VRYA Viryanet Ltd. (MM)

ViryaNet Ltd. (Nasdaq: VRYA), a leading provider of solutions that automate business processes for mobile workforce management and field service delivery announced today that it has received notice from The NASDAQ Stock Market that the NASDAQ Listing Qualifications Panel (the �Panel�) has granted the Company�s request for continued listing on The NASDAQ Capital Market, subject to the condition that the Panel will monitor the Company�s continued compliance with the minimum $2,500,000 stockholders� equity requirement for continued listing on The NASDAQ Capital Market through the quarter ending March 31, 2008. As previously announced, the Company�s stockholders� equity fell below the NASDAQ requirement during the quarter ended September 30, 2006. As a result, the Company attended a hearing with the Panel to present its plan for achieving and sustaining compliance with the NASDAQ equity requirement. In that regard, on January 9, 2007, the Company filed a Report on Form 6-K with the U.S. Securities and Exchange Commission announcing the conversion of a $500,000 convertible note into 326,797 shares of Preferred A Shares. In that filing, the Company also indicated its belief that the note conversion had resulted in the Company�s return to compliance with the NASDAQ stockholders� equity requirement, subject to the review and audit of the Company�s financial results for the fiscal year ended December 31, 2006. In the event that the Company fails to maintain compliance with the NASDAQ stockholders� equity requirement in the future, its securities may be delisted for The NASDAQ Capital Market. Also as previously announced, on January 17, 2007, the Company effected a 1 for 5 reverse split of its Ordinary Shares as part of its effort to regain compliance with NASDAQ�s $1 per share minimum bid price requirement. Pursuant to the NASDAQ Marketplace Rules, the Company must maintain a bid price of at least $1 per share for a minimum of ten consecutive business days in order to regain compliance. Through January 23, 2007, the Company had maintained a closing bid price in excess of $1 per share for five consecutive business days. Assuming that the bid price remains at or above $1 per share for the balance of the ten day monitoring period, the Company would expect to receive a notice from NASDAQ that it has regained compliance with the bid price requirement. The closing price for the Company�s Ordinary Shares on January 23, 2007 was $3.37. About ViryaNet ViryaNet is a provider of software applications that improve the quality and efficiency of an organization�s service operations. ViryaNet�s flagship product � ViryaNet Service Hub � combines the power of the Internet, the freedom of wireless technologies, and the resources of ViryaNet�s deep service expertise to help companies improve workforce scheduling, dispatching, and activity reporting; customer contract and entitlement automation; and asset, logistics, and depot repair management. Customers in the utility, telecommunications, retail, and other industries use ViryaNet Service Hub to transition complex service business processes into a manageable, scalable Internet operation, with the goal of increasing service revenues, decreasing service costs, and maximizing customer satisfaction. Safe Harbor Statement Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: The statements contained in this press release that are not purely historical are forward-looking statements within the meaning of Section 21E of the Securities and Exchange Act of 1934, as amended, including statements regarding ViryaNet�s expectations, beliefs, intentions, or strategies regarding the capabilities of its products, its relationships with its customers, its customer purchases, its future operational plans and objectives including integration of other businesses, its future business prospects, its future financial performance, its future cash position, and its future prospects for profitability. All forward-looking statements included in this document are based upon information available to ViryaNet Ltd. as of the date hereof, and ViryaNet Ltd. assumes no obligation to update any such forward-looking statements. Forward-looking statements involve risks and uncertainties, which could cause actual results to differ materially from those projected. These and other risks relating to ViryaNet�s business include market acceptance of and demand for the Company�s products, risks associated with a slow-down in the economy, risks associated with the financial condition of the company�s customers, risks associated with competition and competitive pricing pressures, risks associated with increases in costs and operating expenses, risks in technology development and commercialization, the risk of operating losses, risks in product development, risks associated with international sales, and other risks that are set forth in ViryaNet�s Form 20-F, dated July 15, 2005, and the other reports filed from time to time with the Securities and Exchange Commission. Reported results should not be considered an indication of future performance. You should not place undue reliance on these forward-looking statements, which speak only as the date hereof. ViryaNet disclaims any obligation to publicly update or revise any such forward-looking statements to reflect any change in our expectations or in events, conditions, or circumstances on which any such statements may be based, or that may affect the likelihood that actual results will differ from those set forth in the forward-looking statements.