SAIC Awards Second Flywheel Power Module Contract to Optimal

    TORRANCE, Calif.--July 18, 2002--Optimal Energy Systems Inc. has won a second contract from Science Applications International Corporation (SAIC) to provide flywheel technology to the Army Research Laboratory (ARL).
    Optimal is contracted to deliver a developmental Flywheel Power Module (FPoM) for a military vehicle system. Delivery is scheduled for January 2003. If successful, there will be the opportunity for additional developmental FPoM contracts for integration into various vehicles.
    "This military vehicle contract is an important milestone in our progress towards establishing our Flywheel Power Module in the government markets," said Dr. Dwight Swett, Optimal president. "This prototype contract is significant to our business strategy as it has the potential to leverage into multiple electric vehicle concepts for multiple services."
    SAIC has a multi-year contract with ARL to develop enabling technologies and conduct demonstrations of an integrated hybrid electric power system to provide power and energy management for all of the electric subsystems in future combat vehicle concepts. Hybrid electric power is an essential enabling technology for future combat vehicles given the number of electrically powered subsystems planned for implementation and the possible weight reductions realizable with electric power technology.
    Optimal FPoM technology has become an important candidate for the prime power requirements of several future electric vehicle concepts that will mature over the next three to five years.
    Certain matters discussed in this news release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and as such may involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of Optimal Energy Systems to be different from any future results, performance or achievements expressed or implied by such forward-looking statements. Although Optimal Energy Systems believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance its expectations will be attained.