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RNS Number : 2985S

Global Lock Safety (Intl) Grp CoLtd

29 November 2012

Global Lock Safety (International) Group Co., Limited

("Global Lock" or the "Company")

Update - new business line - major new contract

Global Lock, the provider of security solutions to retail stores and other organisations in China, is pleased to announce that its operating subsidiary, Shenzhen Global Lock Security System Engineering Co., Limited ("Shenzhen Global Lock"), has signed its first system integration project. Under this contract Global Lock will provide a comprehensive security system based on its intelligent IT technology, utilising internet and mobile technology, to be incorporated as part of a new development of public and private areas at the Xiangtan Jiuhua Economic Development Zone in Hunan province, China. The Xiangtan Jiuhua Economic Development Zone area covers approximately 30 km2 and includes residential areas, office buildings, construction plants and factories.

Unlike Global Lock's traditional model of one contract per customer, the system integration contract covers the entire development and, as such, the customer acquisition costs are reduced.

The main parties to this agreement contract are Chengdu Shuguang Optical Fibre Network Co., Ltd, a domestic Chinese company with experience electronic engineering projects, and the state run Hunan Xiangtan Economic Development Management Committee (the "Developer"). Shenzhen Global Lock is acting as sub-contractor to Chengdu Shuguang Optical Fibre Network Co., Ltd. The project is scheduled to be completed by 28 February 2013.

The Directors anticipate that the contract will make a positive revenue contribution to its accounts for the period ending 31 December 2013 as 50% of the contract fee will be paid into an escrow account controlled by Chengdu Shuguang Optical Fibre Network Co., Ltd and the Developer and this will be released at the completion of the project. An additional 30% of the contract fee will be paid one year after acceptance of the completion of testing phase of the project by the Developer (expected to be in 28 February, 2013) with the remaining 20% of the contract fee to be paid two years after final acceptance and completion of the project by the Developer.

Under the terms of the sub-contracting arrangement, Shenzhen Global Lock will pay Chengdu Shuguang Optical Fibre Network Co., Ltd a 3% management fee on all sums received by Shenzhen Global Lock from the Developer. All of Shenzhen Global Lock's expenses will be recharged to the Developer.

Under the terms of the contract, Shenzhen Global Lock is required to pay a RMB2.0 million performance deposit (approximately GBP 200,000) (the "Deposit"), via Chengdu Shuguang Optical Fibre Network Co., Ltd, to the Developer which is fully refundable upon successful completion of the project. The Deposit was loaned to Shenzhen Global Lock by its Chairman, Li Mo Xiang, in August 2012 and is covered by the terms of the loan facility from Mr Li, further details of which were announced on 24 September 2012.

Following the successful signing of the Xiangtan Jiuhua Economic Development Zone smart system integration contract, Shenzhen Global Lock is currently working on other similar projects and further announcements will be made at the appropriate time.

Li Mo Xiang, Chairman of Global Lock, commented: "I am extremely pleased to be able to announce our first security system integration contract. We feel that contracts which cover a number of customers simultaneously represent an extremely efficient use of our resources and also lowers our customer acquisition costs. These type of contracts have the potential to make a positive contribution to our revenue in future years and also help to diversify our business. I look forward to being able to make further positive contract win announcements in the future".

Enquiries:

Global Lock Safety (International) Group

Li Mo Xiang, Chairman Tel: +86 755 8366 0755

Robert Zhang, Director and Tel. +86 755 8655 6705 (IDD)

Chief Investor Relations Officer E-mail: robertzh@globallock.com

   Andrew Gee, Non-executive Director                                     Tel:  + 44 777 565 3564 

Allenby Capital Limited Tel: + 44 20 3328 5656

Nick Naylor

Alex Price

This information is provided by RNS

The company news service from the London Stock Exchange

END

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