V.i. Labs Builds on Significant Momentum in 2006, Announces Key Milestones and Drivers to the Company's Success in 2007 and Beyond.

New Customers, Partnerships, and Markets Fuel Company Expansion

WALTHAM, Mass. -- V.i. Laboratories, Inc. ("V.i. Labs"), a provider of software protection solutions for securing high value and mission critical applications, announced it made significant strides in 2006 in strengthening its market position as demand increases for solutions that protect software applications against piracy, tampering, and reverse engineering.

"Last year proved to be a successful time for V.i. Labs on many fronts, from signing new customers, to increasing our presence with strategic partnerships and continuing to expand into new markets," said Joe Noonan, president and CEO, V.i. Labs. "We continue to prove that we have the right solutions and technology in place to help application providers, software vendors, and government agencies safeguard their intellectual property resident within software applications."

Highlights for the previous year include:

Corporate

* After securing first-round funding led by Rockford Capital, V.i. Labs built a core team to market the company's innovative application security technology.

* The company announced the general availability of CodeArmor[TM] version 2.0, a powerful, out-of-the-box software protection solution that easily protects existing applications without requiring source code modifications or adding complex security infrastructure.

* V.i. Labs also championed a unique method for quantifying the amount of revenue that software vendors realize before and after implementing anti-piracy measures. The method, called "Time to Crack[TM]," provides software vendors with a benchmark for measuring changes in software license revenues in emerging markets with high piracy rates.

New Customers

V.i. Labs secured significant new customer orders which validated its technology and solution positioning within key vertical markets. Some examples include:

* Software Piracy:

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* Code Theft: A leading provider of detection equipment has deployed CodeArmor to protect highly sensitive algorithms embedded within their detection systems. The systems are in use by governments and corporations around the globe to combat terrorism, drug and weapons smuggling, illegal immigration, and trade fraud.

* Software Tampering: A leading Internet gambling software provider uses CodeArmor to protect its online games against tampering and ensure the integrity of client-side software.

Partnerships

V.i. Labs also secured key alliances and partnerships to extend its solutions for preventing software piracy, code theft, and software tampering:

* The company announced a partnership with Reprise Software, Inc., a provider of software license management systems for end-users and Independent Software Vendors (ISVs), to provide an integrated anti-piracy solution;

* A technology partnership was inked with Uniloc USA, a leading provider of device-locked product activation software. The resulting product integration allows Uniloc softANCHOR[TM] and CodeArmor to ensure that protected applications run only on authorized machines;

* V.i. Labs joined both the Electronic Design Automation (EDA) and Software & Information Industry Association (SIIA), leading industry sources for valuable feedback and education on anti-piracy strategies and measures. The EDA and SIIA represent the industry benchmark for anti-piracy knowledge sharing among member organizations.

Emerging Markets

In 2006, V.i. Labs noted key market trends fueling the demand for its software protection solutions:

* Emerging markets with strong manufacturing expertise such as China saw an increase in piracy rates for high value and specialized software applications (CAD/CAM, Electronic Design Automation, and scientific test equipment);

* Increased knowledge sharing about common licensing systems and more sophisticated reverse engineering tools allow cracking teams to easily remove license enforcement and make cracked software available the day a new release is generally available.

* Developers and content providers within the gaming and casino industries are investing in Web and Internet distribution systems and facing challenges due to regulations and concerns over their ability to protect their applications from tampering threats;

* Embedded system software providers are becoming increasingly concerned about their IP resident within equipment that's deployed and marketed globally.

* As cited by analysts, Enterprise Code Reverse Engineering is also viewed as an emerging cyber threat.

"We saw a number of early adopter companies invest in our solutions in 2006 to counter the increasing threats to their software IP," said Vic DeMarines, vice president of Products, V.i. Labs. "We are aggressively building on our successes in 2006 by announcing a significant new solution at the upcoming Software Development West 2007 show in March that leverages our integration work with industry leaders such as Microsoft."

About V.i. Laboratories (V.i. Labs)

V.i. Labs provides software protection solutions that protect against the misappropriation and theft of intellectual property resident in software applications. Through V.i. Labs' patent-pending technology, software vendors, embedded system providers, enterprise organizations and government agencies are able to easily secure their software against the threat of piracy, tampering and theft, independent of where the applications are distributed. V.i. Labs is privately held and is headquartered in Waltham, MA. For more information please visit http://www.vilabs.com.

[c]2007 V.i. Laboratories, Inc. All rights reserved. V.i. Labs, CodeArmor and the V.i. Labs logo, are trademarks of V.i. Laboratories, Inc. All other product and brand names herein are trademarks or registered trademarks of their respective owners.