Alion Awarded Phase II Office of Naval Research Contract

Technology Services Provider to Develop and Demonstrate New Technology Models in support of Naval Seabasing

McLean, VA – January 14, 2008 – The Office of Naval Research (ONR) has selected Alion Science and Technology to proceed with Phase II, the detailed design phase, of the Sea Base Connector Transformable-Craft (T-Craft) program. The contract, worth between $6 and $10 million over a period of 12 to 24 months, was awarded on Nov. 30 and makes Alion eligible for the critical Phase III award—construction of the ship—on a $156M contract.

Under the Phase II contract, Alion will build full-scale models of new technologies and demonstrate that they work. These technologies include a ship skirt and seal design, an innovative propulsion power distribution system and vehicle transfer technologies. The second phase also requires Alion to finalize a design suitable for construction of a full-scale ship.

"The T-Craft ship supports the rapid transfer of Army and Marine Corps equipment  ashore in support of the Naval Seabasing concept,” said Vice Admiral Scott Fry, (USN Ret.), Alion Sector Senior Vice President and Manager of the Engineering and Integration Solutions Sector. “This is game-changing technology. This capability does not currently exist. This ship can go across the ocean and link up with a large logistics ship and take on some of the roll-on, roll-off cargo and then land it on the beach. We are extremely pleased to continue with this program and look forward to helping the Navy make its Seabasing vision a reality in the not so distant future."

Seabasing will be used by the armed forces to build floating bases in areas in which formal ground bases cannot be established. The goal is for production vessels that utilize the T-Craft technologies to be used as Seabase connectors, transporting wheeled and tracked vehicles through the surf zone and then onto the beach. The craft will have four modes of operation: open ocean transit mode, transfer cargo at sea base, sprint, and an amphibious mode to travel over sand bars and mud flats.

The T-Craft ship is expected to be demonstrated in 2013 and will be approximately 280 feet long by 80 feet wide and weigh about 2,000 tons. It will travel over 40 knots and carry a minimum of six M-182 tanks.

Alion engineers will perform the work from its Alexandria, Va. office, with support from its Pittsburgh office.

Umoe Mandal, a Norweigian-based company, also won an ONR award for the second phase of T-Craft.

This press release contains information about management’s view of Alion’s future expectations, plans and prospects that constitute forward-looking statements for purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by these forward-looking statements as a result of a variety of risk factors and uncertainties discussed in documents periodically filed by Alion with the SEC. Due to such uncertainties and risks, readers are cautioned not to place undue reliance on such forward-looking statements, which speak only as of the date hereof.