Ulticom Announces Completion of Audit Committee Investigations and Provides Anticipated Investigation-Related Financial Statement Adjustments

Market Wire, March, 2008

Ulticom, Inc. (the "Company") (PINKSHEETS: ULCM) filed a Form 8K with the SEC on March 28, 2008 announcing that the Audit Committee of the Board of Directors of the Company (the "Audit Committee") has concluded its previously announced investigations into historical option grant practices and certain historical accounting practices not related to stock options and has presented its formal findings and recommendations to the Company's Board of Directors. The Company filed the Audit Committee's summary of its findings and recommendations as an exhibit to a Current Report on Form 8-K under the Securities Exchange Act of 1934. The Company also provided anticipated adjustments to previously reported pre-tax income/(loss) in connection with the investigation-related financial restatement. As described below, independent of the investigations, the Company's evaluation of certain revenue recognition practices under AICPA Statement of Position 97-2 ("SOP 97-2") is ongoing.

Audit Committee Investigations

"The completion of the Audit Committee investigations represents an important step forward for the Company, both to ensure that we understand and address all historical issues and to provide the basis for the Company's upcoming financial restatement and filings with the Securities and Exchange Commission. The Board fully supports the actions of the Audit Committee and is committed to ensuring that the highest standards of financial reporting and internal controls are maintained at the Company," said Andre Dahan, Chairman of the Board of the Company and Chief Executive Officer of Comverse Technology, Inc.

The Audit Committee released the following statement: "We support the Company in its ongoing efforts to complete its financial restatement and to regain the confidence of the investing public. As is discussed in the summary of our report, we have recommended and the Board of Directors has adopted remedial measures to raise awareness regarding compliance matters at the Company and to monitor and strengthen the Company's internal controls." Remedial measures to be implemented to address the Audit Committee's findings relating to historical stock option practices include (i) elimination of the use of written consents for option grants, (ii) having the Company's General Counsel administer the stock option grant process and (iii) conducting an annual internal audit of the Company's stock option grant process with an emphasis upon compliance and documentation.

Remedial measures to be implemented relating to the investigation into historical accounting practices not related to stock option grants include (i) quarterly reviewing the Company's financial reporting and accounting functions with an emphasis upon accruals and revenue deferrals, (ii) convening periodic meetings among the Company's independent registered public accounting firm audit team, the Company's CEO, CFO, General Counsel and the Chair of the Company's Audit Committee for the purpose of discussing any issues or information of relevance to the Company's financial statements and financial reporting process, (iii) conducting education and training for Company employees to emphasize ethical conduct in all aspects of its operations, including in particular personnel involved in the financial reporting process or accounting-related functions, (iv) elevating the role of the General Counsel in the organization and (v) mandating that the current Chief Financial Officer attend continuing education at his own expense to improve his future performance.

Financial Statement Adjustments

In its April 17, 2006 Current Report on Form 8-K, the Company disclosed that its financial statements for each of the fiscal years ended January 31, 2005, 2004, 2003 and 2002 and any related reports of its independent registered public accounting firm should no longer be relied upon. In addition, on November 29, 2007, the Company announced that it has determined that it will need to restate its historical financial statements for the 1996 through 2004 fiscal years (year ended December 31, 1996 through year ended January 31, 2005). The required adjustments stem from (i) the fact that the stated dates of certain of the Company's stock option awards differed from the measurement dates required to be used for accounting purposes to determine the value of such awards, (ii) excessive accruals in certain historical periods and (iii) inappropriate deferral of revenue relating to certain intercompany transactions between the Company and one of its Comverse affiliates. The estimates of such adjustments and charges have the effect of decreasing the previously reported income from operations, pre-tax income and retained earnings (or increasing the previously reported loss from operations and pre-tax loss) contained in the Company's historical financial statements.

The impact of the investigation-related restatements on previously reported pre-tax income/(loss) is shown in the table below. More detail surrounding each category of adjustment is provided in the subsequent tables contained in this press release. Investors are cautioned that the financial information presented in this press release is subject to further adjustment as the Company completes its analysis. In particular, on November 29, 2007, the Company disclosed that it was conducting an evaluation of its revenue recognition practices independent of the historical stock option and accounting practices investigations. The Company believes that it must adjust previously provided sales information as a result of such evaluation but is currently unable to determine the amounts of such adjustments. Accordingly, the adjustments shown in the tables below do not represent all adjustments which the Company anticipates will be made to its historical financial statements. The causes of the investigation-related adjustments reflected below are described in greater detail in the summary of the Audit Committee report filed as Exhibit 99.1 to the Company's Current Report on Form 8-K filed with the Securities and Exchange Commission today.