Vimicro Announces $29.5 Million Asset-Backed Loan

BEIJING, April 6, 2012 /PRNewswire-Asia-FirstCall/ -- Vimicro International Corporation (NASDAQ: VIMC) ("Vimicro" or the "Company"), a leading multimedia semiconductor and IP-based surveillance solution provider, today announced that the Company signed an agreement for a $29.5 million (RMB 186 million) asset-backed loan with China Construction Bank ("CCB") on March 28, 2012.

The loan has a 5-year term with an annualized variable interest rate equal to 105% of the benchmark lending rate designated by the People's Bank of China (currently 6.9%). Under the terms of the loan agreement, the proceeds will be used to fund the research and development of SVAC (The Surveillance Video and Audio Coding) project, including the construction and outfitting of an R&D facility. The first disbursement of RMB 30 million has already been transferred to the Company.

"We are pleased to enter this loan agreement with China Construction Bank," stated Mr. Kevin Jin, Vimicro's President and Chief Operating Officer. "The SVAC Project is a key project for Vimicro's future growth and development in the domestic surveillance market. With this timely financial support, we are confident that we can successfully and efficiently complete the project's construction. We will strictly honor our commitments to CCB and look forward to making the SVAC Project a key driver for Vimicro's future growth."

About SVAC

The Surveillance Video and Audio Coding (SVAC) is the first national standard for the Chinese security and surveillance industry and is considered crucial for the establishment of the public security and criminal prevention system in China. SVAC has been approved and officially released by the Standardization Administration of China and the first Research Institute of the Ministry of Public Security of China. SVAC was initiated and co-developed by Vimicro and the Ministry of Public Security, along with contributions from more than 40 scientific research institutes, universities and security industry companies. SVAC aims to promote the orderly development of the surveillance industry in China, while enabling greater interconnectivity and providing more intelligent data analysis through the use of digital technologies and rules-based processes. SVAC is also the first fundamental technology that will enable surveillance's transition from the analog world to a fully digital, high definition, open and intelligent surveillance network. SVAC is the preferred protocol in Chinese government contracts and available to all companies participating in the surveillance industry in China.

About Vimicro International Corporation

Vimicro International Corporation is a leading multimedia semiconductor and solution provider that designs, develops and markets mixed-signal semiconductor products and system-level solutions that enable multimedia capabilities in a variety of products for PC/Notebook, consumer electronics and surveillance markets. Vimicro is aggressively expanding business into the surveillance market with system-level solutions and semiconductor products to capitalize on China's domestic demand. Vimicro's ADSs, each of which represents four ordinary shares, are currently trading on the NASDAQ Global Market under the ticker symbol "VIMC."

Forward-Looking Statements

This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates," "confident" and similar statements. Among other things, the quotations from management in this announcement, as well as Vimicro's expectations and forecasts, contain forward-looking statements. Vimicro may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission on forms 20-F and 6-K, etc., in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about Vimicro's beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: the company's ability to develop and sell new mobile multimedia products; the expected growth of the mobile multimedia market; the company's ability to increase sales of notebook camera multimedia processors; the company's ability to retain existing customers and acquire new customers and respond to competitive market conditions; the company's ability to respond in a timely manner to the evolving multimedia market and changing consumer preferences and industry standards and to stay abreast of technological changes; the company's ability to secure sufficient foundry capacity in a timely manner; the company's ability to effectively protect its intellectual property and the risk that it may infringe on the intellectual property of others; and cyclicality of the semiconductor industry. Further information regarding these and other risks is included in Vimicro's annual report on Form 20-F filed with the Securities and Exchange Commission. Vimicro does not undertake any obligation to update any forward-looking statement, except as required under applicable law. All information provided in this press release is as of the date hereof, and Vimicro undertakes no duty to update such information, except as required under applicable law.