UPDATE 1-UK Stocks-Factors to watch on March 5

* Ultra Electronics: British defence contractor Ultra Electronics said it terminated the $234 million acquisition of Sparton Corp following an unfavourable anti-trust review outcome from the U.S. Department of Justice. * ROYAL BANK OF SCOTLAND: Britain's Royal Bank of Scotland could reach a multi billion-dollar settlement with the U.S. Department of Justice over its mis-selling of toxic mortgage-backed securities within weeks, Sky News reported on Friday, citing sources.