Ultralife Batteries Awarded $1.7 Million BA-5390 Battery Contract by U.S. Defense Department

"Field usage for BA-5390 batteries continues to be strong, andcontinued reaffirmation by the Department of Defense of their strategyto migrate rapidly to lithium/manganese dioxide batteries will furtherstrengthen Ultralife's leadership position in this market," said JohnD. Kavazanjian, Ultralife's president and chief executive officer."This contract will provide the military with needed inventory whilethey begin to transition to our new BA-5390A battery withstate-of-charge indicator."

The BA-5390 is a lithium/manganese dioxide non-rechargeablebattery, and, with 50 percent more energy, is an alternative to thelithium/sulfur dioxide BA-5590 battery, the most widely used militarybattery in the U.S. Armed Forces. The BA-5390 is widely used to powermore than 50 military applications, such as the AN/PRC-119 SINCGARS(Single Channel Ground and Airborne Radio System) and the JavelinMedium Anti-Tank Missile Command Launch Unit. The BA-5390 providessoldiers with the latest and best battery technology in a costeffective manner. More energy in each battery provides longer missiontime with fewer batteries for soldiers to carry, and fewer batteriesto ship and dispose of, all of which reduce cost to the military.

About Ultralife Batteries, Inc.

Ultralife is a global provider of high-energy power systems fordiverse applications. The company develops, manufactures and markets awide range of non-rechargeable and rechargeable batteries, chargingsystems and accessories for use in military, industrial and consumerportable electronic products. Through its portfolio of standardproducts and engineered solutions, Ultralife is at the forefront ofproviding the next generation of power systems. Industrial, retail andgovernment customers include General Dynamics, Philips MedicalSystems, General Motors, Energizer, Kidde Safety, Lowe's, Radio Shackand the national defense agencies of the United States, UnitedKingdom, Germany and Australia, among others.

Ultralife's headquarters, principal manufacturing and researchfacilities are in Newark, New York, near Rochester. UltralifeBatteries (UK) Ltd., a second manufacturing facility, is located inAbingdon, England. Both facilities are ISO-9001 certified. Detailedinformation on Ultralife is available at the company's web site,www.ultralifebatteries.com.

This press release may contain forward-looking statements based oncurrent expectations that involve a number of risks and uncertainties.The potential risks and uncertainties that could cause actual resultsto differ materially include: worsening global economic conditions,increased competitive environment and pricing pressures, disruptionsrelated to restructuring actions and delays. Further information onthese factors and other factors that could affect Ultralife'sfinancial results is included in Ultralife's Securities and ExchangeCommission (SEC) filings, including the latest Annual Report on Form10-K.

Ultralife(R) is a registered trademark of Ultralife Batteries,Inc.