FOR IMMEDIATE RELEASE

January 19, 2005

Vadium Technology Announces Extension of Sub- Contract.

TACOMA, WA (January 19, 2005) – Vadium Technology, Inc.®, the developer of the AlphaCipher Encryption SystemTM is pleased to announce the extension of its sub-contract award from the United States Government for the porting AlphaCipher MobileTM to mobile devices using the Palm operating system. AlphaCipher Mobile is the first commercial off the shelf One- Time Pad (OTP) encryption solution for mobile devices. With this effort, AlphaCipher Mobile will be designed for cross-platform use on both the Microsoft Windows CE and Palm operating systems. With this sub-contract extension, the further porting of AlphaCipher to the Palm O/S will provide additional secure communication tools for the war-fighter to use in securing mission critical communications across commercial networks.

“Vadium Technology is committed to continually expand its encryption technology applications to the many available mobile devices and operating systems. We are pleased to be awarded this extension of our sub-contract to provide AlphaCipher products. The porting of AlphaCipher Mobile to the Palm operating system will help to demonstrate the flexibility and robustness of the AlphaCipher Encryption System for securing mission critical data in transmission and storage,” stated Rod Nicholls, President of Vadium Technology, Inc.

The original prime contract and the subsequent prime contract extension was awarded by the United States Government to Commonwealth Research Institute of Johnstown, PA, which awarded a sub-contract to ACEncrypt Solutions, LLC (www.acencrypt.com) of Vienna, VA, which further awarded a sub-contract to Vadium for completion and performance of this effort.

About Vadium Technology, Inc.
Vadium Technology, Inc., (www.vadiumtech.com) located in Tacoma, Washington, is the developer of the newest generation innovative security solutions. The AlphaCipher Encryption System TM, implements a true digital One-Time-Pad (“OTP”) cipher. The OTP is the only method of encrypting data where the strength of protection is immune to the mounting threats posed by breakthroughs in advanced mathematics and the ever-increasing processing power of computers. The Company’s products combine portable, easy-to-use key management and storage systems with a user friendly graphical interface to deliver fast, ultra-strong protection for data stored locally or transmitted over communication networks for small to mid-size sensitive workgroups. Vadium’s technology is suitable for government and commercial enterprise solutions where critical information demands the highest protection.

CONTACTS:
Elizabeth Hammersmith
Vice President
Vadium Technology, Inc.
(253) 896-1000 x105