EXECUTIVE OFFICER COMPENSATION

This proxy statement provides certain information relating to the compensation of our named executive officers. We have determined that Messrs. Popielec and Fain were our only named executive officers for 2020.

As a smaller reporting company under the Securities Exchange Act of 1934, as amended, we are providing executive compensation information in accordance with the scaled disclosure requirements of Regulation S-K. As a result, a Compensation Disclosure and Analysis (“CD&A”) and certain other disclosures are not included.

Summary Compensation Table

The following table sets forth information concerning the compensation earned by or awarded to our executive officers for their services in all capacities to us during 2020 and 2019:

Narrative to Summary Compensation Table

Compensation Overview

The

Our executive compensation program is evaluated and approved each year by our Compensation and Management Committee engaged an independentCommittee. Annual total compensation for our executive compensation consulting firm, Grahall & Associates, to work with senior management and the Compensation and Management Committee (the “Compensation Committee”) to establish an executive total rewards strategy, which was implemented in 2012. Grahall & Associates looked at the competitiveness of our pay practices by making peer group comparisons. They augmented the core peer group that we had used in the past with several additional organizations as someofficers is comprised of the organizations in our original peer group were removed due to M&A activity. In addition to the core peer group analysis, they also provided analysis on a large sample of general technology organizations. Grahall & Associates presented several different potential reward strategies to the Compensation Committee for consideration.following key components:

The basic premise of Grahall & Associates’ proposal was that compensation must be tied to overall business strategy and must be amended to align with changes in business strategy over time. The program that has been implemented more effectively allocates the scarce resources that we have across competing needs than did our previous program. It recognizes that when resources are tight, resource allocation needs to be more precisely targeted. This structure is designed to increase our ability to recruit for key competitive advantage positions, motivate core executives to reposition our company and promote the retention of high performers who can impact our business going forward.

Our executive rewardscompensation program was designed by our Compensation Committeeis structured to align the interests of our Named Executive Officers and other highly compensated employees, including Mr. Heir,executive officers with those of our shareholdersstockholders by rewarding performance that enhances the long-term objectiveachieves successful execution of increasing shareholder value, significantlyour business strategy, grows theour business and executes our business strategy.increases stockholder value. Our executive rewardscompensation program is designed to motivateincentivize our executives, including our Named Executive Officers and other highly compensated employees,executive officers to achieve strong financial, operational and strategic performance and to provide a link between the amountscompensation earned by our executives and the creation of shareholderlong-term sustainable value. The Compensation and Management Committee establishes specific annual, long-term and strategic goals and rewards for Named Executive Officers and other highly compensated employeesseeks to reward our executive officers for performance that meets or exceeds those goals. In addition, we expect our Named Executive Officers and other highly compensated employeesexecutive officers to work toward achievement of these goals while maintaining the highest ethical standards.

The key components of our executive rewards program for our Named Executive Officers and other highly compensated employees are base salary, an annual short-term incentive plan (“STIP”) and a long-term incentive plan (“LTIP”), combined with health and welfare benefits, retirement benefits, limited perquisites (for Named Executive Officers only) and other benefits. We seek to ensure that total executive compensation is aligned with corporate performance and the creation of shareholder value by placing an appropriate portion of an executive’s total compensation at risk, based on financial and non-financial performance measures and subject to the achievement of corporate and individual performance goals.

Our executive rewards program is structured to attract, retain and motivate talented individuals, and to incentivize them to achieve our business strategy with strong financial, operational and strategic performance. In particular:

Base Salary

To this end, the Compensation Committee reviews our executive total rewards program annually to assess if we are achieving our business strategy, if we are able to attract and retain talented executives, and to ensure that the total compensation paid to our executives, including our Named Executive Officers and other highly compensated employees, is reasonable, competitive and appropriately performance-based. The Compensation and Management Committee also ensures thatevaluates the performance of Mr. Popielec, our total compensation is linked to the degree to which we meet our annual financial and non-financial goals and, longer term, to our success in improving shareholder return. Our President and CEO makes recommendations with respect to the awards of the other NamedChief Executive Officer, and other highly compensated employees,presents its evaluation and recommendation for base salary adjustment, if any, to the Compensation Committee determines the actual awardsBoard of the Named Executive Officers.

Our fiscal 2014 financial performance, our 2015 annual operating plan, and the individual performance of our Named Executive Officers and other highly compensated employees, served as key factors in making compensation decisionsDirectors for 2015.

We continued the linkage between our STIP awards and achievement of annual corporate financial targets in 2015, reflecting our pay for performance philosophy. As a result, for 2015 corporate operating profit and corporate revenue were the key metrics for our Named Executive Officer annual cash incentive awards under the STIP. Forapproval. Mr. Heir, the key metrics for incentive awards under the STIP were corporate operating profit and revenues from the Battery & Energy Products segment. Corporate operating profit of $3.75 million comprised 70% of the STIP weighting and corporate revenue of $80.3 million comprised the remaining 30% of the STIP weighting for our Named Executive Officers. Corporate operating profit of $3.75 million comprised 70% of the STIP weighting and Battery & Energy Products revenue of $60.5 million comprised the remaining 30% of the STIP for Mr. Heir. The threshold levels of performance provided under the STIP utilizing these metrics were met in 2015, and therefore, short-term annual cash incentive awards were paid to our Named Executive Officers and Mr. Heir for 2015 in March 2016.

Long-term equity incentive compensation continued to make up a significant portion of the compensation for each of our Named Executive Officers and other highly compensated employees. Awards are determined individually and are based on the relative criticality of the position and the Named Executive Officer’s and other highly compensated employees’ ability to implement changes designed to promote future growth.

Base Salary

Our President & CEO reviewsPopielec evaluates the performance of the other Named ExecutiveMr. Fain, our Chief Financial Officer, Treasurer and other highly compensated employeesSecretary, and then recommendspresents his evaluation and recommendation for a base salary adjustments,adjustment, if any, to the Compensation Committee. Inand Management Committee, which, in turn, the Compensation Committee reviews, adjusts where appropriate and approves themay recommend acceptance of or adjustment to such base salary adjustments, if any, based upon the determination of the Compensation Committee. In our Board’s executive session, the Committee reviews and recommendsrecommendation to the full Board any base salary adjustment for our President & CEO.of Directors. If changesadjustments to base salaries are recommended and approved, the changes in base salaryadjustments are made to be effective for a period ranging from twelve to fifteen months from the date of the last increase based upon an executive’s performance.salary adjustment.

The

In 2020, Mr. Popielec and Mr. Fain informed the Compensation and Management Committee, typically reviewsthat they would voluntarily forego any base salary levels fromincreases for 2020 although they were eligible for increases based on a number of factors including individual and Company performance.

In April 2019, the core peer group and the technology peer group on an annual or semi-annual basis. The Committee has endeavored to better align executive salaries with the market, moving them between the 25^th and the 50^th percentileBoard of our peer group, since base salaries for our executive officers have traditionally been significantly below market norms for comparable companies. In addition to lookingDirectors, at the peer group data, salaries for our Named Executive Officers are determined based upon the following factors:

In March 2015, the Compensation and Management Committee, approved a base salary increase of 3.0% for Mr. Popielec ($516,273 to $531,761) and 3.0% for Mr. Fain of 5.0% ($286,650328,848 to $300,976)$338,713). The merit increase wassalary increases were approved by the Committee based on a number of factors including individual and Company and individual performance.    Other than this adjustment, no changes were made to the base salaries of our Named Executive Officers during 2015.

Short-Term Incentive Plan 2015

Typically, our

Our Compensation and Management Committee establishes a short-term incentive planSTIP each fiscal year which provides the Named Executive Officersto provide our executive officers an opportunity to receiveearn an annual cash paymentaward in addition to their base salaries. The short-term incentive planSTIP is designed to place “at risk” a significant portion of the annual total cash compensation of the Named Executive Officers by linking the amount of compensation that can be achieved under the plan with our financial performance. We believe that the STIP is a key component of maintaining a competitive executive compensation program because it motivates our Named Executive Officersofficers to incentivize them to achieve our short-term financial and strategic objectives while making progress toward our longer term growth. longer-term goals. Generally, the STIP target levels are set such that, assuming achievement of pre-established performance metrics, the combined annual base salary and STIP award for our executive officers will be at or near the 50^th percentile for executive officers at the companies in our peer group.

For 2020, the STIP target bonus levels for Messrs. Popielec and Fain were 75% and 50% of their respective base salaries. The performance goals to be achieved to be awarded the STIP targeted bonus for 2020 were consolidated operating profit and revenue goals of $9.4 million and $122.3 million, respectively, as measured pursuant to generally accepted accounting principles. The STIP award was structured with a 70% weighting on the consolidated operating profit goal and a 30% weighting on the consolidated revenue goal. Achievement of less than 78% of the operating profit goal or less than 85% of the revenue goal would result in no award being earned with respect to that metric. Achievement of 78% to 100% of the operating profit goal and achievement of 85% to 100% of the revenue goal would result in an award ranging from 50% to 100% of the target award with respect to the metric for which such performance levels had been achieved. Achievement of over 100% to 125% of the operating profit goal and over 100% to 125% of the revenue goal would result in an award ranging from 101% to 150% of the target award with respect to the metric for which such performance levels had been achieved. Our executive officers were eligible for a partial award if one of the two metrics was achieved.

Based on our total rewards strategy, those Named Executive Officers2020 financial performance, Messrs. Popielec and other executives who, by virtueFain earned STIP awards for 2020 of their position$72,088 and $30,612, respectively, which were paid in the Company, had the

opportunity to make an immediate short term impact on the business and were instrumental in driving our operating results had more of their pay at risk in the STIP.    These individuals also were tasked with balancing short-term results and decisions with creating long term value.

President & CEO

Mr. Popielec was eligible to receive an annual cash bonus in accordance with the 2015 Executive STIP if the Company met or exceeded certain performance metrics that were to be agreed upon no later than January 31, 2015. In 2015,For 2019, the STIP target bonus levels for Mr.Messrs. Popielec wasand Fain were 75% and 50% of histheir respective base salary, and hissalaries. The performance goals to be achieved to be awarded the STIP targeted bonus was based on meeting pre-established 2015for 2019 were consolidated operating profit and corporate revenue goals.goals of $9.7 million and $102.0 million, respectively, as measured pursuant to generally accepted accounting principles. The STIP award was structured with a 70% ofweighting on the weighting of the bonus based on 2015consolidated operating profit goal of $3.75 million and a 30% ofweighting on the weighting of the bonus based on 2015 corporateconsolidated revenue goal of $80.3 million.goal. Achievement of less than 75% of the operating profit goal or less than 89%85% of the corporate revenue goal resultedwould result in no bonusaward being paidearned with respect to that metric. Achievement of 75% to 100% of the operating profit goal and achievement of 89%85% to 100% of the corporate revenue goal would result in a bonus range payoutan award ranging from 50% to 70% of the target bonus for the metric with respect to which the respective 75% to 100% or 89% to 100% performance was achieved. Payout of 100% of the target bonus under the plan would be achieved by exceeding the operating profit goal by 27% and the corporate revenue goal by 7%. Achievement of over 127% to 160% of the operating profit goal and over 107% to 118% of the corporate revenue goal would result in a bonus payout ranging from 100% to 150% of the target bonusaward with respect to the metric for which such performance levellevels had been achieved. Mr. Popielec wasAchievement of over 100% to 125% of the operating profit goal and over 100% to 125% of the revenue goal would result in an award ranging from 101% to 150% of the target award with respect to the metric for which such performance levels had been achieved. Our executive officers were eligible for a partial payment under the planaward if one of the two metrics was achieved. Payout under the plan is capped at 150% of the target bonus.    

Based on our 20152019 financial performance, Mr.Messrs. Popielec and Fain earned a STIP bonusawards for 2019 of $236,455 which was paid in March 2016.

Other Named Executive Officers$63,255 and Mr. Heir

Based in part on the recommendation from the President & CEO, the Compensation Committee establishes threshold, target and maximum bonus levels for each Named Executive Officer and Mr. Heir, which is expressed as a percentage of their base salary. The percentages are determined by the position of the Named Executive Officer and Mr. Heir within the organization and based upon the review of peer data. In 2015, the target for Mr. Fain was 45% of base salary and the target for Mr. Heir was 40% of his base salary. For our Other Named Executive Officer, the threshold level for 2015 was the minimum level of performance required before any amount would be earned under the STIP, which is 75% of the Company performance goal of operating profit and 89% of corporate revenue. For Mr. Heir, the minimum level of performance required before any amount would be earned under the STIP, is 75% of the Company performance goal of operating profit and 91% of revenues from the Battery & Energy Products Segment. The Compensation Committee also establishes a maximum bonus level under the STIP. For 2015, that maximum bonus level was 150% of the target bonus level.

Generally, the Compensation Committee sets the target bonus level such that, assuming achievement of the corporate financial metrics, the combined base salary and annual STIP opportunity for our Named Executive Officers will be at or near the 50^th percentile for comparable executives at the companies in our peer group. The President and CEO establishes Mr. Heir’s base salary and STIP opportunity with approval by the Compensation Committee.

In establishing the 2015 total rewards strategy, the Compensation Committee approved the President & CEO’s recommendation that all Named Executive Officers would have their STIP based on our operating profit and corporate revenue goals. The STIP potential for 2015 was based on a percentage of the Other Named Executive Officer’s base salary and the base salary of Mr. Heir. The two metrics used for computation of the 2015 bonus for the Other Named Executive Officers were Company operating profit and corporate revenue, with 70% of the weighting of the bonus based on 2015 operating profit target of $3.75 million and 30% of the weighting of the bonus based on 2015 corporate revenue target of $80.3 million. For Mr. Heir, the two metrics used were Company operating profit and Battery &

Energy Products segment revenues with the same weighting as for the Named Executive Officers. Achievement of these metrics in 2015 would result in a 70% payout of the percentage of the base salaries for the Other Named Executive Officer and for Mr. Heir.

Achievement of less than 75% of the bonus plan metric of operating profit goal and less than 89% of corporate revenue goal resulted in no bonus being paid to the Named Executive Officers for that metric. Achievement of 75% to 100% of the bonus plan metrics of operating profit goal and 89% to 100% of the corporate revenue goal would result in a bonus range payout to the Named Executive Officers from 50% to 70% of the target bonus for that metric. Payout of 100% of the target bonus under the plan would be achieved by exceeding the operating profit goal by 27% and exceeding the corporate revenue goal by 7%. Satisfaction of over 127% to 160% of the bonus plan metrics of operating profit and over 107% to 118% of corporate revenue goals would result in a bonus range payout of 100% to 150% of the target bonus for that metric. Named Executive Officers were eligible for a partial payment under the plan if one of the two metrics was achieved. Payout under the plan is capped at 150% of the target bonus. While the decisions to make STIP payouts as well as the amounts earned under the STIP are made at the sole discretion of the Compensation Committee, in making such determinations, the Compensation Committee considers the recommendations from our President & CEO for all other Named Executive Officers. The conditions described above were identical for Mr. Heir based on his specific metrics, except for the entry point for the revenues from Battery & Energy Products bonus metric which was 91%. Based on our financial performance in 2015, the Other Named Executive Officer earned a STIP bonus of $87,738 and Mr. Heir earned a bonus of $70,012, both of$26,861, respectively, which were paid in March 2016.February 2020. In addition, at the recommendation of the Compensation and Management Committee, the Board of Directors approved discretionary bonuses of $30,000 and $20,000 for Mr. Popielec and Mr. Fain, respectively, which were paid in February 2020 for their roles in the 2019 acquisition and integration of Southwest Electronic Energy Corporation.

Long-Term Incentive Compensation

Long-Term Equity Incentive Compensation – Other Named Executive Officer and Mr. HeirPlan

We use

Stock options and other equity awards are used to motivate our Named Executive Officers and other highly compensated employees to increase the long-term value of our common stock and, thereby, align the interests of our Named Executive Officers and other highly compensated employeesexecutive officers with those of our shareholders. Long-term equity incentive awards are intended to further our successstockholders by ensuring that sustainable value creation is a significant factor to the amount of total compensation which our Named Executive Officers and other highly compensated employees may receive. We believe that linking long-term compensation to sustained value creation helps retain executives over time.

Long-term equity incentive compensation may consist of equity such as awards of stock options, performance vested restricted shares and time vested restricted shares that vest over a multi-year period. This design approach helps align the interests of our Named Executive Officers and other highly compensated employees with those of our shareholders by linking the compensation of our Named Executive Officers and other highly compensated employees to long-term increases in the value of equity instruments. We use stock options as one of our long-term incentives because, in addition to providingincentivizing our executive officers with the opportunity to develop a stock ownership stake in our company, they result in compensation onlyachieve long-term growth and sustainable stockholder value.

Refer to the extent that the market price of our common stock increases over the term of the stock option.

The size and form of these equity awards“Outstanding Equity Awards” below for the other Named Executive Officer was determined by the Compensation Committee in consultation with the President & CEO. In March 2015, the Compensation Committee, based on recommendation of the President & CEO, awarded Mr. Fain with 30,000 stock options. The size of Mr. Heir’s equity awards is determined by the President and CEO and requires the approval of the Compensation Committee. In March 2015, the Committee approved the recommended award of 20,000 stock options for Mr. Heir.

Long-Term Equity Incentive Compensation – President & CEO

Long-term equity incentive compensation is a significant component of the compensation package ofgranted during 2020 and 2019. There were no other equity-based awards granted to our President & CEO. Under his employment agreement, Mr. Popielec received the following options to purchase shares of our common stock:executive officers during 2020 and 2019.

Mr. Popielec also received three additional stock option awards, each of which was conditioned upon shareholder approval of our Restated 2004 LTIP at our 2011 annual meeting. This approval was obtained at our 2011 annual meeting. As detailed below, most of these stock option awards were granted with an exercise price substantially above the grant date fair market value of our common stock.Retirement Benefits

On January 29, 2013, our Board of Directors, on recommendation of our Compensation Committee, granted 120,000 restricted stock units (RSU’s) to our President & Chief Executive Officer, Michael D. Popielec, which grant was approved by our shareholders at our June 4, 2013 Annual Meeting. These RSU’s vest and will convert to shares of our common stock as follows:

(4)

30,000 shares of our common stock will be issued on the later of January 1, 2015 or the date when our common stock first reaches a closing price of $5.00 per share for 15 trading days in a 30 trading day period.

The 30,000 shares of the Company’s common stock described in (1) above were issued on January 1, 2014, the 30,000 shares of the Company’s common stock described in (3) above were issued on January 1, 2015, and the 60,000 shares of the Company common stock described in (2) and (4) above were issued on October 8, 2015.

On March 3, 2015 and on March 5, 2015, our Board of Directors, on recommendation of our Compensation Committee, granted 40,000 and 20,000 stock options pursuant to our shareholder approved 2014 LTIP, respectively, to Mr. Popielec.

Retirement Benefits

We provide a tax-qualified 401(k) plan to all active employees a tax-qualified 401(k) plan that provides for both employer and employee contributions. Under this plan, employees may defercontribute a portion of their base salaryeligible cash compensation to the plan up to annual IRS limits. We provide a company match ofplan. For 2020 and 2019, the Company matched 50% on the first 6% of an employee’s deferrals, up to a maximum of 4% of the employee’s annual salary.eligible contributions.

Perquisites and Other Personal Benefits

We provide our Named Executive Officersexecutive officers with certain perquisites and other personal benefits that we and the Compensation Committee believewhich are reasonable and consistent with the objectives of our overall compensation program to better enable us to attract and retain superior employees for key positions. The Compensation and Management Committee periodically reviews the levels of such perquisites and other personal benefits to ensure they remain at appropriate levels. The aggregate incremental costs of the perquisites and other personal benefits provided to our Named Executive Officers to determine if they remain at appropriate levels. Mr. Heir does not receive perquisites.

The aggregate incremental costs of the personal benefits provided to our Named Executive Officersexecutive officers are included in the “All Other Compensation” column of the 2015 Summary Compensation Table.

Stock Ownership and Retention Guidelines

In order to better align the interests of executive officers and shareholders, the Compensation Committee implemented stock ownership and retention requirements for executive officers. The stock ownership requirements for executive officers are as follows:

For 2015, the Compensation Committee established the presumed share price, which is to be used for purposes of determining the minimum number of shares to be owned by the executive officers. This presumed price was $3.67 per share, which was based on the Volume Weighted Average Price (“VWAP”), calculated as an amount equal to the sum of all dollars traded for every transaction in our common stock for the two-year period ended December 31, 2014 divided by the total shares traded for such two-year period. Each year the Compensation Committee will establish a new price per share to be used to determine the minimum number of shares required to be held which price per share will be based on the VWAP of our common stock for the preceding two-year period. Executive officers have three

years from the date of hire to achieve the required holdings, which are based on the price per share as calculated above. Additionally, there are shareholding requirements which require that until the share ownership guidelines are met, executive officers are prohibited from disposing of more than 50% of vested shares received from restricted share grants (on an after tax basis) and 50% of shares received on exercise of stock options. Shares owned by an executive, as well as shares underlying awards of stock options and restricted stock are treated as owned by the executive for purposes of determining whether required ownership has been achieved. All Named Executive Officers have met their applicable stock ownership requirement. There are no stock ownership requirements for other highly compensated employees.

Deductibility of Executive Compensation

As part of its responsibility, the Compensation Committee reviews and considers the deductibility of executive compensation under Section 162(m) of the Code which provides that unless we comply with certain shareholder approval procedures, we may not deduct compensation of more than $1,000,000 that is paid to certain individuals. We believe that compensation paid under our executive compensation plans is fully deductible for federal income tax purposes. However, the Compensation Committee may in the future approve compensation that will not meet these requirements in order to ensure competitive levels of total compensation for our executive officers.

Accounting for Stock-Based Compensation

Beginning on January 1, 2006, we began accounting for stock-based payments, including stock options and restricted stock awards, in accordance with the requirements of SFAS 123(R), now referred to as ASC 718.

2015 Summary Compensation Table with components detailed in an accompanying note.

Outstanding Equity Awards

The following table sets forth information concerning the compensation awarded to, paid to or earned by the Named Executive Officersnumber of shares underlying exercisable and Mr. Heirnon-exercisable stock option awards outstanding at December 31, 2020 for all services in all capacities to us and our subsidiaries during 2014 and 2015:executive officers.

(2)	Mr. Fain earned a STIP bonus of $87,738 for the year ended December 31, 2015 which was paid in March 2016.

(3)

On July 12, 2013, Mr. Heir was hired by the Company as President, Battery & Energy Products. In conjunction with his hiring, the Compensation Committee guaranteed Mr. Heir a bonus of $31,500 that was paid to him in 2014. Mr. Heir earned a STIP bonus of $70,012 for the year-ended December 31, 2015 which was paid in March 2016.

(4)

On January 29, 2013,April 18, 2018, our Board of Directors, on recommendation of ourthe Compensation and Management Committee, granted 120,000 restricted stock units (RSU’s) to Michael D. Popielec, which grant was approved by our shareholders at our June 4, 2013 Annual Meeting. During 2014, 30,000 of these RSU’s vested, and during 2015, the remaining 90,000 of these RSU’s vested. The amount reported in the RSU/Option Awards column for Mr. Popielec represents the VWAP’soption to purchase 40,000 shares of the Company’sour common stockstock. This option vested with respect to 13,334 shares on the dates the RSU’s vested.April 18, 2019, 13,333 shares on April 18, 2020, and 13,333 shares on April 18, 2021.

There were no other equity awards outstanding at December 31, 2020 for our executive officers.

Option Exercises

The following table sets forth information concerning the exercise of stock option awards for the year ended December 31, 2020 for our executive officers.

Employment Arrangements

Mr. Popielec

On December 6, 2010, in connection with enteringthe Company entered into an employment agreement with Mr. Popielec, effective December 30, 2010,providing that Mr. Popielec becamewould become our President and Chief Executive Officer.

We setOfficer effective December 30, 2010. Mr. Popielec’s annual base salary was set at $450,000 subject to adjustment. Mr. Popielec is also eligible to receive an annual cash bonus under our short-term cash bonus incentive planSTIP if we meet or exceed certain quantitative and qualitative performance metrics to be agreed upon and approved by the Compensation and Management Committee no later than January 31 of the year for which the bonus applies. The bonus goals and payout ranges for 20152019 and 2020 are set forth above beginning on Page 17 for Mr. Popielec.13.

Mr. Popielec is also a participant in our Restated 2004 LTIP and 2014 LTIP. 

Pursuant to the terms of his employment agreement, Mr. Popielec was granted options to purchase shares of our common stock. Certain of the options granted on December 30, 2010 were conditional and were subject to shareholderstockholder approval to increase the number of shares available under our Restated 2004 LTIP. ShareholderLTIP (“2004 LTIP”). Stockholder approval of this increase was obtained in June 2011. All options awarded to Mr. Popielec pursuant to the terms of his employee agreement were exercised or expired as of December 31, 2020. Mr. Popielec is eligible for additional stock option grants on recommendation of the Compensation and Management Committee. Refer to the Outstanding Equity Awards section above beginning on Page 14.

Mr. Popielec is also entitled to receive the retirement benefits, perquisites and other personal benefits described in this proxy statement under the sections above entitled “Retirement Benefits” and “Perquisites and Other Personal Benefits”.

The employment agreement provides that Mr. Popielec’s employment is “at will.” Mr. Popielec is entitled to certain severance benefits if we terminate his employment without Business Reasons or a Constructive Termination occurs (as those terms are defined in the employment agreement), includingincluding: (i) salary continuation for a period of 12 months following the termination date; (ii) a pro rata amount (calculated on a per diem basis) of the full-year bonus which Mr. Popielec would have earned for the calendar year in which the termination of employment occurs; (iii) acceleration of vesting of all outstanding stock options and other equity awards subject to the provision, however, that the acceleration shall not apply to the extent that the outstanding options and other equity awards would otherwise have vested no more than 18 months after the date of termination;termination, and all such options and other equity awards shall remain exercisable for one year following the termination date or through the original expiration date, if earlier; (iv) continuation of health benefits for Mr. Popielec, his spouse and any dependent children for a period of 12 months after the termination date followed by 18 months of executive-paid COBRA eligibility. In addition, if we terminate the employment of Mr. Popielec within 12 months following the occurrence of a Change in Control, without Business Reasons or if a Constructive Termination occurs, (as those terms are defined in the employment agreement), then Mr. Popielec shall be entitled to receive a lump sum payment equal toreceive: (i) any earned but unpaid salary, any unpaid bonus from the prior year plus an amount equal to 18 months of his base salary as then in effect, payable immediately upon the termination date; (ii) one and one-half times his target bonus for the calendar year in which the termination date occurs; (iii) acceleration of vesting of all outstanding stock options all such optionsand other equity awards, which are to remain exercisable for 18 months following the termination date, or through the original expiration date, of the stock options, if earlier; (iv) continuation of health benefits for Mr. Popielec, his spouse and any dependent children for a period of 24 months after the termination date. To the extent the vesting and/or accelerated payment of outstanding stock options would subject Mr. Popielec to the imposition of tax and/or penalties under Section 409A of the Internal Revenue Code, (the “Code”), the vesting and/or payment of such stock options and other equity shall be delayed to the extent necessary to avoid the imposition of such tax and/or penalties. The employment agreement also provides for the continuation of certain benefits in the event Mr. Popielec’s employment is terminated for Disability (as defined in the employment agreement) or by his death. Mr. Popielec has also executed an Employee Confidentiality Non-Disclosure, Non-Compete, Non-Disparagement and Assignment Agreement in our standard form.

Other Executive Officers

We do not have an employment agreement with Mr. Fain. Mr. Fain or with any ofhas executed an Employee Confidentiality Non-Disclosure, Non-Compete, Non-Disparagement and Assignment Agreement in our highly compensated employees.

Outstanding Equity Awards at December 31, 2015

The following table sets forth information concerning the number of shares underlying exercisable and non-exercisable options and stock awards outstanding at December 31, 2015 for our Named Executive Officers.standard form.

(1)	This stock option will vest on the date our common stock first reaches a closing price of $10 for 15 trading days in a 30-day trading period, with such vesting in equal amounts over the four anniversary dates of that date.

Retirement Benefits and Potential Payments upon Termination, or Change in Control or Retirement

The only arrangement that we maintain that provides for retirement benefits is our tax-qualified defined contribution 401(k) plan. The material terms of our tax-qualified defined contribution 401(k) plan are summarized above under the heading “Retirement Benefits.”

All of the potential payments and benefits payable by us to those of our Named Executive Officers who were employed by us during 2015executive officers in the event of various scenarioscircumstances involving either a termination of employment and/or change in control are determined pursuant to the employment agreement with Mr. Popielec or the Restated 2004 LTIP and 2014 LTIP. The employment agreement with Mr. Popielec is summarized above under the heading “Employment Arrangements.” We do not have an employment agreement with Mr. Fain or Mr. Heir. UnderArrangements”. On June 18, 2018, the award, agreements issued under the Restated 2004 LTIP and 2014 LTIP,Committee unanimously approved a resolution for full vesting of all outstanding unvested stock options shares of restricted stock and restricted stock units immediately vestother equity awards upon the occurrence of a “Change in Control.”

Stock Ownership Guidelines

In order to better align the interests of our executive officers and stockholders, the Compensation and Management Committee implemented stock ownership requirements for our executive officers. The stock ownership requirements for our executive officers are as follows:

For 2020, the Compensation and Management Committee established the presumed share price to be used for purposes of determining the minimum number of shares to be owned by the executive officers. This presumed price was $7.82 per share, which was based on the volume weighted average price (“VWAP”), calculated as an amount equal to the sum of the dollar value of every transaction in our common stock for the two-year period ended December 31, 2020 divided by the total shares traded for such two-year period. Each year the Compensation and Management Committee will establish a new price per share to be used to determine the minimum number of shares required to be held which will be based on the VWAP of our common stock for the preceding two-year period. Executive officers have three years from the date of hire to achieve the required holdings, which are based on the price per share as calculated above. Additionally, our stock ownership policy requires that until the share ownership guidelines are met, executive officers are prohibited from disposing of more than 50% of vested shares received from restricted share grants (on an after-tax basis) and 50% of shares received on exercise of stock options. Shares owned by an executive, as well as shares underlying awards of stock options and restricted stock are treated as owned by the executive for purposes of determining whether required ownership has been achieved. Our executive officers have met their respective stock ownership requirement.

PROPOSAL 2
APPROVE AN AMENDMENT TO
THE ULTRALIFE CORPORATION AMENDED 2014 LONG-TERM

INCENTIVE PLAN

On June 3, 2014, our stockholders approved the Ultralife Corporation 2014 Long-Term Incentive Plan (as amended, the “2014 LTIP”). On November 14, 2016, the Ultralife Corporation 2014 Long-Term Incentive Plan was amended to affect a technical correction relating to the administration of the Ultralife Corporation 2014 Long-Term Incentive Plan by the Compensation and Management Committee.

We believe that long-term incentive awards are a valuable tool for the recruitment, retention and motivation of employees, directors and consultants who can contribute materially to the Company’s success. We have used stock options for such purposes since 1992, and other forms of equity-based compensation since 2004, and we continue to believe that stock options and other forms of equity-based compensation are an appropriate vehicle to incentivize and reward our employees, directors and consultants. As of May 25, 2021, there are outstanding options under all of our equity-based plans which entitle the holders of such options to acquire up to 1,088,738 shares of our Common Stock. Of the 1,750,000 shares originally reserved for issuance pursuant to the 2014 LTIP, only 248,073 shares remain available for future issuance pursuant to new grants or awards.

Our Board of Directors believes that it is important to have additional shares available to provide adequate flexibility and to support our ability to issue equity-based incentive compensation to our employees, directors and consultants, thus aligning the interests of our employees, directors and consultants with our stockholders. On April 22, 2021, our Board of Directors approved, subject to approval of the Company’s stockholders, an amendment to the 2014 LTIP to increase the total number of shares of our Common Stock authorized to be issued pursuant to the 2014 LTIP from 1,750,000 to 2,750,000, a copy of which is attached hereto as Appendix A.

The description of the 2014 LTIP set forth below is a summary, does not purport to be complete and is qualified in its entirety by reference to the provisions of the 2014 LTIP, a copy of which is attached hereto as Appendix B. Unless otherwise defined in this summary, capitalized terms used in this summary have the meanings given to such terms in the 2014 LTIP.

The following table provides certain important information concerning the existing equity compensation plans of the Company as of May 25, 2021:

Equity Compensation Plan Information

Summary of 2014 LTIP

Purpose. The purpose of the 2014 LTIP is to provide our Employees, Directors and Consultants who are in a position to contribute to our long-term success, with equity-based incentive awards in accordance with the terms specified in such awards. We believe that the equity-based incentive awards which are available under the terms of the 2014 LTIP will align the interests of award recipients with those of our stockholders and aid in attracting and retaining Employees, Directors and Consultants of outstanding ability.

Duration. The effective date of the 2014 LTIP was June 3, 2014.  Awards may not be granted under the 2014 LTIP after June 2, 2024, but awards granted on or before June 2, 2024 may extend beyond that date.

Administration. The 2014 LTIP is administered by our Compensation and Management Committee, or such other committee as may be designated by our Board of Directors (the “Committee”); provided, however, that the Committee shall consist of not less than two directors who are “non-employee directors,” within the meaning of Rule 16b-3 under the Exchange Act.

The Committee may allocate all or any portion of its responsibilities and powers under the 2014 LTIP to any one or more of its members, our Chief Executive Officer or other senior members of management as the Committee deems appropriate; however, only the Committee may select and grant awards to participants who are subject to Section 16 of the Exchange Act.

The Committee has broad authority in its administration of the 2014 LTIP, including, but not limited to, the authority to interpret the 2014 LTIP; to establish rules and regulations for the operation and administration of the 2014 LTIP; to select the 2014 LTIP participants to receive awards; to determine the type, size, terms, conditions, limitations, and restrictions of awards, including, without limitation, terms regarding vesting, exercisability, assignability, expiration and the effect of certain events; and to take all other action it deems necessary or advisable to administer the 2014 LTIP.

Notwithstanding the Committee’s broad authority to administer the 2014 LTIP and the awards issued under the 2014 LTIP, the exercise price of any stock option or stock appreciation right granted pursuant to the 2014 LTIP may not be subsequently “repriced” without stockholder approval.  The term “reprice” means: (1) the reduction, directly or indirectly, in the per-share exercise price of an outstanding stock option or stock appreciation right by amendment, cancellation or substitution; (2) the cancellation of a stock option or stock appreciation right when its exercise price exceeds the fair market value of the underlying Common Stock in exchange for another stock option, stock appreciation right or other equity security (unless the cancellation and exchange occurs in connection with a merger, acquisition, or similar transaction); or (3) the taking of any other action that is treated as a repricing under United States generally accepted accounting principles or by the rules or regulations of any stock exchange on which our securities are traded.  The term “reprice” shall not include adjustments made to awards by the Committee upon the occurrence of certain events (as described under “Adjustments Upon Certain Events” below).

To facilitate the granting of awards to participants who are employed or retained outside of the United States, the Committee will be authorized to modify and amend the terms and conditions of an award to accommodate differences in local law, policy or custom, or as otherwise deemed necessary or desirable by the Committee.

Eligibility. All of our Employees, Directors and Consultants are eligible to participate in the 2014 LTIP; provided, however, only Employees are eligible to receive incentive stock options.  Participants in the 2014 LTIP will be selected by the Committee from those eligible persons who are in a position to have a material impact on our results of operations.  Participants may be selected and awards may be made at any time on or prior to June 2, 2024.  As of December 31, 2020, our two named executive officers and approximately 120 other employees participated in the 2014 LTIP.

The selection of those persons within a particular class who will receive awards is entirely within the discretion of the Committee.  The Committee has not yet determined what benefits will be granted to participants subsequent to the approval by the stockholders of the proposed amendment of the 2014 LTIP.  The Committee intends to grant most of the 2014 LTIP’s awards to those persons who are in a position to have a significant direct impact on the growth, profitability and success of the Company, which would include the participants in the 2014 LTIP.

Shares Available. There are currently a total of 1,088,738 shares of Common Stock available for issuance upon exercise of outstanding options and unvested restricted stock awards, and 248,073 shares of Common Stock remaining available for issuance under future awards granted under the terms of the 2014 LTIP. Upon the approval by the stockholders of the amendment to the 2014 LTIP, an additional 1,000,000 shares of Common Stock will be available for issuance pursuant to future awards granted under the 2014 LTIP. With respect to the total number of shares of Common Stock available for awards under the 2014 LTIP, no more than 800,000 shares of Common Stock may be used for awards other than stock options and stock appreciation rights.  The 2014 LTIP authorizes the Committee to make equitable adjustments to the authorized number and class of securities to be issued under the 2014 LTIP upon the occurrence of certain events, as described under “Adjustments Upon Certain Events” below.

Types of Awards. Awards under the 2014 LTIP may be in the form of stock options, stock appreciation rights, restricted stock, restricted stock units, unrestricted stock and other equity-based awards, or any combination thereof.   All awards granted under the 2014 LTIP shall be evidenced by an award agreement which specifies the type of award granted pursuant to the 2014 LTIP, the number of shares of Common Stock underlying the award and all of the terms governing the award, including, without limitation, terms regarding the vesting, exercisability, forfeiture and expiration of the award.  The Committee has exclusive power and authority, consistent with the provisions of the 2014 LTIP, to establish the terms and conditions of any award and to waive any such terms or conditions.

Award Limits. The maximum number of shares with respect to which awards may be paid or granted during each calendar year to any given participant may not exceed 150,000 shares of Common Stock, except inducement grants to new executives and key employees in amounts not to exceed 700,000 shares are not subject to the 150,000 share annual limitation.  The 2014 LTIP authorizes the Committee to make equitable adjustments to the number of shares with respect to which awards may be paid or granted during each calendar year to any given participant under the 2014 LTIP upon the occurrence of certain events, as described under “Adjustments Upon Certain Events” below.

Stock Options and Stock Appreciation Rights. The Committee may grant awards under the 2014 LTIP in the form of stock options to purchase shares of Common Stock, which stock options may be non-qualified stock options or incentive stock options for federal income tax purposes.  Any stock option granted in the form of an incentive stock option must satisfy the requirements of Section 422 of the Internal Revenue Code. Stock options shall be vested and exercisable at such times and upon such terms and conditions as may be determined by the Committee, but in no event shall a stock option be exercisable more than ten years (five years for incentive stock options issued to certain Control Persons) after the date it is granted.  The exercise price per share of Common Stock for any stock option awarded shall not be less than 100 percent (110 percent for incentive stock options issued to certain Control Persons) of the fair market value of a share of Common Stock on the day the stock option is granted, except for stock options granted in assumption or replacement of outstanding awards in connection with specified corporate transactions.

A stock option may be exercised by paying the exercise price in cash or its equivalent, or, to the extent permitted by the Committee, shares of Common Stock, a combination of cash and shares of Common Stock, or such other consideration as the Committee deems appropriate. In addition, options may be exercised through the delivery of irrevocable instruments to a broker to sell the shares of Common Stock obtained upon the exercise of the stock option and to deliver to us an amount equal to the exercise price.

The Committee may grant stock appreciation rights independent of (“Freestanding SARs”) or in conjunction with (“Tandem SARs”) a stock option.  The exercise price of a stock appreciation right shall be an amount determined by the Committee, but in no event shall such amount be less than the fair market value of the Common Stock on the date the stock appreciation right is granted or, in the case of Tandem SARs, the exercise price of the related stock option.  Each Freestanding SAR shall entitle the participant upon exercise to the payment of an amount equal to (i) the excess of (A) the fair market value on the exercise date of one share of Common Stock over (B) the exercise price, multiplied by (ii) the number of shares of Common Stock as to which the stock appreciation right is exercised.  Each Tandem SAR shall entitle the participant to surrender the related stock option and to receive payment of an amount equal to (i) the excess of (A) the fair market value on the exercise date of one share of Common Stock over (B) the exercise price per share of Common Stock, multiplied by (ii) the number of shares of Common Stock covered by the related stock option which is surrendered.  Payment of the exercise price of a stock appreciation right may be made to us in shares of Common Stock or in cash or partly in shares of Common Stock and partly in cash, as determined by the Committee. 

Stock-Based Awards and Restricted Stock Units. The Committee, in its sole discretion, may grant stock awards (shares of restricted stock or unrestricted stock) or restricted stock units (“RSU’s”) and other awards that are valued in whole or in part by reference to, or are otherwise based on the fair market value of, the Common Stock.   Such stock-based awards shall be in such form, and dependent on such conditions, as the Committee shall determine, including, without limitation, the right to receive, or vest with respect to, one or more shares of Common Stock (or the equivalent cash value of such shares of Common Stock) upon the completion of a specified period of service, the occurrence of an event and/or the attainment of performance objectives.  The restricted period specified in respect of any stock award shall not be less than three years, except that the Committee may (i) provide for the restricted period to terminate at any time after one year upon the attainment of performance-based objectives, and (ii) grant stock awards of up to 30,000 shares of Common Stock without regard to this limitation. Furthermore, the Committee may not terminate the restrictions applicable to outstanding stock awards except in connection with a Change in Control. The Committee may grant an unrestricted stock award only if the Committee determines that such stock award is made in lieu of all or a portion of salary or cash bonus of comparable value.

Withholding. We are entitled to deduct from any payment to a participant under the 2014 LTIP the amount of all applicable income and employment taxes required by law to be withheld with respect to such payment or may require the participant to pay to us such tax prior to and as a condition of the making of such payment.  Subject to certain limitations, the Committee may allow a participant to pay the amount of taxes required by law to be withheld from an award by withholding shares of Common Stock to be paid under such award or by permitting the participant to deliver to us shares of Common Stock having a fair market value equal to the amount of such taxes.

Adjustments Upon Certain Events. In the event of any reclassification, recapitalization, merger, consolidation, reorganization, issuance of warrants, rights or debentures, stock dividend, stock split or reverse stock split, cash dividend, property dividend, combination or exchange of shares, repurchase of shares or any other change in corporate structure which, in the judgment of the Committee, materially affects the value of the Common Stock, the Committee may determine the substitutions or adjustments to the maximum number of shares available for the grant or issuance of awards under the 2014 LTIP, the maximum award payable under the 2014 LTIP, the number and class of shares and the exercise price per share set forth in any award theretofore granted, or any other effected terms of an award or the 2014 LTIP as the Committee deems equitable or appropriate.

Effect of Certain Events. The Committee will have the authority to promulgate rules and regulations to determine the treatment of a participant’s award in the event of the participant’s death, disability or termination.  In addition, the Committee shall have the right to extend the period for exercise of any stock option or stock appreciation right, provided such extension does not result in an exercise period for any such stock option or Tandem SAR, which exceeds ten years from the date of grant.

Unless otherwise decided by the Committee and provided in an award agreement, upon a participant’s death or disability prior to the complete exercise of the stock options or stock appreciation rights granted to him or her under the 2014 LTIP, any such remaining stock options or stock appreciation rights may be exercised within one year after the date of the participant’s death or disability and prior to the expiration of the term thereof, to the extent exercisable on the date of the participant’s death or disability.

Unless otherwise decided by the Committee and provided in an award agreement, upon a participant’s termination for any reason other than death or disability prior to the complete exercise of the stock options or stock appreciation rights granted to him or her under the 2014 LTIP, any such remaining stock options or stock appreciation rights may be exercised within three months after the date of the participant’s termination and prior to the expiration of the term thereof, to the extent exercisable on the date of the participant’s termination.

Amendment and Termination. The Board of Directors may, at any time, suspend, discontinue or terminate the 2014 LTIP; provided, however, that no such action shall adversely affect the rights of participants to awards previously granted hereunder and, provided further, however, that any stockholder approval necessary or desirable in order to comply with tax, securities, or other applicable laws or regulations, including, but not limited to, the listing requirements of the stock exchanges on which our securities are listed, shall be obtained in the manner required therein.  In addition, the Board of Directors may, at any time and for any reason, with or without prior notice, amend the 2014 LTIP in any manner, but may not without stockholder approval, adopt any amendment which would: (i) increase the number of shares available under the 2014 LTIP; (ii) expand the types of awards available; (iii) expand the class of persons eligible to participate; (iv) extend the term of the 2014 LTIP; (v) materially amend the 2014 LTIP, including, but not limited to, changing the method of determining the exercise price of options issued under the 2014 LTIP; (vi) allow for repricing of options or SARs; or (vii) terminate restrictions applicable to awards (except in connection with a grantee’s death, disability or termination of employment or connection with a Change in Control).

New Plan Benefits

Because the benefits conveyed under the 2014 LTIP will largely be at the discretion of the Committee, it is not possible to determine what benefits participants will receive under the 2014 LTIP as a result of the proposed amendment.

Securities Act Registration

We intend to register the additional shares of Common Stock issuable and purchasable under the 2014 LTIP pursuant to a Registration Statement on Form S-8 as soon as reasonably practicable, subject to the stockholders’ approval of the amendment to the 2014 LTIP at the Meeting.

Tax Status of 2014 LTIP Awards

Introduction. The following discussion of the United States federal income tax consequences of awards under the 2014 LTIP, as proposed, is based on present federal tax laws and regulations and does not purport to be a complete description of the federal income tax laws. Participants may also be subject to certain foreign, state and local taxes which are not described below.

Incentive Stock Options. Pursuant to the requirements of Section 422 of the Internal Revenue Code, only employees are eligible to receive incentive stock options. If a stock option is an incentive stock option, no income is realized by the employee upon grant or exercise of the incentive stock option, and no deduction is available to the Company at such times. If the Common Stock purchased upon the exercise of an incentive stock option is held by the employee for at least two years from the date of the grant of such incentive stock option and for at least one year after exercise, any resulting gain is taxed at long-term capital gains rates. If the Common Stock purchased pursuant to the incentive stock option is disposed of before the expiration of that period, any gain on the disposition, up to the difference between the fair market value of the Common Stock at the time of exercise and the exercise price of the incentive stock option, is taxed at ordinary rates as compensation paid to the employee, and the Company is entitled to a deduction for an equivalent amount. Any amount realized by the employee in excess of the fair market value of the Common Stock at the time of exercise is taxed at capital gains rates.

Non-Qualified Options. If a stock option is a non-qualified option, no income is realized by the participant at the time of grant of the non-qualified stock option, and no deduction is available to the Company at such time. At the time of exercise (other than by delivery of shares of Common Stock to the Company), ordinary income is realized by the participant in an amount equal to the difference between the exercise price and the fair market value of the shares on the date of exercise, and the Company receives an income tax deduction for the same amount. If a non-qualified stock option is exercised by delivering shares of Common Stock to the Company, the number of shares received by the participant equal to the number of shares so delivered are received tax-free and have a tax basis and holding period equal to the shares so delivered. The fair market value of the additional shares received by the participant are taxable to the participant as ordinary income, and the participant’s tax basis in such shares is their fair market value on the date of exercise. Upon disposition, any appreciation or depreciation of the Common Stock after the date of exercise may be treated as capital gain or loss depending on how long the shares have been held.

Stock Appreciation Rights. No income is realized by a participant at the time a stock appreciation right is granted, and no deduction is available to the Company at such time. When the stock appreciation right is exercised, ordinary income is realized in the amount of the cash or the fair market value at such time of the shares of Common Stock received by the participant, and the Company is entitled to a deduction of equivalent value.

Unrestricted Stock and Unrestricted Stock-Based Awards. Upon the grant of an award of shares of unrestricted stock or another stock-based award which is not restricted, a participant realizes taxable income equal to the cash and fair market value at such time of the shares of Common Stock received by the participant under such award (less the purchase price, if any), and the Company is entitled to a corresponding tax deduction at that time.

Restricted Stock and Restricted Stock-Based Awards. Upon the grant of an award of shares of restricted stock or another stock-based award which is restricted, no income is realized by a participant (unless a participant timely makes an election under Section 83(b) of the Code to accelerate the recognition of the income to the date of grant), and the Company is not allowed a deduction at that time; when the award vests and is no longer subject to a substantial risk of forfeiture for income tax purposes, the participant realizes taxable ordinary income in an amount equal to the cash and the fair market value at the time of vesting of the shares of Common Stock received by the participant under such award (less the purchase price therefor, if any), and the Company is entitled to a corresponding deduction at such time. If a participant makes an election, as permitted under Section 83(b) of the Code, within 30 days after the date of the transfer by the Company to the participant of the shares of restricted stock or other restricted stock-based award, then the participant recognizes taxable ordinary income in an amount equal to the cash and the fair market value at the time of grant of the shares of Common Stock to be received by the participant under such award (less the purchase price therefor, if any), and the Company entitled to a corresponding deduction at such time.

Stock Price

The closing price of our Common Stock reported on the NASDAQ Global Market on May 25, 2021 was $9.00 per share.

Required Vote and Board of Directors’ Recommendation

We believe that our best interests will be served by the approval of Proposal 2. Amending the 2014 LTIP will enable us to be in a position to grant stock options and other new forms of long-term incentive awards to employees, directors and consultants who can contribute materially to our success.

Approval of Proposal 2 requires the affirmative vote of a majority of shares of the Common Stock represented at the Meeting at which a quorum is present and in attendance.

The Board of Directors recommends a vote FOR the proposal to approve the amendment to the 2014 LTIP, and, unless otherwise indicated therein, the shares represented by the enclosed properly executed proxy will be voted FOR such proposal.

PROPOSAL 3
RATIFY THE SELECTION OF OUR INDEPENDENT

REGISTERED PUBLIC ACCOUNTING FIRM

The firm of Bonadio & Co., LLPFreed Maxick CPAs, P.C. (“Freed Maxick”) served as our independent registered public accounting firm for the years ended December 31, 20142020 and 2015.2019.

Our Audit and Finance Committee has selected

The selection of Freed Maxick CPAs P.C. to serve as our independent registered public accounting firm for 2016. This selection2021 will be presented to our shareholdersstockholders for their ratification at the Meeting. Our Board of Directors recommends a vote in favor of the proposal to ratify this selection, and the persons named in the enclosed proxy (unless otherwise instructed therein) will vote such proxiesFOR this proposal. If the shareholdersstockholders do not ratify this selection, the Audit and Finance Committee will seek to identify and address the reason or reasons why the shareholdersstockholders did not ratify the committee’s selectionCommittee’s selection. The Audit and Finance Committee will consider such reason or reasons in selecting an independent registered public accounting firm for 2016.2021 but retains discretion to select Freed Maxick.

We have been advised by Freed Maxick CPAs, P.C. that they will have a representative present atavailable during the Meeting, either in person or telephonically, who will be available to respond to appropriate questions. In addition, we intend to give such representative an opportunity to make any statements if theythe representative should so desire.

Principal Accountant Fees and Services

Aggregate fees for professional services rendered for us by Bonadio, & Co., LLP for 20142020 and 20152019 were:

Audit Fees

Audit fees for 2014 and 2015, respectively, were for professional services rendered for the audits of our consolidated financial statements and reviews of our quarterly consolidated financial statements, consentsstatements. Audit fees for 2020 include fees attributable to the first-year attestation of internal controls over financial reporting for Southwest Electronic Energy Corporation (“SWE”) acquired by the Company in May 2019. Audit fees for 2019 include fees attributable to business combination accounting and assistance with review of documents filed with the SEC.reporting and first year substantive audit fees relating to SWE.

Audit-Related Fees

Audit-related fees in 2014 and 2015, respectively, were for the auditannual audits of our 401(k) defined contribution plan for the years ended December 31, 2013 and December 31, 2014. Also included in the audit-related fees in 2015 was an amount related to a review of our S-8 Filing and included in the audit-related fees in 2014 was an amount relating to a review and discussion of our accounting for the relocation of our China facility.plan.

Tax Fees

Tax fees relatewere attributable to corporate and expatriate tax compliance, includingdue diligence performed in connection with the preparationCompany’s acquisition of tax returns and claims for refund, tax planning, tax advice.

Our Audit and Finance Committee has not adopted pre-approval policies and procedures for audit and non-audit services. Although no pre-approval policy was in effect,Nevertheless, all audit, audit-related and permitted non-audit services for which Bonadio & Co., LLP wereour independent registered public accounting firm was engaged were reviewed and approved prior to the commencement of the services by our Audit and Finance Committee in compliance with applicable SEC requirements.

REPORT OF THE AUDIT AND FINANCE COMMITTEE

The duties and responsibilities of the Audit and Finance Committee are set forth in our Audit and Finance Committee Charter, a copy of which is available on our website athttp://investor.ultralifecorporation.com under the subheading “Corporate Governance.” Among other things, the Audit and Finance Committee reviews the adequacy of our system of internal control regarding financial reporting, disclosure controls and procedures and preparing our consolidated financial statements. In addition, the Audit and Finance Committee recommends to our Board of Directors that our audited financial statements be included in our Annual Report on Form 10-K, approves our quarterly filings on Form 10-Q and selects the independent registered public accounting firm to audit our books and records.

The Audit and Finance Committee has:

The Audit and Finance Committee met with our independent accountants with and without management present and discussed with them the results of their examinations, their evaluations of our internal control over financial reporting, our disclosure controls and procedures and the quality of our financial reporting. Based on the review and discussions referred to above, the Audit and Finance Committee concluded that Bonadio & Co., LLPFreed Maxick is independent and recommended to the Board of Directors that the audited financial statements be included in our Annual Report on Form 10-K for the year ended December 31, 20152020 for filing with the SEC.

The Audit and Finance Committee:

Thomas L. Saeli, Chair

Steven M. Anderson

Robert W. Shaw II

Ranjit C. Singh

OTHER MATTERS

Our Board of Directors does not intend to present and has not been informed that any other person intends to present, any matters for action at the Meeting other than those specifically referred to in this proxy statement. If any other matters properly come before the Meeting, it is intended that the holders of the proxies will act in respect thereof in accordance with their best judgment.

EXECUTIVE OFFICERS

Other than Mr. Popielec, whose information is set forth with the other directors standing for election, the names of, and certain information with respect to, our executive officers are presented below.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS

The table below shows certain information regarding the beneficial ownership of shares of our common stock as of April 5, 2016 by each person known by us to beneficially own more than five percent of the outstanding shares of our common stock, with percentages based on 15,325,58916,040,738 shares issued and outstanding.outstanding as of May 25, 2021.

SECURITY OWNERSHIP OF MANAGEMENT

The table below shows certain information regarding the beneficial ownership of shares of our common stock as of April 5, 2016May 25, 2021 by (1) each of our directors, (2) each of our Named Executive Officers (as defined under the heading “Executive Compensation”),executive officers, and (3) all of our directors and executive officers as a group.

(5) (6)

The amount shown includes 184,667number of shares deemed to be beneficially owned consists of 118,160 shares of common stock held by Mr. Fain as of May 25, 2021, or less than 1% of common stock outstanding as of that date, and 113,334 shares of common stock subject to options that may be exercised within 60 days by Mr. Fain.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Exchange Act requires our directors, executive officers and persons who own more than 10% of our common stock to file with the SEC initial reports of beneficial ownership and reports of changes in beneficial ownership of our common stock and our other equity securities. To our knowledge, based solely on the written representations of our directors and executive officers and the copies of such reports filed with the SEC during 2015, all Section 16(a) filings applicable to our officers, directors and more than 10% beneficial owners were filed in a timely manner.

SUBMISSION OF SHAREHOLDERSTOCKHOLDER PROPOSALS

Under Rule 14a-8 of the Exchange Act, shareholderstockholder proposals intended for inclusion in the proxy statement for our 20162021 Annual Meeting of ShareholdersStockholders must be submitted in writing to us to our Corporate Secretary (Attn: Philip A. Fain) at 2000 Technology Parkway, Newark, New York 14513, and must have been received by December 23, 2016.February 1, 2021.

Any shareholderstockholder proposal submitted for consideration at our 20162021 Annual Meeting of ShareholdersStockholders butnot submitted for inclusion in the proxy statement for that meeting that is received by us after December 23, 2016February 1, 2021 will not be considered filed on a timely basis with us under Rule 14a-4(c)(1) of the Exchange Act. For such proposals that are not timely filed, we retain discretion to vote proxies we receive. For such proposals that are timely filed, we retain discretion to vote proxies we receive provided that we include in our proxy statement advice on the nature of the proposal and how we intend to exercise our voting discretionand the proponent of any such proposal does not issue its own proxy statement.

Our Annual Report on Form 10-K for the year ended December 31, 2015,2020 as amended, as filed with the SEC, is included in the 20152020 Annual Report to ShareholdersStockholders which accompanies this proxy statement.

April 22, 2016						By Order of the Board of Directors
						Bradford T. Whitmore
						Chair of the Board of Directors

Bradford T. Whitmore,

Chair of the Board of Directors

APPENDIX A

AMENDMENT TO THE
ULTRALIFE CORPORATION
2014 LONG-TERM INCENTIVE PLAN

WHEREAS, Ultralife Corporation (the “Company”) maintains the Ultralife Corporation 2014 Long-Term Incentive Plan (the “Plan”);

WHEREAS, pursuant to Section 11(i) of the Plan, the Company has reserved the right to amend the Plan;

WHEREAS, the Company desires to amend the Plan in certain respects;

WHEREAS, on April 22, 2021, subject to stockholder approval, the Board of Directors of the Company approved this amendment; and

WHEREAS, pursuant to Section 11(i) of the Plan, approval by the Company’s stockholders is required with respect to this amendment.

NOW, THEREFORE, the Plan is hereby amended as follows:

‘‘(a) In General.  The maximum number of shares of Stock which shall be available for the grant or issuance of Awards under the Plan (including ISOs) during its term shall be equal to 2,750,000, provided, however, that no more than 800,000 shares of Stock may be used for Awards other than Options or SARs.”

APPENDIX B

ULTRALIFE CORPORATION
AMENDED 2014 LONG-TERM INCENTIVE PLAN

Original Plan Effective June 3, 2014

As Amended by Board on November 14, 2016

Section 1. Purpose.