Signal Technology Receives Electronic Countermeasures Contract; Initial Production Award is Valued at $600,000.

Business Editors/High-Tech Writers

DANVERS, Mass.--(BUSINESS WIRE)--Feb. 26, 2003

Signal Technology Corporation (Nasdaq: STCO), a provider of electronic components, subsystems and system solutions for defense and space applications, today announced the award of a contract to provide multi-output power supplies for the Large Aircraft Infrared Countermeasures (LAIRCM) system. The LAIRCM system is deployed on C-17 Globemaster and C-130 Hercules military transport aircraft to defend against enemy surface-to-air missiles. The low rate initial production contract, awarded by Northrop Grumman Corporation, is valued at $600,000.

"Given the large inventory of currently fielded C-130 and C-17 aircraft, as well as the number of C-17s scheduled to be delivered by 2005, this program represents a solid long-term revenue stream for Signal Technology," said John Cotumaccio, president and chief operating officer. "In addition, considering the potential vulnerability of other large aircraft, we believe that requirements for LAIRCM systems will increase."

About Signal Technology Corporation

Signal Technology is a leader in developing state-of-the-art electronic components, subsystems and system solutions for defense and space applications. The Company manufactures a wide range of RF, microwave and millimeter wave products, power conversion systems and power supplies. These devices are used in military communications networks, and in systems related to electronic countermeasures, precision guidance, radar, intelligence, surveillance and reconnaissance. The Company sells its products to defense prime contractors worldwide. For further information about Signal Technology, please visit the Company's Web site at www.sigtech.com.

Safe Harbor Statement

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: The statements made in this news release that are not historical facts contain forward-looking information that involves risks and uncertainties. These forward-looking statements include statements regarding the expected receipt of $600,000 in revenues associated with a low rate initial production contract from Northrop Grumman Corporation to produce power supplies for the LAIRCM system; and certain other statements identified or qualified by words such as "likely", "will", "suggests", "may", "would", "could", "should", "expects", "expected", "anticipates", "estimates", "plans", "projects", " projected", "believes", "is optimistic about", or similar expressions (and variants of such words or expressions). Important factors that may cause actual results to differ include, but are not limited to, future demand for the Company's products, risks associated with court proceedings and litigation, fluctuations in the Company's operating results, volume and timing of orders received, changes in the mix of products sold, competitive pricing pressure, the Company's ability to meet or renegotiate customer demands, the ability to anticipate changes in the market, the Company's ability to finance its operations on terms that are acceptable, the Company's ability to attract and retain qualified personnel including the Company's management, changes in the global economy, changes in regulatory processes, the dependence on certain key customers (including the U.S. government), the Company's ability to realize sufficient margins on sales of its products, the availability and timing of funding for the Company's current products and the development of future products and other risks detailed from time to time in the Company's Securities and Exchange Commission filings. Signal Technology assumes no obligation to update the information included in this news release.