers agreed but failed to
purchase does not exceed 10% of the total number of shares of International
Securities that the Managers are obligated to purchase on such Closing Date,
CSFBL may make arrangements satisfactory to the Company for the purchase of such
International Securities by other persons, including any of the Managers, but if
no such arrangements are made by such Closing Date the non-defaulting Managers
shall be obligated severally, in proportion to their respective commitments
hereunder, to purchase the International Securities that such defaulting
Managers agreed but failed to purchase on such Closing Date.  If any Manager or
Managers so default and the aggregate number of shares of International
Securities with respect to which such default or defaults occur exceeds 10% of
the total number of shares of International Securities that the Managers are
obligated to purchase on such Closing Date and arrangements satisfactory to
CSFBL and the Company for the purchase of such International Securities by other
persons are not made within 36 hours after such default, this Agreement will
terminate without liability on the part of any non-defaulting Manager or the
Company, except as provided in Section 9 (provided that if such default occurs
with respect to International Optional Securities after the First Closing Date,
this Agreement will not terminate as to the International Firm Securities or any
International Optional Securities purchased prior to such termination).  As used
in this Agreement, the term "Manager" includes any person substituted for a
Manager under this Section.  Nothing herein will relieve a defaulting Manager
from liability for its default.

       9.  SURVIVAL OF CERTAIN REPRESENTATIONS AND OBLIGATIONS.  The respective
indemnities, agreements, representations, warranties and other statements of the
Company or its officers and of the several Managers set forth in or made
pursuant to this Agreement will remain in full force and effect, regardless of
any investigation, or statement as to the results thereof, made by or on behalf
of any


                                          15


<PAGE>

Manager, the Company or any of their respective representatives, officers or
directors or any controlling person, and will survive delivery of and payment
for the International Securities.  If this Agreement is terminated pursuant to
Section 8 or if for any reason the purchase of the International Securities by
the Managers is not consummated, the Company shall remain responsible for the
expenses to be paid or reimbursed by it pursuant to Section 5 and the respective
obligations of the Company and the Managers pursuant to Section 7 shall remain
in effect and if any International Securities have been purchased hereunder the
representations and warranties in Section 2 and all obligations under Section 5
shall also remain in effect.  If the purchase of the International Securities by
the Managers is not consummated for any reason other than solely because of the
termination of this Agreement pursuant to Section 8 or the occurrence of any
event specified in Section 6(d)(A) or clause (iii), (iv), or (v) of Section
6(d)(B), the Company will reimburse the Managers for all out-of-pocket expenses
(including fees and disbursements of counsel) reasonably incurred by them in
connection with the offering of the International Securities.

       10.  NOTICES.  All communications hereunder will be in writing and, if
sent to the Managers, will be mailed, delivered, telexed or transmitted by
facsimile and confirmed to CSFBL at One Cabot Square, London E14 4QJ England,
Attention:  Company Secretary (telex 892181 CSFBC, facsimile (011 44 171 516
1300), or, if sent to the Company, will be mailed, delivered, telegraphed or
transmitted by facsimile and confirmed to it at Northrop Grumman Corporation,
1840 Century Park East, Los Angeles, CA  90067, Attention:  Albert F. Myers,
Corporate Vice President and Treasurer; provided, however, that any notice to a
Manager pursuant to Section 7 will be mailed, delivered, telexed or transmitted
by facsimile and confirmed to such Manager.

       11.  SUCCESSORS.  This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the officers
and directors and controlling persons referred to in Section 7, and no other
person will have any right or obligation hereunder.

       12.  REPRESENTATION OF MANAGERS.  CSFBL will act for the several
Managers in connection with this financing, and any action under this Agreement
taken by CSFBL will be binding upon all the Managers.

       13.  COUNTERPARTS.  This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.

       14.  APPLICABLE LAW.  THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAWS.

       The Company hereby submits to the non-exclusive jurisdiction of the
Federal and state courts in the Borough of Manhattan in The City of New York in
any suit or proceeding arising out of or relating to this Agreement or the
transactions contemplated hereby. 


                                          16


<PAGE>

       If the foregoing is in accordance with the Managers' understanding of
our agreement, kindly sign and return to the Company one of the counterparts
hereof, whereupon it will become a binding agreement between the Company and the
several Managers in accordance with its terms.

                                  Very truly yours,

                                  NORTHROP GRUMMAN CORPORATION


                                  By...................................
                                     NAME:  JAMES L. SANFORD
                                     TITLE:  ASSISTANT TREASURER

The foregoing Subscription Agreement is hereby confirmed and accepted as of the
       date first above written.


    CS FIRST BOSTON LIMITED


    BY:...................................
       NAME:
       TITLE:

    MERRILL LYNCH INTERNATIONAL
    SALOMON BROTHERS INTERNATIONAL LIMITED



    EACH BY ITS DULY AUTHORIZED ATTORNEY-IN-FACT:



    ...................................
    NAME:
    TITLE:  ATTORNEY-IN-FACT


<PAGE>

                                      SCHEDULE A



                                                            Number of 
                          Manager                  International Firm Securities
                          -------                  -----------------------------

CS FIRST BOSTON CORPORATION ......................

MERRILL LYNCH INTERNATIONAL ......................

SALOMON BROTHERS INTERNATIONAL LIMITED ...........

[Other Managers]                                   -----------------------------

TOTAL ............................................
                                                   -----------------------------
                                                   -----------------------------


<PAGE>

                                      SCHEDULE B

                           LIST OF SIGNIFICANT SUBSIDIARIES


1.     Grumman Corporation, a New York corporation.





<PAGE>
                                                                    EXHIBIT 23.1
                         INDEPENDENT AUDITORS' CONSENT
 
We  consent  to  the incorporation  by  reference  in this  Amendment  No.  1 to
Registration Statement  No.  333-02453  of  Northrop  Grumman  Corporation  (the
"Company") on Form S-3 and in Registration Statement No. 33-55143 of the Company
on Form S-3 of our report dated February 7, 1996, appearing in the Annual Report
on  Form 10-K of  the Company for  the year ended  December 31, 1995  and to the
reference to us under the heading "Experts" in the Prospectus, which is part  of
this Registration Statement.
 
DELOITTE & TOUCHE LLP
 
Deloitte & Touche LLP
Los Angeles, California
May 16, 1996