Ceradyne, Inc. Receives Four-Year SAPI Armor Contract; $29 Million Base Award For 2004

COSTA MESA, Calif.--Sept. 29, 2003--Ceradyne, Inc. announced the receipt of a new four-year indefinite-quantity contract from the Department of Defense to supply small arms protective inserts (SAPI) for the U.S. Army. The contract involves a base award for 2004 of approximately $29 million, with options for the following three years ranging from approximately $4 million to $14 million per year. Shipments of the base award are scheduled from February through December 2004.

Joel Moskowitz, Ceradyne chief executive officer, commented: "This multi-year SAPI order is one of the largest orders of any kind received by Ceradyne and gives the Company visibility for the next four years.

"The Congressional debates regarding the Administration's request for additional military funds includes $300 million for body armor," Moskowitz continued. "We believe this may lead to additional procurements, including the potential for substantially increasing the initial base order. As a result, we are currently expanding our manufacturing facilities in anticipation of additional orders in 2004. This award will not only contribute to further business growth but also allow us to save American lives."

Ceradyne develops, manufactures and markets advanced technical ceramic products and components for defense, industrial, automotive/diesel and commercial applications. Additional information about the Company can be found at www.ceradyne.com.

Exchange Commission.