EaglePicher Technologies, LLC (EPT), an EaglePicher company, is a world leader in custom and standardized power solutions for the extreme environments of aerospace and military applications as well as medical and commercial applications. The company specializes in design and manufacture of battery cells, battery packaging, battery management systems (BMS), analysis, environmental testing, and energetic devices.

Active in battery development and testing since 1922, EPT has the most experience and broadest capability in battery electrochemistry of any battery supplier. Headquartered in Joplin, Missouri, EPT employs approximately 850 employees. The company currently maintains nine manufacturing facilities in Missouri, Kansas, Canada and Germany. EPT manufacturing facilities comprise approximately 500,000 square feet. EPT is certified with both ISO 9001:2000 and AS9100B standards. EPT is one of the three operating units of the EaglePicher Corporation (EPC). EaglePicher Corporation (EPC) is the parent company of Wolverine Advanced Materials, LLC, EP Minerals, LLC, and EaglePicher Technologies, LLC. The products and services of the operating units other than EPT include precision machined components, vibration damping, sealing materials, and diatomaceous earth products for automotive, specialty materials, and filtration industries.

Founded in Cincinnati, Ohio in 1843, EaglePicher has a rich heritage of technological leadership. Among these are the introduction of the transistor in conjunction with Bell Labs in 1947, EPT silver zinc batteries taking a critical role returning the Apollo 13 to the earth safely in 1970, and the introduction of the world’s smallest batteries for implantable medical devices in 2007. Headquartered in Dearborn, Michigan, EPC employs approximately 2,800 people worldwide. EPC is a United States (U.S.) company registered in the State of Delaware. EPT’s capabilities in product development and production demonstrate excellent levels of product assurance and reliability. EPT has attained prime supplier status for major military and aerospace battery programs by producing high quality, reliable products. Many of these products are still in production today and receive support and expertise from the seasoned professionals who worked on the programs from their inception. Table 1 lists EPT’s functional application areas. EPT has supplied in excess of 1,000 different part numbers to 250 military, aerospace and commercial customers and produces more than 25 different electrochemical systems, as well as energetic devices, flares, battery packs and electronic sub-assemblies. Active in battery development and testing since 1922, EPT has the most experience and broadest capability in battery electrochemistry of any battery supplier. EPT has over 50 years of experience in reserve battery development for military and aerospace programs.

Table 1 EPT Functional Application Areas

This project will maintain a program organization structure. The program will be under the supervision of a Program Manager (PM) who has total responsibility for all efforts. Other engineering and management personnel including an Engineering Manager, Engineering Leads, Program Engineer, Senior Quality Specialist, Contract Administrator and Production Supervisor support the PM. The team also contains Chemists, Electrical Engineers, Mechanical Engineers and Engineering Technicians. The PM utilizes all program team members to support the program.

The Program Manager (PM) is responsible for complete oversight of the program work effort and supports negotiations and contract requirements. The PM serves as EPT’s liaison to the customer. The PM monitors the program progress on schedule and costs and drives the resolution of all technical issues that may arise. The PM ensures the delivered product is fully compliant with the customer’s product specification and SOW. The PM reports the program status to the customer.

The Program Engineer reports to the Engineering Manager/Lead and supports Contracts, Operations, Quality & the Customer. The Program Engineer is responsible for designing the product, writing and checking production documentation, ordering parts according to schedule, participating in all program reviews as well as performing any required analysis for the program. For the Customer, the Program Engineer retrieves and presents any technical data, translates all customer requirements into written procedures, and implements customer directed changes to ensure a conforming product. The Program Engineer has the responsibility to inform the customer through the program manager and contracts of possible problems (either to the product or to the safety of operators) relating to their requirements.

The Quality Engineer reviews all inspection procedures and documentation prior to publication. The Quality Engineer monitors hardware production and testing for anomalous conditions and compiles the End Item Data Package for the customer. The Quality Engineer supports the resolution of technical issues that may arise during product manufacture and testing. The Quality Engineer serves as the liaison to the customer’s quality assurance representative(s).

The Contract Administrator interacts with all levels of program management and other internal functional disciplines. The Contract Administrator communicates with the customer in the negotiation, structure, review, acceptance and flow-down of all proposal and contractual requirements. The Contract Administrator advises and consults with operations, program management, engineering and other functional disciplines to resolve contractual and proposal problems in a timely manner. The Contract Administrator reviews, interprets and approves contracts, modifications and change orders per established EPT standards.

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3.0 Cost

3.1.1

Program Cost Summary

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SELLER’S PROPERTY

A)

Seller may provide to Buyer certain items of tangible and intangible property, including but not limited to, tools, equipment, machinery, materials, drawings, specifications, computer software, documents, information, data, or other intellectual property or proprietary information, which Seller may furnish for the sole purpose of assisting Buyer in performing its obligations under this Agreement or under a purchase order, or as the parties may otherwise agree in writing ("Seller’s Property"). All such Property shall remain Seller’s personal property. All of Seller’s Property furnished to Buyer shall be deemed to be proprietary property to Seller, whether or not it is marked as such with any restrictive legend.

B)

Buyer shall exercise the same care in maintaining, storing and using Seller’s Property as it exercises with its own property, but in no event shall Buyer exercise less than reasonable care with respect to any of Seller’s Property in Buyer’s possession, reasonable wear and tear excepted. Buyer shall not commingle Seller’s Property with Buyer’s own property or that of a third party. Buyer shall insure Seller’s Property in an amount equal to the replacement cost, and name Seller as an additional insured under such insurance policy with any losses payable to Seller. Buyer shall not substitute any property for Seller’s Property and shall not use Seller’s Property except in fulfilling its obligations under this Agreement. Seller may, for any reason and upon reasonable notice to Buyer, remove Seller’s Property from Buyer’s premises at mutually agreeable dates and times, and at Seller’s Expense. If Seller requests, Buyer shall prepare such property for shipment and shall deliver it as Seller directs, at Seller’s expense. Notwithstanding the foregoing, upon completion or termination of this Agreement, Buyer shall promptly return to Seller all of Seller’s Property in Buyer’s possession.

C)

Buyer shall not use, utilize, misappropriate, disclose, or reproduce Seller’s Property for any purpose, except as outlined in the terms of this Agreement. Buyer may allow its contractors to utilize Seller’s Property for the sole purpose of enabling Buyer’s contractors to assist Buyer in performing its obligations under this Agreement or as the parties may otherwise agree in writing, but only on the condition that Buyer’s contractors agree in writing to the provisions of this Article. Seller may terminate this license with or without cause at any time.

D)

In the event Seller provides any of its Property to Buyer under a bailment or consignment arrangement, or sells any of its Property to Buyer, then Buyer hereby grants to Seller, and Seller hereby reserves, a security interest in such Seller’s Property, as well as any replacements, improvements, substitutions, attachments, and accessories thereto provided by Seller, whether now existing or hereafter arising, until Seller receives payment in full. Buyer shall execute and deliver all documents that Seller may request to perfect, protect, and maintain Seller’s security interest.

BANKRUPTCY, INSOLVENCY, AND CESSATION .

A)

Buyer shall provide at least fifteen (15) calendar days advance notice to Seller of any of the following events involving or affecting Buyer or Buyer’s parent, affiliates, or subsidiaries: (i) imminent filing of a bankruptcy petition of any type; (ii) declaration that Buyer or Buyer’s parent, affiliates, or subsidiaries has or will become bankrupt or insolvent, or unable to pay its debts as they become due; (iii) proposed or contemplated liquidation, dissolution receivership, or assignment for the benefit of Buyer’s creditors; or (iv) cessation of Buyer’s business or Buyer’s intent to cease to do business. Effective upon the issuance of such notice, Buyer shall be deemed in default, and Seller may in Seller’s sole discretion and notwithstanding any other provision of this Agreement, immediately cancel this Agreement or any purchase order without any liability. Buyer shall nonetheless be responsible for the payment of any outstanding balance and/or unpaid invoice owed to Seller for Products delivered to Buyer prior to the issuance of such notice.

B)

Notwithstanding the payment terms of Article 8, Payment, above, Seller may require payment by cash on delivery ("C.O.D.") or cash in advance, as a condition precedent for any future deliveries: (i) that Seller chooses to make to Buyer after the issuance of the notice under Article 15(a), or (ii) if Seller otherwise reasonably believes in its sole discretion that Buyer may file for or consent to bankruptcy, become insolvent or unable to pay its debts as they become due, or cease its operations. All other provisions of Article 10 shall nonetheless apply.

C)

Notwithstanding the payment terms of Article 8, Payment, above, Seller may also accelerate the payment terms by requiring Buyer to make payment immediately for Products delivered prior to either: (i) the issuance of the notice under Article 15(a), or (ii) the date when Seller formulates its belief that Buyer may file for bankruptcy, become insolvent or unable to pay its debts as they become due, or cease its operations. All other provisions of Article 8 shall nonetheless apply.

D)

Nothing contained in this Article 15 or elsewhere in this Agreement is intended to or shall limit or otherwise impair any right or remedy that Seller may have under applicable law.

U.S GOVERNMENT CONTRACT AUDIT RIGHTS . For any U.S. Government contract or subcontract, only a United States Agency, such as the Defense Contract Audit Agency ("DCAA") shall be authorized to perform assistance audits concerning financial and engineering records. Buyer agrees, however, that the DCAA shall not disclose to Buyer, and Buyer shall not accept from the DCAA, any of Seller’s proprietary information that the DCAA may obtain as a result of any assistance audit. Seller, in its sole discretion, shall have the right to limit audits for all manufacturing and quality processes

18.

DISPUTE RESOLUTION . Any and all disputes, controversies or claims arising under or relating to any purchase order or breach, termination, or invalidation under this Agreement shall upon written notice, be referred to the respective representatives for each party. The parties, through their representatives and/or senior management shall confer in good faith to attempt to resolve the matter. If the parties are unable to resolve the matter within a reasonable amount of time, either party may refer the matter to administered mediation. If the parties are unable to fully resolve the dispute or claim through mediation, then either party may file a lawsuit in a court of competent jurisdiction, in accordance with Article 19, Governing Law, Jurisdiction, and Venue, below.

19.

NOTICES . Buyer shall provide Seller with a contact person and address for all notifications that Seller may send to Buyer under this Agreement. Buyer shall send its notices to Seller to the following address: Director of Contracts EaglePicher Technologies, LLC C& Porter Streets Joplin, Missouri 64801

GOVERNING LAW, JURISDICTION, AND VENUE . The UN Convention of Contracts for the International Sale of Goods ("CISG") shall not govern the rights and obligations of the parties under this Agreement. Rather, this Agreement shall be interpreted, governed, construed and enforced in accordance with the laws of the State of Missouri, without regard to its conflicts of law principles. Buyer hereby consents to the exclusive jurisdiction of the State of Missouri, and all litigation matters shall be heard and determined by state courts located in Jasper County, Missouri or in federal courts located in the Western District of Missouri. Buyer waives any objection based on lack of personal jurisdiction; improper venue or forum non convenes.

21.

GOVERNING LANGUAGE . This Agreement, and all oral communications, writings, documents and technical information shall be in and governed by the English language.

22.

NON-WAIVER . Seller’s failure to either enforce or exercise any right, privilege, or legal remedy at any time, any provision contained in this Agreement or in a Confirmation or Acknowledgement, shall not be deemed a waiver of such provisions or right, remedy, or privilege.

23.

SURVIVABILITY. If this Agreement expires, is completed, or is terminated, Buyer shall not be relived of those obligations contained in the following provisions:

Applicable Laws
Export Control
Independent Contractor Relationship
Intellectual Property
Release of Information
Warranty

24.

REMEDIES AND SET-OFF. Seller’s remedies are cumulative and in addition to all remedies set forth herein or otherwise available, either at law or in equity. Seller may exercise its remedies either individually or cumulatively. Notwithstanding any other available remedies, Seller may, at its option, set off any deliveries of Products to Buyer for the equivalent amount of any outstanding balance and/or unpaid invoices that Buyer owes to Seller under: (a) this Agreement or a purchase order, (b) any other separate agreement or purchase order(s) between the parties, or (c) any claim, judgment or other liability by Seller against Buyer.

SEVERABILITY . In the event that any provision of this Agreement or in Seller’s Confirmation or Acknowledgement may be invalid, unlawful or incapable of being enforced by a rule of law or public policy, all other provisions shall, nonetheless, remain in full force and effect.

26.

TERMINATION FOR DEFAULT . Upon thirty (30) days written notice to the other party, either party may terminate this Agreement for default, in whole or in part, if the other party fails to comply with any material provisions of this Agreement and if said noncompliance is not cured within said thirty (30) day notice period. In the event of default by Seller, Buyer shall nonetheless compensate Seller for work actually completed and for work in progress. If Buyer defaults, Seller may, in its sole discretion and at anytime: (a) withhold deliveries and suspend performance; (b) continue performance if Seller deems it reasonable to do so; or (c) place the Products into storage. Seller shall submit invoices to Buyer for all costs that Seller incurs as a result of Buyer’s default. Buyer shall promptly pay to Seller the amount set forth in any such invoice. Seller shall be entitled to an extension of time for performance of its obligations equaling the period of time for Buyer’s default, whether or not Seller elects to suspend performance.

27.

PUBLICITY . The Parties are permitted to issue an initial news release, public announcement, advertisement, or any other form of publication concerning the Agreement. Subsequent news releases, public announcements, advertisements, or any other form of publication concerning the Agreement is only permitted with the advance written approval of the other Party which shall not be unreasonably withheld.

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INDEMNIFICATION . Both parties shall defend, indemnify, and hold harmless the other and each other’s, affiliates, agents, and customers from any and all damages, liabilities, claims, losses, suits, legal actions, investigations, or any threat of the same, and any costs incurred in connection therewith, including but not limited to, attorney fees and litigation expenses, arising out of, or related to, a breach by either party of this Agreement, or which may result in any way from any accident, injury, libel, or property damage by reason of: (a) any act or omission by either party, its agents, employees, or subcontractors, except to the extent that the accident, injury, libel, or property damage is due solely and directly to the other’s negligence, or (b) Either Parties’ use of the Products in such a way that constitutes or may constitute an infringement of any patent, trade secret, trademark, service mark, copyright, or related application, or other intellectual property or confidential and proprietary information infringement. Either party may, at its sole option: (i) tender such claim to the other party to defend using legal counsel acceptable to the other party, or (ii) defend such claim by retaining legal counsel of the other party’s choosing and that party shall reimburse the other for all costs of such defense. In either case all parties shall indemnify and hold the other harmless from and against all damages arising out of or relating to such claim. If any party tenders the defense of a claim to the other and that party accepts such defense, then the other party shall be conclusively deemed to have agreed that such claim is subject to indemnification hereunder, and that that party has no claim or counterclaim against the other, all of which that party shall be deemed to have waived. If a party assumes the defense of a claim and thereafter fails to vigorously defend such claim, the other party shall have the right, at its option, to assume the defense of such claim and both parties shall remain obligated to indemnify the other hereunder. If a party assumes the defense of a claim, that party shall not settle or compromise such claim without Seller’s prior written consent. Buyer shall at all times maintain such general and other liability, property damage, and employee liability insurance in sufficient amounts that will protect Seller from any or all of the foregoing risks, and upon request Buyer shall supply certificates of insurance to Seller.

29.

SECTION HEADINGS . Section headings are for the convenience of the parties only and shall not be used to construe or interpret the terms and conditions contained herein.

30.

ENTIRE AGREEMENT . This contract, together with any purchase orders issued pursuant to this contract, including attachments and documents incorporated herein by reference, constitutes the entire agreement between Seller and Buyer, and supersedes all prior representations, agreements, understandings, and communications between Seller and Buyer.

LITTLE FALLS, NJ--(Globe Newswire) – January 29, 2009 - mPhase Technologies, Inc. (OTC BB: XDSL.OB - News ) has announced that it has contracted EaglePicher Technologies to manufacture the AlwaysReady Reserve Battery that will be used in the AlwaysReady Emergency Flashlight. EaglePicher was selected for the project because of their experience in custom and standardized power solutions for the extreme environments of aerospace and military applications as well as medican and commercial applications.

"EaglePicher is one of the most respected companies in the power solutions industry," said mPhase CEO Ron Durando. "We chose to work with EaglePicher because we know that we will receive a top quality, reliable product that will clearly satisfy the requirements needed for emergency applications."

mPhase Technologies, Inc. (OTC BB:XDSL.OB - News ), through its wholly owned subsidiary AlwaysReady, Inc., is focused on developing and commercializing a new battery technology based on a well-patented phenomenon known as electrowetting, which provides a unique way to store energy and manage power that will revolutionize the battery industry. For more information, please visit our website at www.mPhaseTech.com.

EaglePicher Technologies, LLC (EPT), and EaglePicher company, is a world leader in custom and standardized power solutions for the extreme environments of aerospace and military applications as well as medical and commercial applications. The company specializes in design and manufacture of battery cells, battery packaging, battery management systems (BMS), analysis, environmental testing, and energetic devices. Active in battery development and testing since 1922, EPT has the most experience and broadest capability in battery electrochemistry of any battery supplier.

This news release contains forward-looking statements related to future growth and earnings opportunities. Such statements are based upon certain assumptions and assessments made by management of companies mentioned in this press release in light of current conditions, expected future developments and other factors they believe to be appropriate. Actual results may differ as a result of factors over which the company has no control.

Contact:

Mr. John Levitt
mPhase Technologies, Inc.
Public Relations Coordinator
973-256-3737 x166
JLevitt@mPhaseTech.com