<PAGE>   1
                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-K

(Mark One)

[ X ] Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange
      Act of 1934.

                    FOR THE FISCAL YEAR ENDED MARCH 31, 1997
                                       or

[ ]   Transition Report Pursuant to Section 13 or 15(d) of the Securities 
      Exchange Act of 1934.
 
          For the transition period from ____________ to____________.

                       Commission File Number ( 0-21767 )

                                  VIASAT, INC.
             (Exact name of registrant as specified in its charter)

      DELAWARE                                                   33-0174996
(State or other jurisdiction of                               (I.R.S. Employer
incorporation or organization)                               Identification No.)


                  2290 COSMOS COURT, CARLSBAD, CALIFORNIA 92009
                                 (760) 438-8099
    (Address, including zip code, and telephone number, including area code,
                        of principal executive offices)

           Securities registered pursuant to Section 12(b) of the Act:
                                      NONE

           Securities registered pursuant to Section 12(g) of the Act:
                         COMMON STOCK, $.0001 PAR VALUE

         Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X   No
                                             ---    ---
 
        Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [ ]

         The aggregate market value of the voting stock held by non-affiliates
of the registrant, as of June 16, 1997 was approximately $59,409,099 (based on
the closing price for shares of the registrant's Common Stock as reported by the
Nasdaq National Market for the last trading day prior to that date). Shares of
Common Stock held by each officer, director and holder of 5% or more of the
outstanding Common Stock have been excluded in that such persons may be deemed
affiliates. This determination of affiliate status is not necessarily a
conclusive determination for other purposes

The number of shares outstanding of the registrant's Common Stock,
$.0001 par value, as of June 16, 1997 was 7,745,041.



<PAGE>   2


                       DOCUMENTS INCORPORATED BY REFERENCE


      Portions of the registrant's definitive Proxy Statement to be filed with
the Securities and Exchange Commission pursuant to Regulation 14A in connection
with the 1997 Annual Meeting are incorporated herein by reference into Part III
of this Report. Such Proxy Statement will be filed with the Securities and
Exchange Commission not later than 120 days after the registrant's fiscal year
ended March 31, 1997.

      Certain Exhibits filed with the registrant's Registration Statement on
Form S-1 (File No. 333-13183), as amended, are incorporated by reference into

Part IV of this Report.



<PAGE>   3
                                  VIASAT, INC.

                                    FORM 10-K

                    FOR THE FISCAL YEAR ENDED MARCH 31, 1997

                                      INDEX


<TABLE>
<CAPTION>
PART I                                                                                               Page
                                                                                                     ----
<S> <C>           <C>                                                                                 <C>
    Item 1.       Business                                                                            1
    Item 2.       Properties                                                                          28
    Item 3.       Legal Proceedings                                                                   28
    Item 4.       Submission of Matters to a Vote of Security Holders                                 28

PART II
    Item 5.       Market for the Registrants Common Stock and Related  Stockholder Matters            29
    Item 6.       Selected Financial Data                                                             30
    Item 7.       Management's Discussion and Analysis of Financial Condition and Results of
                  Operations                                                                          31
    Item 8.       Financial Statements                                                                35
    Item 9.       Changes in and Disagreements with Accountants on Accounting and Financial
                  Disclosures                                                                         35
PART III
    Item 10.      Directors and Executive Officers of the Registrant                                  36
    Item 11.      Executive Compensation                                                              36
    Item 12.      Security Ownership of Certain Beneficial Owners and Management                      36
    Item 13.      Certain Relationships and Related Transactions                                      36

PART IV
    Item 14.      Exhibits, Financial Statements Schedules and Reports on Form 8-K                    37
    Glossary of Selected Terms                                                                        40
    Signatures                                                                                        42
</TABLE>




<PAGE>   4

                                     PART I


ITEM 1. BUSINESS

         Except for the historical information contained herein, the following
discussion contains forward-looking statements that involve risks and
uncertainties. ViaSat, Inc. ("ViaSat" or the "Company") future results could
differ materially from those discussed herein. Factors that could cause or
contribute to such differences include, but are not specifically limited to,
timely product development, variation of royalty, license and other revenues,
failure to satisfy performance obligations, uncertainty regarding the Company's
patents and property rights (including the risk that the Company may be forced
to engage in costly litigation to protect such patents and rights and the
material adverse consequences to the Company if there were unfavorable outcome
of any such litigation), difficulties in obtaining components needed for the
production of wireless equipment and changes in economic conditions of various
markets the Company serves, as well as the other risks detailed in this section,
in particular under the heading Risk Factors. See "Glossary of Selected Terms"
for definitions of certain terms used in this Report.

INTRODUCTION

      ViaSat designs, produces and markets advanced digital satellite
telecommunications and wireless signal processing equipment. The Company has
achieved eleven consecutive years of internally generated revenue growth and ten
consecutive years of profitability, primarily through defense-related
applications. More recently, the Company has been developing and marketing its
technology through strategic alliances for emerging commercial markets, such as
rural telephony, alternative carrier access and Internet/Intranet access by
satellite to multiple servers. ViaSat is a leading provider of Demand Assigned
Multiple Access ("DAMA") technology, which allows a large number of Very Small
Aperture Terminal ("VSAT") subscribers to economically share common satellite
transponders for high-performance voice, fax or data communications.

      The Company believes that DAMA satellite technology is superior to other
existing VSAT networking technologies for many important applications. The
existing Time Division Multiplex/Time Division Multiple Access ("TDM/TDMA")
networking technology features a "hub and spoke" architecture which requires all
transmissions to be routed through a central terrestrial hub. Unlike TDM/TDMA
systems, DAMA provides direct, on-demand switched networking capabilities which
do not require a terrestrial hub and allow faster and more efficient use of
expensive satellite transponder resources. In addition, the Company believes
that its DAMA products, commercially marketed under the tradename StarWire(TM),
offer greater network flexibility and permit up to 50% greater satellite
capacity than competing DAMA systems. See "-- The ViaSat Advantage" and "--
Technology."

      ViaSat's DAMA products include satellite modems, networking processors and
network control systems for managing large numbers of network subscribers. The
Company's DAMA technology consists of proprietary real-time firmware and
software designed to run on industry-standard digital signal processors. The
Company also has developed DAMA network control software that operates on
IBM-compatible personal computers running Windows NT(TM) operating systems. The
Company's DAMA technology operates on satellites in the military UHF and SHF
frequency bands, and commercial C and Ku bands. In addition to DAMA products,
the Company offers network information security products, communications
simulation and test equipment, and spread spectrum digital radios for satellite
and terrestrial data networks.

RECENT DEVELOPMENTS

      During the past year the Company has continued to demonstrate its
leadership in DAMA satellite networking. Communications products for the U.S.
Department of Defense and its prime contractors (collectively, the "DOD")
continue to lead the Company's growth, as they have for 11 years. In addition,
StarWire(TM) commercial network installations have reached India, Indonesia,
several locations in the Caribbean and Central America, Colombia, Hong Kong,
Brunei, Thailand, Bosnia, and Nigeria. Some specific highlights follow:



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      -  Installation, certification and commissioning of the DOD's 5 kHz DAMA
         network controllers at Norfolk and Hawaii is complete, with
         installations in Guam and Naples, Italy continuing in fiscal 1998.

      -  The EMUT UHF DAMA modem module received important government
         certifications. More than 2,000 of these units have been delivered, and
         the Company received a $20.9 million follow on order for additional
         units, moving it into a dominant position in the government DAMA
         equipment market.

      -  The Company won a $20 million, 3-year contract for two Joint
         Communication Simulators.

      -  Hutchison Telecommunications' first equipment installations are
         operational, with a network control site in Hong Kong and the first
         network traffic terminal in Brunei. Two more traffic sites in Kuala
         Lumpur, Malaysia and Pakistan, and a backup network control station in
         Singapore are due to be installed in the summer of 1997. This
         application offers cost-effective long distance telephone access across
         Asia via single-hop thin-route connections among public network
         carriers.

      -  StarWire(TM) distributor SCSI has inaugurated a network serving the
         International Civil Aviation Organization (ICAO), an agency of the
         United Nations that is responsible for worldwide air traffic control.
         This network is using StarWire(TM) terminals to establish voice, data,
         and radar communications among air traffic control sites in the
         Caribbean and Central America.

      -  In May 1997 the Company and Nortel ("Northern Telecom") signed a
         teaming agreement to jointly pursue fixed site and direct-to-home rural
         satellite telephony network opportunities, initially in the
         Asia-Pacific region. Nortel will contribute to this effort its
         considerable expertise in design and deployment of large-scale digital
         wireless and wireline networks. ViaSat will provide its advanced DAMA
         satellite networking technology.

INDUSTRY BACKGROUND

      A broad array of new consumer, business and government markets, as well as
the development of new technologies, have driven the significant expansion of
the wireless communications industry. In addition to common consumer
applications such as paging, cellular telephony and new Personal Communications
Services ("PCS"), there is a wide range of other specialized terrestrial- and
space-based wireless applications. Such wireless applications include government
fixed and mobile wireless networking and commercial fixed-site, switched
satellite services, ViaSat's principal lines of business. The growth in
software-intensive wireless equipment markets stems from, among other things,
increasing dependence on voice and data networks of all types, regulatory
reform, advances in technology, decreasing costs of equipment and services,
economic growth in developing nations, the increasing importance of
communications infrastructure as a catalyst of economic growth, and increasing
user acceptance of and confidence in wireless solutions. This growth in wireless
equipment markets corresponds to a transition away from mere point to point
radio links connecting remote or mobile users towards offering more
comprehensive wireless network services. Market demands for wireless services
are being addressed by both terrestrial- and satellite-based systems.

      GOVERNMENT APPLICATIONS. Historically, the military has driven development
of many new wireless technologies -- pioneering applications of satellite
communications, digital radios, spread spectrum and mobile wireless networks to
connect widely dispersed operations. In many cases these technologies have been
extended and increased in scale for broader non-defense use. Defense
applications of wireless technologies also have evolved over the same time
period. The break-up of the Soviet Union has caused a de-emphasis on strategic
missions and a shift towards more localized tactical roles such as
peace-keeping, counter-terrorism, counter-insurgency and drug enforcement. These
missions create new demands for rapidly deployable, mobile connectivity. Overall
reductions in the defense budget have led to a numerically smaller, more
technologically-advanced force structure. As a result, defense networks
increasingly build 




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around real-time transmission of digital tactical data. Defense systems also are
adopting and extending low cost commercial technologies to meet their needs.

      There has been a constantly shifting flow of technology between government
and commercial network applications. Both government and commercial users
developed fixed-site, long-haul applications. The government pioneered mobile
satellite terminals, as well as non-geosynchronous, high power and extremely
high frequency satellites. Commercial users adopted elements of these
technologies for Low Earth Orbit ("LEO") mobile telephony and high-powered
Direct Broadcast Satellite ("DBS") television systems. Now government agencies
are planning to integrate these technologies into still more advanced military
networks. Often, companies with both government and commercial expertise have
facilitated such technology transitions.

      COMMERCIAL APPLICATIONS. The recent worldwide trend toward privatization
of public telephone operators and deregulation of local telephone ("local loop")
services has resulted in increased competition in the delivery of telephone
services from alternative access providers. Many of these new access providers,
such as long-distance telephone carriers, must install or upgrade infrastructure
to support basic and enhanced services. In addition, worldwide demand for basic
telephone service has grown, especially in developing countries. As new
infrastructure is established to deliver local telephone service, the technology
exists to provide cost-effective, satellite-based wireless transmission systems,
instead of a traditional wired approach, to connect subscribers to the public
telephone network.

      A growing segment of the wireless communications industry involves VSATs,
which are communications systems utilizing fixed-site satellite terminals.
Historically, these systems were primarily designed for certain specific data
applications. But recent improvements in VSAT technology for satellite-based
wireless voice and data networks have led to their increasing use in a variety
of broader, higher system throughput commercial applications such as mobile and
rural telephony and more complicated data transmissions. Satellite telephony
systems are being utilized by developing countries that lack a terrestrial-based
telecommunication infrastructure, and which seek to provide telephone service
for large areas fairly rapidly and on a cost-effective basis. Additionally, even
where terrestrial systems exist, satellite systems are used to fill in coverage
for remote areas.

      EVOLUTION OF VSAT TECHNOLOGY. The commercial VSAT business began with U.S.
customers who operated large, sophisticated private terrestrial networks using
TDM/TDMA technology. Customers such as chain retailers, hotels and auto dealers
operated private data networks with hundreds or thousands of sites and a high
flow of transactions from remote terminals to host mainframe computers for
credit card validations, point-of-sale data collection, reservations or similar
applications. Customers who used VSATs for data networking still relied on
terrestrial providers for telephone service and possibly other telecommunication
needs for their sites. Sales of such VSAT systems are often quite sensitive to
prices from telephone carriers for equivalent packet transaction services. Users
with large networks generally are the only ones who can justify the significant
one-time cost of a VSAT network management hub.

      TDM/TDMA technology, while more established than DAMA technology, features
a "hub and spoke" architecture which requires all transmissions to be routed
through a central hub and is most useful for remote to mainframe network
connections. Remote-to-remote TDM/TDMA connections require two satellite hops.
DAMA is better suited for remote-to-remote connections than TDM/TDMA because the
voice quality is better and DAMA networks use expensive satellite transponders
more efficiently. DAMA satellite technology allows individual subscribers to
request links on demand directly to any other subscriber with a single satellite
hop. DAMA allows users to make exactly the connections needed, lasting only for
the duration of a voice call, fax, electronic mail or digital file transfer.
DAMA technology has been under development for many years by the DOD to serve
large networks of fixed and mobile subscribers sharing a limited amount of
satellite capacity, but is only recently being deployed in significant
quantities by the DOD.

      The Company believes the opportunities for government and commercial
ground station equipment sales are increasing. The government is planning over
$1.0 billion in total UHF space segment expenditures for tactical
communications. DAMA is applicable to several different satellite bands,
including government 




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UHF and SHF and commercial C, Ku and Ka bands. DAMA is also being used by
commercial customers who believe that it is better suited for their applications
than the earlier VSAT technologies.

THE VIASAT ADVANTAGE

      In light of the limitations of the TDM/TDMA architecture, and the
magnitude of the potential market for primary telecommunications services
compared to the more limited market for data transaction services, ViaSat
believes that DAMA networks will better serve the emerging international market
for VSAT, voice and data services. Virtually all of the VSAT equipment makers
are now adding DAMA products to their line of products. This represents a
discontinuity in the VSAT market. VSAT vendors are now developing new
transmission waveforms, multiple access techniques, DAMA protocols, DAMA control
software, subscriber terminals and interface protocols to support the targeted
applications (voice, fax, dial-up data, video conferencing or others), which
creates an opportunity for new equipment suppliers such as the Company.

      The Company believes that its DAMA-based products have technological
advantages over competing DAMA products in offering practical solutions for
telecommunications applications through several means:

FLEXIBILITY

      Since communications networks are evolving so quickly, a system such as
the Company's that can be easily extended and configured has a competitive
advantage.

      -   REAL-TIME DIGITAL SIGNAL PROCESSING FIRMWARE. The Company's
          technology involves extensive use of real-time digital signal
          processing firmware to implement both signal processing and DAMA
          networking protocol functions. This approach was developed and proven
          under several government programs, especially UHF DAMA. The Company
          believes that digital signal processing firmware offers great
          flexibility in adding new features, because it allows modification
          without more expensive hardware changes, and that product costs should
          decrease if prices of Texas Instruments digital signal processing
          chips and associated peripherals continue to decline. The Company's
          digital signal processing design allows common hardware to be applied
          to both government and commercial markets.

      -   WINDOWS NT(TM)-BASED NETWORK CONTROL. ViaSat believes that it is a
          leader in using an Intel PC/Windows NT(TM) computer platform for its
          network control system. Most vendors still use Unix platforms. ViaSat
          developed and proved Windows NT(TM) as a viable network control
          platform under government funded UHF and SHF DAMA programs. Windows
          NT(TM) has several advantages which the Company believes support its
          technical leadership position:

          -    True real-time multi-tasking, allowing many functions to be
               moved from specialized VSAT hardware into an industry-standard
               personal computer. Such functions can be developed more quickly
               and are more easily modified to support new communication
               applications and interfaces.

          -    Lower overall costs and faster time to market in terms of
               development hardware and software tools, a more readily available
               pool of experienced software engineers, lower recurring cost of
               network control computer platforms, less expensive networking and
               communications interfaces and lower operator training costs than
               Unix-based systems.

          -    DOD approved access-control is built directly into the
               network-controller computer operating system. This includes
               secure remote-access via many built-in communication paths. The
               Company believes computer security is essential technology for
               mission critical telecommunication tasks such as billing.



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      -   STANDARD VSAT PLATFORM. ViaSat believes that it is the only company
          building on a standard "open systems" VSAT platform for commercial and
          SHF DAMA products. Open systems enable mix and match of satellite
          equipment and baseband terrestrial interfaces on a circuit by circuit
          basis. The architecture supports third party interface cards for
          faster time to market for specialized terrestrial interfaces. While
          open systems architecture does not offer the lowest possible
          manufacturing cost for any single fixed terminal configuration, it is
          consistent with two other strategic objectives: (i) rapid time to
          market by building on industry standard third-party hardware and
          software and (ii) flexibility to support a broad array of services and
          applications consistent with the Company's target distribution
          channels of service providers.

      -    INTERNALLY-DEVELOPED TECHNOLOGY. Many competing VSAT providers are
           primarily systems integrators with little internally-developed
           technology, particularly in the software and firmware areas. The
           Company believes its extensive internal technology development
           capability gives it an advantage in flexibility, time-to-market and
           product quality.

CAPACITY

      ViaSat's narrow-spacing technology, developed during the course of its
government DAMA contracts, results in less unused bandwidth between voice
channels than other DAMA systems, and this, along with more precise power-usage
control software, allows ViaSat's DAMA products to achieve up to 50% greater
satellite capacity than competing DAMA systems.

CERTIFICATION

      ViaSat believes it is currently the only provider of DAMA products which
has received full certification from the U.S. government. The rigorous military
certification process may take up to several months to complete.

STRATEGY

      ViaSat's objective is to become a leading developer and supplier of
DAMA-based products to commercial markets and to retain a leadership position in
developing and supplying DAMA-based products to the government market. The
Company's strategy incorporates the following key elements:

      MAINTAIN AND ENHANCE TECHNOLOGY LEADERSHIP POSITION. The Company's
strategy is to maintain and enhance its leadership position in DAMA-based
satellite technology by continuing its participation in selected DOD programs
involving networking technology and other related real-time signal processing
and networking software. The Company is also investing in proprietary research
for commercial applications. The Company's objective is to continue to offer
high-performance, software-oriented products which provide the most effective
use of satellite power and bandwidth as well as offering the most flexible
platform for continued growth.

      LEVERAGE TECHNOLOGICAL EXPERTISE INTO COMMERCIAL MARKETS. The Company's
strategy is to continue using its technological expertise developed in defense
applications to develop and market products to respond to the increasing demand
for DAMA-based VSAT solutions for commercial voice and data applications. The
Company is targeting commercial markets which it believes will offer high growth
potential and where it believes ViaSat's technology will have competitive
advantages, such as rural telephony, alternative carrier access and
Internet/Intranet access by satellite to multiple servers. The Company believes
its products are competitive largely because of their technological advantages
over competing products. The Company's strategy is to capitalize on these
technological advantages by utilizing a "cost of ownership" marketing approach
that emphasizes the overall lower cost to customers over the operating life of
the Company's products because of the products' adaptability and more efficient
use of limited satellite capacity.

      DEVELOP BROAD BASE OF INNOVATIVE PROPRIETARY PRODUCTS. The Company's
strategy is to continue to develop and market to both defense and commercial
customers a broad variety of signal processing and 




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networking software products. The Company has over 150 research engineers on
staff and emphasizes offering technologically-superior products. The Company
generally retains certain proprietary rights from the government-funded research
and development of its defense products and is also devoting a significant
amount of its own resources to independent product development.

      DEVELOP STRATEGIC ALLIANCES. The Company's strategy is to develop
strategic alliances with leading prime defense contractors and major
international telecommunications companies and equipment suppliers. The Company
targets those companies whose financial and technological resources and
established customer bases allow them to jointly introduce new technologies and
penetrate new markets sooner and at a lower cost than the Company could alone.
The Company has entered into strategic alliances with defense companies, such as
Hughes Defense Communications, formerly Magnavox Electronic Systems Co. ("Hughes
Defense Communications") and Lockheed Martin Corporation ("Lockheed Martin"),
and commercial telecommunications companies, such as Hutchison Corporate Access
(HK) Limited ("Hutchison Telecommunications"), HCL Comnet Systems and Services
Limited ("HCL Comnet"), and Northern Telecom.

      ESTABLISH GLOBAL PRESENCE. The Company's strategy is to develop its
products so that they may be marketed and used throughout the world. The Company
is a market leader in DAMA-based defense products for the United States and its
allies. The Company believes that the commercial market opportunities for the
Company's products are greater internationally. The Company believes its focus
on meeting applicable international communication standards and establishing key
international strategic alliances will enable it to effectively penetrate
foreign markets.

      ADDRESS RURAL TELEPHONY MARKET. The Company believes there is a
substantial unmet demand for rural telephony services, especially in developing
countries. The Company's strategy is to capitalize on its networking software
expertise to develop technology for establishing regional rural telephony
network infrastructures of strategically located VSAT terminals capable of
handling multiple satellite telephone calls ("Point-of-Entry Terminals"). The
Company believes such an infrastructure would have a competitive advantage over
a single Point-of-Entry system by minimizing the ground transmission cost of
each satellite telephone call by permitting such calls to enter the Public
Switched Telephone Network (PSTN) through the Point-of-Entry Terminal closest to
the call's destination. The Company's strategy also includes seeking
partnerships with regional and local service providers to create distribution
channels for rural telephony infrastructures and to provide related retail
distribution services, including sales of Company-designed subscriber terminals,
installation and maintenance, as well as customer service, billing and revenue
collection. To this end, the Company has entered into a contract with Hutchison
Telecommunications for satellite telephony equipment which can serve as rural
telephony infrastructure.

TECHNOLOGY

      The Company's VSAT technology is focused on DAMA which allows individual
subscribers to request links on demand to any other subscriber through one
satellite hop. TDM/TDMA technology, while more established than DAMA technology,
features a "hub and spoke" architecture which requires all transmissions to be
routed through a central hub and is most useful for remote to mainframe network
connections. Remote-to-remote TDM/TDMA connections require two satellite hops.
DAMA is better suited for remote-to-remote connections than TDM/TDMA because the
voice quality is better and DAMA networks use expensive satellite transponders
more efficiently.

      DAMA technology has been under development for many years by the DOD, but
is only recently being deployed in significant quantities. DAMA is applicable to
several different satellite bands, including government UHF and SHF and
commercial C, Ku and Ka bands. A major objective for the DOD is to improve
capacity of extremely expensive government-owned satellite transponders. The
government expects DAMA to increase capacity for UHF tactical users by as much
as a factor of ten, depending on the application and traffic usage, compared to
dedicated non-DAMA links.

      A DAMA system consists of (i) a set of subscribers with DAMA-capable
terminals, (ii) a network management terminal which orchestrates access to a
shared satellite resource, and (iii) satellite transponder 




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capacity managed by the network controller and shared by subscribers. DAMA
subscribers use networking protocols to interact with the controller and each
other. The essence of DAMA is that the network controller allocates a shared
satellite resource to a particular combination of subscribers only when they
request it, and then terminates the connection when they are finished.

      DAMA protocols may be either "open" or "proprietary." Open standards are
published so that multiple manufacturers can develop equipment that works
together. The DOD has designated two different open DAMA standards defining
over-the-air interfaces for narrowband UHF satellite communications channels.
MIL-STD 188-182 defines an interoperable waveform for channels with 5 kHz
bandwidth, and MIL-STD 188-183 defines the 25 kHz channel waveform. The DOD is
currently defining open standards for SHF channels and for government DAMA use
of commercial C and Ku band transponders. There are no widely accepted
commercial open DAMA standards, and no open standards have evolved for TDM/TDMA
VSATs.

      DAMA VS. TDM/TDMA.  DAMA is being sought by customers who see that it is 
a better fit than TDM/TDMA VSATs for non-transaction applications such as voice
and fax. The principal limitations of TDM/TDMA for non-transaction applications
are:

      CAPACITY LIMITATIONS AND COSTS

      -   The TDM/TDMA hub and spoke architecture is primarily designed for
          rapid service for sporadic, short, burst transactions between a remote
          site and a mainframe computer. The hubs typically only support a
          maximum instantaneous aggregate data rate of 256 kbps to approximately
          1 Mbps divided among the entire subscriber population (often several
          thousand terminals). This is a severe bottleneck for sustained
          circuit-type services like telephony, fax or peer-to-peer file
          transfers, which often dominate when the VSAT becomes the primary
          communication means for a site, as in telephony uses. In contrast, a
          comparable DAMA system has a much higher aggregate capacity. For small
          networks the TDM/TDMA hub performance is not a capacity bottleneck,
          but the typical hub price of approximately $1.0 million, amortized
          over a small number of subscribers, is usually prohibitively
          expensive. The equipment cost for a comparable DAMA system for voice
          use, in contrast, would be significantly less.

      TRANSMISSION TIME

      -   The hub and spoke architecture requires all calls (voice or data)
          between two remote nodes to be routed through the hub. This causes
          each call to traverse two separate satellite hops in each direction
          (remote A-to-satellite-to-hub and then hub-to-satellite-to-remote B,
          with the return path from remote B to remote A also traversing two
          satellite hops). The additional time delay due to the extra satellite
          hops is striking for voice communications and is unacceptable to many
          users. Plus, the two satellite hops consume more expensive transponder
          resources per call than a single hop DAMA connection.

      DAMA VS. DEDICATED SCPC. In contrast to DAMA, which allows individual
subscribers to request links to other subscribers on demand, dedicated Single
Channel Per Carrier ("SCPC")-based systems maintain dedicated, unswitched links
between subscribers, such as for long distance trunk lines. Dedicated links
provide high quality transmissions, but only between particular subscriber sets.
In order to provide connections among many sites, a SCPC-based system would
require a dedicated link between each subscriber and each other subscriber,
which would be prohibitively expensive. As a result, DAMA is a much more
attractive solution for managing large numbers of network subscribers, as DAMA
provides transmissions of equally high quality, without restricting the
subscribers' ability to establish links on demand to any other subscriber.

      MOBILE SATELLITE VS. FIXED-SITE DAMA. The obvious advantage of commercial
mobile satellite systems, such as Iridium(TM) and GlobalStar(TM), is that they
allow subscribers to be mobile. A mobile satellite terminal can be used by
either a mobile or a fixed subscriber, while a fixed terminal cannot be used by
a mobile subscriber. However, in order to gain mobility, mobile terminals employ
an omni-directional 




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antenna which operates at lower frequencies and provides less bandwidth than is
available in the fixed-site DAMA satellite bands. Less bandwidth corresponds to
less capacity and fewer voice circuits. Also, mobile satellite systems typically
require a greater investment in unique space-based satellite resources than
fixed-site DAMA systems which use existing capacity on general purpose
communication satellites. The combination of lower capacity plus higher capital
investments means that mobile service providers are projecting per-minute
service costs that are five to ten times higher than that possible through
fixed-site DAMA-based systems. Therefore, the Company believes that customers
who require satellite telephony services at fixed locations will find fixed-site
DAMA services to be much more economical than using mobile satellite phones --
even if they already own mobile satellite phones for mobile use.

      NON-DAMA TECHNOLOGY. The Company offers products outside of DAMA and
satellite communications that benefit from the Company's wireless networking
software and related technology. Important non-DAMA applications include:

      -   Spread spectrum digital radios for real-time tactical data networks
          among ground and airborne users. The JTIDS (Joint Tactical Information
          Distribution System) radio builds on the Company's software, firmware
          and hardware technology. The government is investing in "digitized
          battlefield" communications in an effort to obtain greater
          effectiveness from expensive tactical aircraft.

      -   Information security modules that encrypt classified information that
          can be broadcasted and routed across unclassified wired or wireless
          networks. This technology allows the government to make better use of
          commercial networks for securely transmitting classified information.

      -   Equipment that tests wireless receivers in the presence of complex,
          simulated radio wave environments. This technology allows the
          government to thoroughly test sophisticated airborne radio equipment
          without expensive flight exercises.

GOVERNMENT MARKETS, PRODUCTS AND CUSTOMERS

      GOVERNMENT MARKETS. The Company believes it has an opportunity to build on
its government DAMA technology, software, hardware design and manufacturing base
to capture significant revenues in the government markets.

      UHF DAMA MARKETS. The Company is considered a leader in the UHF DAMA
market. The Company believes its DAMA manpack subcontract is the largest
outstanding DAMA contract in terms of quantity of units sold. The Company also
believes that it was the first to develop and market a stand-alone airborne DAMA
modem. The DOD requires all UHF satellite communications terminals to meet open
DAMA standards. This mandate has helped stimulate the UHF DAMA market. ViaSat is
active in the following business segments:

      -       UHF DAMA NETWORK CONTROL INFRASTRUCTURE. Viasat has several
              contracts with the U.S. Air Force for development, production,
              installation and support for four global network control system
              sites. Each site serves as a primary controller for seven channels
              and as an alternate for seven channels. Each satellite has 38
              channels, offering a potential market for additional production,
              installation and support services.

      -       MANPACK TERMINALS. ViaSat has a contract with Hughes Defense
              Communications for over 7,000 DAMA modems for manpacks. The
              contract has options which allows Hughes Defense Communications,
              in its discretion, to purchase up to an additional 4,000 of such
              modems. As of March 31, 1997, the funded contract value was $37.7
              million, of which $14.2 million had been delivered.



                                       8

<PAGE>   12

      -       AIRBORNE DAMA TERMINALS. The 5 kHz channel DAMA protocols were
              designed to support U.S. Air Force aircraft. The U.S. Navy is also
              a major user of airborne UHF terminals. ViaSat equipment has been
              designed into a number of platforms, including P-3, S-3, Air Force
              One, EP-3, ES-3, Tomahawk cruise missiles and others.

      -       INTERNATIONAL UHF DAMA MARKET. Cooperative efforts among multiple
              nations, such as in the Gulf War and Bosnia, require that allies
              have a standard communications platform. There are requirements
              for some units of NATO and other allies to have UHF DAMA capable
              satellite terminals.

      The Company's strategy includes actively working to expand the UHF DAMA
market as a whole, while sustaining its leading market share. Increasing the
market means extending UHF satellite communications capability to new users. UHF
satellite communications access and market size is limited in the following
ways:

      -       AVAILABILITY OF SATELLITE CAPACITY. Without DAMA, many users are
              denied access because higher priorities consume all channels. DAMA
              expands capacity. The Company anticipates increases in the UHF
              market, versus pre-DAMA levels, over the next seven years due to
              pent-up demand for service.

      -       EQUIPMENT SIZE AND WEIGHT. Most users are mobile and thus size
              and weight sensitive. They carry equipment in back-packs, or
              airframes where communication gear displaces weapons or mission
              critical payloads. Easier to carry, smaller, lighter equipment may
              expand the market beyond a core group who require DAMA to complete
              their mission.

      -       EQUIPMENT PRICE. The Company believes that the UHF DAMA market
              can expand by reducing the price of DAMA equipment. Embedded DAMA
              radios are less expensive than stand-alone models, and offer
              reduced size and weight.

      -       IMPROVED DAMA SUBSCRIBER SERVICES. The current DAMA system is a
              data "pipe." The Company anticipates that demand for DAMA can grow
              by increasing the value of the content sent over the pipes.
              Several areas are being explored, including improved secure voice
              quality, increased message routing capability, higher data rates
              and improved service set-up times.

      -       DAMA SIGNAL PROCESSING. Airborne DAMA is currently limited to
              large, slow aircraft for surveillance, airlift, command and
              control, or similar missions. High performance aircraft are
              excluded because current satellite communications antennas degrade
              mission performance or safety. A promising solution is to use low
              profile, conformal antennas with active antenna combiners. The
              Company has a contract for such active antenna combiners with
              Lockheed Martin which, if successful, opens the possibility of
              extending the UHF DAMA market to high performance aircraft,
              potentially resulting in an increase of up to 100% in the airborne
              DAMA market.

      ViaSat is also applying the market expansion strategy to its Advanced Data
Controller ("ADC") products. ADC conforms to MIL-STD 188-184 for packet
processing. It provides error-free data transmission over noisy channels. ADC
works for terrestrial and satellite communications wireless links. The Company
is working to reduce size, weight and price for ADC products, and potentially
licensing other manufacturers to embed ViaSat's ADC digital signal processing
firmware directly into their radios.

      TRI-BAND DAMA MARKETS. The U.S. government is a major consumer of leased
commercial satellite capacity in the C and Ku bands. Since satellite
availability is limited, the government has specified the purchase of "tri-band"
terminals (i.e., terminals which can operate on any of three bands, SHF (X
band), C or Ku band). This makes it easier for subscribers to use available
capacity in any band, as a function of time and location. The government
established the Commercial Satellite Communications Initiative program to
manage:



                                       9

<PAGE>   13

            -  Long term leases for commercial satellite transponders.

            -  Contracts to purchase tri-band satellite terminals.

            -  Bandwidth Management Centers to act as network controllers for
               the tri-band terminals.

      The DOD is defining an "open" standard for DAMA in SHF and commercial
satellite bands. The government owns and operates the Defense Satellite
Communication System constellation at SHF. Bandwidth at SHF is much greater than
at UHF -- over 200 MHz per satellite compared to less than 2 MHz at UHF. Still,
SHF capacity is insufficient and could be improved via DAMA. More effective SHF
use should reduce the government's monthly lease on commercial satellites used
for overflow. The potential market for SHF DAMA capable terminals may be as
large as that for UHF DAMA terminals.

      Extending DAMA to commercial satellites vastly increases the bandwidth
available for government users. Increased bandwidth should support many more
terminals, increasing the potential DAMA user equipment market.

      In 1994, ViaSat was awarded a $2.0 million contract by the U.S. Air Force
for prototype demonstration of a draft SHF DAMA standard. In February 1996, the
Company delivered and installed equipment which performs many, but not all, of
the protocols in the draft. The DOD has not yet designated a final version of
SHF DAMA, nor has the DOD yet issued a mandate for DAMA in SHF terminals.

      The government tri-band DAMA market is very immature. This market will
likely not grow substantially until the DOD adopts a final standard and mandates
its use. However, there can be no assurance that the Company's products will be
procured by the government or prime contractors, even if a final standard
similar to the draft version is adopted. The Company is working to position its
SHF DAMA products through participation in government-industry standards working
groups. ViaSat also has been working with terminal manufacturers to help ensure
that its DAMA equipment integrates easily into their products. Finally, the
Company is working to maintain a prudent level of commonality between the
government and commercial DAMA modem platforms. The benefit of commonality is
that the larger commercial market offers economies of scale that reduce
manufacturing costs for the smaller government market. There is a potential
disadvantage if unique government product requirements increase the cost of
commercial products. The Company considers issues arising from this trade-off on
a case-by-case basis.

      GOVERNMENT PRODUCTS

      ViaSat's DAMA products for the government market include:

           -  EMUT (ENHANCED MANPACK UHF TERMINAL) is a battery-operated UHF
              satellite radio which Hughes Defense Communications builds for the
              U.S. Army. ViaSat provides a DAMA modem to Hughes under
              subcontract. EMUT is used to send encrypted voice, electronic
              mail, fax or other data via satellite. The DAMA modem allows the
              operator to automatically request a portion of a satellite channel
              to a selected destination whenever the operator asks to send a
              message or make a call. The EMUT radio, combined with a portable
              satellite antenna, can be used to make a secure voice or data call
              almost anywhere in the world.

           -  INCS (INITIAL NETWORK CONTROL SYSTEM) is the DAMA network
              management system for the U.S. Air Force. There are four sites
              worldwide (Guam, Hawaii, Naples and Virginia) that manage
              automatic DAMA access to 5 kHz band with UHF satellite channels.
              The network control computer automatically allocates satellite
              resources to subscriber terminals (such as EMUT) whenever a
              subscriber requests a voice or data service. The INCS also keeps
              track of which satellite terminals are active, how much capacity
              is used and how much is available. ViaSat designs, installs and
              supports the whole system at each site.



                                       10

<PAGE>   14

           -  VM-200 (Also CALLED MD-1324) is ViaSat's stand-alone UHF DAMA
              modem product. The modem can be used with many UHF satellite
              radios having an industry standard 70 MHz interface. The VM-200
              enables a satellite radio to connect to a DAMA network. VM-200
              modems also are used in the INCS to communicate with subscribers.
              The modems connect to external voice coders, computers or
              encryption equipment and provide network access for those devices.

    ViaSat's other government wireless networking products include:

           -  JTIDS (JOINT TACTICAL INFORMATION DISTRIBUTION SYSTEM) is an
              anti-jam radio and message protocol standard for communicating
              real-time data among aircraft and ground units. It connects to
              sensors (like radar), computers, and targeting systems and
              provides information used for navigation, target identification,
              tracking and fire control. JTIDS is currently used as the wireless
              communication system for "digital battlefields." For example, it
              allows individual fighter planes to obtain a broad view of the
              battlefield that is synthesized based on many different views from
              many different participants.

           -  CES/JCS (COMMUNICATION ENVIRONMENT SIMULATOR/JOINT COMMUNICATION
              SIMULATOR) is used to simulate a realistic radio environment which
              can be used to test how well surveillance or other radio systems
              work in the presence of various and changing signals. It can
              simulate friendly military signals, neutral signals, commercial
              signals and enemy signals. The government uses the simulated total
              environment to verify that a system under test can correctly
              analyze specific target signals within a complicated and cluttered
              composite signal.

           -  EIP (EMBEDDABLE INFOSEC PRODUCT) is a plug-in module that
              encrypts classified information so that it can be broadcast over
              wireless systems (terrestrial or satellite) or sent over
              unclassified wirelines. EIP is unique because it can work for
              packet data systems instead of on circuits. For instance, EIP can
              encrypt information for the Internet (or government equivalents).
              EIP also can separate the addressing and routing information from
              a packet and allow such information to remain unencrypted so that
              the network can correctly route the packet to its destination.

           -  ADC (ADVANCED DATA CONTROLLER) is a packet processing system
              which provides error-free data transmission over noisy channels.
              ADC works for terrestrial and satellite communications wireless
              lines.

    GOVERNMENT CUSTOMERS

    The Company's major customers in the government DAMA market include:

           -  Hughes Defense Communications is the customer for the EMUT DAMA
              modem. Approximately 23.9% of the Company's fiscal 1997 revenues
              were derived from this contract. Hughes is also a customer for the
              Tomahawk Baseline Improvement Program which includes adding a UHF
              DAMA satellite link to Tomahawk cruise missiles.

           -  The U.S. Air Force Electronics System Center ("ESC") is the
              customer for the 5 kHz UHF DAMA Global Initial Network Control
              System. ESC also procures stand-alone DAMA modems and
              Control/Indicators for various Air Force user agencies.

           -  Lockheed Martin is the customer for the VM-200 under the
              Communications Improvement Program.

           -  Lockheed Martin is the customer for the airborne DAMA-capable UHF
              satellite communications antenna combiner.



                                       11

<PAGE>   15

           -  The Company also has entered into a number of smaller contracts
              with the DOD for UHF DAMA and ADC satellite equipment.

    The Company's major government customers for other wireless networking
products include:

           -  The U.S. Air Force and Logicon Tactical Systems Division are the
              customers for JTIDS.

           -  The U.S. Navy and U.S. Air Force are the customers for CES/JCS.

           -  The U.S. Navy is the customer for EIP.

COMMERCIAL MARKETS, PRODUCTS AND CUSTOMERS

      COMMERCIAL MARKETS

      DAMA technology is increasingly being used in emerging commercial
telecommunications markets. In contrast to "pre-assigned" or "hub and spoke"
satellite networks, DAMA is well suited to primary "circuit-oriented"
telecommunication because it routes connections in real-time on a call-by-call
basis from any subscriber to any other subscriber with only one satellite hop.
See "-- Industry Background" and "-- Technology." DAMA commercial markets can be
segmented as follows:

           -  TURN-KEY PRIVATE NETWORK EQUIPMENT SALES for corporations and
              government agencies in developing nations. These customers require
              voice and/or data services. Users manage their own networks and/or
              contract for management services. They lease satellite capacity in
              bulk. DAMA equipment is selected based primarily on purchase and
              operating costs for specific needs. Customers typically need to
              operate ten or more sites for a turn-key private network to be
              economical.

           -  "SHARED HUB" PRIVATE NETWORK SERVICE PROVIDERS. Customers with
              small networks may use a satellite service provider. The provider
              purchases a DAMA network and obtains transponder capacity at
              wholesale rates. The provider manages small "virtual" nets for its
              customers. Customers buy capacity from the provider at retail
              daily, hourly or minute rates. Service providers have different
              priorities than turn-key operators. Breadth and depth of service
              offerings are more important to providers since they must attract
              a broad base of customers. DAMA terminals must support a range of
              telephone and data equipment. Providers generally prefer flexible
              user terminal configurations to meet varying customer needs. They
              profit from the spread between wholesale transponder lease costs
              and retail minute prices, so DAMA performance is important.
              Efficiency advantages (measured, for example, by voice circuits
              per unit bandwidth) can offset a higher initial terminal purchase
              price over the term of a service contract.

           -  PUBLIC NETWORK CARRIER SERVICE PROVIDERS. Many telecommunications
              carriers use satellite links as part of their long distance
              networks. However, the satellite segment usually consists of a
              pre-planned link establishing a particular geographic connection
              at a fixed capacity. A satellite DAMA network can reduce costs for
              independent carriers by bypassing transit switching charges
              through a telecommunications hub city. Satellite DAMA can serve as
              either a primary link or as a back-up when terrestrial links are
              congested. DAMA satellite technology provides an economical
              secondary connection because the satellite pool of trunk lines can
              be quickly applied to any of the primary terrestrial routes. The
              DAMA network's ability to reach many different destinations offers
              a competitive advantage to a DAMA operator whose business is
              selling wholesale minutes of long distance service to national or
              regional carriers.



                                       12

<PAGE>   16

           -  PUBLIC NETWORK "LOCAL LOOP" SUBSCRIBER SERVICE PROVIDERS.
              Subscriber services differ from the carrier services in that there
              is a local loop interface between the DAMA satellite switch and a
              subscriber telephone. This allows a subscriber with a small VSAT
              terminal to connect directly into the public switched telephone
              network by using a single dial-tone to call to other satellite
              subscribers or to terrestrial phones through national (and/or
              international) switches. While the Company believes the local loop
              subscriber service has, by far, the greatest potential market
              volume for equipment manufacturers and also represents the
              greatest opportunity for service providers, there are numerous
              technical, regulatory and business management hurdles to
              implementing this service.

      COMMERCIAL PRODUCTS

      STARWIRE(TM) is a satellite networking system consisting of two major
elements, a network control system and a subscriber terminal. The network
control system sends and receives messages over the satellite, while the
subscriber terminal switches all user interface ports (voice and data)
individually and connects them call-by-call to an available satellite modem.
StarWire(TM) provides toll-quality voice circuits on a demand basis, efficiently
sharing satellite resources and thereby reducing costs to the end-user and the
network service provider.

      StarWire(TM) products include:

           -  AURORA TERMINAL is a ten slot rack mountable chassis configured
              with one VMM-101 and one TIM-201 (described below). The terminal
              is expandable to six user traffic channels by inserting additional
              VMM modems and TIM modules. Expansion beyond six channels is
              possible by using additional Aurora chassis with VMM modems and
              TIM modules installed.

           -  VMM-101 is a DAMA modem module designed for the Aurora. The
              VMM-101 is a single modem used for both user-data transmission and
              order-wire control channels.

           -  TIM-201 is a dual channel voice encoder/decoder module designed
              for the Aurora. The TIM-201 has a fax modem on board, along with
              an integrated echo canceller.

           -  TMC-101 is a terminal monitor and control card designed for the
              Aurora. The "EIP" version has an integrated LAN Ethernet port and
              supports multiple daughter-cards for data communications and
              additional external equipment control support.

           -  STARWIRE(TM) NETWORK CONTROL TERMINAL (NCT) is a ten slot rack
              mountable Aurora chassis with one Network Control Computer (NCC)
              interface card and two VMM-101 modems (operating as DAMA system
              control channel modems).

           -  STARWIRE(TM) DAMA NETWORK CONTROL SOFTWARE (NCS) provides the
              real-time network control and monitoring functions of the
              StarWire(TM) DAMA networking system. The NCS software acts as a
              switch to route calls through the network. In addition, the
              StarWire(TM) NCS monitors all aspects of system operation as well
              as collecting historical information about calls and maintaining
              detailed call records for billing purposes.

           -  STARWIRE(TM) NETWORK CONTROL COMPUTER (NCC) is computing and
              networking equipment designed to support the operation of the NCS
              software. The non-redundant configuration (NCC-100) provides for
              one operator workstation/server, Ethernet interface, Windows
              NT(TM) operating system and back-up media. The redundant
              configuration (NCC-200) provides two operator
              workstations/servers, Ethernet adapter cards, Windows NT(TM)
              operating system and back-up media.

           -  EXTERNAL DEVICE INTERFACE DRIVER (EDID) supports third party modem
              and RF terminal equipment. 





                                       13

<PAGE>   17

      COMMERCIAL CUSTOMERS

      The Company is in the early stages of establishing sales for its
StarWire(TM) commercial DAMA product. Activities to date have primarily focused
on establishing distribution agreements with "in-country" service providers,
distributors and original equipment manufacturers ("OEMs"). The Company also has
delivered several test versions of the StarWire(TM) product for customer
evaluation and demonstration purposes. The Company's commercial sales accounted
for approximately 3% of sales for the year ended March 31, 1997.
The Company's major customers in the commercial DAMA market include:

           -  HUTCHISON TELECOMMUNICATIONS -- ViaSat and Hutchison
              Telecommunications have entered into a contract for intranational
              and international carrier satellite telephony equipment. The
              contract also provides for advanced digital data capabilities for
              public and private networks. The contract was awarded after
              competition from many other DAMA vendors. Under the terms of the
              contract, Hutchison Telecommunications has the right to terminate
              the contract and, under certain circumstances, receive liquidated
              damages from the Company of up to approximately $275,000, as well
              as other damages. See "Risk Factors -- Development Contracts."

           -  HCL COMNET -- HCL Comnet, located in India, operates the largest
              single VSAT network in India for the national stock exchange. HCL
              Comnet selected ViaSat's StarWire(TM) system for HCL Comnet's DAMA
              private network products and services. HCL Comnet has placed an 
              order for initial production systems.

           -  SATELLITE COMMUNICATIONS SERVICES INCORPORATED ("SCSI") -- SCSI
              has inaugurated a network serving the International Civil Aviation
              Organization, an agency of the United Nations that is responsible
              for worldwide air traffic control. This network uses Starwire(TM)
              terminals to establish voice, data, and radar communications among
              air traffic control sites in the Caribbean and Central America.

           -  AT&T TRIDOM -- The Company believes AT&T Tridom has the third
              largest VSAT revenues (counting equipment and services) in the
              United States. AT&T Tridom selected ViaSat as the private label
              manufacturer of an AT&T Tridom "Clearlink"-labeled DAMA VSAT
              product through competitive bids. AT&T Tridom has taken delivery
              of two test systems, one of which is installed at a customer site
              in Indonesia.

           -  ViaSat also has executed distribution agreements and purchase
              contracts with companies operating VSAT networks in Mexico, the
              Caribbean, Africa, South America and other regions.

RESEARCH AND DEVELOPMENT

      The Company believes that its future success depends on its ability to
adapt to the rapidly changing satellite communications and related real-time
signal processing and networking software environment, and to continue to meet
its customers' needs. Therefore, the continued timely development and
introduction of new products is essential in maintaining its competitive
position. The Company develops most of its products in-house and currently has a
research and development staff which includes over 160 engineers. A significant
portion of the Company's research and development efforts in the defense
industry have generally been conducted in direct response to the specific
requirements of a customer's order and, accordingly, such amounts are included
in the cost of sales when incurred and the related funding (which includes a
profit component) is included in net revenues at such time. Revenues for funded
research and development during the fiscal years ended March 31, 1997, 1996 and
1995 were approximately $21.3 million, $19.5 million, and $20.7 million,
respectively. In addition, the Company invested $5.1 million, $2.8 million and
$788,000, respectively, during the fiscal years ended March 31, 1997, 1996 and
1995 on independent research and development, which is not directly funded by a
third party. Funded research and development contains a profit component and is
therefore not directly comparable to independent research 




                                       14

<PAGE>   18

and development. As a government contractor, the Company also is able to recover
a portion of its independent research and development expenses, consisting
primarily of salaries and other personnel-related expenses, supplies and
prototype materials related to research and development programs, pursuant to
its government contracts.

      The Company has benefited and continues to benefit from the Small Business
Innovation Research ("SBIR") program, through which the government provides
research and development funding for companies with fewer than 500 employees.
While the Company has already harvested significant benefits from the SBIR
program throughout the initial developmental stages of its core technology base,
the Company believes that its business, financial condition and results of
operations would not be materially adversely affected if the Company were to
lose its SBIR funding status. The Company plans to leverage from this technology
base to further develop products for commercial applications.

MANUFACTURING

      The Company's manufacturing objective is to produce products that conform
to its specifications at the lowest possible manufacturing cost. The Company is
engaged in an effort to increase the standardization of its manufacturing
process in order to permit it to more fully utilize contract manufacturers. As
part of its program to reduce the cost of its manufacturing and to support an
increase in the volume of orders, the Company primarily utilizes contract
manufacturers in its manufacturing process. The Company conducts extensive
testing and quality control procedures for all products before they are
delivered to customers.

      The Company also relies on outside vendors to manufacture certain
components and subassemblies used in the production of the Company's products.
Certain components, subassemblies and services necessary for the manufacture of
the Company's products are obtained from a sole supplier or a limited group of
suppliers. In particular, Texas Instruments is a sole source supplier of digital
signal processing chips, which are critical components used by the Company in
substantially all of its products. The Company intends to reserve its limited
internal manufacturing capacity for new products and products manufactured in
accordance with a customer's custom specifications or expected delivery
schedule. Therefore, the Company's internal manufacturing capability for
standard products has been, and is expected to continue to be, very limited, and
the Company intends to rely on contract manufacturers for large scale
manufacturing. There can be no assurance that the Company's internal
manufacturing capacity and that of its contract manufacturers and suppliers will
be sufficient to fulfill the Company's orders in a timely manner. Failure to
manufacture, assemble and deliver products and meet customer demands on a timely
and cost effective basis could damage relationships with customers and have a
material adverse effect on the Company's business, financial condition and
operating results.

SALES AND MARKETING

      The Company markets its products to the DOD and to commercial customers
worldwide primarily through the Company's internal sales and marketing staff of
nine people. After the Company has identified key potential customers in its
market segments, the Company makes sales calls with its sales, management and
engineering personnel. Many of the companies entering the wireless
communications markets possess expertise in digital processing and wired systems
but relatively little experience in DAMA wireless transmission. In order to
promote widespread acceptance of its products and provide customers with support
for their wireless transmission needs, the Company's sales and engineering teams
work closely with its customers to develop tailored solutions to their wireless
transmission needs. The Company believes that its customer engineering support
provides it with a key competitive advantage.

      During the fiscal year ended March 31, 1997 ViaSat sold products to
approximately 50 customers of which DOD contracts accounted for approximately
97.0% of total revenues.

BACKLOG

      At March 31, 1997, the Company had firm backlog of $78.4 million, of which
$67.6 million was funded, not including options of $24.9 million. Of the $78.4
million in firm backlog, approximately $46.7 




                                       15

<PAGE>   19

million is expected to be delivered in the fiscal year ending March 31, 1998,
$13.2 million is expected to be delivered in the fiscal year ending March 31,
1999 and the balance is expected to be delivered in the fiscal year ending March
31, 2000 and thereafter. The Company had firm backlog of $28.7 million, not
including options of $28.0 million, at March 31, 1996, compared to firm backlog
of $31.7 million, not including options of $27.3 million, at March 31, 1995. The
Company includes in its backlog only those orders for which it has accepted
purchase orders. However, backlog is not necessarily indicative of future sales.
A majority of the Company's backlog scheduled for delivery can be terminated at
the convenience of the government since orders are often made substantially in
advance of delivery, and the Company's contracts typically provide that orders
may be terminated with limited or no penalties. In addition, purchase orders may
set forth product specifications that would require the Company to complete
additional product development. A failure to develop products meeting such
specifications could lead to a termination of the related purchase order.

      The backlog amounts as presented are comprised of funded and unfunded
components. Funded backlog represents the sum of contract amounts for which
funds have been specifically obligated by customers to contracts. Unfunded
backlog represents future contract or option amounts that customers may obligate
over the specified contract performance periods. The Company's customers
allocate funds for expenditures on long-term contracts on a periodic basis. The
Company is committed to produce products under its contracts to the extent funds
are provided. The funded component of the Company's backlog at March 31, 1997
was approximately $67.6 million, and the funded components of the Company's
backlog at March 31, 1996 and 1995 were $26.3 million and $29.6 million,
respectively. The ability of the Company to realize revenues from government
contracts in backlog is dependent upon adequate funding for such contracts.
Although funding of its government contracts is not within the Company's
control, the Company's experience indicates that actual contract fundings have
ultimately been approximately equal to the aggregate amounts of the contracts.

GOVERNMENT CONTRACTS

      A substantial portion of the Company's revenues are derived from contracts
and subcontracts with the DOD and other federal government agencies. Many of the
Company's contracts are competitively bid and awarded on the basis of technical
merit, personnel qualifications, experience and price. The Company also receives
some contract awards involving special technical capabilities on a negotiated,
noncompetitive basis due to the Company's unique technical capabilities in
special areas. Future revenues and income of the Company could be materially
affected by changes in procurement policies, a reduction in expenditures for the
products and services provided by the Company, and other risks generally
associated with federal government contracts. See "Risk Factors -- Dependence on
Defense Market" and "--Government Regulations."

      The Company provides products under federal government contracts that
usually require performance over a period of one to five years. Long-term
contracts may be conditioned upon continued availability of Congressional
appropriations. Variances between anticipated budget and Congressional
appropriations may result in a delay, reduction or termination of such
contracts. Contractors often experience revenue uncertainties with respect to
available contract funding during the first quarter of the government's fiscal
year beginning October 1, until differences between budget requests and
appropriations are resolved.

      The Company's federal government contracts are performed under
cost-reimbursement contracts, time-and-materials contracts and fixed-price
contracts. Cost-reimbursement contracts provide for reimbursement of costs (to
the extent allowable, allocable and reasonable under Federal Acquisition
Regulations) and for payment of a fee. The fee may be either fixed by the
contract (cost-plus-fixed fee) or variable, based upon cost control, quality,
delivery and the customer's subjective evaluation of the work (cost-plus-award
fee). Under time-and-materials contracts, the Company receives a fixed amount by
labor category for services performed and is reimbursed (without fee) for the
cost of materials purchased to perform the contract. Under a fixed-price
contract, the Company agrees to perform certain work for a fixed price and,
accordingly, realizes the benefit or detriment to the extent that the actual
cost of performing the work differs from the contract price. Contract revenues
for the fiscal year ended March 31, 1997 were approximately 




                                       16

<PAGE>   20

30.7% from cost-reimbursement contracts, approximately 6.0% from
time-and-materials contracts and approximately 63.3% from fixed-price contracts.
See "Risk Factors -- Contract Profit Exposure."

      The Company's allowable federal government contract costs and fees are
subject to audit by the Defense Contract Audit Agency. Audits may result in
non-reimbursement of some contract costs and fees. While the government reserves
the right to conduct further audits, audits conducted for periods through fiscal
1994 have resulted in no material cost recovery disallowances for the Company.

      The Company's federal government contracts may be terminated, in whole or
in part, at the convenience of the government. If a termination for convenience
occurs, the government generally is obligated to pay the cost incurred by the
Company under the contract plus a pro rata fee based upon the work completed.
When the Company participates as a subcontractor, the Company is at risk if the
prime contractor does not perform its contract. Similarly, when the Company as a
prime contractor employs subcontractors, the Company is at risk if a
subcontractor does not perform its subcontract.

      Some of the Company's federal government contracts contain options which
are exercisable at the discretion of the customer. An option may extend the
period of performance for one or more years for additional consideration on
terms and conditions similar to those contained in the original contract. An
option may also increase the level of effort and assign new tasks to the
Company. In the Company's experience, options are usually exercised.

      The Company's eligibility to perform under its federal government
contracts requires the Company to maintain adequate security measures. The
Company has implemented security procedures which it believes are adequate to
satisfy the requirements of its federal government contracts.

GOVERNMENT REGULATIONS

      Certain of the Company's products are incorporated into wireless
telecommunications systems that are subject to regulation domestically by the
Federal Communications Commission and internationally by other government
agencies. Although the equipment operators and not the Company are responsible
for compliance with such regulations, regulatory changes, including changes in
the allocation of available frequency spectrum and in the military standards
which define the current networking environment, could materially adversely
affect the Company's operations by restricting development efforts by the
Company's customers, making current products obsolete or increasing the
opportunity for additional competition. Changes in, or the failure by the
Company to manufacture products in compliance with, applicable domestic and
international regulations could have a material adverse effect on the Company's
business, financial condition and results of operations. In addition, the
increasing demand for wireless telecommunications has exerted pressure on
regulatory bodies worldwide to adopt new standards for such products, generally
following extensive investigation and deliberation over competing technologies.
The delays inherent in this governmental approval process have in the past
caused and may in the future cause the cancellation, postponement or
rescheduling of the installation of communication systems by the Company's
customers, which in turn may have a material adverse effect on the sale of
products by the Company to such customers.

      The Company is also subject to a variety of local, state and federal
governmental regulations relating to the storage, discharge, handling, emission,
generation, manufacture and disposal of toxic or other hazardous substances used
to manufacture the Company's products. The failure to comply with current or
future regulations could result in the imposition of substantial fines on the
Company, suspension of production, alteration of its manufacturing processes or
cessation of operations. To date, these regulations have not had a material
effect on the Company, as the Company has neither incurred significant costs to
maintain compliance nor to remedy past noncompliance.

      The Company believes that it operates its business in material compliance
with applicable government regulations. The Company is not aware of any pending
legislation which if enacted could have a material adverse effect on the
Company's business, financial condition and results of operations.



                                       17

<PAGE>   21

COMPETITION

      The markets for the Company's products and services are extremely
competitive, and the Company expects that competition will increase in such
markets. See "Risk Factors -- Competition." The Company faces intense
competition in both government and commercial wireless networking markets.

      Government DAMA Competition. Competition in the government DAMA market
consists primarily of other companies offering DAMA capable modem, radio or
network control equipment that is compatible with the open MIL-STD protocols.
The government DAMA competitors are significantly larger companies than ViaSat
and include Titan Corporation, Rockwell International, Raytheon Corporation and
GEC (UK). The Company believes that it is well-positioned among these
competitors because of its significant backlog of DAMA modem orders, its market
lead time with respect to DAMA product certification and its participation in
both the network control and subscriber terminal markets.

      Government Non-DAMA Competition. There is also intense competition in
other wireless networking markets. The JTIDS market, in particular, is dominated
by two very large competitors (Rockwell and GEC- Marconi).

      The Company's simulation and test equipment and information security
products represent relatively new technologies in markets that are still small.
Most of the Company's competition in these markets stems from alternative
technologies that may or may not be applicable to any particular customer.

      Commercial DAMA Competition. There is intense competition in the
commercial DAMA market from companies that have strong positions in the TDM/TDMA
VSAT business, as well as from other companies that seek to enter the VSAT
market using DAMA technology. Most of the leading TDM/TDMA VSAT companies are
offering DAMA products, including Hughes Network Systems, an affiliate of Hughes
Defense Communications (see "Risk Factors -- Dependence on Defense Market"),
Scientific Atlanta Inc., Gilat Satellite Networks Ltd., STM Wireless Inc. and
NEC. In addition, there are also other types of competing DAMA technologies
being developed.

      AT&T Tridom, which is one of the largest VSAT equipment and service
providers and which offers TDM/TDMA products, has entered into a strategic
alliance with the Company to sell the Company's products under an OEM agreement.
The Company believes that this may allow it to compete for customers seeking
hybrid TDM/TDMA and DAMA VSAT solutions.

      In different situations, DAMA products may be evaluated in comparison with
either TDM/TDMA technology, DAMA technology from other companies, dedicated SCPC
technology, mobile satellite technology or possibly terrestrial wireless
solutions. The Company believes that it has a good understanding of those
situations where DAMA systems in general, and its technology in particular,
offer the best overall value to its customers, and tends to focus its marketing
and selling efforts on those applications. DAMA technology is most attractive
for customers with telephone, fax or other circuit-oriented applications. DAMA
technology also allows networks to achieve much higher total capacity, with
better voice quality than TDM/TDMA networks.

      The Company seeks to establish strategic alliances with satellite service
providers which would most benefit from its particular technological advantages.
The Company has established such relationships with a few key companies,
including HCL Comnet in India. The Company believes that its products offer the
lowest total cost of ownership for service providers considering the flexibility
of its equipment, its transponder capacity advantages and the breadth of its
service offerings.

INTELLECTUAL PROPERTY

      The Company relies on a combination of trade secrets, copyrights,
trademarks, service marks and contractual rights to protect its intellectual
property. The Company attempts to protect its trade secrets and other
proprietary information through agreements with its customers, suppliers,
employees and consultants, and through other security measures. Although the
Company intends to protect its rights vigorously, there 




                                       18

<PAGE>   22

can be no assurance that these measures will be successful. In addition, the
laws of certain countries in which the Company's products are or may be
developed, manufactured or sold may not protect the Company's products and
intellectual property rights to the same extent as the laws of the United
States.

      While the Company's ability to compete may be affected by its ability to
protect its intellectual property, the Company believes that, because of the
rapid pace of technological change in the wireless personal communications
industry, its technical expertise and ability to introduce new products on a
timely basis will be more important in maintaining its competitive position than
protection of its intellectual property and that patent, trade secret and
copyright protections are important but must be supported by other factors such
as the expanding knowledge, ability and experience of the Company's personnel,
new product introductions and frequent product enhancements. Although the
Company continues to implement protective measures and intends to defend
vigorously its intellectual property rights, there can be no assurance that
these measures will be successful. See "Risk Factors -- Limited Protection of
the Company's Intellectual Property."

      There can be no assurance that third parties will not assert claims
against the Company with respect to existing and future products. In the event
of litigation to determine the validity of any third party's claims, such
litigation could result in significant expense to the Company and divert the
efforts of the Company's technical and management personnel, whether or not such
litigation is determined in favor of the Company. The wireless communications
industry has been subject to frequent litigation regarding patent and other
intellectual property rights. Leading companies and organizations in the
industry have numerous patents that protect their intellectual property rights
in these areas. In the event of an adverse result of any such litigation, the
Company could be required to expend significant resources to develop
non-infringing technology or to obtain licenses to the technology which is the
subject of the litigation. There can be no assurance that the Company would be
successful in such development or that any such license would be available on
commercially reasonable terms.

EMPLOYEES

      As of March 31, 1997, the Company had 275 employees (12 of which were
temporary employees), including over 160 in research and development, nine in
marketing and sales, 42 in production, and 60 in corporate, administration and
production coordination. The Company believes that its future prospects will
depend, in part, on its ability to continue to attract and retain skilled
engineering, marketing and management personnel, who are in great demand. In
particular, there is a limited supply of highly qualified engineers with
appropriate experience. See "Risk Factors -- Dependence on Key Personnel." Each
of the Company's employees is required to sign an Invention and Confidential
Disclosure Agreement upon joining the Company. Under such agreement, each
employee agrees that any inventions developed by such employee during the term
of employment are the exclusive property of the Company and that such employee
will not disclose or use in any way information related to the Company's
business or products, either during the term of such employee's employment or at
any time thereafter. The Company currently employs over 160 engineers, including
71 engineers who have masters degrees and seven engineers who have doctorate
degrees. None of the Company's employees are covered by a collective bargaining
agreement and the Company has never experienced any strike or work stoppage. The
Company believes that its relations with its employees are good.

RISK FACTORS

      DEPENDENCE ON DEFENSE MARKET

      Over 95% of the Company's revenues for the fiscal year ended March 31,
1997 were derived from U.S. government defense applications. Although the
Company has invested heavily in developing commercial satellite products, there
can be no assurance that the percentage of the Company's commercial business
will increase. In addition, there can be no assurance that the Company's
revenues from its government business will continue to increase at historical
rates or at all. U.S. government business is subject to various risks including
(i) unpredictable contract or project terminations, reductions in funds
available for the Company's projects due to government policy changes, budget
cuts and contract 




                                       19

<PAGE>   23

adjustments and penalties arising from post-award contract audits, and incurred
cost audits in which the value of the contract may be reduced, (ii) risks of
underestimating ultimate costs, particularly with respect to software and
hardware development, for work performed pursuant to fixed-price contracts where
the Company commits to achieve specified deliveries for a predetermined fixed
price, (iii) limited profitability from cost-reimbursement contracts under which
the amount of profit attainable is limited to a specified negotiated amount and
(iv) unpredictable timing of cash collections of certain unbilled receivables as
they may be subject to acceptance of contract deliverables by the customer and
contract close-out procedures, including government approval of final indirect
rates. See "Business -- Government Contracts." In addition, substantially all of
the Company's backlog scheduled for delivery can be terminated at the
convenience of the government since orders are often made well in advance of
delivery, and the Company's contracts typically provide that orders may be
terminated with limited or no penalties. See "Business -- Backlog."

      Certain of the Company's contracts individually contribute a significant
percentage of the Company's revenues. For the fiscal year ended March 31, 1997,
the Company's largest contracts (by revenues) were contracts related to the
Company's UHF DAMA technology, which generated approximately 68.8% of the
Company's total revenues, including a contract with Hughes Defense
Communications which generated approximately 23.9% of the Company's total
revenues. In March 1997 the Company was awarded an option under this contract
valued at $20.9 million. Scheduled deliveries pursuant to firm purchase orders
under this contract are scheduled to be completed during the fiscal year ending
March 31, 2000. Hughes Defense Communications is an affiliate of Hughes Network
Systems (HNS), which is the Company's principal competitor in the commercial
DAMA market. See "Business -- Competition." The Company's five largest contracts
(by revenues) generated approximately 57.6% of the Company's total revenues for
the fiscal year ended March 31, 1997. The Company expects revenues to continue
to be concentrated in a relatively small number of large U.S. government
contracts. Termination or disruption of such contracts, especially the Company's
largest contract, or the Company's inability to renew or replace such contracts
when they expire, could have a material adverse effect on the Company's
business, financial condition and results of operations.

PENETRATION OF COMMERCIAL MARKETS; NEW PRODUCT INTRODUCTIONS

      The Company's ability to grow will depend substantially on its and its
customers' ability to apply its expertise and technologies to existing and
emerging commercial wireless communications markets. The Company's efforts to
penetrate commercial markets has resulted, and the Company anticipates that it
will continue to result, in increased sales and marketing and research and
development expenses. If the Company's net revenues do not correspondingly
increase, the Company's business, financial condition and results of operations
could be materially adversely affected. The Company's success in penetrating
commercial markets also depends upon the success of new product introductions by
the Company, which will be dependent upon several factors, including timely
completion and introduction of new product designs, achievement of acceptable
product costs, establishment of close working relationships with major customers
for the design of their new wireless communications systems incorporating the
Company's products and market acceptance. Sales of the Company's commercial
StarWire(TM) products (see "Business -- Commercial Markets, Products and
Customers -- Commercial Products") have not yet achieved profitability. The
Company believes that as the market expands for the StarWire(TM) products,
average production costs for such products should decrease and sales of such
products should become profitable. However, there can be no assurance that the
market for such products will expand or that average production costs will
decrease. If the Company is unable to design, manufacture and market profitable
new products for existing or emerging commercial markets, its business,
financial condition and results of operations will be adversely affected. No
assurance can be given that the Company's product development efforts for
commercial products will be successful or that any new commercial products it
develops will achieve market acceptance. See "Management's Discussion and
Analysis of Financial Condition and Results of Operations" and "Business --
Commercial Markets, Products and Customers."

DEVELOPMENT CONTRACTS

      The telecommunications industry is characterized by rapid technological
change. As a result, many companies involved in the telecommunications industry,
including the Company, are often parties to 




                                       20

<PAGE>   24

governmental and commercial contracts which involve development of various
products. Pursuant to such contracts, the company performing the development
services typically must agree to meet strict performance covenants and project
milestones which there is a risk it may not be able to satisfy. Under the terms
of such contracts, the failure by a company to meet such performance covenants
and milestones permit the other party to terminate the contract and, under
certain circumstances, recover liquidated damages or other penalties from the
breaching party. The Company is currently a party to a number of such contracts
with a number of customers including, but not limited to, Hutchison
Telecommunications, HCL Comnet, Hughes Defense Communications and the DOD. See
"Business -- Commercial Markets, Products and Customers -- Commercial Customers"
and " -- Government Markets, Products and Customers -- Government Customers." In
substantially all of these contracts, the Company is not currently or in the
past has not been in compliance with every outstanding performance covenant and
project milestone. While the Company's past experience has been that in
situations where the Company has not met all performance covenants and project
milestones generally the other party has not elected to terminate such contracts
or seek liquidated damages from the Company, there can be no assurance that this
will not occur in the future with respect to current or future contracts and
that such termination or damages would not have a material adverse effect on the
Company.

FLUCTUATIONS IN RESULTS OF OPERATIONS

      The Company has experienced and expects to continue to experience
significant fluctuations in quarterly and annual revenues, gross margins and
operating results. The procurement process for most of the Company's current and
potential customers is complex and lengthy, and the timing and amount of
revenues is difficult to predict reliably. The Company recognizes a majority of
its revenues under the percentage of completion method which requires estimates
regarding costs that will be incurred over the life of a specific contract.
Actual results may differ from those estimates. In such event, the Company has
been and may in the future be required to adjust revenues in subsequent periods
relating to revisions of prior period estimates, resulting in fluctuations in
the Company's results of operations from period to period. See "Management's
Discussion and Analysis of Financial Condition and Results of Operations." In
addition, a single customer's order scheduled for delivery in a quarter can
represent a significant portion of the Company's potential revenues for such
quarter. The Company has at times failed to receive expected orders, and
delivery schedules have been deferred as a result of, among other factors,
changes in customer requirements or parts shortages. In fiscal 1997,
approximately 23.9% of the Company's revenues were derived from one contract.
Any disruption with respect to this contract could have a material adverse
effect on the Company in any period where such a disruption occurs. See
"Business -- Government Markets, Products and Customers -- Government
Customers." As a result of the foregoing and other factors, the Company's
operating results for particular periods have in the past been and may in the
future be materially adversely affected by a delay, rescheduling or cancellation
of even one purchase order. Moreover, purchase orders are often received and
accepted substantially in advance of delivery, and the failure to reduce actual
costs to the extent anticipated or an increase in anticipated costs before
delivery could materially adversely affect the gross margins for such orders,
and as a result, the Company's results of operations. There can be no assurance
that the Company will continue to realize positive gross margins or operating
results in the future, and even if so realized, there can be no assurance as to
the level of such gross margins and operating results.

      A large portion of the Company's expenses are fixed and difficult to
reduce should revenues not meet the Company's expectations, thus magnifying the
material adverse effect of any revenue shortfall. Furthermore, announcements by
the Company or its competitors of new products and technologies could cause
customers to defer or cancel purchases of the Company's products and services,
which could materially adversely affect the Company's business, financial
condition and results of operations or result in fluctuations in the Company's
results of operations from period to period. Additional factors that may cause
the Company's revenues, gross margins and results of operations to vary
significantly from period to period include mix of products and services sold;
manufacturing efficiencies, costs and capacity; price discounts; market
acceptance and the timing of availability of new products by the Company or its
customers; usage of different distribution and sales channels; warranty and
customer support expenses; customization of products and services; and general
economic and political conditions. In addition, the Company's results of
operations are influenced by competitive factors, including the pricing and
availability of, and demand for, 




                                       21

<PAGE>   25

competitive products. All of the above factors are difficult for the Company to
forecast, and these and other factors could materially adversely affect the
Company's business, financial condition and results of operations or result in
fluctuations in the Company's results of operations from period to period. As a
result, the Company believes that period-to-period comparisons are not
necessarily meaningful and should not be relied upon as indications of future
performance. See "Management's Discussion and Analysis of Financial Condition
and Results of Operations."

CONTRACT PROFIT EXPOSURE

      The Company's products and services are provided primarily through three
types of contracts: fixed-price, time-and-materials and cost-reimbursement
contracts. Approximately 63.3% of the Company's total revenues for the fiscal
year ended March 31, 1997, were derived from fixed-price contracts which require
the Company to provide products and services under a contract at a stipulated
price. The Company derived approximately 6.0% of its revenues during the year
from time-and-materials contracts which reimburse the Company for the number of
labor hours expended at an established hourly rate negotiated in the contract,
plus the cost of materials utilized in providing such products or services. The
remaining 30.7% of the Company's revenues for the fiscal year ended March 31,
1997 were derived from cost-reimbursement contracts under which the Company is
reimbursed for actual costs incurred in performing the contract to the extent
that such costs are within the contract ceiling and allowable, allocable and
reasonable under the terms of the contract, plus a fee or profit. See "Business
- -- Government Contracts."

      The Company assumes greater financial risk on fixed-price contracts than
on either time-and-materials or cost-reimbursement contracts. As the Company
increases its manufacturing business, it believes that an increasing percentage
of its contracts will be fixed-priced. Failure to anticipate technical problems,
estimate costs accurately or control costs during performance of a fixed-price
contract may reduce the Company's profit or cause a loss. In addition, greater
risks are involved under time-and-materials contracts than under
cost-reimbursement contracts because the Company assumes the responsibility for
the delivery of specified products or services at a fixed hourly rate. Although
management believes that it adequately estimates costs for fixed-price and
time-and-materials contracts, no assurance can be given that such estimates are
adequate or that losses on fixed-price and time-and-materials contracts will not
occur in the future.

      To compete successfully for business, the Company must satisfy client
requirements at competitive rates. Although the Company continually attempts to
lower its costs, there are other companies that may provide the same or similar
products or services at comparable or lower prices than the Company. There can
be no assurance that the Company will be able to compete effectively on pricing
or other requirements, and as a result, the Company could lose clients or be
unable to maintain historic gross margin levels or to operate profitably. See
"Business -- Competition."

DECLINING AVERAGE SELLING PRICES; FLUCTUATIONS IN GROSS MARGINS

      Average selling prices for the Company's products may fluctuate from
period to period due to a number of factors, including product mix, competition
and unit volumes. In particular, the average selling prices of a specific
product tend to decrease over that product's life. To offset such decreases, the
Company intends to rely primarily on obtaining yield improvements and
corresponding cost reductions in the manufacture of existing products and on
introducing new products that incorporate advanced features and therefore can be
sold at higher average selling prices. However, there can be no assurance that
the Company will be able to obtain any such yield improvements or cost
reductions or introduce any such new products in the future. To the extent that
such cost reductions and new product introductions do not occur in a timely
manner or the Company's or its customers' products do not achieve market
acceptance, the Company's business, financial condition and results of
operations could be materially adversely affected. See "Business --
Manufacturing."

      The Company's gross margins in any period are affected by a number of
different factors. Because of the different gross margins on various products,
changes in product mix can impact gross margins in any particular period. In
addition, in the event that the Company is not able to adequately respond to
pricing pressures, the Company's current customers may decrease, postpone or
cancel current or planned orders, 




                                       22

<PAGE>   26

and the Company may not be able to secure new customers or orders. As a result,
the Company may not be able to achieve desired production volumes or gross
margins.

GOVERNMENT REGULATIONS

      The Company's products are incorporated into wireless communications
systems that are subject to various government regulations. Regulatory changes,
including changes in the allocation of available frequency spectrum and in the
military standards and specifications which define the current satellite
networking environment, could significantly impact the Company's operations by
restricting development efforts by the Company's customers, making current
products obsolete or increasing the opportunity for additional competition.
There can be no assurance that regulatory bodies will not promulgate new
regulations that could have a material adverse effect on the Company's business,
financial condition and results of operations. Changes in, or the failure by the
Company to comply with, applicable domestic and international regulations could
have a material adverse effect on the Company's business, financial condition
and results of operations. In addition, the increasing demand for wireless
communications has exerted pressure on regulatory bodies worldwide to adopt new
standards for such products and services, generally following extensive
investigation of and deliberation over competing technologies. The delays
inherent in this governmental approval process have caused and may continue to
cause the cancellation, postponement or rescheduling of the installation of
communications systems by the Company's customers, which in turn may have a
material adverse effect on the sale of products by the Company to such
customers. See "Business -- Government Regulations."

      The Company has benefitted and continues to benefit from the SBIR program,
through which the government provides research and development funding for
companies with fewer than 500 employees. While the Company has already harvested
significant benefits from the SBIR program throughout the initial developmental
stages of its core technology base, the Company believes that its business,
financial condition and results of operations would not be materially adversely
affected if the Company were to lose its SBIR funding status. See "Business --
Research and Development."

EMERGING MARKETS IN WIRELESS COMMUNICATIONS

      A number of the commercial markets for the Company's products in the
wireless communications area, including its DAMA products, have only recently
begun to develop. Because these markets are relatively new, it is difficult to
predict the rate at which these markets will grow, if at all. If the markets for
the Company's products in the commercial wireless communications area fail to
grow, or grow more slowly than anticipated, the Company's business, financial
condition and results of operations could be materially adversely affected.
Conversely, to the extent that growth in these markets results in capacity
limitations in the wireless communications area, the Company's business,
financial condition and results of operations could also be materially adversely
affected. See "Business -- Commercial Markets, Products and Customers."

RURAL TELEPHONY MARKET

      The Company's strategy includes focusing on establishing rural telephony
networking infrastructure for developing countries through strategic alliances
with regional and local service providers (see "Business -- Strategy -- Address
Rural Telephony Market"). There can be no assurance that a substantial market
for rural telephony equipment in developing countries will ever develop, or if
such a market does develop that fixed-site DAMA VSAT-based equipment will
capture a significant portion of that market. The Company's ability to penetrate
such markets will be dependent upon its ability to develop equipment and
software which can be utilized by the regional and local service providers to
develop and implement such infrastructure and for such service providers to
market and sell the use of such systems. Furthermore, there can be no assurance
that the regional and local service providers will be able to successfully
market subscriber terminals to rural subscribers. The development and
implementation of such rural telephony systems will be dependent upon, among
other things, the continued development of the necessary hardware and software
technologies (including the necessary expenditures of a large amount of funds
and resources), the implementation of cost-effective systems, market acceptance
for such systems and approval by the appropriate regulatory agencies. There can
be no assurance that the Company will be able to develop 





                                       23

<PAGE>   27

equipment and software which can be utilized in such rural telephony systems and
accepted by regional and local service providers or that any regional or local
service providers will be able to develop, implement and market rural telephony
systems. Furthermore, if the Company successfully introduces such products and
the regional and local service providers successfully develop and implement such
systems, there is no assurance that the Company will generate enough revenues to
cover the Company expenditures in the development and marketing of such
products. Even if the Company is able to realize sales of such products, the
Company believes it is not likely that the Company will realize any significant
revenues from rural telephony applications any time in the foreseeable future,
including at least the next two years.

DEPENDENCE ON CONTRACT MANUFACTURERS; RELIANCE ON SOLE OR 
LIMITED SOURCES OF SUPPLY

      The Company's internal manufacturing capacity is limited. The Company has
recently begun to utilize contract manufacturers to produce its products and
expects to rely increasingly on such manufacturers in the future. The Company
also relies on outside vendors to manufacture certain components and
subassemblies, including printed wiring boards. Certain components,
subassemblies and services necessary for the manufacture of the Company's
products are obtained from a sole supplier or a limited group of suppliers. In
particular, Texas Instruments is a sole source supplier of digital signal
processing chips, which are critical components used by the Company in
substantially all of its products. There can be no assurance that the Company's
internal manufacturing capacity and that of its contract manufacturers and
suppliers will be sufficient to timely fulfill the Company's orders. See
"Business -- Manufacturing."

      The Company's reliance on contract manufacturers and on sole suppliers or
a limited group of suppliers involves several risks, including a potential
inability to obtain an adequate supply of required components, and reduced
control over the price, timely delivery, reliability and quality of finished
products. From time to time, the Company enters into long-term supply agreements
with its manufacturers and suppliers. Manufacture of the Company's products and
certain of its components and subassemblies is an extremely complex process, and
the Company has from time to time experienced and may in the future experience
delays in the delivery of and quality problems with products and certain
components and subassemblies from vendors. Certain of the Company's suppliers
have relatively limited financial and other resources. Any inability to obtain
timely deliveries of components and subassemblies of acceptable quality or any
other circumstance that would require the Company to seek alternative sources of
supply, or to manufacture its finished products or such components and
subassemblies internally, could delay or prevent the Company from timely
delivery of its systems or raise issues regarding quality, which could damage
relationships with current or prospective customers and have a material adverse
effect on the Company's business, financial condition and results of operations.

COMPETITION

      The markets for the Company's products and services are extremely
competitive, and the Company expects that competition will increase in such
markets. Many of the Company's competitors have entrenched market positions,
established patents, copyrights, tradenames, trademarks, service marks and
intellectual property rights and substantial technological capabilities. The
Company's existing and potential competitors include large and emerging domestic
and international companies, many of which have significantly greater financial,
technical, manufacturing, marketing, sales and distribution resources and
management expertise than the Company. The Company believes that its ability to
compete successfully in the markets for its products and services depends upon a
number of factors within and outside its control, including price, quality,
availability, product performance and features, timing of new product
introductions by the Company, its customers and competitors, and customer
service and technical support. The Company's customers continuously evaluate
whether to develop and manufacture their own products and could elect to compete
with the Company at any time. Price competition in the markets in which the
Company currently competes is likely to increase, which could have a material
adverse effect on the Company's business, financial condition and results of
operations. See "Business -- Competition."



                                       24

<PAGE>   28

LIMITED PROTECTION OF THE COMPANY'S INTELLECTUAL PROPERTY

      The Company's ability to compete may depend, in part, on its ability to
obtain and enforce intellectual property protection for its technology in the
United States and internationally. The Company relies on a combination of trade
secrets, copyrights, trademarks, service marks and contractual rights to protect
its intellectual property. There can be no assurance that the steps taken by the
Company will be adequate to deter misappropriation or impede third party
development of the Company's technology. In addition, the laws of certain
foreign countries in which the Company's products are or may be sold do not
protect the Company's intellectual property rights to the same extent as do the
laws of the United States. The failure of the Company to protect its proprietary
information could have a material adverse effect on the Company's business,
financial condition and results of operations. See "Business -- Intellectual
Property."

      Litigation may be necessary to protect the Company's intellectual property
rights and trade secrets, to determine the validity and scope of the proprietary
rights of others or to defend against claims of infringement or invalidity. Such
litigation could result in substantial costs and diversion of resources and
could have a material adverse effect on the Company's business, financial
condition and results of operations. There can be no assurance that
infringement, invalidity, right to use or ownership claims by third parties or
claims for indemnification resulting from infringement claims will not be
asserted against the Company in the future. If any claims or actions are
asserted against the Company, the Company may seek to obtain a license under a
third party's intellectual property rights. There can be no assurance, however,
that a license will be available under reasonable terms or at all. In addition,
should the Company decide to litigate such claims, such litigation could be
extremely expensive and time consuming and could materially adversely affect the
Company's business, financial condition and results of operations, regardless of
the outcome of the litigation. If the Company's products are found to infringe
upon the rights of third parties, the Company may be forced to incur substantial
costs to develop alternative products. There can be no assurance that the
Company would be able to develop such alternative products or that if such
alternative products were developed, they would perform as required or be
accepted in the applicable markets.

REQUIREMENT FOR RESPONSE TO RAPID TECHNOLOGICAL CHANGE AND REQUIREMENT FOR 
FREQUENT NEW PRODUCT INTRODUCTIONS

      The wireless communications market is subject to rapid technological
change, frequent new product introductions and enhancements, product
obsolescence and changes in end-user requirements. The Company's ability to be
competitive in this market will depend in significant part upon its ability to
successfully develop, introduce and sell new products and enhancements on a
timely and cost-effective basis that respond to changing customer requirements.
Any success of the Company in developing new and enhanced products will depend
upon a variety of factors, including new product selection, integration of the
various elements of its complex technology, timely and efficient completion of
product design, timely and efficient implementation of manufacturing and
assembly processes and its cost reduction efforts, development and completion of
related software tools, product performance, quality and reliability and
development of competitive products by competitors. The Company may experience
delays from time to time in completing development and introduction of new
products. Moreover, there can be no assurance that the Company will be
successful in selecting, developing, manufacturing and marketing new products or
enhancements. There can be no assurance that errors will not be found in the
Company's products after commencement of deliveries, which could result in the
loss of or delay in market acceptance. The inability of the Company to introduce
in a timely manner new products that achieve market acceptance and thereby
contribute to revenues could have a material adverse effect on the Company's
business, financial condition and results of operations. See "Business --
Research and Development."

INTERNATIONAL OPERATIONS; RISKS OF DOING BUSINESS IN DEVELOPING COUNTRIES

      The Company anticipates that international sales will account for an
increasing percentage of its revenues for the foreseeable future. The Company's
international sales may be denominated in foreign or U.S. currencies. The
Company does not currently engage in foreign currency hedging transactions. As a
result, a decrease in the value of foreign currencies relative to the U.S.
dollar could result in losses from transactions denominated in foreign
currencies. With respect to the Company's international sales that are 




                                       25

<PAGE>   29

U.S. dollar-denominated, such a decrease could make the Company's products less
price-competitive. Additional risks inherent in the Company's international
business activities include various and changing regulatory requirements, cost
and risks of localizing systems in foreign countries, increased sales and
marketing and research and development expenses, availability of suitable export
financing, timing and availability of export licenses, tariffs and other trade
barriers, political and economic instability, difficulties in staffing and
managing foreign operations, difficulties in managing distributors, potentially
adverse taxes, complex foreign laws and treaties and the possibility of
difficulty in accounts receivable collections. Certain of the Company's customer
purchase agreements are governed by foreign laws, which may differ significantly
from U.S. laws. Therefore, the Company may be limited in its ability to enforce
its rights under such agreements and to collect damages, if awarded. There can
be no assurance that any of these factors will not have a material adverse
effect on the Company's business, financial condition and results of operations.

VIABLE PUBLIC MARKET; POSSIBLE VOLATILITY OF STOCK PRICE

      The Company's Common Stock has traded on a public market for a relatively
short period of time, and there can be no assurance that a viable public market
for the Common Stock will be sustained. The Company believes that factors such
as announcements of developments related to the Company's business,
announcements of technological innovations or new products or enhancements by
the Company or its competitors, developments in the Company's relationships with
its customers, partners, distributors and suppliers, changes in analysts'
estimates, regulatory developments, fluctuations in results of operations and
general conditions in the Company's market or the markets served by the
Company's customers or the economy could cause the price of the Common Stock to
fluctuate, perhaps substantially. In addition, in recent years the stock market
in general, and technology companies in particular have been subject to
significant price fluctuations, which have often been unrelated to the operating
performance of affected companies. Such fluctuations could adversely affect the
market price of the Common Stock. There can be no assurance that the market
price of the Common Stock will not experience significant fluctuations in the
future, including fluctuations that are unrelated to the Company's performance.

CONTROL BY EXISTING STOCKHOLDERS

      As of March 31, 1997, members of the Board of Directors and the executive
officers of the Company, together with members of their families and entities
that may be deemed affiliates of or related to such persons or entities,
beneficially owned approximately 36.7% of the outstanding shares of the
Company's Common Stock. Accordingly, these stockholders may be able to elect all
members of the Company's Board of Directors and determine the outcome of
corporate actions requiring stockholder approval, such as mergers and
acquisitions. This level of ownership may have a significant effect in delaying,
deferring preventing a change in control of the Company and may adversely affect
the voting and other rights of other holders of the Common Stock.

ANTI-TAKEOVER EFFECTS OF CERTAIN CHARTER PROVISIONS

      Certain provisions of the Company's Amended and Restated Certificate of
Incorporation and Bylaws could discourage potential acquisition proposals, could
delay or prevent a change in control of the Company and could make removal of
management more difficult. Such provisions could diminish the opportunities for
a stockholder to participate in tender offers, including tender offers that are
priced above the then current market value of the Company's Common Stock. The
provisions also may inhibit increases in the market price of the Common Stock
that could result from takeover attempts. Additionally, the Board of Directors
of the Company, without further stockholder approval, may issue up to 5,000,000
shares of Preferred Stock, in one or more series, with such terms as the Board
of Directors may determine, including rights such as voting, dividend and
conversion rights which could adversely affect the voting power and other rights
of the holders of Common Stock. Preferred Stock may be issued quickly with terms
which delay or prevent the change in control of the Company or make removal of
management more difficult. Also, the issuance of Preferred Stock may have the
effect of decreasing the market price of the Common Stock.




                                       26

<PAGE>   30

DEPENDENCE ON KEY PERSONNEL

      The Company's future success depends in large part on the continued
service of its key technical, marketing and management personnel and on its
ability to continue to attract and retain qualified employees, particularly its
Chief Executive Officer, Mark D. Dankberg, and those highly skilled design,
process and test engineers involved in the manufacture of existing products and
the development of new products and processes. The competition for such
personnel is intense, and the loss of key employees could have a material
adverse effect on the Company's business, financial condition and results of
operations. The Company does not have employment agreements with any of its
officers or employees. The Company has obtained, however, a key man insurance
policy on the life of Mr. Dankberg in the amount of $500,000, of which the
Company is the sole beneficiary. See "Business -- Employees."





                                       27

<PAGE>   31


I
TEM 2. PROPERTIES

      The Company's headquarters are located in an approximately 37,000 square
foot leased facility in Carlsbad, California. This facility houses the Company's
management, marketing and sales personnel. The lease for this facility
terminates in November 1998. The Company also leases another facility in
Carlsbad, California containing approximately 49,000 square feet for research
and development, application engineering and manufacturing coordination
activities. This lease terminates in July 1999 with options to renew for two
additional periods of two years each. In addition, the Company leases two
smaller sales facilities aggregating approximately 2,600 square feet located in
Boston, Massachusetts, and Melbourne, Florida. The Boston lease terminates in
May 1998 with an option to renew for one additional period of two years. The
Melbourne lease terminated in March 1997 and is currently being rented on a
monthly basis. Annual leasing costs of the Company totaled $781,000, $608,000
and $493,000 for the fiscal years ended March 31, 1997, 1996 and 1995,
respectively. The Company is seeking additional facilities to meet its current
requirements and believes that suitable additional space will be located on
commercially reasonable terms.


ITEM 3. LEGAL PROCEEDINGS

      The Company is not a party to any legal proceedings other than various
claims and lawsuits arising in the ordinary course of its business which, in the
opinion of the Company's management, are not individually or in the aggregate
material to its business.


ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

         No matters were submitted to a vote of security holders during the
quarter ended March 31, 1997.





                                       28

<PAGE>   32


                                     PART II


ITEM 5.  MARKET FOR REGISTRANT'S COMMON STOCK AND RELATED STOCKHOLDER MATTERS

         The Common Stock of the Company is traded on the Nasdaq National Market
under the symbol "VSAT." The Common Stock was initially offered to the public on
December 3, 1996 at $9.00 per share. The following table sets forth the range of
high and low sales prices on the Nasdaq National Market of the Company's Common
Stock for the periods indicated, as reported by Nasdaq. Such quotations
represent inter-dealer prices without retail markup, markdown or commission and
may not necessarily represent actual transactions.


<TABLE>
<CAPTION>
           FISCAL 1997                             HIGH         LOW
                                                   ----         ----
<S>                                               <C>          <C>  
             Third Quarter (a)                    $ 9.63       $8.38
             Fourth Quarter                       $12.25       $8.75
</TABLE>



      As of June 16, 1997, there were 179 holders of record of the Common stock.

      To date, the Company has neither declared nor paid any dividends on the
Common Stock. The Company currently intends to retain all future earnings, if
any, for use in the operation and development of its business and, therefore,
does not expect to declare or pay any cash dividends on the Common Stock in the
foreseeable future. In addition, an equipment financing agreement of the Company
prohibits the payment of any cash dividends on the Company's capital stock.


____________

(a) Subsequent to December 3, 1996.



                                       29

<PAGE>   33


ITEM 6.  SELECTED FINANCIAL DATA

         The following data has been derived from the Company's audited
financial statements. The balance sheet at March 31, 1997 and 1996 and the
related statements of income and of cash flows of the Company for the three
years ended March 31, 1997 and notes thereto appear elsewhere herein. The data
should be read in conjunction with the annual financial statements, related
notes and other financial information appearing elsewhere herein. All amounts
shown are in thousands, except per share data.



<TABLE>
<CAPTION>
                                                               YEARS ENDED MARCH 31,
                                     ---------------------------------------------------------------
                                       1997          1996         1995          1994          1993
                                     --------     --------      --------      --------      --------
<S>                                  <C>          <C>           <C>           <C>           <C>     
STATEMENT OF INCOME DATA:
  Revenues                           $ 47,715     $ 29,017      $ 22,341      $ 11,579      $  5,072
  Cost of revenues                     33,102       20,983        16,855         9,033         3,939
                                     --------     --------      --------      --------      --------
    Gross profit                       14,613        8,034         5,486         2,546         1,133
  Operating expenses:
    Selling, general and               
      administrative                    4,752        3,400         2,416         1,554           740
    Independent research and            
      development                       5,087        2,820           788           134            59
                                     --------     --------      --------      --------      --------
  Income from operations                4,774        1,814         2,282           858           334
  Net interest income (expense)           100         (231)          (87)          (45)          (17)
                                     --------     --------      --------      --------      --------
  Income before income taxes            4,874        1,583         2,195           813           317
  Provision (benefit) for income 
    taxes                               1,702          (50)          888           328            93
                                     --------     --------      --------      --------      --------
  Net income                         $  3,172     $  1,633      $  1,307      $    485      $    224
                                     ========     ========      ========      ========      ========

  Pro forma net income per share(1)  $   0.47     $   0.28
                                     ========     ========
  Shares used in per share
    calculations(1)                     6,702        5,876
                                     ========     ========
</TABLE>




<TABLE>
<CAPTION>
                                                                MARCH 31,
                                     ---------------------------------------------------------------
                                       1997         1996          1995          1994          1993
                                     --------     --------      --------      --------      --------
<S>                                   <C>          <C>           <C>          <C>            <C>         
BALANCE SHEET DATA:
  Cash and cash equivalents           $12,673      $ 2,297       $ 2,731      $     9        $    75     
  Working capital                      20,406        4,651         2,808        1,486            964     
  Total assets                         35,674       13,262         9,377        4,986          2,550     
  Long-term debt, less current          1,428        1,747         1,220          297            124     
     portion                                                                                         
  Total stockholders' equity           23,619        5,217         3,413        1,956          1,465     
</TABLE>

                                                                

____________ 

(1) For an explanation of the determination of the number of shares used in
    computing pro forma net income per share, see Note 1 of the Notes to 
    Financial Statements.



                                       30

<PAGE>   34


ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND 
         RESULTS OF OPERATIONS

OVERVIEW

    Historically, the Company's revenues have been principally derived from
contracts with the DOD. The Company's DOD revenues have continued to grow
significantly despite government budgetary constraints. Since 1992, such
revenues have grown at a compounded annual growth rate of approximately 63%. DOD
revenues amounted to $46.3 million, $28.3 million and $21.2 million for the
fiscal years ended March 31, 1997, 1996 and 1995, respectively. The Company has
achieved this growth rate entirely through internal growth, and not through
acquisitions. See "Risk Factors -- Fluctuations in Results of Operations."

    The Company's products and services are provided primarily through three
types of contracts: fixed-price, time-and-materials and cost-reimbursement
contracts. Approximately 63.3% and 56.3% of the Company's total revenues for the
fiscal years ended March 31, 1997 and 1996, respectively, were derived from
fixed-price contracts which require the Company to provide products and services
under a contract at a stipulated price. The Company derived approximately 6.0%
and 5.0% of its revenues during such periods from time-and-materials contracts
which reimburse the Company for the number of labor hours expended at an
established hourly rate negotiated in the contract, plus the cost of materials
utilized in providing such products or services. The remaining 30.7% and 38.7%
of the Company's revenues for the fiscal years ended March 31, 1997 and 1996,
respectively, were derived from cost-reimbursement contracts under which the
Company is reimbursed for all actual costs incurred in performing the contract
to the extent that such costs are within the contract ceiling and allowable
under the terms of the contract, plus a fee or profit. See "Risk Factors --
Contract Profit Exposure."

    As of March 31, 1997, the Company had firm backlog of $78.4 million, of
which $67.6 million was funded. Of the $78.4 million in firm backlog,
approximately $46.7 million is expected to be delivered in the fiscal year
ending March 31, 1998, approximately $13.2 million is expected to be delivered
in the fiscal year ending March 31, 1999 and the balance is expected to be
delivered in the fiscal years ending March 31, 2000 and thereafter. The Company
received $100.0 million in awards during the year ended March 31, 1997,
consisting of $62.0 million in UHF DAMA satellite communications awards, $25.2
million in awards for the defense simulator business, $9.5 million in other
defense awards and $3.3 million in commercial satellite communications awards.
The Company's $78.4 million in firm backlog at March 31, 1997 excludes an
additional $24.9 million of customer options. See "Business -- Backlog."

    Historically, a significant portion of the Company's revenue has been
derived from research and development contracts with the DOD. The research and
development efforts are conducted in direct response to the specific
requirements of a customer's order and, accordingly, expenditures related to
such efforts are included in cost of sales when incurred and the related funding
(which includes a profit component) is included in net revenues at such time.
Revenues are recognized using the percentage of completion method on these
long-term development contracts. Revenues for funded research and development
during the fiscal years ended March 31, 1997, 1996 and 1995 were approximately
$21.3 million, $19.5 million and $20.7 million, respectively. See "Business --
Research and Development."

    Beginning in fiscal 1995, production contracts for delivery of previously
developed equipment became a more significant percentage of total revenues.
Production contracts amounted to approximately 35.3%, 19.4%, and 6.5% of fiscal
1997, 1996, and 1995 total revenues, respectively.

       The Company invests in independent research and development ("IR&D"),
which is not directly funded by a third party. The Company expenses IR&D costs
as they are incurred. IR&D expenses consist primarily of salaries and other
personnel-related expenses, supplies and prototype materials related to research
and development programs. IR&D expenses for governmental and commercial
applications were minimal prior to fiscal 1995. In the fourth quarter of fiscal
1995, the Company began investing a significant amount of IR&D funds primarily
in the development of satellite telephony and other satellite DAMA products. The
Company expended 10.6% and 9.7% of revenues in IR&D during the fiscal years
ended March 31, 1997 and 1996, respectively. The Company expects that IR&D
expenditures will continue to 




                                       31

<PAGE>   35

increase in order to fund growth in government and commercial applications. As a
government contractor, the Company is able to recover a portion of its IR&D
expenses pursuant to its government contracts.


RESULTS OF OPERATIONS

    The following table sets forth, as a percentage of total revenues, certain
income data for the periods indicated.



<TABLE>
<CAPTION>
                                                FISCAL YEARS ENDED
                                                     MARCH 31,
                                           ---------------------------
                                           1997        1996       1995
                                           -----      -----      -----
<S>                                        <C>        <C>        <C>   
Revenues                                   100.0%     100.0%     100.0%
Cost of revenues                            69.4       72.3       75.4
                                           -----      -----      -----
Gross profit                                30.6       27.7       24.6
Operating expenses:
Selling, general and administrative         10.0       11.7       10.8
Independent research and development        10.6        9.7        3.5
                                           -----      -----      -----
Income from operations                      10.0        6.3       10.3
Income before income taxes                  10.2        5.5        9.9
Net income                                   6.6        5.6        5.9
</TABLE>



   FISCAL YEAR ENDED MARCH 31, 1997 VS. FISCAL YEAR ENDED MARCH 31, 1996

    Revenues. The Company's revenues increased 64.4% from $29.0 million in
fiscal 1996 to $47.7 million in fiscal 1997. This increase was primarily due to
a $13.0 million increase in revenues generated by contracts with the U.S. Air
Force for UHF DAMA network control stations, and a revenue increase of $8.7
million generated by Enhanced Manpack UHF Terminal ("EMUT") DAMA modem
production, offset in part by reduced activity in other product lines and the
completion of certain contracts. UHF DAMA business area revenues grew from $12.4
million (42.8% of revenues) in fiscal 1996 to $32.8 million (68.8% of revenues)
in fiscal 1997.

    Gross Profit. Gross profit increased 81.9% from $8.0 million (27.7% of
revenues) in fiscal 1996 to $14.6 million (30.6% of revenues) in fiscal 1997.
This increase primarily reflects improved contract profitability and higher
prices related to the recovery of allowable IR&D costs under certain government
contracts.

    Selling, General and Administrative Expenses. Selling, general and
administrative ("SG&A") expenses increased 39.8% from $3.4 million (11.7% of
revenues) in fiscal 1996 to $4.8 million (10.0% of revenues) in fiscal 1997. The
Company continued to increase administrative staff to support IR&D related to
its StarWire(TM) DAMA product, increased its business development staff for
defense programs, and added to finance and administrative staffing. Bid and
proposal efforts increased from $1.0 million in fiscal 1996 to $1.2 million in
fiscal 1997.

    Independent Research and Development. IR&D expenses increased 80.4% from
$2.8 million (9.7% of revenues) in fiscal 1996 to $5.1 million (10.6% of
revenues) in fiscal 1997. Expenditures on the development of the Company's
StarWire(TM) DAMA product began in the last quarter of fiscal 1995 and have been
steadily increasing.

    Interest Expense. Interest expense decreased 2.3% from $260,000 in fiscal
1996 to $254,000 in fiscal 1997. Total outstanding equipment loans were $2.5
million at the end of fiscal 1996 and $2.6 million at the end of fiscal 1997.
There were no outstanding borrowings under the Company's line of credit at the
end of each fiscal year.





                                       32

<PAGE>   36

    Interest Income.  Interest income increased from $29,000 in fiscal 1996 to 
$354,000 in fiscal 1997. Interest income relates to interest earned on
short-term deposits of cash.

    Provision (Benefit) for Income Taxes. The income tax benefit in fiscal 1996
was primarily attributable to the utilization of research and development
credits generated during the current period and the impact of a United States
Federal judicial decision which clarified the tax law related to the utilization
of research and development credits generated from funded research and
development. The income tax provision in fiscal 1997 was less than the combined
federal and state statutory rate due to the utilization of research and
development credits.

   FISCAL YEAR ENDED MARCH 31, 1996 VS. FISCAL YEAR ENDED MARCH 31, 1995

    Revenues. The Company's revenues increased 29.9% from $22.3 million in
fiscal 1995 to $29.0 million in fiscal 1996. This increase reflects the growth
in defense related production contracts, primarily associated with the Company's
EMUT DAMA modem products, which experienced a $5.3 million increase, and
Advanced Data Controller ("ADC") products, which experienced a $1.5 million
increase. Revenues from production orders (compared to funded research and
development) increased from $1.4 million (6.5% of revenues) in fiscal 1995 to
$5.6 million (19.4% of revenues) in fiscal 1996.

    Revenues from UHF DAMA satellite communications products increased to 42.8%
of revenues in fiscal 1996. This increase was due to the first EMUT DAMA modem
production deliveries in the fourth quarter of 1996. UHF DAMA business area
revenues grew from $7.1 million (31.7% of revenues) in fiscal 1995 to $12.4
million (42.8% of revenues) in fiscal 1996.

    Gross Profit. Gross profit increased 46.4% from $5.5 million (24.6% of
revenues) in fiscal 1995 to $8.0 million (27.7% of revenues) in fiscal 1996.
This increase primarily reflects higher prices related to the recovery of
allowable IR&D costs under certain government contracts and improved contract
profitability under certain production contracts.

    Selling, General and Administrative Expenses. SG&A expenses increased 40.7%
from $2.4 million (10.8% of revenues) in fiscal 1995 to $3.4 million (11.7% of
revenues) in fiscal 1996. Increased SG&A expenses were offset somewhat by the
continuing revenue growth. The Company continued to increase administrative
staff to support IR&D related to its StarWire(TM) DAMA product, increased its
business development staff for defense programs, and added to finance and
administrative staffing. Bid and proposal efforts increased from $321,000 in
fiscal 1995 to $1.0 million in fiscal 1996.

    Independent Research and Development. IR&D expenses increased 257.9% from
$788,000 (3.5% of revenues) in fiscal 1995 to $2.8 million (9.7% of revenues) in
fiscal 1996. Expenditures on the development of the Company's StarWire(TM) DAMA
product began in the last quarter of fiscal 1995 and have been steadily
increasing.

    Interest Expense. Interest expense increased 128.1% from $114,000 in fiscal
1995 to $260,000 in fiscal 1996. Total outstanding equipment loans were $1.7
million at the end of fiscal 1995 and $2.5 million at the end of fiscal 1996.
There were no outstanding borrowings under the Company's line of credit at the
end of each fiscal year.

    Interest Income.  Interest income increased 7.4% from $27,000 in fiscal 
1995 to $29,000 in fiscal 1996. Interest income relates to interest earned on
short-term deposits of cash.

    Provision (Benefit) for Income Taxes. The income tax provision in fiscal
1995 approximated the combined federal and state statutory rate of 40.0%. The
income tax benefit in fiscal 1996 was primarily attributable to the utilization
of research and development credits generated during the current period and the
impact of a United States Federal judicial decision which clarified the tax law
related to the utilization of research and development credits generated from
funded research and development.


                                       33

<PAGE>   37

LIQUIDITY AND CAPITAL RESOURCES

      The Company has financed its operations to date primarily from cash flow
from operations, bank line of credit financing, equity financing and loans for
the purchase of capital equipment. Cash (used)/provided by operating activities
for the fiscal years ended March 31, 1997 and 1996 was ($1.2) million and
$456,000, respectively. The relative increase in cash used for operating
activities for the year ended March 31, 1997 compared to the prior year was
primarily due to higher levels of accounts receivable and inventory, which was
partially offset by a $1.5 million increase in net income and higher levels of
accounts payable and accrued liabilities. The increase in accounts receivable,
accounts payable, and accrued liabilities resulted from an increase in the
Company's revenues. The growing share of revenues from production contracts led
to the need to build inventory levels to support production demands. The Company
anticipates that in future periods the level of inventory will be higher than
historical levels.

      Cash used in investing activities for the fiscal years ended March 31,
1997 and 1996 was $3.7 million and $1.9 million, respectively. The increase was
the result of purchases of property and equipment, primarily consisting of test
equipment and computers.

      Cash provided by financing activities for the fiscal years ended March 31,
1997 and 1996 was $15.3 million and $1.0 million, respectively. This increase
was primarily the result of $14.8 million of capital raised in the Company's
initial public offering which closed in December 1996. This relative increase
was offset by lower net financing provided by the Company's equipment line of
credit.

      At March 31, 1997, the Company had $12.7 million in cash and cash
equivalents, $20.4 million in working capital and $1.4 million in long-term debt
which consists of equipment financing. The Company had a zero balance under its
line of credit at March 31, 1997 and 1996.

      The Company's credit facility with Union Bank includes a $6.0 million line
of credit and $4.5 million in commitments for equipment financing. The line of
credit allows the Company to borrow, for general working capital purposes, the
greater of $2.0 million or 80% of eligible accounts receivable plus 50% of the
Company's eligible inventory. At the Company's option interest accrues either at
the bank's prime rate (8.5% at March 31, 1997) or at the banks LIBOR rate plus
1.75%(7.69% at March 31, 1997). The credit facility expires on September 15,
1998. The Company is required to pay a fee equal to 0.09% of the unused portion
of the line of credit on a quarterly basis.

      The equipment line consists of three loans, each of which limits
borrowings to an 80.0% advance against the purchase price, net of sales tax,
delivery and insurance. The first loan has been converted into a fully
amortizing loan which matures on September 15, 1999. All borrowings under the
second loan, which may not exceed $2.0 million, must be made before September
15, 1997, at which time all unpaid principal under such loan will be converted
into a fully amortizing loan for a period of 36 months with a maturity date of
September 15, 2000. All borrowings under the third loan, which may not exceed
$2.5 million, must be made before September 15, 1998, at which time all unpaid
principal under such loan will be converted into a fully amortizing loan for a
period of 36 months with a maturity date of September 15, 2001.

      The Company's future capital requirements, which management anticipates
will not exceed $10.0 million over the next 12 months, will depend upon many
factors, including the progress of the Company's research and development
efforts, expansion of the Company's marketing efforts, and the nature and timing
of commercial orders. The Company believes that its current cash balances,
amounts available under its credit facilities and net cash expected to be
provided by operating activities, will be sufficient to meet its working capital
and capital expenditure requirements for at least the next 12 months. Management
intends to invest the Company's cash in excess of current operating requirements
in short-term, interest-bearing, investment-grade securities.



                                       34

<PAGE>   38

SUMMARIZED QUARTERLY DATA (UNAUDITED)

         The following financial information reflects all normal recurring
adjustments which are, in the opinion of management, necessary for the fair
statement of the results of the interim periods. Summarized quarterly data for
fiscal 1997 and 1996 is as follows (in thousands, except per share data):


<TABLE>
<CAPTION>
                                    1st Quarter      2nd Quarter   3rd Quarter     4th Quarter
                                    -----------      -----------   -----------     -----------
<S>                                    <C>             <C>            <C>            <C>    
1997
Revenues                               $9,732          $11,850        $12,079        $14,054
Gross  profit                           2,870            3,379          3,832          4,532
Income from operations                    772              947          1,288          1,767
Net income                                478              604            853          1,237
Pro forma net income per share (1)     $  .08          $   .10        $   .13
Net income per share (1)                                                             $   .15

1996
Revenues                               $6,768          $ 7,388        $ 5,755        $ 9,106
Gross  profit                           1,938            2,108          1,713          2,275
Income from operations                    553              545            129            587
Net income                                541              503             70            519
Pro forma net income per share (1)     $  .09          $   .09        $   .01        $   .09
</TABLE>



- -------------

(1)  Pro forma net income per share and net income per share computations for
     each quarter are independent and may not add up to the pro forma net income
     per share computation for the respective year. See Note 1 of Notes to the
     Financial Statements for an explanation of the determination of pro forma
     net income per share.



I
TEM 8. FINANCIAL STATEMENTS

      The Company's financial statements at March 31, 1997 and 1996, and for
each of the three years in the period ended March 31, 1997, and the Report of
Price Waterhouse LLP, Independent Accountants, are included in this Report on
pages F-1 through F-14.


ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND 
        FINANCIAL DISCLOSURE

     None.




                                       35

<PAGE>   39


                                    PART III


ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

      The information required by this item will be set forth under the captions
"Election of Directors" and "Executive Officers" in the Company's definitive
Proxy Statement to be filed with the Securities and Exchange Commission in
connection with the 1997 Annual Meeting of Stockholders (the "Proxy Statement"),
which is incorporated by reference herein.


ITEM 11. EXECUTIVE COMPENSATION

     The information required by this item is incorporated by reference to the 
Proxy Statement under the heading "Executive Compensation."


ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The information required by this item is incorporated by reference to the 
Proxy Statement under the heading "Security Ownership of Certain Beneficial
Owners and Management."



ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

      The information required by this item is incorporated by reference to the
Proxy Statement under the heading "Certain Transactions."




                                       36

<PAGE>   40


                                     PART IV


ITEM 14. EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES AND REPORTS ON FORM 8-K


<TABLE>
<CAPTION>
                                                                           PAGE
                                                                          NUMBER
                                                                          ------
<S>  <C>                                                                    <C>
(a)  Documents filed as part of the report:
     (1)           Report of Independent Accountants                        F-1
                   Balance Sheets at March 31, 1997 and 1996                F-2
                   Statements of Income for Fiscal 1997, 1996 and 1995      F-3
                   Statements of Cash Flow for Fiscal 1997, 1996 and 1995   F-4
                   Statements of Stockholders' Equity for Fiscal 1997,
                   1996 and 1995                                            F-5
                   Notes to Financial Statements                            F-6
</TABLE>



      Financial statement schedules other than those listed above have been
omitted because they are either not required, not applicable or the information
is otherwise included.

     (2)   Exhibits


<TABLE>
<CAPTION>
           EXHIBIT
           NUMBERS               DESCRIPTION OF EXHIBIT
           --------              ----------------------
             <S>    <C>                     
             3.1    Amended and Restated Certificate of Incorporation.(1)

             3.2    Bylaws.(1)

             4.1    Form of Common Stock Certificate.(1)

            10.1    Preferred Stock Purchase Agreement, dated as of June 11,
                    1986, by and among the Company, Southern California
                    Ventures, Robert W. Johnson and Thomas A. Tisch.(1)

            10.2    Shareholders' Agreement, dated June 11, 1986, by and among
                    Southern California Ventures, Robert W. Johnson, Thomas A.
                    Tisch, the Company, Mark D. Dankberg, Steven R. Hart and
                    Mark J. Miller.(1)

            10.3    Form of Stock Restriction Agreement by and between the
                    Company and each stockholder of the Company.(1)

            10.4    Form of Invention and Confidential Disclosure Agreement by
                    and between the Company and each employee of the Company.(1)

            10.5    ViaSat, Inc. 1993 Stock Option Plan (the "1993 Stock Option
                    Plan").(1)

            10.6    First Amendment to the 1993 Stock Option Plan.(2)

            10.7    Form of Incentive Stock Option Agreement under the 1993
                    Stock Option Plan.(1)

            10.8    Form of Nonqualified Stock Option Agreement under the 1993
                    Stock Option Plan.(1)

            10.9    The 1996 Equity Participation Plan of ViaSat, Inc. (the
                    "1996 Equity Participation Plan").(1)

            10.10   Form of Incentive Stock Option Agreement under the 1996
                    Equity Participation Plan.(1)

            10.11   Form of Nonqualified Stock Option Agreement under the 1996
                    Equity Participation Plan.(1)

            10.12   The ViaSat, Inc. Employee Stock Purchase Plan.(1)

            10.13   ViaSat, Inc. 401(k) Profit Sharing Plan.(1)

            10.14   Loan Agreement, dated as of September 15, 1995, by and
                    between the Company and Union Bank.(1)

            10.15   Waiver and First Amendment to Loan Agreement, dated as of
                    March 31, 1997, by and between the Company and Union
                    Bank.(2)

            10.16   Business Loan Agreement, dated as of April 5, 1994, as
                    amended, by and between the Company and Scripps Bank.(1)

            10.17   Equipment Financing Agreement, dated April 28, 1994, by and
                    between the Company and Heritage Leasing Capital.(1)

            10.18   Equipment Financing Agreement, dated May 13, 1994, by and
                    between the Company and Heritage Leasing Capital.(1)
</TABLE>




                                       37

<PAGE>   41


<TABLE>
<CAPTION>
           EXHIBIT
           NUMBERS               DESCRIPTION OF EXHIBIT
           --------              ----------------------
             <S>    <C>                     
            10.19   Equipment Financing Agreement, dated September 19, 1994, by
                    and between the Company and Heritage Leasing Capital.(1)

            10.20   Equipment Financing Agreement, dated December 6, 1994, by
                    and between the Company and Heritage Leasing Capital.(1)

            10.21   Sublease, dated as of August 20, 1993, by and between
                    Whittaker Corporation and the Company (2290 Cosmos Court,
                    Carlsbad, California).(1)

            10.22   Lease Agreement, dated December 8, 1994, by and between The
                    Campus, LLC and the Company (The Campus, Carlsbad,
                    California).(1)

            10.23   Lease, dated March 21, 1995, by and between Nagog
                    Development Co. and the Company (125 Nagog Park, Acton,
                    Massachusetts).(1)

            10.24   Lease, dated March 8, 1996, by and between Harry and Wendy
                    Brandon and the Company(1900 S. Harbor City Blvd.,
                    Melbourne, Florida).(1)

            10.25   Basic Ordering Agreement, dated November 8, 1994, as
                    amended, by and between the Company and AT&T acting through
                    its Tridom division.(1)

            10.26   Supply & Services Contract, dated June 2, 1996, by and
                    between HCL Comnet Systems and Services Limited and the
                    Company.(1)

            10.27   Basic Ordering Agreement Subcontract, dated March 4, 1994,
                    by and between Magnavox Electronic Systems Company and the
                    Company.(1)

            10.28   Purchase Order Change to Basic Ordering Agreement
                    Subcontract, dated February 25, 1997, by and between Hughes
                    Defense Communications (formerly Magnavox Electronic Systems
                    Company) and the Company.(2)

            10.29   Award/Contract, effective March 29, 1996, as amended, issued
                    by Electronic Systems Center/MCK Air Force Materiel Command,
                    USAF to the Company.(1)

            10.30   Amendment of Award/Contract, effective February 24, 1997,
                    issued by Electronic Systems Center/MCK Air Force Materiel
                    Command, USAF to the Company.(2)

            10.31   Award/Contract, effective October 2, 1995, issued by
                    Electronic Systems Center/MCK Air Force Materiel Command,
                    USAF to the Company.(1)

            10.32   Award/Contract, effective September 29, 1993, as amended,
                    issued by Information Technology Acquisition Center to the
                    Company.(1)

            10.33   Turnkey Agreement, dated August 9, 1996, by and between
                    Hutchison Corporate Access (HK) Limited and the Company.(1)

            10.34   Award/Contract, effective July 30, 1991, issued by
                    Electronic Systems Division Air Force Systems Command, USAF
                    to the Company.(1)

            10.35   Award/Contract, effective September 27, 1993, as amended,
                    issued by Contracting Officer Naval Research Laboratory to
                    the Company.(1)

            10.36   Award Contract, effective September 21, 1994, as amended,
                    issued by Technical Contract Management Office to the
                    Company.(1)

            10.37   Fixed Price Contract, dated as of October 18, 1995, by and
                    between the Company and Spectragraphics.(1)

            11.1    Statement re: Computation of per share earnings.(2)

            21.1    Subsidiaries.(1)

            23.1    Consent of Independent Accountants.(2)

            27.1    Financial Data Schedule.(2)
</TABLE>


- ----------

 (1)  Incorporated by reference to the Registrant's Registration Statement on
      Form S-1 filed with the Securities and Exchange Commission (the
      "Commission") on October 1, 1996 (File No. 333-13183), as amended by
      Amendment No 1 filed with the Commission on November 5, 1996, Amendment
      No. 2 filed with the Commission on November 20, 1996, and Amendment No. 3
      filed with the Commission on November 22, 1996.

(2)      Filed herewith.


                                       38

<PAGE>   42

(b)   REPORTS ON FORM 8-K

         There were no reports on Form 8-K filed by the registrant during the
forth quarter of the fiscal year ended March 31, 1997.

(c)   EXHIBITS

         The exhibits required by this Item are listed under Item 14(a)(2).



                                       39

<PAGE>   43

                           GLOSSARY OF SELECTED TERMS

DAMA..............................Demand Assigned Multiple Access. A protocol
                                    for assigning a communication channel to a
                                    user only upon request.

DOD...............................Department of Defense.

Downlink..........................A radio transmission from a satellite back
                                    down toward the earth.

EMUT..............................Enhanced Manpack UHF Terminal. A small,
                                    portable satellite terminal for DOD that
                                    operates in the UHF frequency band.

FDMA..............................Frequency Division Multiple Access. A protocol
                                    that assigns each communication channel to a
                                    different transmission frequency.

GHz...............................Giga Hertz. One billion cycles per second. A
                                    measure of frequency or bandwidth.

LEO...............................Low Earth Orbit.

Local Loop Services...............Local telephony service.

MHz...............................Mega Hertz. One million cycles per second. A
                                    measure of frequency or bandwidth.

MIL-STD...........................Military standard.

NCS...............................Network Control System. The satellite terminal
                                    and computer that manages channel
                                    assignments in a DAMA network.

Network...........................A collection of user terminals linked together
                                    by a satellite.

PSTN..............................Public Switched Telephone Network.

RF................................Radio Frequency.

SCPC..............................Single Channel Per Carrier. A signalling
                                    technique that transmits one voice or data
                                    circuit per radio channel.

SHF...............................Super High Frequency radio transmissions.

TDM...............................Time Division Multiplexing. A protocol for
                                    combining several different circuits into a
                                    single, continuous transmission.

TDMA..............................Time Division Multiple Access. A protocol for
                                    time sharing a single communication channel
                                    among a number of different users.

Transponder.......................A receiving and transmitting device on board a
                                    satellite that relays an uplink transmission
                                    from a satellite terminal back down to
                                    earth.

UHF...............................Ultra High Frequency radio transmissions.





                                       40

<PAGE>   44

Uplink............................A radio transmission from a satellite terminal
                                    that is sent up to a satellite.

VSAT..............................Very Small Aperture Terminal. A satellite
                                    terminal with a very small antenna. A VSAT
                                    antenna is typically considered to be less
                                    than 3.7 meters in diameter.

Wireless Local Loop ..............Wireless switched local telephony service.



                                       41

<PAGE>   45


                                   SIGNATURES

     Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

Date:  June 16, 1997.


                                   ViaSat, Inc.

                                   By:  /s/  MARK D. DANKBERG
                                       -----------------------------
                                        Mark D. Dankberg
                                        Chairman, President and Chief 
                                        Executive Officer

     Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.


<TABLE>
<CAPTION>
       SIGNATURE                     TITLE                         DATE
       ---------                     -----                         ----
<S>                           <C>                               <C>
 /s/  MARK D. DANKBERG        Chairman of the Board,            June 16, 1997
 ---------------------------  President and Chief          
 Mark D. Dankberg             Executive Officer (Principal 
                              Executive Officer)           
                              

 /s/  GREGORY D. MONAHAN      Vice President, Chief             June 16, 1997
- ----------------------------  Financial Officer and
Gregory D. Monahan            General Counsel (Principal
                              Financial Officer and
                              Principal Accounting
                              Officer)

 /s/  ROBERT W. JOHNSON       Director                          June 16, 1997
 ---------------------------
 Robert W. Johnson

 /s/  JEFFREY M. NASH         Director                          June 16, 1997
 ---------------------------
 Jeffrey M. Nash

 /s/  B. ALLEN LAY            Director                          June 16, 1997
 ---------------------------
 B. Allen Lay

 /s/  JAMES F. BUNKER         Director                          June 16, 1997
 ---------------------------
 James F. Bunker
</TABLE>





                                       42

<PAGE>   46


                        REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors and Stockholders of ViaSat, Inc.

In our opinion, the financial statements listed in the index appearing under
item 14(a)(1) on page 37 present fairly, in all material respects, the financial
position of ViaSat, Inc. at March 31, 1997 and 1996, and the results of its
operations and its cash flows for each of the three years in the period ended
March 31, 1997, in conformity with generally accepted accounting principles.
These financial statements are the responsibility of the Company's management;
our responsibility is to express an opinion on these financial statements based
on our audits. We conducted our audits of these statements in accordance with
generally accepted auditing standards which require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for the opinion expressed
above.


PRICE WATERHOUSE LLP

San Diego, California
May 12, 1997




                                       F-1

<PAGE>   47

                                  VIASAT, INC.

                                  BALANCE SHEET



<TABLE>
<CAPTION>
                                                                   MARCH 31,         MARCH 31,
                                                                     1997              1996
                                                                 ------------      ------------
<S>                                                              <C>               <C>         
              ASSETS

Current assets:
  Cash and cash equivalents                                      $ 12,673,000      $  2,297,000
  Accounts receivable                                              10,315,000         6,171,000
  Inventory                                                         4,478,000         1,223,000
  Deferred income taxes                                               863,000           484,000
  Other current assets                                              1,825,000           170,000
                                                                 ------------      ------------
     Total current assets                                          30,154,000        10,345,000
Property and equipment, net                                         5,085,000         2,789,000
Other assets                                                          435,000           128,000
                                                                 ------------      ------------
          Total assets                                           $ 35,674,000      $ 13,262,000
                                                                 ============      ============

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
  Accounts payable                                               $  4,844,000      $  2,774,000
  Accrued liabilities                                               3,769,000         2,157,000
  Current portion of notes payable                                  1,135,000           763,000
                                                                 ------------      ------------
     Total current liabilities                                      9,748,000         5,694,000
                                                                 ------------      ------------
Notes payable                                                       1,428,000         1,747,000

Other liabilities                                                     879,000           604,000
                                                                 ------------      ------------
     Total long-term liabilities                                    2,307,000         2,351,000
                                                                 ------------      ------------
Commitments and contingencies (Notes 10 & 11)
Stockholders' equity:
Series A, convertible preferred stock, $.0001 par value;
  5,000,000, and 3,225,000 shares authorized; no shares and
  3,225,0000 shares issued and outstanding at March 31, 1997
  and March 31,1996,  respectively                                                       32,000
Common stock, $.0001 par value, 25,000,000 and
  7,335,000 shares authorized; 7,742,274 and
  3,342,101 issued and outstanding at March 31,
  1997 and March 31, 1996, respectively                                81,000            46,000
Paid in capital                                                    16,044,000           737,000
Stockholders' notes receivable                                        (80,000)
Retained earnings                                                   7,574,000         4,402,000
                                                                 ------------      ------------
     Total stockholders' equity                                    23,619,000         5,217,000
                                                                 ------------      ------------
     Total liabilities and stockholders' equity                  $ 35,674,000      $ 13,262,000
                                                                 ============      ============
</TABLE>



                 See accompanying notes to financial statements


                                      F-2

<PAGE>   48

                                  VIASAT, INC.

                               STATEMENT OF INCOME


<TABLE>
<CAPTION>

                                                       YEAR ENDED MARCH 31,
                                         ---------------------------------------------
                                             1997             1996            1995
                                         -----------      -----------      -----------
<S>                                      <C>              <C>              <C>        
Revenues                                 $47,715,000      $29,017,000      $22,341,000
Cost of revenues                          33,102,000       20,983,000       16,855,000
                                         -----------      -----------      -----------
  Gross profit                            14,613,000        8,034,000        5,486,000
Operating expenses:
  Selling, general and
     administrative                        4,752,000        3,400,000        2,416,000
  Independent research and
     development                           5,087,000        2,820,000          788,000
                                         -----------      -----------      -----------
Income from operations                     4,774,000        1,814,000        2,282,000
Other income (expense):
Interest income                              354,000           29,000           27,000
Interest expense                            (254,000)        (260,000)        (114,000)
                                         -----------      -----------      -----------
Income before income taxes .               4,874,000        1,583,000        2,195,000
Provision (benefit) for income taxes       1,702,000          (50,000)         888,000
                                         -----------      -----------      -----------
Net income                               $ 3,172,000      $ 1,633,000      $ 1,307,000
                                         ===========      ===========      ===========

Pro forma net income per share           $      0.47      $      0.28
                                         ===========      ============ 

Shares used in computing pro
  forma net income per share               6,702,414        5,875,729
                                         ===========      ===========
</TABLE>




                 See accompanying notes to financial statements.



                                      F-3

<PAGE>   49

                                  VIASAT, INC.

                             STATEMENT OF CASH FLOWS


<TABLE>
<CAPTION>
                                                                   YEAR ENDED MARCH 31,
                                                     ------------------------------------------------
                                                          1997              1996              1995
                                                     ------------      ------------      ------------
<S>                                                  <C>               <C>               <C>         
Cash flows from operating activities:
  Net income                                         $  3,172,000      $  1,633,000      $  1,307,000
  Adjustments to reconcile net income
    to net cash (used in) provided by
    operating activities:
    Depreciation                                        1,389,000           982,000           542,000
    Deferred income taxes                                (721,000)         (350,000)          (13,000)
  Increase (decrease) in cash resulting
    from changes in:
    Accounts receivable                                (4,144,000)       (1,871,000)         (265,000)
    Inventory                                          (3,255,000)       (1,019,000)         (189,000)
    Other assets                                       (1,620,000)         (186,000)          (43,000)
    Accounts payable                                    2,070,000         1,294,000           530,000
    Accrued liabilities                                 1,612,000          (512,000)        1,331,000
    Other liabilities                                     275,000           485,000           119,000
                                                     ------------      ------------      ------------
      Net cash (used in) provided by
         operating activities                          (1,222,000)          456,000         3,319,000
                                                     ------------      ------------      ------------

Cash flows from investing activities:
  Purchases of property and equipment                  (3,685,000)       (1,875,000)       (1,701,000)
                                                     ------------      ------------      ------------

Cash flows from financing activities:
  Proceeds from short-term bank borrowings              2,600,000         1,400,000                --
  Repayment of short-term bank borrowings              (2,600,000)       (1,400,000)         (350,000)
  Proceeds from issuance of notes payable                 889,000         2,778,000         1,650,000
  Repayment of notes payable                             (836,000)       (1,964,000)         (346,000)
  Proceeds from issuance of common stock               15,230,000           171,000           150,000
                                                     ------------      ------------      ------------

       Net cash provided by financing activities       15,283,000           985,000         1,104,000
                                                     ------------      ------------      ------------

Net increase (decrease) in cash and cash
   equivalents                                         10,376,000          (434,000)        2,722,000
Cash and cash equivalents at beginning of period        2,297,000         2,731,000             9,000
                                                     ------------      ------------      ------------

Cash and cash equivalents at end of  period          $ 12,673,000      $  2,297,000      $  2,731,000
                                                     ============      ============      ============

Supplemental information:
  Cash paid for interest                             $    254,000      $    260,000      $    116,000
                                                     ============      ============      ============
  Cash paid for income taxes                         $  2,293,000      $    468,000      $    642,000
                                                     ============      ============      ============
</TABLE>





                 See accompanying notes to financial statements.


                                      F-4

<PAGE>   50

                                  VIASAT, INC.

                        STATEMENT OF STOCKHOLDERS' EQUITY


<TABLE>
<CAPTION>

                                  PREFERRED STOCK              COMMON  STOCK
                               ----------------------      ----------------------                   STOCKHOLDERS'
                               NUMBER OF                   NUMBER OF                    PAID IN        NOTES       RETAINED
                                SHARES        AMOUNT        SHARES        AMOUNT        CAPITAL     RECEIVABLE     EARNINGS
                               ---------   ----------      ---------    ---------    ------------  -------------   --------
<S>                            <C>         <C>             <C>          <C>          <C>            <C>            <C>
Balance at March 31,  1994     3,225,000   $   32,000      2,967,008    $  40,000    $    422,000                 $1,462,000

  Issuance of common stock                                   240,331        4,000         146,000
  Net income                                                                                                       1,307,000
                              ----------     --------     ----------     --------     ----------     --------     ----------

Balance at March 31, 1995      3,225,000       32,000      3,207,339       44,000         568,000                  2,769,000

  Issuance of common stock                                   134,762        2,000         169,000
  Net income                                                                                                       1,633,000
                              ----------     --------     ----------     --------     ----------     --------     ----------

Balance at March 31, 1996      3,225,000       32,000      3,342,101       46,000         737,000                  4,402,000

  Issuance of common stock                                 2,034,635        3,000      15,307,000
  Conversion of
    preferred stock           
    to common stock           (3,225,000)     (32,000)     2,365,538       32,000
  Shares subscribed                                                                                  $(80,000)
  Net income                                                                                                       3,172,000
                              ----------     --------     ----------     --------     ----------     --------     ----------
Balance at March 31,  1997           --      $    --       7,742,274     $ 81,000     $16,044,000    $(80,000)    $7,574,000
                              ==========     =========    ==========     ========     ===========    =========    ==========
</TABLE>




                 See accompanying notes to financial statements.



                                      F-5

<PAGE>   51

                                  VIASAT, INC.

                          NOTES TO FINANCIAL STATEMENTS

NOTE 1 - THE COMPANY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

   The Company

      ViaSat, Inc. (the "Company") designs, produces and markets advanced
digital satellite telecommunications and wireless signal processing equipment.

   Management Estimates and Assumptions

      The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those estimates.

   Cash Equivalents

      Cash equivalents consist of highly liquid investments with original
maturities of 90 days or less.

   Investments

      At March 31, 1997, the Company held investments in investment grade
securities with maturities of three months or less. Management determines the
appropriate classification of its investments in debt securities at the time of
purchase and reevaluates such designation as of each balance sheet date. The
Company has included these securities, net of amortization, in cash and cash
equivalents and has designated them as held to maturity.

   Revenue Recognition

      The majority of the Company's revenues are derived from services performed
for the United States Government and its prime contractors under a variety of
contracts including cost-plus-fixed fee, fixed-price, and time and materials
type contracts. Such sales amounted to $46,292,000, $28,305,000, and $21,226,000
for the years ended March 31, 1997, 1996 and 1995, respectively. Included in
these revenues are sales to a significant customer under various subcontracts
totaling $12,830,000, $5,269,000 and $4,166,000 during the years ended March 31,
1997, 1996 and 1995, respectively. The Company's five largest contracts (by
revenues) generated approximately 57.6% and 36.5% of the Company's total
revenues for the fiscal year ended March 31, 1997 and 1996, respectively.
Generally, revenues are recognized as services are performed using the
percentage of completion method, measured primarily by costs incurred to date
compared with total estimated costs at completion or based on the number of
units delivered. The Company provides for anticipated losses on contracts by a
charge to income during the period in which they are first identified.

      Contract costs, including indirect costs, are subject to audit and
negotiations with Government representatives. These audits have been completed
and agreed upon through fiscal year 1994. Contract revenues and accounts
receivable are stated at amounts which are expected to be realized upon final
settlement.

   Unbilled Accounts Receivable

      Unbilled receivables consist of costs and fees earned and billable on
contract completion or other specified events. The majority of unbilled
receivables is expected to be collected within one year.



                                      F-6

<PAGE>   52

   Concentration of Credit Risk

      Financial instruments that potentially subject the Company to significant
concentrations of credit risk consist primarily of cash equivalents and trade
accounts receivable which are generally not collateralized. The Company limits
its exposure to credit loss by placing its cash equivalents with high credit
quality financial institutions. Concentrations of credit risk with respect to
receivables are limited because the Company's primary customers are various
agencies of the United States Government and its prime contractors.

   Inventory

      Inventories are valued at the lower of cost or market, cost being
determined by the first-in, first-out method.

   Software Costs

      Software product development costs incurred from the time technological
feasibility is reached until the product is available for general release to
customers are capitalized and reported at the lower of cost or net realizable
value. Through March 31, 1997, no significant amounts were expended subsequent
to reaching technological feasibility.

   Property and Equipment

      Equipment, computers, and furniture and fixtures are recorded at cost, and
depreciated over estimated useful lives of 3 to 7 years under the straight-line
method. Additions to property and equipment together with major renewals and
betterments are capitalized. Maintenance, repairs and minor renewals and
betterments are charged to expense. When assets are sold or otherwise disposed
of, the cost and related accumulated depreciation or amortization are removed
from the accounts and any resulting gain or loss is recognized.

   Long-lived Assets

      The Company assesses potential impairments to its long-lived assets when
there is evidence that events or changes in circumstances have made recovery of
the asset's carrying value unlikely. An impairment loss would be recognized when
the sum of the expected future net cash flows is less than the carrying amount
of the asset. No such impairment losses have been identified by the Company.

   Warranty Reserves

      The Company provides limited warranties on certain of its products for
periods of up to three years. The Company recognizes warranty reserves based
upon an estimate of total warranty costs, with amounts expected to be incurred
within twelve months classified as a current liability.

   Income Taxes

      Income taxes are provided utilizing the liability method. The liability
method requires the recognition of deferred tax assets and liabilities for the
expected future tax consequences of temporary differences between the carrying
amounts and tax bases of assets and liabilities. Additionally, under the
liability method, changes in tax rates and laws will be reflected in income in
the period such changes are enacted.

   Fair Value of Financial Instruments

      At March 31, 1997, the carrying amounts of the Company's financial
instruments, including cash equivalents, trade receivables and accounts payable,
approximated their fair values due to their short term maturities. At March 31,
1997, the estimated fair value of the Company's long-term debt approximated its
carrying value.



                                      F-7

<PAGE>   53

   Stock Based Compensation

      The Company measures compensation expense for its stock-based employee
compensation plans using the intrinsic value method and provides pro forma
disclosures of net income and earnings per share as if the fair value-based
method had been applied in measuring compensation expense (Note 7).

   Pro forma net income per share

      Pro forma net income per share is computed based on the weighted average
number of common shares and common stock equivalents, using the treasury stock
method, outstanding during the respective periods after giving retroactive
effect to the conversion, which occurred upon the closing of the Company's
initial public offering, of all outstanding shares of preferred stock into
2,365,538 shares of common stock. Pursuant to Securities and Exchange Commission
Staff Accounting Bulletin No. 83, all issuances of common stock and all stock
options granted within one year prior to the Company's initial public offering
have been included as outstanding for all periods using the treasury stock
method. Historical earnings per share are not presented because such amounts are
not deemed meaningful due to the significant change in the Company's capital
structure that occurred in connection with the initial public offering.

   New Accounting Pronouncement

      In March 1997, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards (SFAS) No. 128, "Earnings Per Share." SFAS No.
128 will be adopted by the Company as required in the third quarter of fiscal
1998. Upon adoption of SFAS No. 128, the Company will present basic earnings per
share as well as diluted earnings per share. Basic earnings per share will be
computed based on the weighted average number of shares of common stock
outstanding during the period. Diluted earnings per share will be computed based
on the weighted average number of shares of common stock outstanding during the
period increased by the effect of dilutive stock options using the treasury
stock method. Pro forma basic earnings per share for the years ended March 31,
1997 and 1996 are $0.49 and $0.28, respectively. Pro forma diluted earnings per
share for the years ended March 31, 1997 and 1996 are $0.47 and $0.28,
respectively.

   Recapitalization

      In November 1996, the Company filed an Amended and Restated Certificate of
Incorporation to effect a .7335 for 1 reverse stock split of all outstanding
shares of common stock and stock options. All shares and per share data in the
accompanying financial statements have been adjusted retroactively to give
effect to the reverse stock split. The Amended and Restated Certificate of
Incorporation increases the authorized stock of the Company such that the
Company is authorized to issue 5,000,000 shares of $0.0001 par value preferred
stock, and 25,000,000 shares of $0.0001 par value common stock. Concurrently,
the conversion ratio of the Company's preferred stock was changed to .7335 for
1.

NOTE 2 - COMPLETION OF INITIAL PUBLIC OFFERING

On December 3, 1996, the Company completed its initial public offering for the
sale of 2,400,000 shares of common stock (of which 1,850,000 shares were sold by
the Company and 550,000 shares were sold by certain stockholders) at a price to
the public of $9 per share, which resulted in net proceeds to the Company of
$15,485,000 after payment of the underwriters' commissions but before deduction
of offering expenses.




                                      F-8

<PAGE>   54


NOTE 3 - COMPOSITION OF CERTAIN BALANCE SHEET CAPTIONS


<TABLE>
<CAPTION>
                                                      MARCH 31,
                                           -----------------------------
                                                1997            1996
                                           ------------      -----------
<S>                                        <C>                <C>
Cash and cash equivalents:
  Investments                              $  8,979,000                 
  Certificates of deposit                     1,500,000                 
  Cash                                        2,194,000         2,297,000
                                           ------------      ------------
                                           $ 12,673,000      $  2,297,000
                                           ============      ============
Accounts receivable:
  Billed                                   $  6,860,000      $  5,653,000
  Unbilled                                    3,455,000           518,000
                                           ------------      ------------
                                           $ 10,315,000      $  6,171,000
                                           ============      ============
Inventory:
  Raw materials                            $  1,418,000      $    753,000
  Work in process                             2,662,000           402,000
  Finished goods                                398,000            68,000
                                           ------------      ------------
                                           $  4,478,000      $  1,223,000
                                           ============      ============
Property and equipment:
  Machinery and equipment                  $  5,320,000      $  2,313,000
  Computer equipment                          3,012,000         2,213,000
  Furniture and fixtures                        256,000           380,000
                                           ------------      ------------
                                              8,588,000         4,906,000
  Less accumulated depreciation              (3,503,000)       (2,117,000)
                                           ------------      ------------
                                           $  5,085,000      $  2,789,000
                                           ============      ============
Accrued liabilities:
  Accrued vacation                         $    821,000      $    591,000
  Current portion of warranty reserve           806,000           413,000
  Accrued bonus                                 762,000           347,000
  Accrued 401(k) matching contribution          553,000           444,000
  Collections in excess of revenues             355,000           237,000
  Income taxes payable                          252,000            40,000
  Other                                         220,000            85,000
                                           ------------      ------------
                                           $  3,769,000      $  2,157,000
                                           ============      ============
</TABLE>



NOTE 4 - SHORT-TERM BANK BORROWINGS

      The Company has a $6,000,000 line of credit with a bank which allows it to
borrow the greater of $2,000,000 or 80% of eligible accounts receivable plus 50%
of the Company's eligible inventory. At the Company's option interest accrues
either at the bank's prime rate (8.5% at March 31, 1997) or at the banks LIBOR
rate plus 1.75% (7.69% at March 31, 1997). There were no borrowings outstanding
as of March 31, 1997 and 1996. The Company is required to pay a fee equal to
0.09% of the unused portion of the line of credit on a quarterly basis. The
credit agreement includes covenants which, among other things, require the
Company to maintain stated net worth amounts plus specific liquidity and
long-term solvency ratios as well as a minimum net income level. The line of
credit expires on September 15, 1998. Amounts borrowed are secured by
substantially all of the Company's assets.




                                      F-9

<PAGE>   55

NOTE 5 - NOTES PAYABLE


<TABLE>
<CAPTION>
                                                            MARCH 31,
                                                   -----------------------------
                                                       1997             1996
                                                   -----------      -----------
<S>                                                <C>              <C>        
Bank installment loans, with various
  expiration dates through September 1999,
  total monthly payments of $87,000 with
  interest rates ranging between 8% and 12%,
  collateralized by equipment                      $ 2,232,000      $ 1,989,000

Finance company installment loans, with
  various expiration dates through April 1999,
  total  monthly payments of $20,000 with
  interest rates ranging between 10.23%
  and 11.81%, collateralized by equipment              331,000          521,000
                                                   -----------      -----------
                                                     2,563,000        2,510,000
Less current portion                                (1,135,000)        (763,000)
                                                   -----------      -----------
                                                   $ 1,428,000      $ 1,747,000
                                                   ===========      ===========
</TABLE>


    Principal maturities of notes payable as of March 31, 1997 are summarized as
follows:


<TABLE>
<CAPTION>
           YEAR ENDING MARCH 31,
           ---------------------
                   <S>                                               <C>      
                   1998                                              1,135,000
                   1999                                                907,000
                   2000                                                417,000
                   2001                                                104,000
                                                                    ----------
                                                                    $2,563,000
                                                                    ==========
</TABLE>


NOTE 6 - CONVERTIBLE PREFERRED STOCK

      At March 31, 1996, the Company had 3,225,000 shares of its convertible
$.01 par value Series A preferred stock outstanding with a liquidation
preference of $.10 per share. Holders of the preferred stock have votes per
share equivalent to the number of shares of common stock to which the preferred
stock may be converted. On December 3, 1996, the Company completed its initial
public offering which resulted in the conversion of all outstanding shares of
the preferred stock into 2,365,538 shares of common stock.

NOTE 7 - COMMON STOCK AND OPTIONS

      In July 1993, the Company adopted the 1993 Stock Option Plan (the "Plan")
which authorizes 733,500 shares to be granted no later than July 2003. The Plan
provides for the grant of both incentive stock options and non-qualified stock
options which are subject to a three year vesting period. The exercise prices of
the options represent the estimated fair market value of the Company's common
stock as determined by the Company's Board of Directors. In November 1996, the
Plan was terminated and replaced by the 1996 Equity Participation Plan. No
options were issued under the Plan since July 1996.

      In November 1996, the Company adopted the ViaSat, Inc. 1996 Equity
Participation Plan (the "1996 Equity Participation Plan") designed to update and
replace the 1993 Stock Option Plan. The 1996 Equity Participation Plan provides
for the grant to executive officers, other key employees, consultants and
non-employee directors of the Company a broad variety of stock-based
compensation alternatives such as nonqualified stock options, incentive stock
options, restricted stock and performance awards. A maximum of 750,000 shares
are reserved for issuance under the 1996 Equity Participation Plan. As of March
31, 1997, the Company has granted 175,000 options to purchase shares of common
stock under this plan with vesting terms of 3 to 5 years.

In November 1996, the Company adopted the ViaSat, Inc. Employee Stock Purchase
Plan (the "Employee Stock Purchase Plan") to assist employees of the Company in
acquiring a stock ownership interest in the Company and to encourage them to
remain in the employment of the Company. The Employee Stock 




                                      F-10

<PAGE>   56

Purchase Plan is intended to qualify under Section 423 of the Internal
Revenue Code. A maximum of 250,000 shares of common stock are reserved for
issuance under the Employee Stock Purchase Plan. The Employee Stock Purchase
Plan permits eligible employees to purchase common stock at a discount through
payroll deductions during specified six-month offering periods. No employee may
purchase more than $25,000 worth of stock in any calendar year. The price of
shares purchased under the Employee Stock Purchase Plan is equal to 85% of the
fair market value of the common stock on the first or last day of the offering
period, whichever is lower.

      Transactions under the Company's stock option plans are summarized as
follows:


<TABLE>
<CAPTION>
                                                    NUMBER      EXERCISE PRICE
                                                   OF SHARES      PER SHARE
                                                   ---------     ------------
   <S>                                               <C>         <C>
   Outstanding at March 31, 1994                      54,829     $        .34
   Options granted                                   135,587     $ .48 -  .82
                                                    --------      
   Outstanding at March 31, 1995                     190,416     $ .34 -  .82
   Options granted                                   128,033     $       1.36
   Options canceled                                     (147)    $        .82
   Options exercised                                  (8,215)    $ .34 -  .82
                                                    --------      
   Outstanding at March 31, 1996                     310,087     $ .34 - 1.36
   Options granted                                   295,673     $4.09 -10.75
   Options canceled                                   (5,284)    $ .82 - 4.09
   Options exercised                                 (73,458)    $ .34 - 1.36
                                                    --------      
   Outstanding at March 31, 1997                     527,018     $ .34 -10.75
                                                    ========     
</TABLE>


      The Company also granted certain officers and employees the opportunity to
purchase at fair market value 118,607, 124,805 and 254,855, shares of the
Company's common stock in fiscal 1997, 1996 and 1995, respectively.

      The following table summarizes all options outstanding and exercisable by
price range as of March 31, 1997:


<TABLE>
<CAPTION>
                                               WEIGHTED
                                               AVERAGE       WEIGHTED                      WEIGHTED
                                              REMAINING       AVERAGE                       AVERAGE
            RANGE OF           NUMBER        CONTRACTUAL     EXERCISE        NUMBER        EXERCISE
        EXERCISE PRICES      OUTSTANDING      LIFE-YEARS       PRICE      EXERCISABLE        PRICE
        ---------------      -----------      ----------       -----      -----------        -----
<S>      <C>                  <C>                <C>         <C>            <C>              <C>      
         $ 0.34  -  1.50       235,380            7.80          $1.00       112,349          $0.84
         $ 4.09  -  4.50       116,638            9.25          $4.15         --               --
         $ 9.00  - 10.75       175,000            9.86          $9.84         --               --
         ---------------       -------
         $ 0.34  - 10.75       527,018
         ===============       =======
</TABLE>


         Pro forma information

      The Company has elected to follow APB Opinion No. 25, "Accounting for
Stock Issued to Employees," to account for its employee stock options because,
as discussed below, the alternative fair value based accounting provided for
under SFAS No. 123 "Accounting for Stock-Based Compensation," requires the use
of option valuation models that were not developed for use in valuing employee
stock options. These valuation models were developed for use in estimating the
fair value of traded options that have no vesting restrictions and are fully
transferable. In addition, option valuation models require the input of highly
subjective assumptions, including the expected stock price volatility. Under APB
No. 25, when the exercise price of the Company's employee stock options equals
the market price of the underlying stock on the date of grant, no compensation
expense is recognized in the Company's financial statements.

         Pro forma information regarding net income and earnings per share is
required by SFAS No. 123. Such information is determined as if the Company had
accounted for its employee stock options and shares 




                                      F-11

<PAGE>   57

issued under the Employee Stock Purchase Plan (hereafter referred to as
"options") granted subsequent to March 31, 1995 using the fair value methodology
prescribed by that statement.

      The fair values of options granted during the years ended March 31, 1997
and 1996 reported below were estimated at the date of grant using a
Black-Scholes option pricing model with the following weighted average
assumptions:



<TABLE>
<CAPTION>
                                         EMPLOYEE              EMPLOYEE STOCK
                                      STOCK OPTIONS            PURCHASE PLAN
                              -----------------------------    ---------------
                                  1997               1996           1997
                              -----------           -------        ------
<S>                           <C>                     <C>           <C> 
Expected life (in years)      3.50 - 5.00             3.50          0.50
Risk-free interest rate           6.45%               5.93%         5.97%
Expected volatility              50.00%              50.00%        50.00%
Expected dividend yield           0.00%               0.00%         0.00%
</TABLE>


         The weighted average estimated fair value of employee stock options
granted during 1997 and 1996 was $3.55 and $0.57 per share, respectively. The
weighted average estimated fair value of shares granted under the Employee Stock
Purchase Plan during fiscal 1997 was $2.78 per share.

         For purposes of pro forma disclosures, the estimated fair value of
options is amortized to expense over the options' vesting period. Because SFAS
No. 123 is applicable only to options granted subsequent to March 31, 1995, the
pro forma effect will not be fully reflected until the options granted in fiscal
1996 are fully vested in fiscal 2000. The Company's pro forma information for
the years ended March 31, 1997 and 1996 are as follows:


<TABLE>
<CAPTION>
                                                   1997               1996
                                                ----------          ----------
<S>                                             <C>                 <C>       
Pro forma net income                            $3,016,000          $1,615,000
Pro forma earnings per share                    $     0.46          $     0.28
</TABLE>


NOTE 8 - INCOME TAXES

      The provision (benefit) for income taxes includes the following:


<TABLE>
<CAPTION>
                                              YEAR ENDED MARCH 31,
                                   ---------------------------------------------
                                       1997             1996              1995
                                   -----------      -----------      -----------
<S>                                <C>              <C>              <C>        
Current tax provision
  Federal                          $ 1,954,000      $   344,000      $   708,000
  State                                469,000            9,000          193,000
                                   -----------      -----------      -----------
                                     2,423,000          353,000          901,000
                                   -----------      -----------      -----------
Deferred tax provision:
  Federal                             (563,000)        (310,000)         (10,000)
  State                               (158,000)         (93,000)          (3,000)
                                   -----------      -----------      -----------
                                      (721,000)        (403,000)         (13,000)
                                   -----------      -----------      -----------
     Total provision (benefit) 
       for income taxes            $ 1,702,000      $   (50,000)     $   888,000
                                   ===========      ===========      ===========
</TABLE>





                                      F-12

<PAGE>   58

      Significant components of the Company's deferred tax assets and
liabilities are as follows:


<TABLE>
<CAPTION>
                                             MARCH 31,
                                   ----------------------------
                                        1997            1996
                                   -----------      -----------
<S>                                <C>              <C>        
Deferred tax assets:
  Warranty reserve                 $   528,000      $   219,000
  Inventory Reserve                    280,000
  Accrued vacation                     247,000          190,000
  Other                                260,000          142,000
                                   -----------      -----------
     Total deferred tax assets       1,315,000          551,000
Deferred tax liabilities:
  Depreciation                         (57,000)         (14,000)
                                   -----------      -----------
Net deferred tax assets            $ 1,258,000      $   537,000
                                   ===========      ===========
</TABLE>



      A reconciliation of the provision for income taxes to the amount computed
by applying the statutory federal income tax rate to income before income taxes
is as follows:


<TABLE>
<CAPTION>
                                                     MARCH 31,
                                   ---------------------------------------------
                                       1997             1996             1995
                                   -----------      -----------      -----------
<S>                                <C>              <C>              <C>        
Tax expense at statutory rate      $ 1,657,000      $   538,000      $   746,000
State tax provision (benefit),
 net of federal benefit                205,000          (60,000)         153,000
Research tax credit                   (181,000)        (480,000)         (18,000)
Other                                   21,000          (48,000)           7,000
                                   -----------      -----------      -----------
                                   $ 1,702,000      $   (50,000)     $   888,000
                                   ===========      ===========      ===========
</TABLE>


      The Company's income tax benefit for the fiscal year ended March 31, 1996
was primarily attributable to the utilization of research and development
credits generated in the period and the impact of a favorable United States
Federal judicial decision which clarified the tax law related to the utilization
of research and development credits generated from the Company's funded research
and development.

NOTE 9 - EMPLOYEE BENEFITS

      The Company has a voluntary deferred compensation plan under Section
401(k) of the Internal Revenue Code. The Company may make discretionary
contributions to the plan which vest equally over six years. Employees who have
completed 90 days of service and are at least 21 years of age are eligible to
participate in the plan. Participants are entitled, upon termination or
retirement, to their vested portion of the plan assets which are held by an
independent trustee. Discretionary contributions accrued by the Company during
fiscal years 1997, 1996 and 1995 amounted to $553,000, $444,000 and $275,000,
respectively. The cost of administering the plan is not significant.



                                      F-13

<PAGE>   59

NOTE 10 - COMMITMENTS

      The Company leases office facilities under noncancelable operating leases
with terms ranging from one to five years which expire between May 1998 and July
1999. Certain of the Company's facilities leases contain option provisions which
allow for extension of the lease terms. Rent expense was $793,000, $608,000 and
$493,000 in fiscal years 1997, 1996 and 1995, respectively.

Future minimum lease payments are as follows:


<TABLE>
<CAPTION>
             YEAR ENDING MARCH 31,
             ---------------------
                    <S>                                <C>       
                    1998                               $  755,000
                    1999                                  649,000
                    2000                                  151,000
                                                       ----------
                                                       $1,555,000
                                                       ==========
</TABLE>


      Additionally, the Company enters into long term purchase commitments with
certain of its vendors to purchase materials used to manufacture products
delivered under long term contracts. At March 31, 1997, the Company had
commitments to purchase $1,280,000, $1,181,000, $1,181,000, and $66,000 of
materials in fiscal 1998, 1999, 2000, and 2001, respectively. Purchases under
these contracts totaled $2,098,000 during the year ended March 31, 1997.

NOTE 11 - CONTINGENCIES

The Company is currently a party to various government and commercial contracts
which require the Company to meet performance covenants and project milestones.
Under the terms of these contracts, failure by the Company to meet such
performance covenants and milestones permit the other party to terminate the
contract and, under certain circumstances, recover liquidated damages or other
penalties. The Company is currently not in compliance (or in the past was not in
compliance) with the performance or milestone requirements of certain of these
contracts. Historically, the Company's customers have not elected to terminate
such contracts or seek liquidated damages from the Company and management does
not believe that its existing customers will do so; therefore, the Company has
not accrued for any potential liquidated damages or penalties.




                                      F-14





<PAGE>   1

                                                                    EXHIBIT 10.6

                                 FIRST AMENDMENT
                                       TO
                       VIASAT, INC. 1993 STOCK OPTION PLAN

         Pursuant to the authority reserved to the Compensation Committee (the
"Committee") of the Board of Directors of ViaSat, Inc. (the "Company") under
Section 3.3 of the ViaSat, Inc. 1993 Stock Option Plan (the "Plan"), the
Committee hereby amends the Plan as follows:

         1.       Section 3.1 of the Plan is amended to read, in its entirety,
                  as follows:

                  The Company's Board of Directors ("Board") shall designate a
         committee ("Committee") to administer the Plan. In the absence of a
         Committee, the Plan shall be administered by the Board. The Committee
         shall consist solely of two or more directors appointed by and holding
         office at the pleasure of the Board, each of whom is both a
         "non-employee director" as defined by Rule 16b-3 under the Securities
         Exchange Act of 1934, as amended, and an "outside director" for
         purposes of Section 162(m) of the Code. Appointment of Committee
         members shall be effective upon acceptance of appointment. Committee
         members may resign at any time by delivering written notice to the
         Board. Vacancies in the Committee may be filled by the Board.

         2.       Section 7.1 of the Plan is amended to read, in its entirety,
                  as follows:

                  Subject to the provisions of Section 18, the period during

         which the right to exercise an Option in whole or in part vests in the
         holder of such Option ("Optionee") shall be set by the Committee and
         the Committee may determine that an Option may not be exercised in
         whole or in part for a specified period after it is granted; provided,
         however, that, unless the Committee otherwise provides in the term of
         an Option or otherwise, the Optionee may exercise such Option in
         accordance with a vesting schedule set forth hereafter:



<TABLE>
<CAPTION>
                                                  Percentage of Total Options
                       Date                     Granted Which May be Exercised
                       ----                     ------------------------------
          <S>                                   <C>
          1st anniversary from date of grant                  35%
          2nd anniversary from date of grant                  35%
          3rd anniversary from date of grant                  30%
</TABLE>


         The date after which the Option may no longer be exercisable
         ("Expiration Date') shall be five (5) years after the Grant Date.

         3.       In all other respects the Plan shall remain in full force and
                  effect as originally adopted.






<PAGE>   1

                                                                   EXHIBIT 10.15

                                             COMMERCIAL PORTFOLIO ADMINISTRATION

                      [UNION BANK OF CALIFORNIA LETTERHEAD]

                           WAIVER AND FIRST AMENDMENT
                                TO LOAN AGREEMENT


THIS WAIVER AND FIRST AMENDMENT TO LOAN AGREEMENT (this "First Amendment"),
dated as of March 31, 1997, is made and entered into by and between ViaSat,
Inc., a Delaware corporation formerly known as ViaSat, Inc., a California
corporation ("Borrower"), and UNION BANK OF CALIFORNIA, N.A. (successor in
interest to Union Bank), a national banking association ("Bank").

                                   RECITALS:

A.       Borrower and Bank are parties to that certain Loan Agreement, dated
September 15, 1995 (the "Agreement"), pursuant to which Bank agreed to
extend credit to Borrower.

B.       Borrower and Bank desire to amend the Agreement subject to the terms
and conditions of this First Amendment.

                                   AGREEMENT:

In consideration of the above recitals and of the mutual covenants and
conditions contained herein, Borrower and Bank agree as follows:

1.       Defined Terms. Initially capitalized terms used herein which are not
otherwise defined shall have the meanings assigned thereto in the Agreement.

2.       Waivers to the Agreement.

         (a) The Bank hereby waives Section 4.5 (a), for the calendar months
ended July 1996 through February 1997, and only for such months,
 and agrees that
such noncompliance shall not constitute an Event of Default under the Loan
Agreement or under the Loan Agreement as amended by this First Amendment. The
waiver here given is specific to the covenants, and for the calendar months
referred to above and shall not operate as a waiver of compliance by the Company
with any other covenants set forth by this First Amendment, or with the
covenants referred to above for any other calendar month.







                                      -1-

<PAGE>   2
         (b) The Bank hereby waives Section 4.5(h), for the fiscal quarters
ended September 1996 through December 1996, and only for such months, and agrees
that such noncompliance shall not constitute an Event of Default under the Loan
Agreement or under the Loan Agreement as amended by this First Amendment. The
waiver here given is specific to the covenants, and for the fiscal quarters
referred to above and shall not operate as a waiver of compliance by the Company
with any other covenants set forth by this First Amendment, or with the
covenants referred to above for any other fiscal quarter.

3.       Amendments to the Agreement.

         (a) Section 1 of the Agreement is hereby amended to read as follows:

         SECTION 1. THE LOAN

              1.1.1 THE REVOLVING LOAN.  Bank will loan to Borrower an amount
not to exceed Six Million Dollars ($6,000,000) outstanding in the aggregate at
any one time (the "Revolving Loan"). Borrower may borrow, repay and reborrow all
or part of the Revolving Loan in amounts of not less than Ten Thousand Dollars
($10,000) in accordance with the terms of the Revolving Note. All borrowings of
the Revolving Loan must be made before September 15, 1998 at which time all
unpaid principal and interest of the Revolving Loan shall be due and payable.
The Revolving Loan shall be evidenced by a new promissory note (the "Revolving
Note") on the standard form used by Bank for commercial loans, as modified by
the Addendum attached thereto. Bank shall enter each amount borrowed and repaid
in Bank's records and such entries shall be deemed to be the amount of the
Revolving Loan outstanding. Omission of Bank to make any such entries shall not
discharge Borrower of its obligation to repay in full with interest all amounts
borrowed.

              1.1.2 EQUIPMENT LOAN I.  Bank previously extended to Borrower a
certain fully amortizing term loan ("Equipment Loan I"), which matures on
September 15, 1999. The current outstanding principal amount of Equipment Loan I
is Nine Hundred Fifty Four Thousand Seven Hundred Twenty One Dollars ($954,721).
Equipment Loan I is evidenced by a promissory note ("Equipment Note I") on the
standard form used by Bank for commercial loans, as modified by the Addendum
attached thereto. In the event of a prepayment of principal and any resulting
fees, any prepaid amounts shall be applied to the scheduled principal payments
in the reverse order of their maturity.

              1.1.3 EQUIPMENT LOAN II.  Bank previously agreed to loan to
Borrower an amount not to exceed Two Million Dollars ($2,000,000) outstanding in
the aggregate at any one time ("Equipment Loan II"). Borrower may continue to
borrow all or part of Equipment Loan II in amounts of not less than Ten Thousand
Dollars ($10,000) in accordance with the terms of Equipment Note II. All
borrowings will be limited to an Eighty percent (80%) advance against the
purchase price, net of sales tax, delivery, and insurance. All borrowings of
Equipment Loan II must be made before September 15, 1997, at which time all
unpaid principal under Equipment Loan II shall be converted to a fully
amortizing loan for a period of Thirty-six (36) months with a maturity date of
September 15, 2000. In the event of a prepayment of principal after such
conversion and payment of any resulting fees, any prepaid amounts shall be
applied to the





                                       -2-


<PAGE>   3
scheduled principal payments in the reverse order of their maturity. Equipment
Loan II shall be evidenced by a new promissory note ("Equipment Note II") on the
standard form used by Bank for commercial loans, as modified by the Addendum
attached thereto. Bank shall enter each amount borrowed and repaid in Bank's
records and such entries shall be deemed to be the amount of Equipment Loan II
outstanding. Omission of Bank to make any such entries shall not discharge
Borrower of its obligation to repay in full with interest all amounts borrowed.

              1.1.4 EQUIPMENT LOAN III.  Beginning September 16, 1997 Bank will
loan to Borrower an amount not to exceed Two Million Five Hundred Thousand
Dollars ($2,500,000) outstanding in the aggregate at any one time ("Equipment
Loan III"). Borrower may borrow all or part of Equipment Loan III in amounts of
not less than Ten Thousand Dollars ($10,000) in accordance with the terms of
Equipment Note III. All borrowings will be limited to an Eighty percent (80%)
advance against the purchase price, net of sales tax, delivery, and insurance.
All borrowings of Equipment Loan III must be made before September 15, 1998, at
which time all unpaid principal under Equipment Loan III shall be converted to a
fully amortizing loan for a period of Thirty-six (36) months with a maturity
date of September 15, 2001. In the event of a prepayment of principal after such
conversion and payment of any resulting fees, any prepaid amounts shall be
applied to the scheduled principal payments in the reverse order of their
maturity. Equipment Loan III shall be evidenced by a promissory note ("Equipment
Note III") on the standard form used by Bank for commercial loans, as modified
by the Addendum attached thereto. Bank shall enter each amount borrowed and
repaid in Bank's records and such entries shall be deemed to be the amount of
Equipment Loan III outstanding. Omission of Bank to make any such entries shall
not discharge Borrower of its obligation to repay in full with interest all
amounts borrowed.

         1.2      TERMINOLOGY.

                  As used herein the word "Loan" shall mean, collectively, all
the credit facilities described above.

                  As used herein the word "Note" shall mean, collectively,
all the promissory notes described above.

                  As used herein, the words "Loan Documents" shall mean all
documents executed in connection with this Agreement.

         1.3      BORROWING BASE.  Borrower will not be subject to a borrowing
base so long as the principal amount outstanding under the Revolving Loan does
not exceed Two Million Dollars ($2,000,000). Notwithstanding any other provision
of this Agreement, Bank shall not be obligated to advance funds under the
Revolving Loan in a principal amount in excess of Two Million Dollars
($2,000,000) if the total outstanding principal amount of Borrower's obligations
to Bank under the Revolving Loan exceeds, or after giving effect to the
requested advance would exceed, the sum of (a) eighty percent (80%) of
Borrower's Eligible Billed Accounts, and (b) fifty percent (50%) of Borrower's
Eligible Inventory; provided, however, that loan availability based upon
Eligible Inventory shall in no event exceed Two Million Dollars ($2,000,000) at
any one time. If at any time Borrower's obligations to Bank under the above
facilities exceed the sum so permitted, Borrower shall immediately repay to Bank
such excess.





                                       -3-

<PAGE>   4

         1.3.1    ELIGIBLE BILLED ACCOUNTS. The term "Billed Accounts" means all
presently existing and hereafter arising accounts receivable, contract rights,
chattel paper, and all other forms of obligations owing to Borrower, payable in
United States Dollars, arising out of the sale or lease of goods, or the
rendition of services by Borrower, whether or not earned by performance, and any
and all credit insurance, guaranties and other security therefor, as well as all
merchandise returned to or reclaimed by Borrower and Borrower's books and
records relating to any of the foregoing.

         The term "Eligible Billed Accounts" means those Billed Accounts, net of
finance charges, which are due and payable within Ninety (90) days, or less,
from the date of the invoice, have been validly assigned to Bank and strictly
comply with all of Borrower's warranties and representations to Bank, but
Eligible Billed Accounts shall not include the following:

                  (a)      Any Billed Account with respect to which the account
debtor is an officer, shareholder, director, employee or agent of Borrower;

                  (b)      Any Billed Account with respect to which the account
debtor is a subsidiary of, related to, or affiliated or has common officers or
directors with Borrower;

                  (c)      Any Billed Account relating to goods placed on
consignment, guaranteed sale or other terms by reason of which the payment by
the account debtor may be conditional;

                  (d)      Any Billed Account with respect to which the account
debtor is not a resident of the United States or Canada;

                  (e)      Intentionally deleted;

                  (f)      Any Billed Account with respect to which Borrower is
or may become liable to the account debtor for goods sold or services rendered
by the account debtor to Borrower;

                  (g)      Any Billed Account with respect to which there is
asserted a defense, counterclaim, discount or setoff, whether well-founded or
otherwise, except for those discounts, allowances and returns arising in the
ordinary course of Borrower's business;

                  (h)      Any Billed Account with respect to which the account
debtor becomes insolvent, fails to pay its debts as they mature or goes out of
business or is owed by an account debtor which has become the subject of a
proceeding under any provision of the United States Bankruptcy Code, as amended,
or under any other bankruptcy or insolvency law, including, but not limited to,
assignments for the benefit of creditors, formal or informal moratoriums,
compositions or extensions with all or substantially all of its creditors;

                  (i)      Any Account owed by any account debtor with respect
to which twenty-five percent (25%) or more of the aggregate dollar amount of its
Accounts are not paid within ninety (90) days from the due date of the invoice;




                                       -4-




<PAGE>   5
                  (j)      Any Billed Account that is not paid by the account
debtor within ninety (90) days of date of invoice;

                  (k)      Intentionally deleted; and

                  (1)      Intentionally deleted.

         1.3.2 ELIGIBLE INVENTORY. The term "Eligible Inventory" means that
portion of Borrower's inventory of raw materials and finished goods consisting
of Borrower's main lines of business products, which is (a) owned by Borrower,
free and clear of all liens or encumbrances except those in favor of Bank, (b)
held for sale or lease by Borrower and normally and currently saleable in the
ordinary course of Borrower's business, (c) of good and merchantable quality,
free from defects, (d) located only at locations of which Bank is notified in
writing, and (e) as to which Bank has been able to perfect and maintain
perfected a first priority security interest. Eligible inventory does not
include any of the following: work in process, spare parts, returned items,
damaged, defective or recalled items, items unfit for further processing,
obsolete or unmerchantable items, items used as salesperson's samples or
demonstrators, inventory held in stock more than twelve (12) months.

         1.4 PURPOSE OF LOAN. The proceeds of the Revolving Loan shall be used
for general working capital purposes and the proceeds of Equipment Loans I, II
and III shall be used only for purchases of equipment, machinery, and software
directly related to Borrower's main lines of business.

         1.5.1 REVOLVING LOAN INTEREST. The unpaid principal balance of the
Revolving Loan shall bear interest at the rate or rates provided in the
Revolving Note and selected by Borrower. The Revolving Loan may be prepaid in
full or in part only in accordance with the terms of the Revolving Note and any
such prepayment shall be subject to the prepayment fee provided for therein.

         1.5.2 EQUIPMENT LOANS I, II AND III INTEREST. The unpaid principal
balance of Equipment Loans I, II and III shall bear interest at the rate or
rates provided in Equipment Notes I, II and III respectively, and selected by
Borrower. Equipment Loans I, II and III may be prepaid in full or in part only
in accordance with the terms of Equipment Notes I, II, and III, respectively,
and any such prepayment shall be subject to the prepayment fee provided for
therein.

         1.6 UNUSED COMMITMENT FEE. On the last calendar day of the third month
following the execution of this Agreement and on the last calendar day of each
three-month period thereafter until September 15, 1998, or the earlier
termination of the Loan, Borrower shall pay to Bank a fee of nine one-hundredths
percent (0.09%) per year on the average unused portion of the Revolving Loan for
the preceding quarter computed on the basis of actual days elapsed of a year of
360 days.

         1.7 EQUIPMENT LOAN I, II AND III COMMITMENT FEE. Borrower shall pay a
commitment fee of Two Thousand Dollars ($2,000) on September 15th of each year
for so long






                                       -5-




<PAGE>   6
as any portion of Equipment Loan I, II or III is outstanding. No portion of this
fee shall be reimbursable.

         1.8 BALANCES. Borrower shall maintain its major depository accounts
with Bank until the Note and all sums payable pursuant to this Agreement have
been paid in full.

         1.9 DISBURSEMENT. Upon execution hereof, Bank shall disburse the
proceeds of the Loan as provided in Bank's standard form Authorization executed
by Borrower.

         1.10 SECURITY. Prior to any disbursement of the Loan, Borrower shall
have executed a security agreement, on Bank's standard form, and a financing
statement, suitable for filing in the office of the Secretary of State of the
State of California and any other state designated by Bank, granting to Bank a
first priority security interest in such of Borrower's property as is described
in said security agreement. Exceptions to Bank's first priority, if any, are
permitted only as otherwise provided in this Agreement. At Bank's request,
Borrower will also obtain executed landlord's and mortgagee's waivers on Bank's
form covering all of Borrower's property located on leased or encumbered real
property.

         1.11 CONTROLLING DOCUMENT. In the event of any inconsistency between
the terms of this Agreement and any Note or any of the other Loan Documents, the
terms of such Note or other Loan Document will prevail over the terms of this
Agreement.

         (b) Section 2.6 of the Agreement is hereby amended to read as follows:

         2.6 ACCOUNTS RECEIVABLE AND INVENTORY CERTIFICATION. Prior to any
advance under the Revolving Loan which would cause the total amount of the
Revolving Loan to exceed Two Million Dollars ($2,000,000), the Borrower shall
have delivered to the Bank its monthly accounts receivable aging schedule along
with a Compliance Certificate and Borrowing Base Certificate in the form of
Exhibit D and E, respectively, executed by Borrower's chief financial officer or
other duly authorized officer of the Borrower. The Borrowing Base Certificate
shall accurately report Borrower's accounts receivable, Eligible Billed
Accounts, inventory and Eligible Inventory as of the end of the calendar month
preceding the month most recently ended.

         (c) Section 4.5 (a) of the Agreement is hereby deleted in its entirety.

         (d) Section 4.5 (l), line 2 of the Agreement is hereby amended by
deleting the amount "One Million Dollars ($1,000,000)" and by substituting in
lieu thereof the amount "Two Million Dollars ($2,000,000)."





                                       -6-


<PAGE>   7

         (e) Section 4.6 of the Agreement is hereby amended to read as follows:

                  4.6 TANGIBLE NET WORTH. Beginning with the fiscal quarter of
Borrower ended March 31, 1997, Borrower will at all times maintain Tangible Net
Worth of not less than Twenty One Million Four Hundred Fifty-Nine Thousand Five
Hundred Dollars ($21,459,500). Thereafter, Borrower will at all times maintain a
minimum Tangible Net Worth that increases from said amount as of the end of each
fiscal quarter of Borrower by Seventy percent (70%) of Borrower's cumulative net
profit after taxes (without reduction, however, for after tax net losses
sustained by Borrower for any such fiscal quarter), plus One Hundred percent
(100%) of any equity infusions made on or after March 31, 1997. "Tangible Net
Worth" shall mean net worth increased by indebtedness of Borrower subordinated
to Bank and decreased by patents, licenses, trademarks, trade names, goodwill
and other similar intangible assets, organizational expenses, and monies due
from affiliates (including officers, shareholders and directors).

         (f) Section 4.7 of the Agreement is hereby amended to read as follows:

                  4.7 DEBT TO TANGIBLE NET WORTH. Beginning with the fiscal
quarter of Borrower ended December 31, 1996, Borrower will at all times maintain
a ratio of Total Debt ("Total Debt" shall mean all of Borrower's liabilities
with the exception of cash advances from customers) to Tangible Net Worth of not
greater than 1.5:1.0.

         (g) Section 4.8 of the Agreement is hereby amended to read as follows:

                  4.8 PROFITABILITY. Borrower will maintain a net profit, after
provision for income taxes, of a positive amount as reported at fiscal year end.

4. EFFECTIVENESS OF THE FIRST AMENDMENT. This First Amendment shall become
effective when, and only when, Bank shall have received all of the following, in
form and substance satisfactory to Bank:

         (a) This First Amendment, duly executed by Borrower;

         (b) The replacement Revolving Note, and the replacement Equipment Note
II, duly executed by Borrower; and,

         (c) Such other documents, instruments or agreements as Bank may
reasonably deem necessary.

5. RATIFICATION. Except as specifically amended hereinabove, the Agreement shall
remain in full force and effect and is hereby ratified and confirmed.

6. REPRESENTATIONS AND WARRANTIES. Borrower represents and warrants as follows:









                                       -7-




<PAGE>   8

         (a) Each of the representations and warranties contained in the
Agreement, as the same have been amended hereby, is hereby reaffirmed as of the
date hereof, each as if set forth herein;

         (b) The execution, delivery and performance of the First Amendment and
any other instruments or documents in connection herewith are within Borrower's
power, have been duly authorized, are legal, valid and binding obligations of
Borrower, and are not in conflict with the terms of any charter, bylaw, or other
organizational papers of Borrower or with any law, indenture, agreement or
undertaking to which Borrower is a party or by which Borrower is bound or
affected;

         (c) No event has occurred and is continuing or would result from this
First Amendment which constitutes or would constitute an Event of Default under
the Agreement.

7. GOVERNING LAW. This First Amendment and all other instruments or documents in
connection herewith shall be governed by and construed according to the laws of
the State of California.

8. COUNTERPARTS. This First Amendment may be executed in two or more
counterparts, each of which shall be deemed an original and all of which
together shall constitute one and the same instrument.

WITNESS the due execution hereof as of the date first above written.

VIASAT, INC.                                  UNION BANK OF CALIFORNIA, N.A.

By: /s/ [ILLEGIBLE]                           By: /s/ [ILLEGIBLE] 
   --------------------------                    --------------------------


Title: Vice President                         Title: Vice President
     ------------------------                      ------------------------

By:                                           By: /s/ [ILLEGIBLE] 
   --------------------------                    --------------------------


Title:                                        Title: Vice President
     ------------------------                      ------------------------







                                      -8-



<PAGE>   9

                                   EXHIBIT "D"

                             COMPLIANCE CERTIFICATE

Enclosed please find ViaSat Inc. most recent financial statements for the period
ending          .

Enclosed is my calculation of the financial covenants agreed upon in the Loan
and Security Agreement with Union Bank of California dated September 15, 1995
which may be amended from time to time thereafter.

SECTION 4.6 TANGIBLE NET WORTH

Beginning with the fiscal quarter of Borrower ended March 31, 1997, Borrower
will at all times maintain Tangible Net Worth of not less than Twenty One
Million Four Hundred Fifty-Nine Thousand Five Hundred Dollars ($21,459,500).
Thereafter, Borrower will at all times maintain a minimum Tangible Net Worth
that increases from said amount as of the end of each fiscal quarter of Borrower
by seventy percent (70%) of Borrower's cumulative net profit after taxes
(without reduction, however, for after tax net losses sustained by Borrower for
any such fiscal year), plus One Hundred percent (100%) of any equity infusions
made on or after March 31, 1997. "Tangible Net Worth" shall mean net worth
increased by indebtedness of Borrower subordinated to Bank and decreased by
patents, licenses, trademarks, trade names, goodwill and other similar
intangible assets, organizational expenses, and monies due from affiliates
(including officers, shareholders and directors).



        -------------------------------------------------------
        Equity per Balance Sheet
        -------------------------------------------------------
        Plus:   Subordinated Debt
        -------------------------------------------------------
        Minus:  Intangibles
        -------------------------------------------------------
        Tangible Net Worth
        -------------------------------------------------------
        Covenant
        -------------------------------------------------------
        Compliance
        -------------------------------------------------------



<TABLE>
<CAPTION>
                                                      TNW Covenant Calculation

                                       03/31/97     06/30/97     09/30/97     12/31/97      03/31/98     06/30/98   09/30/98
        --------------------------------------------------------------------------------------------------------------------
       <S>                             <C>          <C>          <C>          <C>           <C>          <C>        <C>
        Beginning TNW Covenant                    $21,459,500
        --------------------------------------------------------------------------------------------------------------------
        Plus: 70% NPAT
        --------------------------------------------------------------------------------------------------------------------
        Plus:   100% Equity Infusions
        --------------------------------------------------------------------------------------------------------------------
        Ending TNW Covenant               $21,459,500
        --------------------------------------------------------------------------------------------------------------------
</TABLE>


SECTION 4.7 DEBT TO TANGIBLE NET WORTH (TNW)

Beginning with the fiscal quarter of Borrower ended December 31, 1996, Borrower
will at all times maintain a ratio of Total Debt ("Total Debt" shall mean all of
Borrower's liabilities with the exception of cash advances from customers) to
Tangible Net Worth of not greater than 1.5:1.0.


                            Total Debt
                            ----------------------------------------------
                            Minus:    Subordinated Debt
                            ----------------------------------------------
                            Minus:    Cash Advances from
                            Customers
                            ----------------------------------------------
                            Subtotal
                            ----------------------------------------------
                            Divided by: TNW
                            ----------------------------------------------
                            Equals: Debt to TNW
                            ----------------------------------------------
                            Covenant
                            ----------------------------------------------
                            Compliance
                            ----------------------------------------------

SECTION 4.8 PROFITABILITY




<PAGE>   10

Borrower will maintain a ratio of Cash Flow to Debt Service of not less than
1.5:1.0. Compliance with this subsection shall be measured as of the end of each
fiscal quarter. "Cash Flow" shall mean net profit after taxes to which
depreciation, amortization, other non cash expenses, and interest expense are
added for the twelve (12) month period immediately preceding the date of
calculation. "Debt Service" shall mean the sum of that portion of long-term
liabilities and capital leases coming due within twelve (12) months of the date
of calculation plus interest expense and dividends for the twelve (12) month
period immediately preceding the date of calculation.


                            ----------------------------------------------
                            Net Profit After Taxes
                            ----------------------------------------------
                            Plus: Taxes
                            ----------------------------------------------
                            Plus: Interest
                            ----------------------------------------------
                            Plus:   Depreciation
                            ----------------------------------------------
                            Plus:   Amortization
                            ----------------------------------------------
                            Equals: EBITDA
                            ----------------------------------------------
                            Principal Payments Coming Due in
                            the next 12 months
                            ----------------------------------------------
                            Capital Lease Payments Coming Due
                            in the next 12 months
                            ----------------------------------------------
                            Plus: Interest
                            ----------------------------------------------
                            Plus: Dividends
                            ----------------------------------------------
                            Equals: Debt Service
                            ----------------------------------------------
                            EBITDA to Debt Service Ratio
                            ----------------------------------------------
                            Covenant
                            ----------------------------------------------
                            Compliance
                            ----------------------------------------------


5.9 Capital Expenditures

        Covenant: $4,000,000
        Year to date actual:_______________

Borrower hereby acknowledges and certifies that as of the date indicated on the
last page hereof that no event or condition constituting an "Event of Default"
or breach of covenant (matured or unmatured) exists unless specified herein.

        Compliance: Yes     No
                   ------      ------

        If no, please provide a detailed explanation in the form of an
attachment.

Borrower hereby certifies that the statement and accompanying schedules are
complete and accurate and prepared in accordance with generally accepted
accounting principles. Borrower hereby reaffirms and restates each of the
representations and warranties and covenants contained in the Agreement.


                                           ViaSat, Inc.

                                           _________________________
                                           By

                                           _________________________
                                           Title

                                           _________________________
                                           Date




<PAGE>   11

                                                            DATE:_____________


                                   EXHIBIT "E"
                           BORROWING BASE CERTIFICATE
                                       FOR
                            VIASAT, INC. ("BORROWER")

As defined in and pursuant to that Loan Agreement by and between Borrower and
Union Bank of California, N.A. dated September 15, 1995 ("LOAN AGREEMENT") which
may be amended from time to time.



<TABLE>
<CAPTION>
<S>                                              <C>                     <C>                                    <C>
Date of aging:
- ----------------------------------------------------------------------------------------------------------------------------------
1. Total Accounts (A/R)                    $_________________

2. Less Ineligible A/R:

a.) Over 90 Days                           $_________________

b.) Cross Aged________%                    $_________________      6. Inventory:

c.) Concentration________%                 $_________________      a.) Raw Materials                       $_____________
                                                             
d.) Offcr/Emp/Inter-Co.                    $_________________      b.) Finished Goods                      $_____________

e.) Foreign/Gov't Accts                    $_________________      c.) Less Ineligible Inventory           $_____________

f.) Contra Accts                           $_________________      d.) Eligible Inventory                  $_____________

g.) Insolvent Accts                        $_________________      e.) Inventory Advance Rate               __________%

h.) Consignments/CODs                      $_________________      Inventory Availability

i.) Retentions                             $_________________      Calculation [(a+b-c)*e]                 $_____________

j.) Credit Balances >90                    $_________________

             Total Ineligible A/R          $_________________      g.) Inventory Sublimit                  $_____________

3. Total Eligible A/R (1-2)                $_________________

4. Advance Rate on A/R                      _________%             h.) Funds Available on

5. Funds Available on A/R (3*4)            $                           Inventory (NOT TO EXCEED 6g)        $_____________
==================================================================================================================================
7. Borrowing Base (5+6)                                            $______________________________

8. Loan Balance                                                    $______________________________

9. Outstanding Letters of Credit                                   $______________________________

10. Availability/(OverAdvanced) (7-8-9)                            $______________________________
</TABLE>



The undersigned represents and warrants that i.) the foregoing
information is true, correct and complete, ii.) that the accompanying
accounts receivable aging, accounts payable aging, and inventory report
provided in support of this certificate are true, correct and complete,
and iii.) Borrower is in compliance with the terms, conditions,
warranties, representations and covenants as set forth in the Loan
Agreement.



        [SIG] V.P.
- ---------------------------
Signature of officer, title





<PAGE>   12

This Alternative Dispute Resolution Agreement ("Agreement") is made and entered
into as of the 3rd day of April 1997, by and between the undersigned ("Obligor")
and Union Bank of California, N.A., ("Bank") (Obligor and Bank herein
collectively, the "Parties" and individually, a "Party"). Initially capitalized
terms used in this Agreement which are not otherwise defined herein shall have
the respective meanings set forth in Paragraph 7 of this Agreement.

1.  CLAIMS SUBJECT TO ARBITRATION OR JUDICIAL REFERENCE.

    (a) Any Claim other than a Claim that arises out of or relates to any
        obligation under any Subject Document that is secured, in whole or in
        part, by an interest in real property shall, at the written request of
        any Party, be determined by Arbitration.

    (b) Any Claim that arises out of or relates to any obligation under any
        Subject Document that is secured, in whole or in part, by an interest in
        real property shall be determined by Arbitration only with the consent
        of both Parties. If both Parties do not consent to the determination of
        any such Claim by Arbitration, then such Claim shall, at the written
        request of any Party, be determined by Reference.

    (c) The determination as to whether or not a Claim arises out of or relates
        to any obligation under any Subject Document that is secured, in whole
        or in part, by an interest in real property shall be made at the time
        the arbitrator or referee is selected pursuant to Paragraph 2 of this
        Agreement.

2. SELECTION OF ARBITRATOR OR REFEREE. Within 30 days after written demand, or
within 30 days after commencement by any Party, of any lawsuit subject to this
Agreement, the Parties shall select a single neutral arbitrator pursuant to the
Commercial Arbitration Rules of the AAA or a single neutral referee pursuant to
the Judicial Reference Procedures of the AAA. However, the arbitrator or referee
selected must be a retired state or federal court judge with at least five years
of judicial experience in civil matters. In the event that the selection
pursuant to such Commercial Arbitration Rules or Judicial Reference Procedures
does not result in the appointment of a single neutral arbitrator or a single
neutral referee within 30 days, any such Party may petition the court to appoint
a single neutral arbitrator or single neutral referee with the judicial
experience described above. The Parties shall equally bear the fees and expenses
of the arbitrator or referee unless the arbitrator or referee otherwise provides
in the award or statement of decision.

3.  CONDUCT OF ARBITRATION OR REFERENCE.

    (a) Except as provided in this Agreement, the arbitrator shall have the
        powers provided under Applicable State Law and the Commercial
        Arbitration Rules of the AAA, and the referee shall have the powers
        provided under Applicable State Law and the Judicial Reference
        Procedures of the AAA.

    (b) The arbitrator or referee shall determine all challenges to the legality
        or enforceability of this Agreement.

    (c) The arbitrator or referee shall apply the rules of evidence to the same
        extent as they would be applied in a court of law.

    (d) A Party may not conduct discovery unless the arbitrator or referee
        grants such Party leave to do so upon a showing of good cause. All
        discovery shall be completed within 90 days after the appointment of the
        arbitrator or referee, except upon a showing of good cause by any Party.
        The arbitrator or referee shall limit discovery to non-privileged
        material that is relevant to the issues to be determined by the
        arbitrator or referee.

    (e) The arbitrator or referee shall determine the time of the hearing and
        shall designate its location based upon the convenience of the
        arbitrator or referee, the Parties and any witnesses. However, such
        hearing shall be commenced within 30 days after completion of discovery,
        unless the arbitrator or referee grants a continuance upon a showing of
        good cause by any Party. At least 7 days before the date set for such
        hearing, the Parties shall exchange copies of exhibits to be offered as
        evidence, and lists of the witnesses who will testify, at such hearing.
        Once commenced, the hearing shall proceed day to day until completed,
        unless the arbitrator or referee grants a continuance upon a showing of
        good cause by any Party. Any Party may cause to be prepared, at its
        expense, a written transcription or electronic recordation of such
        hearing.

    (f) Subject to the provisions of this Agreement, the arbitrator may award,
        or the referee may report, a statement of decision providing for any
        remedy or relief, including without limitation judicial foreclosure,
        deficiency judgment and equitable relief, and give effect to all legal
        and equitable defenses, including without limitation, statutes of
        limitation, the statute of frauds, waiver and estoppel.

    (g) The award of the arbitrator or the statement of decision of the referee
        shall be supported by written findings of fact and conclusions of law
        delivered by the arbitrator or referee to the Parties concurrently with
        such award or statement of decision.

    (h) In the event that punitive damages are permitted under Applicable State
        Law, the award of the arbitrator or the statement of decision of the
        referee may provide for recovery of punitive damages provided that the
        arbitrator or referee first makes written findings of fact that would
        satisfy the requirements for recovery of punitive damages under
        Applicable State Law. Any such punitive damages shall not exceed a sum
        equal to three times the amount of actual damages as determined by the
        arbitrator or referee.

    (i) The arbitrator shall have the power to award or the referee shall have
        the power to report a statement of decision providing for reasonable
        attorneys' fees (including a reasonable allocation for the costs of
        in-house counsel) and costs to the prevailing party.

    (j) In the event that Applicable State Law provides that publications or
        communications made in a judicial proceeding are subject to a litigation
        privilege, such litigation privilege shall apply to the same extent to
        publications or communications made in the Arbitration or Reference.

4.  PROVISIONAL REMEDIES, SELF-HELP AND FORECLOSURE. No provision of this
Agreement shall limit the right of any Party (a) to exercise self-help remedies
including, without limitation, set-off, (b) to foreclose against or sell any
collateral, by power of sale or otherwise or (c) to obtain or oppose provisional
or ancillary remedies from a court of competent jurisdiction before, after or
during the pendency of the Arbitration or Reference. The exercise of, or
opposition to, any such remedy does not waive the right of any Party to
Arbitration or Reference pursuant to this Agreement.

5.  FINAL, BINDING AND NONAPPEALABLE JUDGMENT. Any court of competent
jurisdiction shall, upon the petition of any Party, confirm the award of the
arbitrator and enter judgment in conformity therewith. Any court of competent
jurisdiction shall, upon the filing of the statement of decision of the referee,
enter judgment thereon. Any such judgment shall be final, binding and
nonappealable.

6.  MISCELLANEOUS. In the event that multiple claims are asserted, some of
which are found not subject to this Agreement, the Parties agree to stay the
proceedings of the claims not subject to this Agreement until all other claims
are resolved in accordance with this Agreement. In the event that claims are
asserted against multiple parties, some of whom are not subject to this
Agreement, the Parties




<PAGE>   13

agree to sever the claims subject to this Agreement and resolve them in
accordance with this Agreement. In the event that any provision of this
Agreement is found to be illegal or unenforceable, the remainder of this
Agreement shall remain in full force and effect. In the event of any challenge
to the legality or enforceability of this Agreement, the prevailing Party shall
be entitled to recover the costs and expenses, including reasonable attorneys'
fees, incurred by it in connection therewith. Applicable State Law shall govern
the interpretation of this Agreement. This Agreement fully states all of the
terms and conditions of the Parties' agreement regarding the matters mentioned
in, or incidental to, this Agreement. This Agreement supersedes all oral
negotiations and prior writings concerning the subject matter hereof.

7.  DEFINED TERMS. As used in this Agreement, the following terms shall have the
    respective meanings set forth below:

    (a) "AAA" shall mean the American Arbitration Association.

    (b) "Applicable State Law" shall mean the law of the state in which this
        Agreement is executed by Obligor; provided, however, that if any Party
        seeks (i) to exercise self-help remedies, including without limitation
        set-off, (ii) to foreclose against or sell any collateral, by power of
        sale or otherwise or (iii) to obtain or oppose provisional or ancillary
        remedies from a court of competent jurisdiction before, after or during
        the pendency of the Arbitration or Reference, the law of the state where
        such collateral is located shall govern the exercise of or opposition to
        such rights and remedies.

    (c) "Arbitration" shall mean an arbitration conducted pursuant to this
        Agreement in accordance with Applicable State Law, and under the
        Commercial Arbitration Rules of the AAA, as in effect at the time the
        arbitrator is selected pursuant to paragraph 2 of this Agreement.

    (d) "Claim" shall mean any claim, cause of action, action, dispute or
        controversy between or among the Parties, including any claim, cause of
        action, action, dispute or controversy alleged in or subject to a
        lawsuit between or among the Parties, which arises out of or relates to:

        (i) any of the Subject Documents,

        (ii) any negotiations, correspondence or communications relating to any
             of the Subject Documents, whether or not incorporated into the
             Subject Documents or any indebtedness evidenced thereby,

        (iii) the administration or management of the Subject Documents or any
              indebtedness evidenced thereby or

        (iv) any alleged agreements, promises, representations or transactions
             in connection therewith, including but not limited to any claim,
             cause of action, action, dispute or controversy which arises out of
             or is based upon an alleged tort or other breach of legal duty.

    (e) "Reference" shall mean a judicial reference conducted pursuant to this
        Agreement in accordance with Applicable State Law and under the Judicial
        Reference Procedures of the AAA, as in effect at the time the referee is
        selected pursuant to paragraph 2 of this Agreement.

    (f) "Subject Documents" shall mean any and all documents, instruments and
        agreements previously, concurrently or hereafter executed by Obligor in
        favor of Bank, or between Obligor and Bank, which incorporated by
        reference an alternative dispute resolution agreement or another
        agreement providing for the resolution of Claims between or among the
        Parties by arbitration or judicial reference, any and all related
        documents, instruments and agreements, and any and all extensions,
        renewals, amendments, substitutions and replacements of any of the
        foregoing; and "Subject Document" shall mean any one of such Subject
        Documents.

    WAIVER OF RIGHT TO TRIAL BY JURY. In connection with an Arbitration or
Reference, or any other action or proceeding, the Parties hereby expressly,
intentionally and deliberately waive any right they may otherwise have to trial
by jury of any Claim.

This Agreement is duly executed by the Parties as of the date first written
above.

UNION BANK OF CALIFORNIA, N.A.


- -------------------------------------------------
DICK PETRIE

TITLE:   VICE PRESIDENT
- -------------------------------------------------

VIASAT, INC.
A DELAWARE CORPORATION



By:   [sig]             V.P.
- --------------------------------              --------------------------------
                       TITLE

- --------------------------------              --------------------------------


- --------------------------------              --------------------------------


- --------------------------------              --------------------------------


- --------------------------------              --------------------------------


- --------------------------------              --------------------------------








<PAGE>   14
                                    RECITALS

     A. VIASAT, INC. duly organized and existing under the laws of DELAWARE with
its principal place of business at 2290 COSMOS CT., CARLSBAD, CA (the
"Business") desires to obtain present or future credit from, grant security to,
or give guaranties or subordinations to Union Bank of California, N.A. ("Bank").
The Business operates under a fictitious business name, and has filed, published
and/or registered the required writing, stating that the Business is doing
business as N/A and the writing, a copy of which is attached, is currently in
full force and effect.

     B. The Business desires that certain person(s) be authorized to act on its
behalf from time to time in obtaining, among other things, such credit from,
granting security to, or giving guaranties or subordinations to, Bank.

NOW, THEREFORE, IT IS RESOLVED THAT:

1. Authorization. Any 1 of the following is/are authorized and directed, in the
name and on behalf of the Business, from time to time, with or without security,
to obtain credit and other financial accommodations from Bank, or to give
guaranties or subordinations to Bank, upon such terms as any such person(s)
shall approve: President Vice President. 

2. Scope Of Authority. Without limiting the generality of the authority granted,
each person designated in paragraph 1 above is authorized, from time to time, in
the name and on behalf of the Business, to:

          2.1 Incur Indebtedness To Bank. The word "Indebtedness" as used herein
     means all debts, obligations and liabilities, including without limitation
     obligations and liabilities under guaranties or subordinations, currently
     existing or now or hereafter made, incurred or created, whether voluntary
     or involuntary and however arising or evidenced, whether direct or acquired
     by assignment or succession, whether due or not due, absolute or
     contingent, liquidated or unliquidated, determined or undetermined, and
     whether liability is individual or joint with others, all renewals,
     extensions and modifications thereof, and all attorneys' fees and costs
     incurred in connection with the negotiation, preparation, workout,
     collection and enforcement thereof;

          2.2 Execute, deliver and endorse with respect to Indebtedness to Bank,
     promissory notes, loan agreements, drafts, guaranties, subordinations,
     applications and agreements for letters of credit, acceptance agreements,
     foreign exchange documentation, applications and agreements pertaining to
     the payment and collection of documents, indemnities, waivers, purchase
     agreements and other financial undertakings, leases and other documents and
     agreements in connection therewith, and all renewals, extensions or
     modifications thereof;

          2.3 Grant security interests in, pledge, assign, transfer, endorse,
     mortgage or hypothecate, and execute security or pledge agreements,
     financing statements and other security interest perfection documentation,
     mortgages and deeds of trust on, and give trust receipts for, any or all
     property of the Business as may be agreed upon by any officer as security
     for any or all Indebtedness of the Business or any other individual or
     entity ("Person"), and grant and execute renewals, extensions or
     modifications thereof;

          2.4 Sell to, or discount or rediscount with, Bank all negotiable
     instruments, including without limitation promissory notes, commercial
     paper, drafts, accounts, acceptances, leases, chattel paper, contracts,
     documents, instruments or evidences of debt at any time owned, held or
     drawn by the Business, and draw, endorse or transfer any of such
     instruments or documents on behalf of the Business, guarantee payment or
     repurchase thereof, and execute and deliver to Bank all documents and
     agreements in connection therewith, and all renewals, extensions or
     modifications thereof;

          2.5 Direct the disposition of the proceeds of any credit extended by
     Bank, and deliver to Bank and accept from Bank delivery of any property of
     the Business at any time held by Bank.

          2.6 Specify in writing to Bank the individuals who are authorized, in
     the name of and on behalf of the Business, to request advances under loans
     or credit lines made available by Bank to the Business, subject to the
     terms thereof.

3. Writings. Any instruments, documents, agreements or other writings executed
under or pursuant to these resolutions (collectively, the "Authorization") may
be in such form and contain such terms and conditions as may be required by Bank
in its sole discretion, and execution thereof by any officer authorized under
the Authorization shall be conclusive evidence of such officer's and the
Business's approval of the terms and conditions thereof.

4. Certification. The Secretary or any Assistant Secretary of the Business is
hereby authorized and directed from time to time to certify to Bank a copy of
this Authorization, the names and specimen signatures of the persons designated
in paragraph 1 above, and any modification thereof.

5. Ratification/Amendment. The authority given under this Authorization shall be
retroactive and any and all acts so authorized that are performed prior to the
formal adoption are hereby approved and ratified. In the event two or more
resolutions of this Business are concurrently in effect, the provisions of each
shall be cumulative, unless the later(est) shall specifically provide otherwise.
The authority given hereby shall remain in full force and effect, and Bank is
authorized and requested to rely and act thereon, until Bank shall have received
at its SAN DIEGO COMMERCIAL BANKING OFFICE a certified copy of a further
resolution of the Business amending, rescinding or revoking the Authorization.

<PAGE>   15


6. REQUESTS FOR CREDIT. Credit may be requested by the Business from Bank in
writing, by telephone, or by other telecommunication method acceptable to Bank.
The Business recognizes and agrees that Bank cannot effectively determine
whether a specific request purportedly made by or on behalf of the Business is
actually authorized or authentic. As it is in the Business's best interest that
Bank extend credit in response to these forms of request, the Business assumes
all risks regarding the validity, authenticity and due authorization of any
request purporting to be made by or on behalf of the Business. The Business is
hereby authorized and directed to repay any credit that is extended by Bank
pursuant to any request which Bank in good faith believes to be authorized, or
when the proceeds of any credit are deposited to the account of the Business
with Bank, regardless of whether any individual or entity other than the
Business may have authority to draw against such account.

7. BUSINESS AS PARTNER/JOINT VENTURER, LLC MEMBER OR MANAGER. Nothing in its
organizational documents limits or prohibits the Business from acting as a
general or limited partner of a partnership, a member or manager of a limited
liability company, or joint venturer of a joint venture. Any Person designated
in paragraph 1 of the Authorization is authorized, on behalf of the Business, in
its role as a general or limited partner, a member or manager, or a joint
venturer, to execute, deliver and endorse all certificates, authorizations and
agreements (i) to evidence the Business's role in and responsibilities to and
for such partnership, limited liability company or joint venture so that Bank
may rely thereon, and (ii) to evidence such partnership's, limited liability
company's or joint venture's obligations and liabilities to Bank. 

8. NO LIMITATION BY THIS AUTHORIZATION. Nothing contained in this Authorization
shall limit or modify the authority of any person to act on behalf of the
Business as provided by law, any agreement or authorization relating to the
Business or otherwise.

                    CERTIFICATE OF SECRETARY OF THE BUSINESS

I hereby certify to Union Bank of California, N.A., ("Bank") that the above
Authorization is a true copy of the resolution(s) of Viasat, Inc._______________
_______________________________________________________________________________
___________________ a corporation duly organized and existing under the laws of
Delaware (the "Business") duly adopted on May 16, 1997 by the Board of Directors
of the Business and duly entered in the records of the Business, and that the
Authorization is in conformity with applicable law and regulation, the Articles
of Incorporation and the By-Laws of the Business and is now in full force and
affect.

I also certify that the following are the names and genuine specimen signatures
of the officers of the Business authorized in paragraph 1 of the Authorization:

President                   Mark D. Dankberg             /s/ MARK D. DANKBERG
- ---------------------       ---------------------        ---------------------
Corporate Title             Name                         Signature


Vice President              Gregory D. Monahan           /s/ GREGORY D. MONAHAN
- ---------------------       ---------------------        ---------------------
Corporate Title             Name                         Signature


- ---------------------       ---------------------        ---------------------
Corporate Title             Name                         Signature

- ---------------------       ---------------------        ---------------------
Corporate Title             Name                         Signature

I agree to notify Bank in writing of any change in any aspect of the
Authorization or of any individual holding any office set forth in this
certificate immediately upon the occurrence of any such change, and to provide
Bank with a copy of the modified resolution(s) and the genuine specimen
signature of any such now officer.


The authority provided for in the Authorization shall remain in full force and
effect, and Bank is authorized and requested to rely and act thereon until Bank
shall receive at its San Diego Commercial Banking Office either a certified
copy of a further resolution of this Business's Board of Directors amending the
Authorization, or a certification of a change in the authorized officer(s).

Dated: May 23, 1997                                /s/ [Illegible]
      --------------------------                   --------------------------
                                                   Secretary of Viasat,   Inc.
                                                   --------------------------
                                                   --------------------------
SEAL

(if no seal,
so state)

                                                   /s/ MARK D. DANKBERG
                                                   --------------------------
                                                   --------------------------
                                                   *President of Viasat, Inc.
                                                   --------------------------




<PAGE>   16

                                 REVOLVING LINE

                           [UNION BANK OF CALIFORNIA
                                  LETTERHEAD]
                                 REVOLVING LINE

                                 PROMISSORY NOTE
                                   (BASE RATE)



<TABLE>
<CAPTION>
=================================================================================================================================
Borrower Name VIASAT, INC.
- ---------------------------------------------------------------------------------------------------------------------------------
Borrower Address 2290 COSMOS CT., CARLSBAD, CA. 92009                           Office 40061    Loan Number 9449886233 0004000000
<S>                                                                             <C>              <C>

                                                                                Maturity Date SEPTEMBER 15, 1998     Amount
                                                                                                                    $6,000,000.00
=================================================================================================================================
</TABLE>



SAN DIEGO, CALIFORNIA               $6,000,000.00                Date__________

FOR VALUE RECEIVED, on September 15, 1998, the undersigned ("Debtor") promises
to pay to the order of Union Bank of California, N.A. ("Bank"), as indicated
below, the principal sum of SIX MILLION AND NO/100 Dollars ($6,000,000.00), or
so much thereof as is disbursed, together with interest on the balance of such
principal from time to time outstanding, at the per annum rate or rates and at
the times set forth below.

1. INTEREST PAYMENTS. Debtor shall pay interest on the Fifteenth day of each
month (commencing May 15, 1997). Should interest not be paid when due, it shall
become part of the principal and bear interest as herein provided. All
computations of interest under this note shall be made on the basis of a year of
360 days, for actual days elapsed.

     a. BASE INTEREST RATE. At Debtor's option, amounts outstanding hereunder in
     increments of at least $10,000 shall bear interest at a rate, based on an
     index selected by Debtor, which is 1.75% per annum in excess of Bank's
     LIBOR-Rate for the Interest Period selected by Debtor.

     Any Base Interest Rate may not be changed, altered or otherwise modified
     until the expiration of the Interest Period selected by Debtor. The
     exercise of interest rate options by Debtor shall be as recorded in Bank's
     records, which records shall be prima facie evidence of the amount borrowed
     under either interest option and the interest rate; provided, however, that
     failure of Bank to make any such notation in its records shall not
     discharge Debtor from its obligations to repay in full with interest all
     amounts borrowed. In no event shall any Interest Period extend beyond the
     maturity date of this note.

     To exercise this option, Debtor may, from time to time with respect to
     principal outstanding on which a Base Interest Rate is not accruing, and on
     the expiration of any Interest Period with respect to principal outstanding
     on which a Base Interest Rate has been accruing, select an index offered by
     Bank for a Base Interest Rate Loan and an Interest Period by telephoning an
     authorized lending officer of Bank located at the banking office identified
     below prior to 10:00 a.m., Pacific time, on any Business Day and advising
     that officer of the selected index, the Interest Period and the Origination
     Date selected (which Origination Date, for a Base Interest Rate Loan based
     on the LIBOR-Rate, shall follow the date of such selection by no more than
     two (2) Business Days).

     Bank will mail a written confirmation of the terms of the selection to
     Debtor promptly after the selection is made. Failure to send such
     confirmation shall not affect Bank's rights to collect interest at the rate
     selected. If, on the date of the selection, the index selected is
     unavailable for any reason, the selection shall be void. Bank reserves the
     right to fund the principal from any source of funds notwithstanding any
     Base Interest Rate selected by Debtor.

     b. VARIABLE INTEREST RATE. All principal outstanding hereunder which is not
     bearing interest at a Base Interest Rate shall bear interest at a rate per
     annum equal to the Reference Rate, which rate shall vary as and when the
     Reference Rate changes.



                                      -1-


<PAGE>   17

At any time prior to the maturity of this note, subject to the provisions of
paragraph 4. below, of this note, Debtor may borrow, repay and reborrow hereon
so long as the total outstanding at any one time does not exceed the principal
amount of this note. Debtor shall pay all amounts due under this note in lawful
money of the United States at Bank's SAN DIEGO COMMERCIAL BANKING Office, or
such other office as may be designated by Bank, from time to time.

2. LATE PAYMENTS. If any payment required by the terms of this note shall remain
unpaid ten days after same is due, at the option of Bank, Debtor shall pay a fee
of $100 to Bank.

3. INTEREST RATE FOLLOWING DEFAULT. In the event of default, at the option of
Bank, and, to the extent permitted by law, interest shall be payable on the
outstanding principal under this note at a per annum rate equal to five percent
(5%) in excess of the interest rate specified in paragraph 1.b, above,
calculated from the date of default until all amounts payable under this note
are paid in full.

4. PREPAYMENT.

     a. Amounts outstanding under this note bearing interest at a rate based on
     the Reference Rate may be prepaid in whole or in part at any time, without
     penalty or premium. Amounts outstanding under this note bearing interest at
     a Base Interest Rate may only be prepaid, in whole or in part provided Bank
     has received not less than five (5) Business Days prior written notice of
     an intention to make such prepayment and Debtor pays a prepayment fee to
     Bank in an amount equal to the present value of the product of: (i) the
     difference (but not less then zero) between (a) the Base Interest Rate
     applicable to the principal amount which Debtor intends to prepay, and (b)
     the return which Bank could obtain if it used the amount of such prepayment
     of principal to purchase at bid price regularly quoted securities issued by
     the United States having a maturity date most closely coinciding with the
     relevant Base Rate Maturity Date and such securities were held by Bank
     until the relevant Base Rate Maturity Date ("Yield Rate"); (ii) a fraction,
     the numerator of which is the number of days in the period between the date
     of prepayment and the relevant Base Rate Maturity Date and the denominator
     of which is 360; and (iii) the amount of the principal so prepaid (except
     in the event that principal payments are required and have been made as
     scheduled under the terms of the Base Interest Rate Loan being prepaid,
     then an amount equal to the lesser of (A) the amount prepaid or (B) 50% of
     the sum of (1) the amount prepaid and (2) the amount of principal scheduled
     under the terms of the Base Interest Rate Loan being prepaid to be
     outstanding at the relevant Base Rate Maturity Date). Present value under
     this note is determined by discounting the above product to present value
     using the Yield Rate as the annual discount factor.

     b. In no event shall Bank be obligated to make any payment or refund to
     Debtor, nor shall Debtor be entitled to any setoff or other claim against
     Bank, should the return which Bank could obtain under the above prepayment
     formula exceed the interest that Bank would have received if no prepayment
     had occurred. All prepayments shall include payment of accrued interest on
     the principal amount so prepaid and shall be applied to payment of interest
     before application to principal. A determination by Bank as to the
     prepayment fee amount, if any, shall be conclusive.

     c. Such prepayment fee, if any, shall also be payable if prepayment occurs
     as the result of the acceleration of the principal of this note by Bank
     because of any default hereunder. If, following such acceleration, all or
     any portion of a Base Interest Rate Loan is satisfied, whether through sale
     of property encumbered by any security agreement or other agreement
     securing this note, at a foreclosure sale held thereunder or through the
     tender of payment at any time following such acceleration, but prior to
     such a foreclosure sale, then such satisfaction shall be deemed an evasion
     of the prepayment conditions set forth above, and Bank shall, automatically
     and without notice or demand, be entitled to receive, concurrently with
     such satisfaction the prepayment fee set forth above, and the amount of
     such prepayment fee shall be added to the principal. DEBTOR HEREBY
     ACKNOWLEDGES AND AGREES THAT BANK WOULD NOT MAKE THE LOAN TO DEBTOR
     EVIDENCED BY THIS NOTE WITHOUT DEBTOR'S AGREEMENT, AS SET FORTH ABOVE, TO
     PAY BANK A PREPAYMENT FEE UPON THE SATISFACTION OF ALL OR ANY PORTION OF
     THE PRINCIPAL BEARING INTEREST AT A BASE INTEREST RATE FOLLOWING THE
     ACCELERATION OF THE MATURITY DATE HEREOF BY REASON OF A DEFAULT. DEBTOR HAS
     CAUSED THOSE PERSONS SIGNING THIS NOTE ON ITS BEHALF TO SEPARATELY INITIAL
     THE AGREEMENT CONTAINED IN THIS PARAGRAPH BY PLACING THEIR INITIALS BELOW:

     INITIALS:    
              -----------              -----------

5. DEFAULT AND ACCELERATION OF TIME FOR PAYMENT. "See Addendum "A", consisting
of two (2) pages, attached hereto and incorporated herein.

6. ADDITIONAL AGREEMENTS OF DEBTOR. If any amounts owing under this note are not
paid when due, Debtor promises to pay all costs and expenses, including
reasonable attorneys' fees, incurred by Bank in the collection or enforcement of
this note. Debtor and any endorsers of this note, for the maximum period of time
and the full extent permitted by law, (a) waive diligence, presentment, demand,
notice of nonpayment, protest, notice of protest, and notice of every kind; (b)
waive the right to assert the defense of any statute of limitations to any debt
or obligation hereunder; and (c) consent to renewals and extensions of time for
the payment of any amounts due under this note. If this note is signed by more
than one party, the term "Debtor" includes each of the undersigned and any
successors in interest thereof; all of whose liability shall be joint and
several. Any married person who signs this note agrees that recourse may be had
against the separate property of that person for any obligations hereunder. The
receipt of any check or other item of payment by Bank, at its option, shall not
be considered a payment on account until such check or other item of payment is
honored when presented for payment at the drawee bank. Bank may delay the credit
of such payment based upon Bank's schedule of funds availability, and interest
under this note shall accrue until the funds are deemed collected. In any action
brought under or arising out of this note, Debtor and any Obligor, including
their successors and assigns, hereby consent to the jurisdiction of any
competent court within the State of California, as provided in any alternative
dispute resolution agreement executed between Debtor and Bank, and consent to
service of process by any means authorized by said state's law. The term "Bank"
includes, without limitation, any holder of this note. This note shall be
construed in



                                      -2-


<PAGE>   18

accordance with and governed by the laws of the State of California. This note
hereby incorporates any alternative dispute resolution agreement previously,
concurrently or hereafter executed between Debtor and Bank.

7. DEFINITIONS. As used herein, the following terms shall have the meanings
respectively set forth below: "BASE INTEREST RATE" shall mean a rate of interest
based on the LIBOR-Rate. "BASE INTEREST RATE LOAN" shall mean amounts
outstanding under this note that bear interest at a Base Interest Rate. "BASE
RATE MATURITY DATE" shall mean the last day of the Interest Period with respect
to principal outstanding on which a Base Interest Rate has been selected by
Debtor. "BUSINESS DAY" shall mean a day which is not a Saturday or Sunday on
which Bank is open for business in the state identified in paragraph 6, above,
and, with respect to the rate of interest based on the LIBOR Rate, on which
dealings in U.S. dollar deposits outside of the United States may be carried on
by Bank. "INTEREST PERIOD" shall mean any calendar period of one, three, six,
nine or twelve months. In determining an Interest Period, a month means a period
that starts on one Business Day in a month and ends on and includes the day
preceding the numerically corresponding day in the next month. For any month in
which there is no such numerically corresponding day, then as to that month,
such day shall be deemed to be the last calendar day of such month. Any Interest
Period which would otherwise end on a non-Business Day shall and on the next
succeeding Business Day unless that is the first day of a month, in which event
such Interest Period shall and on the next preceding Business Day. "LIBOR RATE"
shall mean a per annum rate of interest (rounded upward, if necessary, to the
nearest 1/100 of 1%) at which dollar deposits, in immediately available funds
and in lawful money of the United States would be offered to Bank, outside of
the United States, for a term coinciding with the Interest Period selected by
Debtor and for an amount equal to the amount of principal covered by Debtor's
interest rate selection, plus Bank's costs, including the costs, if any, of
reserve requirements. "ORIGINATION DATE" shall mean the Business Day on which
funds are made available to Debtor relating to Debtor's selection of a Base
Interest Rate. "REFERENCE RATE" shall mean the rate announced by Bank from time
to time at its corporate headquarters as its "Reference Rate." The Reference
Rate is an index rate determined by Bank from time to time as a means of pricing
certain extensions of credit and is neither directly tied to any external rate
of interest or index nor necessarily the lowest rate of interest charged by Bank
at any given time.

VIASAT, INC.

By /s/ ]Illegible]
  -------------------------------

Title Vice President
     ----------------------------












                                      -3-


<PAGE>   19


                  ADDENDUM "A" TO PROMISSORY NOTE (BASE RATE),
                   DATED __________________, 1997, EXECUTED BY
             VIASAT, INC. IN FAVOR OF UNION BANK OF CALIFORNIA, N.A.
                      (SUCCESSOR IN INTEREST TO UNION BANK)

5. DEFAULT AND ACCELERATION OF TIME FOR PAYMENT. Default shall include, but not
be limited to, any of the following: (a) Debtor shall fail to pay within three
(3) days of the date when due any principal, interest or other payment required
under the terms of this note, that certain Loan Agreement between Debtor and
Bank, dated as of September 15, 1995, and any amendments, modifications,
extensions, supplements or replacements thereof (the "Loan Agreement") or any of
the other Loan Documents (as defined in the Loan Agreement); (b) Debtor shall
fail to observe or perform any covenant, obligation, condition or agreement set
forth in Section 5, or in paragraphs 4.5(i), 4.6, 4.7, 4.8 or 4.9, of the Loan
Agreement; (c) Debtor shall fail to observe or perform any other covenant,
obligation, condition or agreement contained in the Loan Agreement or the other
Loan Documents, and such failure shall continue for twenty (20) days after
written notice thereof to Debtor from Bank; (d) any representation, warranty,
certificate or other statement (financial or otherwise) made or furnished by or
on behalf of Debtor to Bank in or in connection with this note, the Loan
Agreement or any of the other Loan Documents, or as an inducement to Bank to
enter into the Loan Agreement and the other Loan Documents, shall be false,
incorrect, incomplete or misleading in any material respect when made or
furnished; (e) Debtor, any guarantor, co-maker, endorser, or any person or
entity other than Debtor providing security for this note (hereinafter
individually and collectively referred to as the "Obligor") shall fail to pay
when due any principal or interest payment required under the terms of any bond,
debenture, note or other evidence of indebtedness required to be paid by such
Obligor (except for payments required hereunder, under the Loan Agreement or
under the other Loan Documents) beyond any period of grace provided with respect
thereto, or shall default in the observance or performance of any other
agreement, term or condition contained in any such bond, debenture, note or
other evidence of indebtedness, and the effect of such failure or default is to
cause, or permit the holder or holders thereof to cause, the indebtedness
evidenced by such bond, debenture, note or other evidence of indebtedness to
become due prior to its stated date of maturity; (f) any Obligor shall (i) apply
for or consent to the appointment of a receiver, trustee, liquidator or
custodian of itself or of all or a substantial part of its property, (ii) be
unable, or admit in writing its inability, to pay its debts generally as they
mature, (iii) make a general assignment for the benefit of its or any of its
creditors, (iv) be dissolved or liquidated (or an Obligor who is a natural
person shall die), (v) commence a voluntary case or other proceedings seeking
liquidation, reorganization or other relief with respect to itself or its debts
under any bankruptcy, insolvency or other similar law now or hereafter in effect
or consent to any such


                                  Page 1 of 2                 Initial__________



<PAGE>   20


relief or to the appointment of or taking possession of its property by any
official in an involuntary case or other proceeding commenced against it, or
(vi) take any corporate action for the purpose of effecting any of the
foregoing; (g) proceedings for the appointment of a receiver, trustee,
liquidator or custodian of any Obligor or of all or a substantial part of its
property, or an involuntary case or other proceedings seeking liquidation,
reorganization or other similar relief with respect to any Obligor or its debts
under any bankruptcy, insolvency or other similar law now or hereafter in
effect, shall be commenced and shall not be dismissed or discharged within
thirty (30) days of commencement; or (h) a final judgment or order for the
payment of money in excess of Two Hundred Fifty Thousand Dollars ($250,000.00)
(exclusive of amounts covered by insurance) shall be rendered against any
Obligor and the same shall remain undischarged for a period of thirty (30) days
during which execution shall not be effectively stayed, or any judgment, writ,
warrant of attachment, or execution or similar process shall be issued or levied
against a substantial part of any Obligor's property and such judgment, writ or
similar process shall not be released, stayed, vacated, bonded or otherwise
dismissed within twenty (20) days after its issue or levy. Upon the occurrence
of any such default, Bank, in its discretion, may cease to advance funds
hereunder and may declare all obligations under this note immediately due and
payable; provided, however, upon the occurrence of a default under (f) or (g),
all principal and interest shall automatically become immediately due and
payable.



                                                  VIASAT, INC.

                                                  By: /s/ [Illegible]
                                                     ------------------------
                                                  Title: Vice President
                                                        ---------------------








                                   Page 2 of 2


<PAGE>   21



<TABLE>
<CAPTION>
CALIFORNIA                                         AUTHORIZATION
<S>                        <C>                      <C>        <C>                         <C>  
- -----------------------------------------------------------------------------------------------------------------------------------
Borrower Name 
                           VIASAT, INC.
- -----------------------------------------------------------------------------------------------------------------------------------
Borrower Address                                  Office      Loan Number
                                                  40061       9449886233                    0004-00-0-000
                                                  ---------------------------------------------------------------------------------

2290 COSMOS CT.                                   Maturity Date                             Amount 

CARLSBAD, CA 92009-1585                               SEPTEMBER 15, 1998                    $6,000,000.00
- -----------------------------------------------------------------------------------------------------------------------------------

Union Bank of California, N.A. ("Bank") is hereby authorized and instructed to disburse the proceeds of that certain Note referenced
above in the following manner:

     Deposit the proceeds of my/our revolving note into my/our account # 4000142625 from tine to tine and in such amounts as say be
     requested verbally or in writing. RENEWAL OF OBLIGATION #0004-00-0-000, WHICH MATURES 9/15/97 $ 6,000,000.00











- -----------------------------------------------------------------------------------------------------------------------------------
Fees itemized below are payable as follows (check one):

[ ] Charge account #__________________________      [ ] Check enclosed


- -----------------------------------------------------------------------------------------------------------------------------------
                                                        TERMS AND CONDITIONS
- -----------------------------------------------------------------------------------------------------------------------------------

1.   Bank is authorized to charge account number 4000142625 in the name(s) of ViaSat. INC. for payments of interest (or
     principal/interest) when due in connection with this Note and all renewals or extensions thereof.

2.   Bank shall disburse proceeds in the amounts stated above in accordance with the foregoing authorization or when Bank receives
     verbal or written authorization from Borrower(s) to do so, or any one of the Borrowers, if there are joint Borrowers, but not
     later than SEPTEMBER 15, 1998. The Bank, at its discretion, may elect to extend this date without notice to or acknowledgement
     by borrower(s). This Authorization and the above mentioned Note will remain in full force and effect until the obligations in
     connection with this Note have been fulfilled.

3.   Unless dated by Bank prior to execution, the Note shall be dated by Bank as of the date on which Bank disburses proceeds.

4.   Notwithstanding anything to the contrary herein, Bank reserves the right to decline to advance the proceeds of the above
     described Note if there is a filing as to the Borrower(s), or any of them of a voluntary or involuntary petition under the
     provisions of the Federal Bankruptcy Act or any other insolvency law; the issuance of any attachment, garnishment, execution or
     levy of any asset of the Borrower(s), or any endorser or guarantor which results in Bank deeming itself, in good faith
     insecure.

5.   The borrower(s) authorizes Bank to release information concerning the borrower(s) financial condition to suppliers, other
     creditors, credit bureaus and other credit reporters; and also authorizes Bank to obtain such information from any third party
     at any time.

The Borrower(s) by their execution of this Authorization accept the foregoing terms, conditions and instructions.

Executed on    5/23/97
           ------------------
VIASAT, INC.


By: /s/ [Illegible]          Vice President
    ------------------------------------------------------------           ----------------------------------------------------
                             TITLE



    ------------------------------------------------------------           ----------------------------------------------------
</TABLE>




<PAGE>   22

                                 EQUIPMENT LOAN
                                       II


UNION
BANK OF
CALIFORNIA



<TABLE>
<CAPTION>
==================================================================================================================================
Borrower Name VIASAT, INC.
- ----------------------------------------------------------------------------------------------------------------------------------
<S>                                                              <C>                     <C>       
Borrower Address                                                 Office 40061            Loan Number 9449886233
2290 COSMOS CT.                                                  -----------------------------------------------------------------
CARLSBAD, CA. 92009                                              Maturity Date SEPTEMBER 15, 2000    Amount  $2,000,000.00
==================================================================================================================================
</TABLE>




$2,000,000.00                                                    Date_________


FOR VALUE RECEIVED, on SEPTEMBER 15, 2000, the undersigned ("Debtor") promises
to pay to the order of UNION BANK OF CALIFORNIA, N.A. ("Bank"), as indicated
below, the principal sum of TWO MILLION AND NO/100 Dollars ($2,000,000.00), or
so much thereof as is disbursed, together with interest on the balance of such
principal from time to time outstanding, at the per annum rate or rates and at
the times set forth below.

1.   PAYMENTS.

     PRINCIPAL PAYMENTS. Principal shall be payable in 36 equal consecutive
monthly instalments, each instalment in an amount sufficient to fully amortize
the principal balance by the final maturity date, beginning OCTOBER 15, 1997,
and continuing on the 15th day of each consecutive month. The availability under
this note shall be reduced on the same day and in the same amount as each
scheduled principal payment.

     INTEREST PAYMENTS. Debtor shall pay interest on the 15th day of each MONTH
(commencing MAY 15, 1997). Should interest not be paid when due, it shall become
part of the principal and bear interest as herein provided. All computations of
interest under this note shall be made on the basis of a year of 360 days, for
actual days elapsed.

     a. BASE INTEREST RATE. At Debtor's option, amounts outstanding hereunder in
     increments of at least $10,000 shall bear interest at a rate, based on an
     index selected by Debtor, which is 2.00% per annum in excess of Bank's
     LIBOR-Rate for the Interest Period so selected by Debtor.

     Any Base Interest Rate may not be changed, altered or otherwise modified
     until the expiration of the Interest Period selected by Debtor. The
     exercise of interest rate options by Debtor shall be as recorded in Bank's
     records, which records shall be prima facie evidence of the amount borrowed
     under either interest option and the interest rate; provided, however, that
     failure of Bank to make any such notation in its records shall not
     discharge Debtor from its obligations to repay in full with interest all
     amounts borrowed. In no event shall any Interest Period extend beyond the
     maturity date of this note.

     To exercise this option, Debtor may, from time to time with respect to
     principal outstanding on which a Base Interest Rate is not accruing, and on
     the expiration of any Interest Period with respect to principal outstanding
     on which a Base Interest Rate has been accruing, select an index offered by
     Bank for a Base Interest Rate Loan and Interest Period by telephoning an
     authorized lending officer of Bank located at the banking office identified
     below prior to 10:00 a.m., Pacific time, on any Business Day and advising
     that officer of the selected index, Interest Period and the Origination
     Date selected (which Origination Date, for a Base Interest Rate Loan based
     on the LIBOR-Rate, shall follow the date of such election by no more than
     two (2) Business Days).

     Bank will mail a written communication of the terms of the selection to
     Debtor promptly after the selection is made. Failure to send such
     confirmation shall not affect Bank's rights to collect interest at the rate
     selected. If, on the date of the selection, the index selected is
     unavailable for any reason, the selection shall be void. Bank reserves the
     right to fund the principal from any source of funds notwithstanding any
     Base Interest Rate selected by Debtor.

     b. VARIABLE INTEREST RATE. All principal outstanding hereunder which is not
     bearing interest at a Base Interest Rate shall bear interest at a rate per
     annum of 0.35% in excess of the Reference Rate, which rate shall vary as
     and when the Reference Rate changes.




                                      -1-

<PAGE>   23

     Debtor shall pay all amounts due under this note in lawful money of the
     United States at Bank's SAN DIEGO COMMERCIAL BANKING Office, or such other
     office as may be designated by Bank, from time to time.

2. LATE PAYMENTS. If any payment required by the terms of this note shall remain
unpaid ten days after same is due, at the option of Bank, Debtor shall pay a fee
of $100 to Bank.

3. INTEREST RATE FOLLOWING DEFAULT. In the event of default, at the option of
Bank, and, to the extent permitted by law, interest shall be payable on the
outstanding principal under this note at a per annum rate equal to five percent
(5%) in excess of the interest rate specified in paragraph 1.b, of this note,
calculated from the date of default until all amounts payable under this note
are paid in full.

4. PREPAYMENT.

     a. Amounts outstanding under this note bearing interest at a rate based on
     the Reference Rate may be prepaid in whole or in part at any time, without
     penalty or premium. Amounts outstanding under this note bearing interest at
     a Base Interest Rate may only be prepaid, in whole or in part provided Bank
     has received not less than five (5) Business Days prior written notice of
     an intention to make such prepayment and Debtor pays a prepayment fee to
     Bank in an amount equal to the present value of the product of: (i) the
     difference (but not lass than zero) between (a) the Base Interest Rate
     applicable to the principal amount which Debtor intends to prepay, and (b)
     the return which Bank could obtain if it used the amount of such prepayment
     of principal to purchase at bid price regularly quoted securities issued by
     the United States having a maturity date most closely coinciding with the
     relevant Base Rate Maturity Date and such securities were held by Bank
     until the relevant Base Rate Maturity Date ("Yield Rate"); (ii) a fraction,
     the numerator of which is the number of days in the period between the date
     of prepayment and the relevant Base Rate Maturity Date and the denominator
     of which is 360; and (iii) the amount of the principal so prepaid (except
     in the event that principal payments are required and have been made as
     scheduled under the terms of the Base Interest Rate Loan being prepaid,
     then an amount equal to the lesser of (A) the amount prepaid or (B) 50% of
     the sum of (1) the amount prepaid and (2) the amount of principal scheduled
     under the terms of the Base Interest Rate Loan being prepaid to be
     outstanding at the relevant Base Rate Maturity Date). Present value under
     this note is determined by discounting the above product to present value
     using the Yield Rate as the annual discount factor.

     b. In no event shall Bank be obligated to make any payment or refund to
     Debtor, nor shall Debtor be entitled to any setoff or other claim against
     Bank, should the return which Bank could obtain under the above prepayment
     formula exceed the interest that Bank would have received if no prepayment
     had occurred. All prepayments shall include payment of accrued interest on
     the principal amount so prepaid and shall be applied to payment of interest
     before application to principal. A determination by Bank as to the
     prepayment fee amount, if any, shall be conclusive. In the event of partial
     prepayment, such prepayments shall be applied to principal payments in the
     inverse order of their maturity.

     c. Such prepayment fee, if any, shall also be payable if prepayment occurs
     as the result of the acceleration of the principal of this note by Bank
     because of any default hereunder. If, following such acceleration, all or
     any portion of a Base Interest Rate Loan is satisfied, whether through sale
     of property encumbered by any security agreement or other agreement
     securing this note, at a foreclosure sale held thereunder or through the
     tender of payment at any time following such acceleration, but prior to
     such a foreclosure sale, then such satisfaction shall be deemed an evasion
     of the prepayment conditions set forth above, and Bank shall, automatically
     and without notice or demand, be entitled to receive, concurrently with
     such satisfaction the prepayment fee set forth above, and the amount of
     such prepayment fee shall be added to the principal. DEBTOR HEREBY
     ACKNOWLEDGES AND AGREES THAT BANK WOULD NOT MAKE THE LOAN TO DEBTOR
     EVIDENCED BY THIS NOTE WITHOUT DEBTOR'S AGREEMENT, AS SET FORTH ABOVE, TO
     PAY BANK A PREPAYMENT FEE UPON THE SATISFACTION OF ALL OR ANY PORTION OF
     THE PRINCIPAL BEARING INTEREST AT A BASE INTEREST RATE FOLLOWING THE
     ACCELERATION OF THE MATURITY DATE HEREOF BY REASON OF A DEFAULT. DEBTOR HAS
     CAUSED THOSE PERSONS SIGNING THIS NOTE ON ITS BEHALF TO SEPARATELY INITIAL
     THE AGREEMENT CONTAINED IN THIS PARAGRAPH BY PLACING THEIR INITIALS BELOW:

     INITIALS:      
               ------------            ------------   

5. DEFAULT AND ACCELERATION OF TIME FOR PAYMENT See Addendum "A", consisting of
two (2) pages, attached hereto and incorporated herein.

6. ADDITIONAL AGREEMENTS OF DEBTOR. If any amounts owing under this note are not
paid when due, Debtor promises to pay all costs and expenses, including
reasonable attorneys' fees, incurred by Bank in the collection or enforcement
of this note. Debtor and any endorsers of this note, for the maximum period of
time and the full extent permitted by law, (a) waive diligence, presentment,
demand, notice of nonpayment, protest, notice of protest, and notice of every
kind; (b) waive the right to assert the defense of any statute of limitations to
any debt or obligation hereunder; and (c) consent to renewals and extensions of
time for the payment of any amounts due under this note. If this note is signed
by more than one party, the term "Debtor" includes each of the undersigned and
any successors in interest thereof; all of whose liability shall be joint and
several. Any married person who signs this note agrees that recourse may be had
against the separate property of that person for any obligations hereunder. The
receipt of any check or other item of payment by Bank, at its option, shall not
be considered a payment on account until such check or other item of payment is
honored when presented for payment at the drawee bank. Bank may delay the credit
of such payment based upon Bank's schedule of funds availability, and interest
under this note shall accrue until the funds are deemed collected. In any action
brought under or arising out of this note, Debtor and any Obligor, including
their successors and assigns, hereby consent to the jurisdiction of any
competent court within the State of





                                      -2-




<PAGE>   24

California, as provided in any alternative dispute resolution agreement executed
between Debtor and Bank, and consent to service of process by any means
authorized by said state's law. The term "Bank" includes, without limitation,
any holder of this note. This note shall be construed in accordance with and
governed by the laws of the State of California. This note hereby incorporates
any alternative dispute resolution agreement previously, concurrently or
hereafter executed between Debtor and Bank.

7. DEFINITIONS. As used herein, the following terms shall have the meanings
respectively set forth below: "BASE INTEREST RATE" shall mean a rate of interest
based on the LIBOR-Rate. "BASE INTEREST RATE LOAN" shall mean amounts
outstanding under this note that bear interest at a Base interest Rate. "BASE
RATE MATURITY DATE" shall mean the last day of the Interest Period with respect
to principal outstanding under a Base interest Rate Loan. "BUSINESS DAY" shall
mean a day which is not a Saturday or Sunday on which Bank is open for business
in the state identified in paragraph 6, above, and, with respect to the rate of
interest based on the LIBOR-Rate, on which dealings in U.S. dollar deposits
outside of the United States may be carried on by Bank. "INTEREST PERIOD" shall
mean with respect to funds bearing interest at a rate based on the LIBOR-Rate,
any calendar period of one, three, six, nine or twelve months. In determining an
Interest Period, a month means a period that starts on one Business Day in a
month and ends on and includes the day preceding the numerically corresponding
day in the next month. For any month in which there is no such numerically
corresponding day, then as to that month, such day shall be deemed to be the
last calendar day of such month. Any Interest Period which would otherwise end
on a non-Business Day shall end on the next succeeding Business Day unless that
is the first day of a month, in which event such Interest Period shall end on
the next preceding Business Day. "LIBOR RATE" shall mean a per annum rate of
interest (rounded upward, if necessary, to the nearest 1/100 of 1%) at which
dollar deposits, in immediately available funds and in lawful money of the
United States would be offered to Bank, outside of the United States, for a term
coinciding with the Interest Period selected by Debtor and for an amount equal
to the amount of principal covered by Debtor's interest rate election, plus
Bank's costs, including the cost, if any, of reserve requirements. "ORIGINATION
DATE" shall mean the Business Day on which funds are made available to Debtor
relating to Debtor's selection of a Base Interest Rate. "REFERENCE RATE" shall
mean the rate announced by Bank from time to time at its corporate headquarters
as its "Reference Rate." The Reference Rate is an index rate determined by Bank
from time to time as a means of pricing certain extensions of credit and is
neither directly tied to any external rate of interest or index nor necessarily
the lowest rate of interest charged by Bank at any given time.


VIASAT, INC.

BY /s/ [Illegible]
   -------------------------------

TITLE Vice President
      ----------------------------






                                      -3-


<PAGE>   25

                  ADDENDUM "A" TO PROMISSORY NOTE (BASE RATE),
                      DATED __________, 1997, EXECUTED BY
            VIASAT, INC. IN FAVOR OF UNION BANK OF CALIFORNIA, N.A.
                     (SUCCESSOR IN INTEREST TO UNION BANK)

5. DEFAULT AND ACCELERATION OF TIME FOR PAYMENT. Default shall include, but not
be limited to, any of the following: (a) Debtor shall fail to pay within three
(3) days of the date when due any principal, interest or other payment required
under the terms of this note, that certain Loan Agreement between Debtor and
Bank, dated as of September 15, 1995, and any amendments, modifications,
extensions, supplements or replacements thereof (the "Loan Agreement") or any of
the other Loan Documents (as defined in the Loan Agreement); (b) Debtor shall
fail to observe or perform any covenant, obligation, condition or agreement set
forth in Section 5, or in paragraphs 4.5(i), 4.6, 4.7, 4.8 or 4.9, of the Loan
Agreement; (c) Debtor shall fail to observe or perform any other covenant,
obligation, condition or agreement contained in the Loan Agreement or the other
Loan Documents, and such failure shall continue for twenty (20) days after
written notice thereof to Debtor from Bank; (d) any representation, warranty,
certificate or other statement (financial or otherwise) made or furnished by or
on behalf of Debtor to Bank in or in connection with this note, the Loan
Agreement or any of the other Loan Documents, or as an inducement to Bank to
enter into the Loan Agreement and the other Loan Documents, shall be false,
incorrect, incomplete or misleading in any material respect when made or
furnished; (e) Debtor, any guarantor, co-maker, endorser, or any person or
entity other than Debtor providing security for this note (hereinafter
individually and collectively referred to as the "Obligor") shall fail to pay
when due any principal or interest payment required under the terms of any bond,
debenture, note or other evidence of indebtedness required to be paid by such
Obligor (except for payments required hereunder, under the Loan Agreement or
under the other Loan Documents) beyond any period of grace provided with respect
thereto, or shall default in the observance or performance of any other
agreement, term or condition contained in any such bond, debenture, note or
other evidence of indebtedness, and the effect of such failure or default is to
cause, or permit the holder or holders thereof to cause, the indebtedness
evidenced by such bond, debenture, note or other evidence of indebtedness to
become due prior to its stated date of maturity; (f) any Obligor shall (i) apply
for or consent to the appointment of a receiver, trustee, liquidator or
custodian of itself or of all or a substantial part of its property, (ii) be
unable, or admit in writing its inability, to pay its debts generally as they
mature, (iii) make a general assignment for the benefit of its or any of its
creditors, (iv) be dissolved or liquidated (or an Obligor who is a natural
person shall die), (v) commence a voluntary case or other proceedings seeking
liquidation, reorganization or other relief with respect to itself or its debts
under any bankruptcy, insolvency or other similar law now or hereafter in effect
or consent to any such

                                  Page 1 of 2                 Initial_________




<PAGE>   26



relief or to the appointment of or taking possession of its property by any
official in an involuntary case or other proceeding commenced against it, or
(vi) take any corporate action for the purpose of effecting any of the
foregoing; (g) proceedings for the appointment of a receiver, trustee,
liquidator or custodian of any Obligor or of all or a substantial part of its
property, or an involuntary case or other proceedings seeking liquidation,
reorganization or other similar relief with respect to any Obligor or its debts
under any bankruptcy, insolvency or other similar law now or hereafter in
effect, shall be commenced and shall not be dismissed or discharged within
thirty (30) days of commencement; or (h) a final judgment or order for the
payment of money in excess of Two Hundred Fifty Thousand Dollars ($250,000.00)
(exclusive of amounts covered by insurance) shall be rendered against any
Obligor and the same shall remain undischarged for a period of thirty (30) days
during which execution shall not be effectively stayed, or any judgment, writ,
warrant of attachment, or execution or similar process shall be issued or levied
against a substantial part of any Obligor's property and such judgment, writ or
similar process shall not be released, stayed, vacated, bonded or otherwise
dismissed within twenty (20) days after its issue or levy. Upon the occurrence
of any such default, Bank, in its discretion, may cease to advance funds
hereunder and may declare all obligations under this note immediately due and
payable; provided, however, upon the occurrence of a default under (f) or (g),
all principal and interest shall automatically become immediately due and
payable.

                                             VIASAT, INC.

                                             By: /s/ [Illegible]
                                                --------------------------
                                             Title: Vice President
                                                   -----------------------









                                  Page 2 of 2

<PAGE>   27


CALIFORNIA                          AUTHORIZATION

<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------------
  Borrower Name 
             VIASAT, INC.
- ---------------------------------------------------------------------------------------------------------------------------------
<S>                                                              <C>            <C>                       <C>    
  Borrower Address                                                Office        Loan Number
                                                                  40061         9449886233                 0005-00-0-000
                                                                  ---------------------------------------------------------------
  2290 COSMOS CT.                                                 Maturity Date                      Amount
  CARLSBAD, CA 92009-1585                                         SEPTEMBER 15, 2000                 $2,000,000.00
- ---------------------------------------------------------------------------------------------------------------------------------

Union Bank of California, N.A. ("Bank") is hereby authorized and instructed to disburse the proceeds of that certain Note referenced
above in the following manner:

     Deposit the proceeds into my/our account # 4000142625 as may be requested verbally or in writing.

     CHANGE IN TERMS OF OBLIGATION #0005-00-0-000                                $ 2,000,000.00

     TOTAL LOAN PROCEEDS:                                                        $ 2,000,000.00

- ---------------------------------------------------------------------------------------------------------------------------------

Fees itemized below are payable as follows (check one):

[ ] Charge account #________________________________   [ ]  Check enclosed







- ---------------------------------------------------------------------------------------------------------------------------------
                                                        TERMS AND CONDITIONS
- ---------------------------------------------------------------------------------------------------------------------------------

1.   Bank is authorized to charge account number 4000142625 in the name(s) of VIASAT, INC. for payments of interest (or
     principal/interest) when due in connection  with this Note and all renewals or extensions thereof.

2.   Bank shall disburse proceeds in the amounts stated above in accordance with the foregoing authorization or when Bank receives
     verbal or written authorization from Borrower(s) to do so, or any one of the Borrowers, if there are joint Borrowers, but not
     later than SEPTEMBER 15, 2000. The Bank, at its discretion, may elect to extend this date without notice to or acknowledgement
     by the borrower(s). This Authorization and the above mentioned Note will remain in full force and effect until the obligations
     in connection with this Note have been fulfilled.

3.   Unless dated by Bank prior to execution, the Note shall be dated by Bank as of the date on which Bank disburses proceeds.

4.   Notwithstanding anything to the contrary herein, Bank reserves the right to decline to advance the proceeds of the above
     described Note if there is a filing as to the Borrower(s), or any of them of a voluntary or involuntary petition under the
     provisions of the Federal Bankruptcy Act or any other insolvency law; the issuance of any attachment, garnishment, execution or
     levy of any asset of the Borrower(s), or any endorser or guarantor which results in Bank deeming itself, in good faith
     insecure.

5.   The borrower(s) authorizes Bank to release information concerning the borrower(s) financial condition to suppliers, other
     creditors, credit bureaus and other credit reporters; and also authorizes Bank to obtain such information from any third party
     at any time.

The Borrower(s) by their execution of this Authorization accept the foregoing terms, conditions and instructions.

Executed on      5/23/97
           ---------------------
VIASAT, INC.

BY: /s/ [ILLEGIBLE]  Vice President
   -------------------------------------------          ----------------------------------------------------------------------- 

   -------------------------------------------          ----------------------------------------------------------------------- 
                        TITLE
</TABLE>







<PAGE>   28

                                                           EQUIPMENT LOAN
                                                                 III
                                                         EFFECTIVE 9/15/97


UNION
BANK OF
CALIFORNIA

                                 PROMISSORY NOTE
                                   (BASE RATE)


<TABLE>
<CAPTION>
=================================================================================================================================
Borrower Name VIASAT, INC.
- ---------------------------------------------------------------------------------------------------------------------------------
<S>                                                                  <C>                        <C>       
                                                              Office 40061          Loan Number 9449886233
                                                              -------------------------------------------------------------------
Borrower Address   
2290 COSMOS CT.
CARLSBAD, CA. 92009                                           Maturity Date SEPTEMBER 15, 2001             Amount $2.500,000.00
=================================================================================================================================
</TABLE>



$2,500,000.00                                                 Date____________

FOR VALUE RECEIVED, on SEPTEMBER 15, 2001, the undersigned ("Debtor") promises
to pay to the order of UNION BANK OF CALIFORNIA, N.A. ("Bank"), as indicated
below, the principal sum of TWO MILLION FIVE HUNDRED THOUSAND AND NO/100 Dollars
($2,500,000,00), or so much thereof as is disbursed, together with interest on
the balance of such principal from time to time outstanding, at the per annum
rate or rates and at the times set forth below.

1.   PAYMENTS.

     PRINCIPAL PAYMENTS. Principal shall be payable in 36 equal consecutive
monthly instalments, each instalment in an amount sufficient to fully amortize
the principal balance by the final maturity date, beginning OCTOBER 16, 1998,
and continuing on the 16th day of each consecutive month. The availability under
this note shall be reduced on the same day and in the same amount as each
scheduled principal payment.

     INTEREST PAYMENTS. Debtor shall pay interest on the 16th day of each MONTH
(commencing SEPTEMBER 16, 1997). Should interest not be paid when due, it shall
become part of the principal and bear interest as herein provided. All
computations of interest under this note shall be made on the basis of a year of
360 days, for actual days elapsed.

     a. BASE INTEREST RATE. At Debtor's option, amounts outstanding hereunder in
     increments of at least $10,000 shall bear interest at a rate, based on an
     index selected by Debtor, which is 2.00% per annum in excess of Bank's
     LIBOR-Rate for the Interest Period so selected by Debtor.

     Any Base Interest Rate may not be changed, altered or otherwise modified
     until the expiration of the Interest Period selected by Debtor. The
     exercise of interest rate options by Debtor shall be as recorded in Bank's
     records, which records shall be prima facie evidence of the amount borrowed
     under either interest option and the interest rate; provided, however, that
     failure of Bank to make any such notation in its records shall not
     discharge Debtor from its obligations to repay in full with interest all
     amounts borrowed. In no event shall any Interest Period extend beyond the
     maturity date of this note.

     To exercise this option, Debtor may, from time to time with respect to
     principal outstanding on which a Base Interest Rate is not accruing, and on
     the expiration of any Interest Period with respect to principal outstanding
     on which a Base Interest Rate has been accruing, select an index offered by
     Bank for a Base Interest Rate Loan and Interest Period by telephoning an
     authorized lending officer of Bank located at the banking office identified
     below prior to 10:00 a.m., Pacific time, on any Business Day and advising
     that officer of the selected index, Interest Period and the Origination
     Date selected (which Origination Date, for a Base Interest Rate Loan based
     on the LIBOR-Rate, shall follow the date of such election by no more than
     two (2) Business Days).

     Bank will mail a written communication of the terms of the selection to
     Debtor promptly after the selection is made. Failure to send such
     confirmation shall not affect Bank's rights to collect interest at the rate
     selected. If, on the date of the selection, the index selected is
     unavailable for any reason, the selection shall be void. Bank reserves the
     right to fund the principal from any source of funds notwithstanding any
     Base Interest Rate selected by Debtor.

     b. VARIABLE INTEREST RATE. All principal outstanding hereunder which is not
     bearing interest at a Base Interest Rate shall bear interest at a rate per
     annum of 0.35% in excess of the Reference Rate, which rate shall vary as
     and when the Reference Rate changes.




                                      -1-



<PAGE>   29

     Debtor shall pay all amounts due under this note in lawful money of the
     United States at Bank's SAN DIEGO COMMERCIAL BANKING Office, or such
     other office as may be designated by Bank, from time to time.

2. LATE PAYMENTS. If any payment required by the terms of this note shall remain
unpaid ten days after same is due, at the option of Bank, Debtor shall pay a fee
of $100 to Bank.

3. INTEREST RATE FOLLOWING DEFAULT. In the event of default, at the option of
Bank, and, to the extent permitted by law, interest shall be payable on the
outstanding principal under this note at a per annum rate equal to five percent
(5%) in excess of the interest rate specified in paragraph 1.b, of this note,
calculated from the date of default until all amounts payable under this note
are paid in full.

4. PREPAYMENT.

     a. Amounts outstanding under this note bearing interest at a rate based on
     the Reference Rate may be prepaid in whole or in part at any time, without
     penalty or premium. Amounts outstanding under this note bearing interest at
     a Base Interest Rate may only be prepaid, in whole or in part provided Bank
     has received not less than five (5) Business Days prior written notice of
     an intention to make such prepayment and Debtor pays a prepayment fee to
     Bank in an amount equal to the present value of the product of: (i) the
     difference (but not less than zero) between (a) the Base Interest Rate
     applicable to the principal amount which Debtor intends to prepay, and (b)
     the return which Bank could obtain if it used the amount of such prepayment
     of principal to purchase at bid price regularly quoted securities issued by
     the United States having a maturity date most closely coinciding with the
     relevant Base Rate Maturity Date and such securities were held by Bank
     until the relevant Base Rate Maturity Date ("Yield Rate"); (ii) a fraction,
     the numerator of which is the number of days in the period between the date
     of prepayment and the relevant Base Rate Maturity Date and the denominator
     of which is 360; and (iii) the amount of the principal so prepaid (except
     in the event that principal payments are required and have been made as
     scheduled under the terms of the Base Interest Rate Loan being prepaid,
     then an amount equal to the lesser of (A) the amount prepaid or (B) 50% of
     the sum of (1) the amount prepaid and (2) the amount of principal scheduled
     under the terms of the Base Interest Rate Loan being prepaid to be
     outstanding at the relevant Base Rate Maturity Date). Present value under
     this note is determined by discounting the above product to present value
     using the Yield Rate as the annual discount factor.

     b. In no event shall Bank be obligated to make any payment or refund to
     Debtor, nor shall Debtor be entitled to any setoff or other claim against
     Bank, should the return which Bank could obtain under the above prepayment
     formula exceed the interest that Bank would have received if no prepayment
     had occurred. All prepayments shall include payment of accrued interest on
     the principal amount so prepaid and shall be applied to payment of interest
     before application to principal. A determination by Bank as to the
     prepayment fee amount, if any, shall be conclusive. In the event of partial
     prepayment, such prepayments shall be applied to principal payments in the
     inverse order of their maturity.

     c. Such prepayment fee, if any, shall also be payable if prepayment occurs
     as the result of the acceleration of the principal of this note by Bank
     because of any default hereunder. If, following such acceleration, all or
     any portion of a Base Interest Rate Loan is satisfied, whether through sale
     of property encumbered by any security agreement or other agreement
     securing this note, at a foreclosure sale held thereunder or through the
     tender of payment at any time following such acceleration, but prior to
     such a foreclosure sale, then such satisfaction shall be deemed an evasion
     of the prepayment conditions set forth above, and Bank shall, automatically
     and without notice or demand, be entitled to receive, concurrently with
     such satisfaction the prepayment fee set forth above, and the amount of
     such prepayment fee shall be added to the principal. DEBTOR HEREBY
     ACKNOWLEDGES AND AGREES THAT BANK WOULD NOT MAKE THE LOAN TO DEBTOR
     EVIDENCED BY THIS NOTE WITHOUT DEBTOR'S AGREEMENT, AS SET FORTH ABOVE, TO
     PAY BANK A PREPAYMENT FEE UPON THE SATISFACTION OF ALL OR ANY PORTION OF
     THE PRINCIPAL BEARING INTEREST AT A BASE INTEREST RATE FOLLOWING THE
     ACCELERATION OF THE MATURITY DATE HEREOF BY REASON OF A DEFAULT. DEBTOR HAS
     CAUSED THOSE PERSONS SIGNING THIS NOTE ON ITS BEHALF TO SEPARATELY INITIAL
     THE AGREEMENT CONTAINED IN THIS PARAGRAPH BY PLACING THEIR INITIALS BELOW:


     INITIALS: /s/ [INITIALS]
               --------------

5. DEFAULT AND ACCELERATION OF TIME FOR PAYMENT* See Addendum "A", consisting of
two (2) pages, attached hereto and incorporated herein.

6. ADDITIONAL AGREEMENTS OF DEBTOR. If any amounts owing under this note are not
paid when due, Debtor promises to pay all costs and expenses, including
reasonable attorneys' fees, incurred by Bank in the collection or enforcement of
this note. Debtor and any endorsers of this note, for the maximum period of time
and the full extent permitted by law, (a) waive diligence, presentment, demand,
notice of nonpayment, protest, notice of protest, and notice of every kind; (b)
waive the right to assert the defense of any statute of limitations to any debt
or obligation hereunder; and (c) consent to renewals and extensions of time for
the payment of any amounts due under this note. If this note is signed by more
than one party, the term "Debtor" includes each of the undersigned and any
successors in interest thereof; all of whose liability shall be joint and
several. Any married person who signs this note agrees that recourse may be had
against the separate property of that person for any obligations hereunder. The
receipt of any check or other item of payment by Bank, at its option, shall not
be considered a payment on account until such check or other item of payment is
honored when presented for payment at the drawee bank. Bank may delay the credit
of such payment based upon Bank's schedule of funds availability, and interest
under this note shall accrue until the funds are deemed collected. In any action
brought under or arising out of this note, Debtor and any Obligor, including
their successors and assigns, hereby consent to the jurisdiction of any
competent court within the State of




                                      -2-


<PAGE>   30

California, as provided in any alternative dispute resolution agreement executed
between Debtor and Bank, and consent to service of process by any means
authorized by said state's law. The term "Bank" includes, without limitation,
any holder of this note. This note shall be construed in accordance with and
governed by the laws of the State of California. This note hereby incorporates
any alternative dispute resolution agreement previously, concurrently or
hereafter executed between Debtor and Bank.

7. DEFINITIONS. As used herein, the following terms shall have the meanings
respectively set forth below: "BASE INTEREST RATE" shall mean a rate of interest
based on the LIBOR-Rate. "BASE INTEREST RATE LOAN" shall mean amounts
outstanding under this note that bear interest at a Base Interest Rate. "BASE
RATE MATURITY DATE" shall mean the last day of the Interest Period with respect
to principal outstanding under a Base Interest Rate Loan. "BUSINESS DAY" shall
mean a day which is not a Saturday or Sunday on which Bank is open for business
in the state identified in paragraph 6, above, and, with respect to the rate of
interest based on the LIBOR-Rate, on which dealings in U.S. dollar deposits
outside of the United States may be carried on by Bank. "INTEREST PERIOD" shall
mean with respect to funds bearing interest at a rate based on the LIBOR-Rate,
any calendar period of one, three, six, nine or twelve months. In determining an
Interest Period, a month means a period that starts on one Business Day in a
month and ends on and includes the day preceding the numerically corresponding
day in the next month. For any month in which there is no such numerically
corresponding day, then as to that month, such day shall be deemed to be the
last calendar day of such month. Any Interest Period which would otherwise end
on a non-Business Day shall end on the next succeeding Business Day unless that
is the first day of a month, in which event such Interest Period shall end on
the next preceding Business Day. "LIBOR RATE" shall mean a per annum rate of
interest (rounded upward, if necessary, to the nearest 1/100 of 1%) at which
dollar deposits, in immediately available funds and in lawful money of the
United States would be offered to Bank, outside of the United States, for a term
coinciding with the Interest Period selected by Debtor and for an amount equal
to the amount of principal covered by Debtor's interest rate election, plus
Bank's costs, including the cost, if any, of reserve requirements. "ORIGINATION
DATE" shall mean the Business Day on which funds are made available to Debtor
relating to Debtor's selection of a Base Interest Rate. "REFERENCE RATE" shall
mean the rate announced by Bank from time to time at its corporate headquarters
as its "Reference Rate." The Reference Rate is an index rate determined by Bank
from time to time as a means of pricing certain extensions of credit and is
neither directly tied to any external rate of interest or index nor necessarily
the lowest rate of interest charged by Bank at any given time.


VIASAT, INC.
- --------------------------


By    /s/  [ILLEGIBLE]
  ------------------------

Title   Vice President
     ---------------------












                                      -3-




<PAGE>   31


                  ADDENDUM "A" TO PROMISSORY NOTE (BASE RATE),
                       DATED__________, 1997, EXECUTED BY
            VIASAT, INC. IN FAVOR OF UNION BANK OF CALIFORNIA, N.A.
                     (SUCCESSOR IN INTEREST TO UNION BANK)

5. DEFAULT AND ACCELERATION OF TIME FOR PAYMENT. Default shall include, but not
be limited to, any of the following: (a) Debtor shall fail to pay within three
(3) days of the date when due any principal, interest or other payment required
under the terms of this note, that certain Loan Agreement between Debtor and
Bank, dated as of September 15, 1995, and any amendments, modifications,
extensions, supplements or replacements thereof (the "Loan Agreement") or any of
the other Loan Documents (as defined in the Loan Agreement); (b) Debtor shall
fail to observe or perform any covenant, obligation, condition or agreement set
forth in Section 5, or in paragraphs 4.5(i), 4.6, 4.7, 4.8 or 4.9, of the Loan
Agreement; (c) Debtor shall fail to observe or perform any other covenant,
obligation, condition or agreement contained in the Loan Agreement or the other
Loan Documents, and such failure shall continue for twenty (20) days after
written notice thereof to Debtor from Bank; (d) any representation, warranty,
certificate or other statement (financial or otherwise) made or furnished by or
on behalf of Debtor to Bank in or in connection with this note, the Loan
Agreement or any of the other Loan Documents, or as an inducement to Bank to
enter into the Loan Agreement and the other Loan Documents, shall be false,
incorrect, incomplete or misleading in any material respect when made or
furnished; (e) Debtor, any guarantor, co-maker, endorser, or any person or
entity other than Debtor providing security for this note (hereinafter
individually and collectively referred to as the "Obligor") shall fail to pay
when due any principal or interest payment required under the terms of any bond,
debenture, note or other evidence of indebtedness required to be paid by such
Obligor (except for payments required hereunder, under the Loan Agreement or
under the other Loan Documents) beyond any period of grace provided with respect
thereto, or shall default in the observance or performance of any other
agreement, term or condition contained in any such bond, debenture, note or
other evidence of indebtedness, and the effect of such failure or default is to
cause, or permit the holder or holders thereof to cause, the indebtedness
evidenced by such bond, debenture, note or other evidence of indebtedness to
become due prior to its stated date of maturity; (f) any Obligor shall (i) apply
for or consent to the appointment of a receiver, trustee, liquidator or
custodian of itself or of all or a substantial part of its property, (ii) be
unable, or admit in writing its inability, to pay its debts generally as they
mature, (iii) make a general assignment for the benefit of its or any of its
creditors, (iv) be dissolved or liquidated (or an Obligor who is a natural
person shall die), (v) commence a voluntary case or other proceedings seeking
liquidation, reorganization or other relief with respect to itself or its debts
under any bankruptcy, insolvency or other similar law now or hereafter in effect
or consent to any such




                                  Page 1 of 2            Initial /s/ [INITIALS]
                                                                 --------------


<PAGE>   32

relief or to the appointment of or taking possession of its property by any
official in an involuntary case or other proceeding commenced against it, or
(vi) take any corporate action for the purpose of effecting any of the
foregoing; (g) proceedings for the appointment of a receiver, trustee,
liquidator or custodian of any Obligor or of all or a substantial part of its
property, or an involuntary case or other proceedings seeking liquidation,
reorganization or other similar relief with respect to any Obligor or its debts
under any bankruptcy, insolvency or other similar law now or hereafter in
effect, shall be commenced and shall not be dismissed or discharged within
thirty (30) days of commencement; or (h) a final judgment or order for the
payment of money in excess of Two Hundred Fifty Thousand Dollars ($250,000.00)
(exclusive of amounts covered by insurance) shall be rendered against any
Obligor and the same shall remain undischarged for a period of thirty (30) days
during which execution shall not be effectively stayed, or any judgment, writ,
warrant of attachment, or execution or similar process shall be issued or levied
against a substantial part of any Obligor's property and such judgment, writ or
similar process shall not be released, stayed, vacated, bonded or otherwise
dismissed within twenty (20) days after its issue or levy. Upon the occurrence
of any such default, Bank, in its discretion, may cease to advance funds
hereunder and may declare all obligations under this note immediately due and
payable; provided, however, upon the occurrence of a default under (f) or (g),
all principal and interest shall automatically become immediately due and
payable.









                                                   VIASAT, INC.

                                                   BY:
                                                      ---------------------
                                                   TITLE:
                                                         ------------------





                                  Page 2 of 2                 




<PAGE>   33


CALIFORNIA                          AUTHORIZATION

<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------------
  Borrower Name 
             VIASAT, INC.
- ---------------------------------------------------------------------------------------------------------------------------------
<S>                                                              <C>            <C>                        <C>  
  Borrower Address                                                Office        Loan Number
                                                                  40061         9449886233               
                                                                  ---------------------------------------------------------------
  2290 COSMOS CT.                                                 Maturity Date                      Amount
  CARLSBAD, CA 92009-1585                                         SEPTEMBER 15, 2001                 $2,500,000.00
- ---------------------------------------------------------------------------------------------------------------------------------

Union Bank of California, N.A. ("Bank") is hereby authorized and instructed to disburse the proceeds of that certain Note referenced
above in the following manner:

     Deposit the proceeds into my/our account # 4000142625 as may be requested verbally or in writing.



     TOTAL LOAN PROCEEDS:                                                        $ 2,500,000.00

Fees itemized below are payable as follows (check one):

[ ] Charge account #________________________________   [ ]  Check enclosed







- ---------------------------------------------------------------------------------------------------------------------------------
                                                        TERMS AND CONDITIONS
- ---------------------------------------------------------------------------------------------------------------------------------

1.   Bank is authorized to charge account number 4000142625 in the name(s) of Viasat, Inc. for payments of interest (or
     principal/interest) when due in connection  with this Note and all renewals or extensions thereof.

2.   Bank shall disburse proceeds in the amounts stated above in accordance with the foregoing authorization or when Bank receives
     verbal or written authorization from Borrower(s) to do so, or any one of the Borrowers, if there are joint Borrowers, but not
     later than SEPTEMBER 15, 2000 The Bank, at its discretion, may elect to extend this date without notice to or acknowledgement
     by the borrower(s). This Authorization and the above mentioned Note will remain in full force and effect until the obligations
     in connection with this Note have been fulfilled.


3.   Unless dated by Bank prior to execution, the Note shall be dated by Bank as of the date on which Bank disburses proceeds.

4.   Notwithstanding anything to the contrary herein, Bank reserves the right to decline to advance the proceeds of the above
     described Note if there is a filing as to the Borrower(s), or any of them of a voluntary or involuntary petition under the
     provisions of the Federal Bankruptcy Act or any other insolvency law; the issuance of any attachment, garnishment, execution or
     levy of any asset of the Borrower(s), or any endorser or guarantor which results in Bank deeming itself, in good faith
     insecure.

5.   The borrower(s) authorizes Bank to release information concerning the borrower(s) financial condition to suppliers, other
     creditors, credit bureaus and other credit reporters; and also authorizes Bank to obtain such information from any third party
     at any time.

The Borrower(s) by their execution of this Authorization accept the foregoing terms, conditions and instructions.

Executed on      March 23, 1997
           ---------------------
VIASAT, INC.

BY:                 Vice President
   --------------------------------          -------------------------------- 
                        TITLE
</TABLE>








<PAGE>   1
                                                                   EXHIBIT 10.28

                             PURCHASE ORDER CHANGE



HUGHES
  AIRCRAFT                              NOTE: OUR ORDER NUMBER
                                              INCLUDING PREFIX & SUFFIX LETTERS
                                              MUST APPEAR ON YOUR INVOICE, B/L,
                                              PACKING LISTS, PACKAGES, CASES AND
                                              CORRESPONDENCE

                                                         S131TP


ORDER     VIASAT INCORPORATED                   02/25/97
 AND      2290 COSMOS COURT                     PAGE 1
REMIT     CARLSBAD  CA 92009-1585               P.O. REV NBR:  5
  TO                                            BUYER: THOMAS E. PARRISH
                                                CONFIRMING P.O? : Y
VENDOR NBR: 940987     PHONE: 619-438-8099      CONFIRMED BY: MCCULLOUGH
- -------------------------------------------------------------------------------
SHIP  HUGHES DEFENSE COMMUNICATIONS        BILL   HUGHES DEFENSE COMMUNICATIONS
TO    4624 EXECUTIVE BOULEVARD             TO     1010 PRODUCTION ROAD
      FORT WAYNE IN 46808                         FORT WAYNE IN 46808-4106

PAYMENT:   NET 30                     FRGHT PYMT: PREPAID AND ALLOWED
FOB    :   ORIGIN                     TRANS     : BEST WAY - LTR OF INSTRUCTION

REFERENCE INDIANA DIRECT PAY TAX PERMIT: 0005614058 001
- -------------------------------------------------------------------------------

                 ***********************************************
                 ***** PURCHASE ORDER CHANGE NOTIFICATION  *****
                 ***********************************************

PO COMMENTS :  THIS SUBCONTRACT IS ISSUED AS THE DELIVERY ORDER HARDWARE
               RELEASE NO. 1, AS CONTAINED IN BASIC ORDERING AGREEMENT (BOA)
               S114TP AS LINE ITEM 1.- EMUT MODEMS (MX P/N 620307-1). THIS ORDER
               IS ISSUED ON A FFP BASIS AND INVOICES WILL BE SUBMITTED AND
               REIMBURSED IN ACCORDANCE WITH PARA. B.3 AS CONTAINED IN BOA
               S114TP.

               THIS DELIVERY ORDER RELEASE SUPERSEDES LETTER AUTHORIZATION
               TEP-94-025 DATED 15 MARCH 1994 IN ITS ENTIRETY. ALL TERMS AND
               CONDITIONS,
 BOTH DELINEATED AND INCORPORATED BY REFERENCE, AS
               CONTAINED IN BOA S114TP ARE APPLICABLE TO THIS DELIVERY ORDER
               RELEASE AND SUPERSEDE THE PO T&C'S ON THE REVERSE SIDE OF THIS
               DOCUMENT.

               MAGNAVOX SOURCE INSPECTION IS REQUIRED AS A CONDITION OF
               SHIPMENT. NOTIFY MAGNAVOX NOT LESS THAN FIVE (5) WORKING DAYS
               PRIOR TO AN ANTICIPATED SHIP DATE AND SUBMIT EVIDENCE OF MAGNAVOX
               INSPECTION ACCEPTANCE WITH SHIPMENT.

               CHANGE NO. 2 INCORPORATES A REVISED MODEM DELIVERY SCHEDULE AT NO
               CHANGE IN PRICE. THIS MODIFICATION REFLECTS THE MOA DATED 13
               APRIL 1995. THE TOTAL FFP PRICE IS $ *** . ALL OTHER TERMS
               AND CONDITIONS REMAIN UNCHANGED.

               CHANGE NO. 3 IS ISSUED TO *** DUE TO THE

/s/ JOHN HARTMAN              /s/ WILLIAM JENSEN
- -----------------------       -----------------------   -----------------------
BUYER'S SIGNATURE             SELLER'S SIGNATURE

DIRECTOR, MATERIALS ENGINEERING

* CONFIDENTIAL TREATMENT REQUESTED

Certain confidential portions of this Exhibit were omitted by means of blackout
of the text (the "Mark"). This Exhibit has been filed separately with the
Secretary of the Commission without the Mark pursuant to the Company's
Application Requesting Confidential Treatment under Rule 24b-2 under the
Securities Exchange Act.


<PAGE>   2

                             PURCHASE ORDER CHANGE
HUGHES
  AIRCRAFT                              NOTE: OUR ORDER NUMBER
                                              INCLUDING PREFIX & SUFFIX LETTERS
                                              MUST APPEAR ON YOUR INVOICE, B/L,
                                              PACKING LISTS, PACKAGES, CASES AND
                                              CORRESPONDENCE

                                                         S131TP
                                                               J-1240-5 REV 8/96




ORDER     VIASAT INCORPORATED                   02/25/97
 AND      2290 COSMOS COURT                     PAGE 2
REMIT     CARLSBAD  CA 92009-1585               
  TO                                            P.O. REV NBR:  5
                                                BUYER: THOMAS E. PARRISH
                                                CONFIRMING P.O? : Y
VENDOR NBR: 940987     PHONE: 619-438-8099      CONFIRMED BY: MCCULLOUGH
- -------------------------------------------------------------------------------


  PART NBR/               PART                                        DELIVERY
ITEM DESCRIPTION          REV      QUANTITY        U/M    UNIT PRICE    DATE
- ----------------          ---      --------        ---    ----------    ----


*****CONTINUED

               *** IN CONSIDERATION FOR THIS MODIFICATION VIASAT IS
               RESPONSIBLE FOR THE CORRECTION OF ANY SOFTWARE ANOMOLIES
               DISCOVERED DURING THE EXECUTION OF SYSTEM FAT OR MODEM FAT AND
               WILL CORRECT SUCH ANOMOLIES AT VIASAT'S EXPENSE. THE TOTAL FFP
               PRICE IS UNCHANGED AT $ *** . EXCEPT AS SPECIFICALLY
               MODIFIED ABOVE, ALL OTHER T&C'S IN THIS DELIVERY ORDER AND IN BOA
               S114TP REMAIN UNCHANGED. NOTE: LINE ITEM 004 IS CLOSED AT QTY 40
               RECEIVED. REMAINING 10 UNITS ARE TRANSFERRED TO LINE ITEM 005.

               CHANGE NUMBER 4 IS ISSUED TO COVER THE PROCUREMENT OF 264 MODEMS
               AS EMUT SPARES IN ACCORDANCE WITH VIASAT PROPOSAL NO. 9505007.03
               DATED 23 AUGUST 1996. THE UNIT PRICE IS $ *** . THE TOTAL CHANGE
               ORDER VALUE IS $ *** . THE TOTAL FFP PRICE OF THIS ORDER IS
               REVISED TO $ *** . THIS CHANGE ORDER SUPERSEDES LETTER
               AUTHORIZATION TEP-96-096 DATED 9 OCTOBER 1996 IN ITS ENTIRETY. IN
               ADDITION TO THE QUANTITY OF 264 SPARE MODEMS, HDC HAS THE OPTION
               TO ORDER ANOTHER 283 SPARE MODEMS AT THE SAME UNIT PRICE PRIOR TO
               1 JUNE 1997. EXCEPT AS SPECIFICALLY MODIFIED ABOVE, ALL OTHER
               TERMS AND CONDITIONS IN THIS DELIVERY ORDER AND IN BOA S114TP
               REMAIN UNCHANGED.

               CHANGE NO. 5 IS ISSUED TO PROCURE QUANTITY *** PRODUCTION
               MODEMS UNDER THIS DELIVERY ORDER. THIS ORDER FOR *** MODEMS IS
               AT BOA S114TP PER UNIT PRICE OF $ *** EACH OR FOR A TOTAL FFP
               AMOUNT OF $ *** . WITH THIS CHANGE, THE TOTAL FFP PRICE FOR
               THIS DELIVERY ORDER IS REVISED TO $ *** . THIS RELEASE
               INCREASES THE TOTAL "PRODUCTION" MODEM QUANTITY ON THIS ORDER
               FROM *** TO *** MODEMS. THE PAYMENT TERMS INCLUDES AN INITIAL
               PAYMENT OF $ *** . INVOICABLE BY VIASAT AT THE TIME OF
               ACKNOWLEDGMENT OF



/s/ John Hartman             /s/ William Jensen
- -----------------------       -----------------------   -----------------------
BUYER'S SIGNATURE             SELLER'S SIGNATURE

DIRECTOR, MATERIALS ENGINEERING



* CONFIDENTIAL TREATMENT REQUESTED

<PAGE>   3
                               PURCHASE ORDER CHANGE


HUGHES
  AIRCRAFT                              NOTE: OUR ORDER NUMBER
                                              INCLUDING PREFIX & SUFFIX LETTERS
                                              MUST APPEAR ON YOUR INVOICE, B/L,
                                              PACKING LISTS, PACKAGES, CASES AND
                                              CORRESPONDENCE

                                                         S131TP


ORDER     VIASAT INCORPORATED                   02/25/97
 AND      2290 COSMOS COURT                     PAGE  3
REMIT     CARLSBAD  CA 92009-1585               P.O. REV NBR:  5
  TO                                            BUYER: THOMAS E. PARRISH
                                                CONFIRMING P.O? : Y
VENDOR NBR: 940987     PHONE: 619-438-8099      CONFIRMED BY: MCCULLOUGH
- -------------------------------------------------------------------------------


  PART NBR/               PART                                        DELIVERY
ITEM DESCRIPTION          REV      QUANTITY        U/M    UNIT PRICE    DATE
- ----------------          ---      --------        ---    ----------    ----


***** CONTINUED

               THIS CHANGE ORDER. THIS INITIAL PAYMENT WILL BE RECOUPED AT THE
               LIQUIDATION AMOUNT OF $ *** PER MODEM DELIVERED I.E. UNIT PRICE
               OF $ *** . LESS ($ *** .) = NET UNIT PRICE $ *** . IF THE 
               ISSUANCE OF THIS *** QUANTITY ORDER IS TERMINATED AFTER THE
               INITIAL PAYMENT, THE TERMINATION LIABILITY SCHEDULE AS STATED IN
               VIASAT LETTER FBM.96.310 DATED 11 NOVEMBER 1996 SHALL APPLY.
               SINCE THIS SCHEDULE WAS BASED ON QTY. *** , THE ADDITIONAL ***
               QUANTITY WILL BE EXTENDED FROM MONTH 24 ON A SIMILAR SPEND-RATE
               PER MONTH BASIS. IN ADDITION, THIS CHANGE ORDER INCORPORATES
               OTHER AGREEMENTS MADE BETWEEN THE PARTIES, AS WRITTEN AND
               ACKNOWLEDGED IN THE MEMORANDUM OF NEGOTIATIONS (MON) DATED 14
               FEBRUARY 1997. SUCH AGREEMENTS ARE AS STATED BELOW:

               THE MODEM COLD TEMPERATURE PERFORMANCES ISSUE DOCUMENTED IN HDC
               LETTER TEP-96-099 AND AS WITNESSED AT TERMINAL LEVEL BY MR. GREG
               SHAW OF VIASAT SHALL BE RESOLVED BY VIASAT AS A NO COST
               CORRECTIVE ACTION FOR ALL PRODUCTION MODEMS THAT HAVE BEEN BUILT
               (SHIPPED, OR IN FINISHED GOODS, OR AS WORK IN PROCESS) AS OF THE
               DATE OF VIASAT RECEIPT OF THIS ORDER. THIS SHALL INCLUDE THE
               ACTIONS AS DESCRIBED BELOW:

               1.   MODEMS SHALL BE RUN IN LOTS OF 25, EACH INFORMALLY
                    CONFIDENCE CHECKED, AND ON A SAMPLING BASIS ON (1) RUN
                    THROUGH LIMITED TEMPERATURE CYCLING.

               2.   ONE (1) EACH LOT SHALL BE SUBJECT TO A-LEVEL ACCEPTANCE
                    TESTING; NO B-LEVEL ACCEPTANCE TESTING SHALL BE REQUIRED.

               3.   DCRN'S 000529 AND 000530 SHALL BE ISSUED AND INCORPORATED TO
                    CORRECT THE COLD TEMPERATURE PROBLEM.

               SOFTWARE CHANGE ACTIONS DESCRIBED HEREIN SHALL BE CONCURRENTLY
               INCLUDED IN THE MODEMS SUBJECT TO THIS HARDWARE CORRECTIVE
               ACTION. FURTHER, VIASAT SHALL PREPARE A DELIVERABLE CODE BUILD
               CONCURRENT WITH OTHER CODE BUILDS DESCRIBED HERE-



/s/ JOHN HARTMAN              /s/ WILLIAM JENSEN
- -----------------------       -----------------------   -----------------------
BUYER'S SIGNATURE             SELLER'S SIGNATURE

DIRECTOR, MATERIALS ENGINEERING


*CONFIDENTIAL TREATMENT REQUESTED

<PAGE>   4
                             PURCHASE ORDER CHANGE    

HUGHES
  AIRCRAFT                              NOTE: OUR ORDER NUMBER INCLUDING PREFIX
                                              & SUFFIX LETTERS MUST APPEAR ON 
                                              YOUR INVOICE, B/L, PACKING LISTS,
                                              PACKAGES, CASES AND CORRESPONDENCE

                                                         S131TP
                                                         
                                                               J-1240-5 REV 8/96


ORDER     VIASAT INCORPORATED                   02/25/97
 AND      2290 COSMOS COURT                     PAGE  4
REMIT     CARLSBAD  CA 92009-1585               
  TO                                            P.O. REV NBR:  5
                                                BUYER: THOMAS E. PARRISH
VENDOR NBR: 940987     PHONE: 619-438-8099      CONFIRMING PO? : Y
                                                CONFIRMED BY: MCCULLOUGH
- -------------------------------------------------------------------------------


  PART NBR/               PART                                        DELIVERY
ITEM DESCRIPTION          REV      QUANTITY        U/M    UNIT PRICE    DATE
- ----------------          ---      --------        ---    ----------    ----

***** CONTINUED

               IN FOR INCORPORATION IN THE MODEM AS A BASELINE SOFTWARE CHANGE
               ACTION. THIS BASELINE VERSION OF SOFTWARE SHALL BE APPROVED FOR
               RELEASE BY HDC AT THE COMPLETION OF THE REGRESSIVE TERMINAL LEVEL
               TESTING TO OCCUR ON OR BEFORE 07 MARCH 1997. BASELINE SOFTWARE
               CHANGE ACTIONS DESCRIBED ABOVE SHALL BE CONCURRENTLY INCLUDED IN
               THE MODEMS SUBJECT TO THE HARDWARE CORRECTIVE ACTIONS DESCRIBED
               HEREIN.

               THE PARTIES AGREE UPON CTIC USE AND DELIVERY AS FOLLOWS:

               THE CTIC IS PROVIDED GFE TO VIASAT. SHOULD THE GOVERNMENT NOT
               PROVIDE CTICS IN SUFFICIENT NUMBER TO MEET PRODUCTION DELIVERIES,
               VIASAT WILL COMPLETE WORK ON THE MONTHLY MODEM DELIVERIES UP TO
               THE POINT OF THE CTIC INSTALLATION. VIASAT WILL THEN PRESENT THE
               MODEMS FOR HDC CONTRACTOR SOURCE INSPECTION AND PRELIMINARY
               ACCEPTANCE. CRITERIA FOR ACCEPTANCE SHALL BE MODEMS ASSEMBLED TO
               THE POINT OF CTIC INSTALLATION ON THE OEB WITH NO ADDITIONAL
               SHORTAGES. UPON PRELIMINARY ACCEPTANCE, VIASAT WILL THEN BE
               ENTITLED TO INVOICE FOR THE FULL PAYMENT AND STORE THE MODEMS
               UNTIL RECEIPT OF THE CTICS THE CTICS WILL THEN BE INSTALLED,
               FINAL ASSEMBLY COMPLETED AND ATP PERFORMED. THE MODEMS WILL THEN
               BE SHIPPED PER HDC INSTRUCTIONS. ANY FAILURE OCCURRING DURING
               FINAL ATP SHALL BE CORRECTED IN ACCORDANCE WITH BOA S114TP AND
               THE WARRANTY PERIOD SHALL COMMENCE AFTER EACH SUCCESSFUL
               COMPLETION OF THE ATP AND MODEM DELIVERY.

               THE PARTIES AGREE UPON THE WEDGELOCK SUPPLY AND INSTALLATION AS
               FOLLOWS: VIASAT AT ITS EXPENSE SHALL INSTALL THE MODEM WEDGELOCKS
               WITH HDC PROVIDED WEDGELOCKS CONCURRENT WITH THE HARDWARE
               CORRECTIVE ACTION DESCRIBED HEREIN. NO TEST OR INSPECTION, OTHER
               THAN STANDARD VIASAT PROCESSES, SHALL BE REQUIRED FOR THIS
               ACTION.



/s/ JOHN HARTMAN              /s/ WILLIAM JENSEN
- -----------------------       -----------------------   -----------------------
BUYER'S SIGNATURE             SELLER'S SIGNATURE

DIRECTOR, MATERIALS ENGINEERING




<PAGE>   5
                             PURCHASE ORDER CHANGE


HUGHES
  AIRCRAFT                              NOTE: OUR ORDER NUMBER INCLUDING PREFIX
                                              & SUFFIX LETTERS MUST APPEAR ON 
                                              YOUR INVOICE, B/L, PACKING LISTS,
                                              PACKAGES, CASES AND CORRESPONDENCE

                                                         S131TP

                                                               J-1240-5 REV 8/96


ORDER     VIASAT INCORPORATED                   02/25/97
 AND      2290 COSMOS COURT                     PAGE  5
REMIT     CARLSBAD  CA 92009-1585               
  TO                                            P.O. REV NBR:  5
                                                BUYER: THOMAS E. PARRISH
VENDOR NBR: 940987     PHONE: 619-438-8099      CONFIRMING PO? : Y
                                                CONFIRMED BY: MCCULLOUGH
- -------------------------------------------------------------------------------


  PART NBR/               PART                                        DELIVERY
ITEM DESCRIPTION          REV      QUANTITY      U/M    UNIT PRICE      DATE
- ----------------          ---      --------      ---    ----------      ----
***** CONTINUED

     EXCEPT AS SPECIFICALLY MODIFIED ABOVE, ALL OTHER TERMS AND CONDITIONS IN
     THIS DELIVERY ORDER AND IN BOA S114TP REMAIN UNCHANGED.

      PART NBR/          PART                                         DELIVERY
ITEM DESCRIPTION          REV      QUANTITY      U/M    UNIT PRICE      DATE
- ----------------          ---      --------      ---    ----------      ----

  4   620307-11                          50      EA         ***       09/29/95
      MODEM,MODULE

      CONTRACT : DAAB07-94-D-A010-0001    RATING:   D0A7

      COMMENTS : THE ORIGINAL LINE ITEM TOTAL QTY. OF 50 IS CLOSED-OUT AT QTY.
                 10 SHORT, I.E. QTY. 40 HAS BEEN RECEIVED AND BILLED AGAINST
                 THIS LINE ITEM, AND NO FURTHER RECEIPTS ARE REQUIRED

 19   620307-1                          303      EA         ***       03/17/97
      MODEM,MODULE
  
      CONTRACT : DAAB07-94-D-A010-0001    RATING:   DOA7

 20   620307-1                          150      EA         ***       04/15/97
      MODEM,MODULE

      CONTRACT : DAAB07-94-D-A010-0001    RATING:   DOA7

 21   620307-1                          130      EA         ***       05/15/97
      MODEM,MODULE

      CONTRACT : DAAB07-94-D-A010-0001    RATING:   D0A7



/s/ JOHN HARTMAN                 /s/ WILLIAM JENSEN
- -----------------------          -----------------------   --------------------
BUYER'S SIGNATURE                SELLER'S SIGNATURE
DIRECTOR, MATERIALS ENGINEERING



*CONFIDENTIAL TREATMENT REQUESTED

<PAGE>   6

                             PURCHASE ORDER CHANGE
HUGHES
  AIRCRAFT                            NOTE:           OUR ORDER NUMBER
                                              INCLUDING PREFIX & SUFFIX LETTERS
                                              MUST APPEAR ON YOUR INVOICE, B/L,
                                              PACKING LISTS, PACKAGES, CASES AND
                                              CORRESPONDENCE

                                                         S131TP
                                                               J-1240-5 REV 8/96

ORDER     VIASAT INCORPORATED                   02/25/97
 AND      2290 COSMOS COURT                     PAGE  6
REMIT     CARLSBAD  CA 92009-1585              
  TO                                            P.O. REV NBR:  5
                                                BUYER: THOMAS E. PARRISH
                                                CONFIRMING PO? : Y
VENDOR NBR: 940987     PHONE: 619-438-8099      CONFIRMED BY: McCULLOUGH
- -------------------------------------------------------------------------------


  PART NBR/               PART                                        DELIVERY
ITEM DESCRIPTION          REV      QUANTITY        U/M    UNIT PRICE    DATE
- ----------------          ---      --------        ---    ----------    ----

***** CONTINUED

 22   620307-1                       120           EA         ***      06/16/97
      MODEM,MODULE

      CONTRACT : DAAB07-94-D-A010-0001     RATING:  D0A7

 23   620307-1                        56           EA         ***      07/15/97
      MODEM,MODULE

      CONTRACT : DAAB07-94-D-A010-0001     RATING: D0A7

 26   620307-1             A          20           EA         ***      04/15/97
      MODEM,MODULE

      CONTRACT :  DAAB07-94-D-A010-0001     RATING: DOA7

      COMMENTS :  LINE ITEMS 026 - 031 ARE FOR THE SPARE MODEMS REQUIRED UNDER
                  THE PROGRAM. THE TOTAL QTY. OF SPARES ON THESE LINE ITEMS
                  EQUALS 264.

 27   620307-1             A          40           EA         ***      05/15/97
      MODEM,MODULE

      CONTRACT :  DAAB07-94-D-A010-0001     RATING: DOA7

      COMMENTS :  THIS LINE ITEM IS FOR SPARE MODEMS AGAINST THE TOTAL ORDER OF
                  264 SPARES REQUIRED.


 28   620307-1             A          50           EA         ***      06/16/97
      MODEM,MODULE

      CONTRACT : DAAB07-94-D-A010-0001             RATING:      DOA7





/s/  JOHN HARTMAN             /s/  WILLIAM JENSEN
- -----------------------       -----------------------   -----------------------
BUYER'S SIGNATURE             SELLER'S SIGNATURE

DIRECTOR, MATERIALS ENGINEERING



*CONFIDENTIAL TREATMENT REQUESTED

<PAGE>   7

                             PURCHASE ORDER CHANGE
HUGHES
  AIRCRAFT                            NOTE:          OUR ORDER NUMBER
                                              INCLUDING PREFIX & SUFFIX LETTERS
                                              MUST APPEAR ON YOUR INVOICE, B/L,
                                              PACKING LISTS, PACKAGES, CASES AND
                                              CORRESPONDENCE

                                                        S131TP
                                                              J-1240-5  REV 8/96

ORDER     VIASAT INCORPORATED                   02/25/97
 AND      2290 COSMOS COURT                     PAGE  7
REMIT     CARLSBAD  CA 92009-1585               
  TO                                            P.O. REV NBR:  5
                                                BUYER: THOMAS E. PARRISH
                                                CONFIRMING PO? : Y
VENDOR NBR: 940987     PHONE: 619-438-8099      CONFIRMED BY: McCULLOUGH
- -------------------------------------------------------------------------------


  PART NBR/               PART                                         DELIVERY
ITEM DESCRIPTION          REV            QUANTITY    U/M   UNIT PRICE    DATE
- ----------------          ---            --------    ---   ----------    ----

***** CONTINUED

  29  620307-1             A               43        EA       ***      07/08/97
      MODEM,MODULE

      CONTRACT : DAAB07-94-D-A010-0001            RATING: DOA7

  30  620307-1             A              100        EA       ***      08/08/97 
      MODEM,MODULE

      CONTRACT : DAAB07-94-D-A010-0001            RATING: DOA7

  31  620307-1             A               11        EA       ***      09/08/97
      MODEM,MODULE

      CONTRACT : DAAB07-94-D-A010-0001            RATING: DOA7

  32  620307-1             A               89        EA       ***      09/08/97
      MODEM,MODULE

      CONTRACT : DAAB07-94-D-A010-0001            RATING: DOA7

COMMENTS : THIS REPRESENTS THE FIRST SHIPMENT AGAINST THE *** QTY. ORDER
           PLACED. AS STATED IN THE PO HEADER NOTES, THE $***. INITIAL
           PAYMENT WILL BE LIQUIDATED AGAINST THE DELIVERY OF MODEMS BEGINNING
           WITH THIS SHIPMENT. SUCH RECOUPMENT WILL BE ACCOMPLISHED BY DEDUCTING
           $*** FROM THE STATED UNIT PRICE AND VIASAT WILL BE REIMBURSED THIS
           NET AMOUNT, I.E. $***. LESS ($***.) = NET INVOICED AMOUNT OF
           $***. EACH. ACCORDINGLY, VIASAT INVOICES SHALL INDICATE THE
           FOLLOWING AMOUNTS: QTY. SHIPPED TIMES UNIT PRICE, (LESS) QTY. SHIPPED
           TIMES ($***.), AND THE RESULTING NET AMOUNT TO BE PAID.




/s/  JOHN HARTMAN             /s/  WILLIAM JENSEN
- -----------------------       -----------------------   -----------------------
BUYER'S SIGNATURE             SELLER'S SIGNATURE

DIRECTOR, MATERIALS ENGINEERING


* CONFIDENTIAL TREATMENT REQUESTED

<PAGE>   8

                             PURCHASE ORDER CHANGE
HUGHES
  AIRCRAFT                              NOTE:        OUR ORDER NUMBER
                                              INCLUDING PREFIX & SUFFIX LETTERS
                                              MUST APPEAR ON YOUR INVOICE, B/L,
                                              PACKING LISTS, PACKAGES, CASES AND
                                              CORRESPONDENCE

                                                         S131TP
                                                               J-1240-5 REV 8/96

ORDER     VIASAT INCORPORATED                   02/25/97
 AND      2290 COSMOS COURT                     PAGE  8
REMIT     CARLSBAD  CA 92009-1585               
  TO                                            P.O. REV NBR:  5
                                                BUYER: THOMAS E. PARRISH
                                                CONFIRMING PO? : Y
VENDOR NBR: 940987     PHONE: 619-438-8099      CONFIRMED BY: McCULLOUGH
- -------------------------------------------------------------------------------


  PART NBR/               PART                                         DELIVERY
ITEM DESCRIPTION          REV            QUANTITY    U/M   UNIT PRICE    DATE
- ----------------          ---            --------    ---   ----------    ----

***** CONTINUED

  33  620307-1             A                 0       EA     0.00000    10/08/97
      MODEM,MODULE

      CONTRACT : DAAB07-94-D-A010-0001                 RATING: DOA7

      COMMENTS : THIS ITEM HAS BEEN DELETED IN ITS ENTIRETY.

  34  620307-1             A             ***         ***       ***     10/15/97
      MODEM,MODULE

      CONTRACT : DAAB07-94-D-A010-0001           RATING: DOA7

COMMENTS : THE SCHEDULE FOR THE QUANTITY 3,911 MODEMS WILL BE DETERMINED AND
           AGREED TO IN ACCORDANCE WITH BOA S114TP CLAUSE F.7.

- --------------------------------------------------------------------------------
                                                        PO TOTAL:

          FOR ANY LINE ITEM ABOVE REFERENCING A GOVERNMENT CONTRACT AND PRIORITY
          RATING, THE FOLLOWING APPLIES:
          THIS IS A RATED ORDER CERTIFIED FOR NATIONAL DEFENSE USE AND YOU ARE
          REQUIRED TO FOLLOW THE PROVISIONS OF THE DEFENSE PRIORITIES AND
          ALLOCATIONS SYSTEM REGULATION (15CFR PART 350)

          ACCEPTANCE OF THIS ORDER CERTIFIES THAT THE SUPPLIER IS NEITHER
          DEBARRED NOR SUSPENDED BY THE FEDERAL GOVERNMENT.




/s/  JOHN HARTMAN             /s/  WILLIAM JENSEN
- -----------------------       -----------------------   -----------------------
BUYER'S SIGNATURE             SELLER'S SIGNATURE

DIRECTOR, MATERIALS ENGINEERING

* CONFIDENTIAL TREATMENT REQUESTED



<PAGE>   1
                                                                   EXHIBIT 10.30


<TABLE>


AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT              1. PAGE 1 OF 19
<S>                               <C>       <C>                 <C>                              <C>
2. PROC INSTRUMENT ID NO. (PIN)   3. SPIN   4. EFFECTIVE DATE   5. REQUESTING PURCHASE REQUEST   6. BDC/DMS RATING
                                                                   PROJECT NO.
F19628-96-C-0015                  P00011     MAILING DATE                                         DO-A7
- -----------------------------------------------------------------------------------------------------------------------------------
7. ISSUED BY                                            CODE  FA8709        8. ADMINISTERED BY (IF OTHER THAN BLOCK 7)  CODE S0514A

ELECTRONIC SYSTEMS CENTER, MCK                                              DCMC SAN DIEGO
AIR FORCE MATERIEL COMMAND, USAF                                            7675 DAGGET STREET, SUITE 200
50 GRIFFISS STREET, BLDG MITRE D                                            SAN DIEGO, CA  92111-2241
HANSCOM AFB, MA  01731-1620

BUYER: MARK BROWNELL, 1 LT, USAF
   (617)271-6091
- -----------------------------------------------------------------------------------------------------------------------------------
9. CONTRACTOR NAME AND ADDRESS                          CODE  47358             FACILITY CODE     10. SECURITY CLASS  U

VIASAT INCORPORATED                                                             F "9" FOR         11. DISCOUNT FOR PROMPT PAYMENT
2290 COSMOS COURT                                                               MULTIPLE          1ST     %    DAYS      NET DAYS
CARLSBAD, CA  92009-1585                                                        FACILITIES        2ND     %    DAYS      OTHER
                                                                                SEE SECT "K"      3RD     %    DAYS      OTHER
                                                                                                  -------------------------------
                                                                                                  12. PURCHASE OFFICE POINT OF
                                                                                                      CONTACT 
                                                                                                          HNL/H47/HNL
- -----------------------------------------------------------------------------------------------------------------------------------
13. THIS BLOCK APPLIES ONLY TO AMENDMENTS OF SOLICITATIONS

    [ ] The above numbered solicitation is      The hour and date specified    [ ] is extended    [ ] is not extended
        amended as set forth in block 17.       for receipt of Offers 

Others must acknowledge receipt of this amendment prior to the hour and date specified in the solicitation or as amended by one of
the following methods.

(a) By
 signing and returning _____ copies of this amendment; (b) By acknowledging receipt of this amendment on each copy of the
offer submitted; or (c) By separate letter or telegram which includes a reference to the solicitation and amendment numbers.
FAILURE OF YOUR ACKNOWLEDGMENT TO BE RECEIVED AT THE ISSUING OFFICE PRIOR TO THE HOUR AND DATE SPECIFIED MAY RESULT IN REJECTION OF
YOUR OFFER.  If by virtue of this amendment you desire to change an offer already submitted, such change may be made by telegram or
letter provided such telegram or letter makes reference to the solicitation and this amendment, and is received prior to the opening
hour and date specified.
- -----------------------------------------------------------------------------------------------------------------------------------
14. THIS BLOCK APPLIES ONLY TO MODIFICATIONS OF CONTRACTS

    [ ] THIS CHANGE IS ISSUED PURSUANT TO 
                                         ------------------------------------------------------------------------------------------
        THE CHANGES SET FORTH HEREIN ARE MADE TO THE ABOVE NUMBERED CONTRACT/ORDER.

    [ ] THE ABOVE NUMBERED 

    [ ] THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY
                                                                          ---------------------------------------------------------
    [X] THIS MODIFICATION IS ISSUED PURSUANT TO    FAR 52 216-18, ORDERING 52 217-7 OPTION QUANTITY, FAR
                                                -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
15. CONTRACT ADMINISTRATION DATA                52217-8 OPTION SERVICES, CLAUSE H-9601
  A. KND   B. MCD ASST   C. DATE OF SIGNATURE   D. CHANAGE IN CONTRACT AMOUNT   E. LOSING PO/CAO   F. GAINING PO/CAG   G. SVC/AGENCY
   OF MOD  RECIPENT ADP PT    MODIFICATION          INCREASE(+) DECREASE (-)        ON TRANSFER        ON TRANSFER           USE
   N                                                     8,615,638.00+
- -----------------------------------------------------------------------------------------------------------------------------------
16. ENTER ANY APPLICABLE CHANGES 
                               C. CONTRACT                                                                       I. SECURITY
  A. PAY  B. EFFECTIVE DATE                 D. TYPE  E. SURV  F. SPL CONTR  G. PAYING OFC  H. DATE SIGNED
    CODE        OF AWARD    (1)TYPE (2)KIND  CONTR    CRIT     PROVISIONS         CODE                    (1)CLAS (2)DATE OF DO 254

- -----------------------------------------------------------------------------------------------------------------------------------
17. REMARKS (EXCEPT AS PROVIDED HEREIN, ALL ITEMS AND CONDITIONS OF THE CONTRACT, AS HERETOFORE CHANGED, REMAIN UNCHAGED AND IN
    FULL FORCE AND EFFECT.)

This contract modification is for the purchase of 207 Airborne Modems and 78 Control Indicators. It also provides funds for
shipping costs and ICS.


- -----------------------------------------------------------------------------------------------------------------------------------
18. [ ] CONTRACTOR/OFFEROR IS NOT REQUIRED      [X] CONTRACTOR/OFFEROR IS REQUIRED TO SIGN THIS DOCUMENT AND RETURN
        TO SIGN THIS DOCUMENT                          1     COPIES TO ISSUING OFFICE
                                                    --------- 
- ------------------------------------------------------------------------------------------------------------------------------------
19. CONTRACTOR/OFFEROR (Signature of person authorized to sign)   22. UNITED STATES OF AMERICA (signature of Contracting Officer)
  BY
- ------------------------------------------------------------------------------------------------------------------------------------
20. NAME AND TITLE OF SIGNER (TYPE OR PRINT)   21. DATE SIGNED    23. NAME OF CONTRACTING OFFICER (TYPE OR PRINT)    24. DATE SIGNED

                                                                      JOSEPH A. ZIMMERMAN                                97 FEB 21
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>



Certain confidential portions of this Exhibit were omitted by means of blackout
of the text (the "Mark"). This Exhibit has been filed separately with the
Secretary of the Commission without the Mark pursuant to the Company's
Application Requesting Confidential Treatment under Rule 24b-2 under the
Securities Exchange Act.



<PAGE>   2
A. The purpose of this unilateral option exercise is to purchase 207 UHF DAMA
Airborne Modems and 78 UHF DAMA Control Indicators. Of these Modems, 116 are for
SPAWAR (U.S. NAVY), 90 are for the AFSOC, and 1 is for CINCUSNAVEUR. Of the 78
Control Indicators, 77 are for AFSOC and 1 is for CINCUSNAVEUR. The Modems and
Control Indicators and associated data are purchased by exercising option
SubCLINs 0021AF, 0021AG, 0021AH, 0022AF, 0022AG, 0022AH, 0023AC, 0023AD, 0024AC,
and 0024AD. Furthermore, this option exercise also purchases Interim Contractor
Support under option SubCLINs 0026AB, 0027AB. Finally, the cost for shipping the
modems and Control Indicators is provided under SubCLINs 002902, 002903, 002904,
003002, 003003, and 003004.

     As a special note, in ViaSat letter WHJ.97.136 dated 18 Feb 97, ViaSat
agreed to the delivery Schedule as set forth is Section F of this contract
modification for the Delivery of Modems under CLINs 0021AF and 0021AG.

     B. As a result of this Contract Modification the following changes are made
to individual sections of the contract:

1.   SECTION A - AWARD/CONTRACT:

     AFSC Form 701, Block 22 is changed as follows:

            From:       ***               (P00010)
            By:     +   ***               (P00011)
            --------------------------------------
            To:         ***               (P00011)

2.   SECTION B - SUPPLIES OR SERVICES AND PRICES/COSTS:

     a) Add SubCLINs 0021AF, 0021AG, 0021AH, 0022AF, 0022AG, 0022AH, 0023AC,
0023AD, 0024AC, 0024AD, 0026AB, 0027AB, 002902, 002903, 002904, 003002, 003003,
and 003004 in accordance with the Section B of the attached AMIS forms.

     b) Make the updates to Section B, Paragraph A, by deleting it and replacing
it with the following:

"A. The following pricing parameters are established for this contract:


<TABLE>
<CAPTION>
<S>                                   <C>    <C>                       <C>   
(1)FIRM FIXED PRICE                   FROM:  $      ***                 (AWARD)
                                      BY:    $      ***                (P00001)
                                      BY:    $      ***                (P00002)
                                      BY:    $      ***                (P00003)
                                      BY:    $      ***                (P00004)
                                      BY:    $      ***                (P00005)
                                      BY:    $      ***                (P00006)
                                      BY:    $      ***                (P00007)
                                      BY:    $      ***                (P00009)
                                      BY:    $      ***                (P00011)
                                      -----------------------------------------
                                      TO:    $      ***                (P00011)

(2)COST PLUS AWARD FEE                FROM:  $      ***                 (AWARD)
                                      BY:    $      ***                (P00001)
                                      BY:    $      ***                (P00002)
                                      BY:    $      ***                (P00003)
                                      BY:    $      ***                (P00004)
                                      BY:           ***                (P00005)
                                      BY:           ***                (P00006)
                                      BY:    $      ***                (P00007)
                                      BY:    $      ***                (P00009)
                                      -----------------------------------------
                                      TO:    $      ***                (P00009)
</TABLE>





                                                                F19628-96-C-0015
                                                                          P00011
                                                                    Page 2 of 19


* CONFIDENTIAL TREATMENT REQUESTED



<PAGE>   3



<TABLE>
<CAPTION>
<S>                                   <C>    <C>                       <C>   
(3) TIME & MATERIALS: LABOR CEILINGS  FROM:         ***                 (AWARD)
                                      BY:    $      ***                (P00001)
                                      BY:    $      ***                (P00002)
                                      BY:    $      ***                (P00003)
                                      BY:    $      ***                (P00004)
                                      BY:    $      ***                (P00005)
                                      BY:    $      ***                (P00006)
                                      BY:    $      ***                (P00007)
                                      BY:    $      ***                (P00011)
                                      -----------------------------------------
                                      TO:    $      ***                (P00011)

ODC CEILINGS                          FROM:  $      ***                 (AWARD)
                                      BY:    $      ***                (P00001)
                                      BY:    $      ***                (P00002)
                                      BY:    $      ***                (P00003)
                                      BY:    $      ***                (P00004)
                                      BY:    $      ***                (P00005)
                                      BY:    $      ***                (P00006)
                                      BY:    $      ***                (P00007)
                                      BY:    $      ***                (P00011)
                                      -----------------------------------------
                                      TO:           ***                (P00011)

TOTAL CEILINGS                        FROM:         ***                 (AWARD)
                                      BY:    $      ***                (P00001)
                                      BY:    $      ***                (P00002)
                                      BY:    $      ***                (P00003)
                                      BY:    $      ***                (P00004)
                                      BY:    $      ***                (P00005)
                                      BY:    $      ***                (P00006)
                                      BY:    $      ***                (P00007)
                                      BY:    $      ***                (P00011)
                                      -----------------------------------------
                                      TO:    $      ***                (P00011)


(4) AWARD FEE:    (AMOUNT AWARDED)    PERIOD 1: $   ***               (P00008)"
</TABLE>








                                                                F19628-96-C-0015
                                                                          P00011
                                                                    Page 3 of 19


* CONFIDENTIAL TREATMENT REQUESTED

<PAGE>   4

3.   SECTION C - DESCRIPTION/SPECIFICATION/WORK STATEMENT: No Change

4.   SECTION D - PACKAGING AND MARKING: No Change

5.   SECTION E - INSPECTION AND ACCEPTANCE:

Add the following CLINs to Section E paragraph C


        CLIN/SUBCLIN                    DESCRIPTION
        -------------------------------------------

        0021AF, 0021AG, 0021AH          Inspection and acceptance shall occur at
                                        source as evidenced by the Government
                                        execution of a DD form 250. Acceptance
                                        shall be in accordance with Statement of
                                        Work, Appendix A, Paragraph 3.1.1 and
                                        3.1.3-6 (dated 08 July 1996, Section J
                                        Attachment 6a).

        0022AF, 0022AG, 0022AH          In accordance with CDRL Exhibit N

        0021AF, 0021AG, 0021AH          Inspection and acceptance shall occur at
                                        source as evidenced by the Government
                                        execution of a DD form 250. Acceptance
                                        shall be in accordance with Statement of
                                        Work, Appendix A, Paragraph 3.1.2 and
                                        3.1.3-6 (dated 08 July 1996, Section J
                                        Attachment 6a).

        0022AF, 0022AG, 0022AH          In accordance with CDRL Exhibit P

        0026AB, 0027AB                  Inspection and acceptance shall occur
                                        at the end of the period of performance
                                        as evidenced by the government execution
                                        of a DD form 250.

6.   SECTION F - DELIVERIES OR PERFORMANCE:

     Add SubCLINs 0021AF, 0021AG, 0021AH, 0022AF, 0022AG, 0022AH, 0023AC,
     0023AD, 0024AC, 0024AD, 0026AB, 0027AB, 002902, 002903, 002904, 003002,
     003003, and 003004 in accordance with AMIS Forms 70F, Part I, Section F as
     set forth in the attached pages.











                                                                F19628-96-C-0015
                                                                          P00011
                                                                    Page 4 of 19



<PAGE>   5

7.   SECTION G - CONTRACT ADMINISTRATION DATA:

          Add ACRNs AL, AM, and AN in accordance with AMIS Forms 69G, Part I,
          Section G as set forth in the attached pages.

The following is a recapitulation of funding inclusive of the Basic Contract
through P00001, P00003 (issued out of sequence), P00002 (issued out of
sequence), P00004, P00006 (issued out of sequence), P00007 (issued out of
sequence), P00005 (issued out of sequence), P00008, P00009, P00010 and P00011.



<TABLE>
<CAPTION>
                                                                CUMULATIVE                 CUMULATIVE
DOCUMENT         ACRN          AMOUNT OBLIGATED                 OBLIGATION                 TOTAL VALUE
- --------         ----          ----------------                 ----------                 -----------
<S>             <C>            <C>                            <C>                        <C>     
BASIC            AA              ***     
  "              AB                                             ***     
  "              AC                                                     
  "              AD                                                                        ***     
P00001           --                                                                                
P00003           AD                                                                        
P00002           AE                                                                        
  "              AF                                                                        
  "              AG                                                                        
  "              AH                                                                        
P00004           AJ                                                                        
P00006           --                                                                        
P00007           --                                                                        
P00005           AB                                                                        
  "              AK                                                                        
P00008           AB                                                                        
P00009           AB                                                                        
P00010                                                                                     
P00011           AL                                                                        
  "              AM                                                                        
  "              AN                                                                        
</TABLE>


8.   SECTION H - SPECIAL CONTRACT REQUIREMENTS: No Change

9.   SECTION I - Contract Clauses: No Change

1O.  SECTION J - LIST OF DOCUMENTS, EXHIBITS, AND OTHER ATTACHMENTS: No Change









                                                                F19628-96-C-0015
                                                                          P00011
                                                                    Page 5 of 19


* CONFIDENTIAL TREATMENT REQUESTED

<PAGE>   6


70B - PART I, SECTION B OF THE SCHEDULE


<TABLE>
<CAPTION>
                                                               Quantity          Unit Price
Item No            Supplies/Services                          Purch Unit      Total Item Amount
- -------            -----------------                          ----------      -----------------
<S>     <C>                                                   <C>             <C>

0021AF  SubCLIN Establish                 sec class: U            ***           ***
                                                                   EA           ***

        noun: MD-1324(C)/U UHF DAMA AIRBORNE MODEM
        acrn: AL     nsn: N
        site codes   cqa: S   acp: S   fob: S 
        pr/mipr data: MCXX68970043
        type contract: J

        descriptive data:
        Produce and deliver *** MD-1324(c)/U UHF
        DAMA Airborne Modems IAW INFO CLIN 0021; the
        Statement of Work, Appendix A, paragraph 
        3.1.1 (dated 8 July 96, Section J, atch 6a);
        Specification ESC-ABN-MOD-FS001C (dated 15
        May 96, Section J, Atch 12). This SubCLIN
        is established IAW the procedures listed in
        Section H, Clause H-9601 where the per modem
        price is listed as the price in government
        fiscal year 1997 for the quantity of ***,
        see Table B-1b.
        Therefore, the total firm fixed price of this
        SubCLIN is ***.

0021AG  SubCLIN Establish                 sec class: U             ***          ***
                                                                   EA           ***

        noun: MD-1324(C)/U UHF DAMA AIRBORNE MODEM
        acrn: AM     nsn: N
        site codes   cqa: S   acp: S   fob: S
        pr/mipr data: MCXX68970041
        type contract: J
        
        descriptive data:
        Produce and deliver *** MD-1324(c)/U UHF DAMA
        Airborne Modems IAW INFO CLIN 0021; the
        Statement of Work, Appendix A, paragraph
        3.1.1 (dated 8 July 96, Section J, atch 6a);
        Specification ESC-ABN-MOD-FS001C (dated 15
        May 96, Section J, Atch 12). This SubCLIN
        is established IAW the procedures listed in 
        Section H, Clause H-9601 where the per modem
        price is listed as the price in government
        fiscal year 1997 for the quantity of ***,
        see Table B-lb.
        Therefore, the total firm fixed price of this
        SubCLIN is ***.
</TABLE>



                      



                                                                F19628-96-C-001S
                                                                          P00011
                                                                    Page 6 of 19


                       * CONFIDENTIAL TREATMENT REQUESTED



<PAGE>   7



<TABLE>
<CAPTION>

                                                                                     Quantity                Unit Price
Item No                      Supplies/Services                                      Purch Unit            Total Item Amount
- -------                     -----------------                                      ----------------------------------------
<S>                         <C>                                                    <C>                     <C>  
0021AH  SubCLIN Establish                                sec class: U                     ***               ***
                                                                                          EA                ***

        noun: MD-1324(C)/U UHF DAMA AIRBORNE MODEM
        acrn: AN           nsn: N
        site codes cqa: S        acp: S        fob: S 
        pr/mipr data: MCXX68970044
        type contract: J

        descriptive data:
        Produce and deliver ***
        MD-1324(c)/U UHF DAMA. Airborne Modem IAW INFO CLIN 0021; the Statement
        of Work, Appendix A, paragraph 3.1.1 (dated 8 July 96, Section J, atch
        6a); Specification ESC-ABN-MOD-FS001C (dated 15 May 96, Section J, Atch
        12). This SubCLIN is established IAW the procedures listed in Section H,
        Clause H-9601 where the per modem price is listed as the price in
        government fiscal year 1997 for the quantity of ***, see Table B-1b.
        Therefore, the total firm fixed price of this SubCLIN is ***.

0022AF  SubCLIN Establish                                sec class: U                      1   NSP
                                                                                          LO   NSP

        noun: DATA FOR SUBCLIN 0021AF IAW EXBT N
        acrn: AL         nsn: N
        site codes cqa: S        acp: S        fob: S
        pr/mipr data: MCXX689700043
        type contract: J

        descriptive data:
        Data for SubCLIN 0021AF in accordance with INFO CLIN 0022 and the
        Contract Data requirements List (CDRL), DD Form 1423, Exhibit N. This
        SubCLIN is Not Separately Priced (NSP). The price is included in the
        price of SubCLIN 0021AF
</TABLE>





                                                                F19628-96-C-0015
                                                                          P00011
                                                                    Page 7 of 19


                       * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>   8


<TABLE>
<CAPTION>
                                                                                     Quantity                Unit Price
Item No                      Supplies/Services                                      Purch Unit            Total Item Amount
- -------                     -----------------                                      ----------------------------------------
<S>                         <C>                                                    <C>                     <C>  
0022AG  SubCLIN Establish                                                                  1 NSP
                                                                                          LO NSP

        noun: DATA FOR SUBCLIN 0021AG IAW EXBT N
        acrn: AM           nsn: N
        site codes cqa: S        acp: S       fob: S
        pr/mipr data: MCXX689700041
        type contract: J

        descriptive data:
        Data for SubCLIN 0021AG in accordance with INFO CLIN 0022 and the
        Contract Data requirements List (CDRL), DD Form 1423, Exhibit N. This
        SubCLIN is Not Separately Priced (NSP). The price is included in the
        price of SubCLIN 0021AG.

0022AH  SubCLIN Establish                                                                   1 NSP
                                                                                           LO NSP

        noun: DATA FOR SUBCLIN 0021AH IAW EXBT N
        acrn: AN           nsn: N
        site codes cqa: S        acp: S        fob: S 
        pr/mipr data: MCXX689700044
        type contract: J

        descriptive data:
        Data for SubCLIN 0021AH in accordance with INFO CLIN 0022 and the
        Contract Data requirements List (CDRL), DD Form 1423, Exhibit N. This
        SubCLIN is Not Separately Priced (NSP). The price is included in the
        price of SubCLIN 0021AH.
</TABLE>

                                                                F19628-96-C-0015
                                                                          P00011
                                                                    Page 8 of 19




<PAGE>   9

<TABLE>
<CAPTION>
                                                                                     Quantity                Unit Price
Item No                      Supplies/Services                                      Purch Unit            Total Item Amount
- -------                     -----------------                                      ----------------------------------------
<S>                         <C>                                                    <C>                    <C>  
0023AC  SubCLIN Establish                                  sec class: U                 ***                 ***
                                                                                        EA                  ***

        noun: C-12480 CONTROL INDICATORS
        acrn: AM         nsn: N
        site codes cqa: S        acp: S        fob: S
        pr/mipr data: MCXX68970041
        type contract: J

        descriptive data:
        Produce and deliver *** C-12480 UHF DAMA Control Indicators IAW INFO
        CLIN 0023; the Statement of Work, Appendix A, paragraph 3.1.2
        (dated 8 July 96, Section J, atch 6a); Specification ESC-ABN-MOD-FS001C
        (dated 15 May 96, Section J, Atch 12). This SubCLIN is established IAW
        the procedures listed in Section H, Clause H-9601 where the per modem
        price is listed as the price in government fiscal year 1997 for the
        quantity of 126-150, see Table B-2b, option prices. Therefore, the
        total firm fixed price of this SubCLIN is ***.

0023AD  SubCLIN Establish                                  sec class: U                  1                  ***
                                                                                        EA                  ***

        noun: C-12480 CONTROL INDICATORS
        acrn: AN         nsn: N
        site codes cqa: S        acp: S        fob: S 
        pr/mipr data: MCXX68970044
        type contract: J

        descriptive data:
        Produce and deliver ***
        C-12480 UHF DAMA Control Indicator IAW INFO CLIN 0023; the Statement of
        Work, Appendix A, paragraph 3.1.2 (dated 8 July 96, Section J, atch 6a);
        Specification ESC-ABN-MOD-FS001C (dated 15 May 96, Section J, Atch 12).
        This SubCLIN is established IAW the procedures listed in Section H,
        Clause H-9601 where the per modem price is listed as the price in
        government fiscal year 1997 for the quantity of 126-150, see Table B-2b,
        option prices. Therefore, the total firm fixed price of this SubCLIN is
        ***.
</TABLE>









                                                                F19628-96-C-0015
                                                                          P00011
                                                                    Page 9 of 19

                       * CONFIDENTIAL TREATMENT REQUESTED



<PAGE>   10


<TABLE>
<CAPTION>
                                                                                    Quantity                Unit Price
Item No                      Supplies/Services                                      Purch Unit            Total Item Amount
- -------                     -----------------                                      ----------------------------------------
<S>                         <C>                                                    <C>                     <C>  
0024AC  SubCLIN Establish                                                                ***  NSP
                                                                                         LO   NSP

        noun:     DATA FOR SUBCLIN 0023AC IAW EXBT P
        acrn: AM           nsn: N
        site codes cqa: S acp: S fob: S
        pr/mipr data: MCXX689700041
        type contract: J

        descriptive data:

        Data for SubCLIN 0023AC in accordance with INFO
        CLIN 0024 and the
        Contract Data requirements
        List (CDRL), DD Form 1423, Exhibit P. This
        SubCLIN is Not Separately Priced (NSP). The
        price is included in the
        price of SubCLIN 0023AC.

0024AD  SubCLIN Establish                                                                 1   NSP
                                                                                         LO   NSP

        noun:     DATA FOR SUBCLIN 0023AD IAW EXBT P
        acrn: AN           nsn: N
        site codes cqa: S acp: S fob: S pr/mipr data: MCXX689700044
        type contract: J

        descriptive data:

        Data for SubCLIN 0023AD in accordance with INFO
        CLIN 0022 and the
        Contract Data requirements
        List (CDRL), DD Form 1423, Exhibit P. This
        SubCLIN is Not Separately Priced (NSP).
        The price is included in the
        price of SubCLIN 0021AD.
</TABLE>






                                                                F19628-96-C-0015
                                                                          P00011
                                                                   Page 10 of 19

                       * CONFIDENTIAL TREATMENT REQUESTED




<PAGE>   11


<TABLE>
<CAPTION>

                                                                                     Quantity                Unit Price
Item No                      Supplies/Services                                      Purch Unit            Total Item Amount
- -------                     -----------------                                      ----------------------------------------
<S>                         <C>                                                    <C>                     <C>  
0026AB      SubCLIN Establish                                  sec class: U               ***                    ***       
                                                                                          LO                     ***       

        noun:     T&M ICS LABOR FOR SUBCLIN 0021AG
        acrn: AM           nsn: N
        site codes cqa: S acp: S fob: S 
        pr/mipr data: MCXX689700041
        type contract: Y

        descriptive data:

        a. This SubCLIN provides for interim contractor support (ICS) for the
        ninety (90) modems purchased under SubCLIN 0021AG. This support is
        provided in accordance with INFO CLIN 0026 and the Statement of Work,
        Appendix A, paragraph 3.5.4. (Section J, attachment 6a).
        b. This SubCLIN utilizes the labor rates and categories set forth in
        Section J, Attachment 11.
        C. The ceiling price of this SubCLIN is ***.        

0027AB  SubCLIN Establish                                       sec class: U             ***                      ***     
                                                                                         LO                       ***     

        noun: T&M ICS ODC  FOR SUBCLIN 0021AG MODEM
        acrn: AM           nsn: N
        site codes cqa: S acp: S fob: S pr/mipr data: MCXX689700041
        type contract: Y

        descriptive data:
        a. Travel and Other Direct Cost (ODC) in support of SubCLIN 0026AA. No
        profit or fee will be paid in support of this CLIN. In addition, rates
        for both per diem and travel expenses will not exceed those established
        in the Joint Travel Regulations (in effect at the time of travel).
        b. The ceiling price of this SubCLIN is ***.      
</TABLE>








                                                                F19628-96-C-0015
                                                                          P00011
                                                                   Page 11 of 19


* CONFIDENTIAL TREATMENT REQUESTED

<PAGE>   12


<TABLE>
<CAPTION>

                                                                                     Quantity                Unit Price
Item No                      Supplies/Services                                      Purch Unit            Total Item Amount
- -------                      -----------------                                      ---------------------------------------
<S>                         <C>                                                    <C>                     <C>  
0028AB  SubCLIN Establish                                sec class: U                   ***  
                                                                                        NSF                      LO   

        noun: DATA FOR SUBCLIN 0026AB IAW EXBT Q
        acrn: AM         nsn: N
        site codes cqa: S acp: S fob: S 
        pr/mipr data: MCXX689700041 
        type contract: Y

        descriptive data:
        Data for SubCLIN 0026AB in accordance with the Contract Data
        requirements List (CDRL), DD 1423 Exhibit Q, dated 12 Aug 1996. This
        SubCLIN is Not Separately Priced (NSP). The price is included in the
        price of SubCLIN 0026AB.

0029    CLIN Change                                      sec class: U                                            ***         
                                                                                                                 ***          
        noun:     TRN - AIRBORNE MODEM/CI TASKS LABOR
        acrn: 9            nsn: N
        site codes cqa: D acp: D fob: D 
        type contract: Y

        descriptive data:
        C.      The ceiling price of CLIN 0029 is increased
        From    ***        
        by      ***        
        to      ***        

002902  Info SubCLIN Establish                           sec class: U
        noun: ***        
        acrn: AL
        site codes cqa: D acp: D fob: D 
        pr/mipr data: MCXX689700043 
        type contract: Y

        descriptive data:
        Breakout for funding purposes.
        ACRN AL will provide funds up to $*** for CLIN 0029 TRN - Airborne
        Modem/CI tasks -Labor. This money will be used for shipping labor for
        the modems purchased under SubCLIN 0021AF.
</TABLE>







                                                                F19628-96-C-0015
                                                                          P00011
                                                                   Page 12 of 19


* CONFIDENTIAL TREATMENT REQUESTED

<PAGE>   13

<TABLE>
<CAPTION>
                                                                                     Quantity                Unit Price
Item No                      Supplies/Services                                      Purch Unit            Total Item Amount
- -------                      -----------------                                      ---------------------------------------
<S>                         <C>                                                    <C>                     <C>  
002903  Info SubCLIN Establish                          sec class: U

        noun:     ***       
        acrn: AM
        site codes cqa: D acp: D fob: D 
        pr/mipr data: MCXX689700041 
        type contract: Y

        descriptive data:
        Breakout for funding purposes.
        ACRN AM will provide funds up to *** for CLIN 0029 TRN - Airborne
        Modem/CI tasks -Labor.

002904  Info SubCLIN Establish                          sec class: U
        noun: ***    
        acrn: AN
        site codes cqa: D acp: D fob: D 
        pr/mipr data: MCXX689700044 
        type contract: Y

        descriptive data:
        Breakout for funding purposes.
        ACRN AN will provide funds up to *** for CLIN 0029 TRN - Airborne
        Modem/CI tasks -Labor. This money will be used for shipping labor for
        the modems purchased under SubCLIN 0021AH.

0030    CLIN Change                                    sec class: U                                              ***       
                                                                                                                 ***        
        noun:     TRN - AIRBORNE MODEMS/CI TASKS - ODC
        acrn: 9          nsn: N
        site codes cqa: D acp: D fob: D 
        type contract: Y

        descriptive data:
        c.     The ceiling for this CLIN is increased
        From:     ***       
        by        ***        
        to        ***
</TABLE>





                                                                F19628-96-C-0015
                                                                          P00011
                                                                   Page 13 of 19


* CONFIDENTIAL TREATMENT REQUESTED

<PAGE>   14


<TABLE>
<CAPTION>
                                                                                     Quantity                Unit Price
Item No                      Supplies/Services                                      Purch Unit            Total Item Amount
- -------                     -----------------                                      ----------------------------------------
<S>                         <C>                                                    <C>                     <C>  
003002  Info SubCLIN Establish                 sec class: U

        noun: ***
        acrn: AL
        site codes cqa: D   acp: D   fob: D 
        pr/mipr data: MCXX689700043 
        type contract: Y

        descriptive data:
        ACRN AL shall provide fund. for CLIN 0030, TRN - ODC. Funds from this ACRN
        may be provided up to ***. These funds shall be used for shipping
        the modems purchased under SubCLIN 0021AF.

003003  Info SubCLIN Establish               sec class: U
        noun: ***      
        acrn: AM

        site codes cqa: D   acp: D   fob: D 
        pr/mipr data: MCXX689700041 
        type contract: Y

        descriptive data:
        ACRN AM shall provide fund for CLIN 0030, TRN - ODC.  Funds from this ACRN 
        may be provided up to ***.

003004  Info SubCLIN Establish               sec class: U
        noun: ***       
        acrn: AN
        site codes cqa: D   acp: D   fob: D 
        pr/mipr data: MCXX689700044 
        type contract: Y

        descriptive data:
        ACRN AL shall provide fund for CLIN 0030, TRN - ODC. Funds from this ACRN
        may be provided up to ***. These funds shall be used for shipping
        the modems purchased under SubCLIN 0021AH.
</TABLE>







                                                                F19628-96-C-0015
                                                                          P00011
                                                                   Page 14 of 19


* CONFIDENTIAL TREATMENT REQUESTED

<PAGE>   15

70F - PART I, SECTION F OF THE SCHEDULE


<TABLE>
<CAPTION>
                                                                                   Delivery              Schedule       
Item No                      Supplies Schedule Data                                Quantity                Date 
- -------                     -----------------------                                ----------------------------------------
<S>                         <C>                                                    <C>                     <C>  


0021AF  SubCLIN Del Sch Establish                             see class: U
        acrn: AL
        ship to: U                                                                    ***                  ASREQ

        descriptive data:
        Delivery of *** MD-1324(c)/U UHF DAMA Airborne Modems. Delivery 
        shall be in accordance with the following table (see below):

        Jun     1997         ***
        Jul     1997         ***
        Aug     1997         ***
        Sep     1997         ***
        Oct     1997         ***
        Nov     1997         ***
        Dec     1997         ***
        Jan     1998         ***
        Feb     1998         ***

0021AG  SubCLIN Del Sch Establish                            see class: U
        acrn: AM
        ship to: U                                                                    ***                  ASREQ

        descriptive data:
        Delivery of *** MD-1324(c)/U UHF DAMA Airborne Modems. Delivery 
        shall be in accordance with the following table (see below):

        Oct     1997         ***
        Nov     1997         ***
        Dec     1997         ***
        Jan     1998         ***
        Feb     1998         ***
        Mar     1998         ***
</TABLE>






                                                                F19628-96-C-0015
                                                                          P00011
                                                                   Page 15 of 19


*CONFIDENTIAL TREATMENT REQUESTED


<PAGE>   16


<TABLE>
<CAPTION>
                                                                                   Delivery              Schedule       
Item No                      Supplies Schedule Data                                Quantity                Date 
- -------                     -----------------------                                ----------------------------------------
<S>                         <C>                                                    <C>                     <C>  

0021AH  SubCLIN Del Sch Establish                      sec class: U
        acrn: AN
        ship to: U                                                                                         ASREQ

        descriptive data: 
        Delivery of one (1) MD-1324(c)/U UHF DAMA Airborne
        Modem. Delivery shall be in accordance with the following table (see
        below):

        Oct 1997      1
0022AF  SubCLIN Del Sch Establish                      sec class: U
        acrn: AL
        ship to: U                                                                                     *** ASREQ

        descriptive data:
        Deliver in accordance with CDRL Exhibit N.

0022AG  SubCLIN Del Sch Establish
        acrn: AM
        ship to: U                                                                                     *** ASREQ

        descriptive data:
        Deliver in accordance with CDRL Exhibit N.

0022AH  SubCLIN Del Sch Establish
        acrn: AN
        ship to: U                                                                                     *** ASREQ

        descriptive data:
        Deliver in accordance with CDRL Exhibit N.

0023AC  SubCLIN Del Sch Establish                     sec class: U
        acrn: AM
        ship to: U                                                                                     *** ASREQ

        descriptive data:
        Delivery of *** C-12480 Control
        Indicators
        Delivery shall be in accordance with the following table (see below):

        Oct 1997           ***
        Nov 1997           ***
        Dec 1997           ***
        Jan 1998           ***
        Feb 1998           ***
</TABLE>







                                                                F19628-96-C-0015
                                                                          P00011
                                                                   Page 16 of 19



*CONFIDENTIAL TREATMENT REQUESTED

<PAGE>   17


<TABLE>
<CAPTION>
                                                                                   Delivery              Schedule       
Item No                      Supplies Schedule Data                                Quantity                Date 
- -------                     -----------------------                                ----------------------------------------
<S>                         <C>                                                    <C>                     <C>  

0023AD  SubCLIN Del Sch Establish                      sec class: U
        acrn: AN
        ship to: U                                                                                       *** ASREQ

        descriptive data:
        Delivery of *** C-12480 Control Indicator.

        Delivery shall be in accordance with the following table (see below):

        Oct 1997     ***

0024AC  SubCLIN Del Sch Establish
        acrn: AM
        ship to: U                                                                                       *** ASREQ

        descriptive data:
        Deliver in accordance with CDRL Exhibit P.

0024AD  SubCLIN Del Sch Establish
        acrn: AN
        ship to: U                                                                                       *** ASREQ

        descriptive data:
        Deliver in accordance with CDRL Exhibit P.

0026AB  SubCLIN Del Sch Establish            sec class: U
        acrn: AM
        ship to: U                                                                                       *** ASREQ

        descriptive data:
        The period of performance of this SubCLIN shall be from the award of
        this contract modification (P00011) through 31 December 1998.

0027AB  SubCLIN Del Sch Establish           sec class: U
        acrn: AM
        ship to: U                                                                                       *** ASREQ

        descriptive data:
        The period of performance of this SubCLIN shall run concurrent with
        SubCLIN 0026AB.
</TABLE>






                                                                F19628-96-C-0015
                                                                          P00011
                                                                   Page 17 of 19


                                               *CONFIDENTIAL TREATMENT REQUESTED
                                        

<PAGE>   18


<TABLE>
<CAPTION>
                                                                                   Delivery              Schedule       
Item No                      Supplies Schedule Data                                Quantity                Date 
- -------                      ----------------------                                ----------------------------------------
<S>                         <C>                                                    <C>                     <C>  


0028AB  SubCLIN Del Sch Establish                             sec class: U
        acrn: AM
        ship to: U                                                                                       *** ASREQ

        descriptive data:
        Deliver in accordance with CDRL Exhibit Q.

















</TABLE>









                                                                F19628-96-C-0015
                                                                          P00011
                                                                   Page 18 of 19


                                               *CONFIDENTIAL TREATMENT REQUESTED




<PAGE>   19

69G  PART I, SECTION G OF THE SCHEDULE


<TABLE>
<CAPTION>
                                       Appropriation/Lmt Subhead/CPN Recip DODAAD                            Obligation
ACRN              Acct Class data       Supplemental Accounting Classification                                 Amount
- ----              ---------------     ------------------------------------------                         -------------------
<S>      <C>                          <C>                                                                 <C>  
AL      ACCOUNT ESTABLISH

        UNCLASSIFIED            97X4930           NH3P                 70048G                                  $        ***
        pay office: SC1008 000 77777 0 068940 2F 000000 X97MPA 70048G 
        pr/mipr data:
        MCXX689700043 (complete)

        descriptive data:
        SubCLIN       0021AF            $         ***
        SubCLIN       002902            $         ***
        SubCLIN       003002            $         ***
        SubCLIN       0022AF                      NSP

        For this ACRN please reference MIPR #N6600197MP00048

AM      ACCOUNT ESTABLISH
        UNCLASSIFIED                 5773010                                                  F78100           $         ***
        pay office: SC1008           117 3650 119992 030000 00000 33601F                      678100
        pr/mipr data:
          MCXX689700041 (Complete)

        descriptive data:
        SUBCLIN       0021AG            $         ***
        SUBCLIN       0022AG            $         NSP
        SUBCLIN       0023AC            $         ***
        SUBCLIN       0024AC            $         NSP
        SUBCLIN       0026AB            $         ***
        SUBCLIN       0027AB            $         ***
        SUBCLIN       0028AB            $         NSP
        SUBCLIN       002903            $         ***
        SUBCLIN       003003            $         ***

        AN  ACCOUNT ESTABLISH

        UNCLASSIFIED            1771804           61A0                                        062863              $      ***

        pay office: SC1008 311 00061 00 062863 2D PMCATB 0006172M4UQW 
        pr/mipr data:
        MCXX689700044 (Complete)

        descriptive data:
        SUBCLIN       0021AH            $         ***
        SUBCLIN       0022AH            $         NSP
        SUBCLIN       0023AD            $         ***
        SUBCLIN       0024AD            $         NSP
        SUBCLIN       002904            $         ***
        SUBCLIN       003004            $         ***

        FOR ACRN AN PLEASE REFERENCE MIPR# N0006197MPMCAT
</TABLE>




                                                                F19628-96-C-0015
                                                                          P00011
                                                                   Paqe 19 of 19


* CONFIDENTIAL TREATMENT REQURESTED



<PAGE>   1
                                                                    EXHIBIT 11.1


                                  VIASAT, INC.

                   COMPUTATION OF PRO FORMA EARNINGS PER SHARE


<TABLE>
<CAPTION>

                                                        YEAR ENDED
                                                         MARCH 31,
                                                 -------------------------
                                                    1997           1996
                                                 ----------     ----------
<S>                                              <C>            <C>       
Net Income                                       $3,172,000     $1,633,000
                                                 ==========     ==========

Weighted average number of
  common shares outstanding                       6,411,260      3,267,141

Assumed conversion of preferred shares                           2,365,538

Common stock equivalent shares                      226,840        106,398

Effect of shares issued and options granted
  at less than the offering price                    64,314        136,652
                                                 ----------     ----------
Total number of shares for computing
  pro forma primary earnings per share            6,702,414      5,875,729

Incremental shares for computing pro forma
  fully diluted earnings per share                   49,542             

Total number of shares for computing pro
  forma fully diluted earnings per share          6,751,956      5,875,729
                                                 ==========     ==========

Pro forma primary earnings per share             $      .47     $      .28
                                                 ==========     ==========

Pro forma fully diluted earnings per share       $      .47     $      .28
                                                 ==========     ==========
</TABLE>






<PAGE>   1
                                                                EXHIBIT 23.1

                       CONSENT OF INDEPENDENT ACCOUNTANTS

We hereby consent to the incorporation by reference in the Registration
Statement on Form S-8 (No. 333-21113) of ViaSat, Inc. of our report dated May
12, 1997 appearing on page F-1 of this Form 10-K.


PRICE WATERHOUSE LLP

San Diego, California
June 16, 1997





<TABLE> <S> <C>

<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE VIASAT
INC. FINANCIAL STATEMENTS FOR YEAR ENDED MARCH 31, 1997 AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS INCLUDED IN FORM 10-K.
</LEGEND>
<MULTIPLIER> 1,000
       
<S>                             <C>
<PERIOD-TYPE>                   YEAR
<FISCAL-YEAR-END>                          MAR-31-1997
<PERIOD-START>                             APR-01-1996
<PERIOD-END>                               MAR-31-1997
<CASH>                                          12,673
<SECURITIES>                                         0
<RECEIVABLES>                                   10,315
<ALLOWANCES>                                         0
<INVENTORY>                                      4,478
<CURRENT-ASSETS>                                30,154
<PP&E>                                           8,588
<DEPRECIATION>                                   3,503
<TOTAL-ASSETS>                                  35,674
<CURRENT-LIABILITIES>                            9,748
<BONDS>                                              0
<PREFERRED-MANDATORY>                                0
<PREFERRED>                                          0
<COMMON>                                            81
<OTHER-SE>                                      23,538
<TOTAL-LIABILITY-AND-EQUITY>                    35,674
<SALES>                                         47,715
<TOTAL-REVENUES>                                47,715
<CGS>                                           33,102
<TOTAL-COSTS>                                   33,102
<OTHER-EXPENSES>                                 9,839
<LOSS-PROVISION>                                     0
<INTEREST-EXPENSE>                               (100)
<INCOME-PRETAX>                                  4,874
<INCOME-TAX>                                     1,702
<INCOME-CONTINUING>                              3,172
<DISCONTINUED>                                       0
<EXTRAORDINARY>                                      0
<CHANGES>                                            0
<NET-INCOME>                                     3,172
<EPS-PRIMARY>                                      .47
<EPS-DILUTED>                                      .47
        

</TABLE>