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JV for Lumacom in lucrative US market
Tuesday, 18 February 2003 08:46

LUMACOM LIMITED 2003-02-18 ASX-SIGNAL-G

HOMEX - Perth

+++++++++++++++++++++++++
Lumacom Limited (Lumacom) announces today that it has reached
agreement on the terms for a joint venture and licence arrangement
for the Company's proprietary signage technology and products in the
North American region. Heads of agreements have been signed. The deal
will be through Lumacom Limited's wholly owned subsidiary, Lumacom
International (Lumacom).

Lumacom North America, LLC (Lumacom NA) will be established with The
Totius Group, an American-based investor and industry specialist. The
new company, initially capitalised at US$1m through the Totius
Group's investment of US$250,000 for 25% ownership, will have offices
in New York and have exclusive rights to sell Lumacom technology
throughout the USA, Canada and Mexico.

Lumacom will retain 75% ownership, and therefore profit share from
advertisings and sales revenue. Working capital for the new company
is provided by the investment of the joint venture partner. Prior to
the calculation of profit share in Lumacom NA, Lumacom will also
receive a continuous royalty payment stream of 25% on gross
advertising revenues generated from advertisers on installed signs,
and will retain the lucrative manufacturing rights for the region.

The agreement also allows the Totius Group to increase its
shareholding in Lumacom NA to 50% for a further cash payment of
US$250,000, with the royalty stream to Lumacom remaining 25%.

In addition, and of substantial interest to Lumacom under this
Agreement, is the option granted to the Totius Group to purchase the
North American manufacturing license of Lumacom's proprietary
technology for a cash payment of US$1.5million. At that time, The
Totius Group will increase its shareholding to 70% in Lumacom NA and
the royalty stream will reduce to 15% of gross advertising revenues.
Importantly, under the granting of a manufacturing license, Lumacom
always remains the sole supplier of its patented "chip module" which
incorporates the psycho physics process unique to Lumacom's
technology.

"The formation of Lumacom NA and the investment by The Totius Group
is an important achievement for us" said Rodd Sala, Managing Director
of Perth-based Lumacom Ltd. "It will fast-track the commercialisation
of Lumacom products in the lucrative US market, utilising the
expertise and funding from experienced and well connected industry
players". He added that a number of prospective product sales and
advertising revenue sharing installations have already been
identified by Lumacom, and will be immediately targeted and advanced
by the new operation.

"One particular advertising revenue site that has already been
secured ranks as a major 'spectacular' site by any world standards"
he added. "This advertising signage opportunity is possibly one of
the largest in the world, both in terms of sign size and advertising
revenue, and we hope to announce specific details very shortly".

Mr Sala will assume the position of Chairman of Lumacom North
America, LLC and Lumacom's Marketing Manager -North America, Mr Nick
Clews, who has been responsible to date for the development of all
marketing and commercial opportunities in the region, will maintain
an executive and active role in the operation.

The Totius group (through related parties) have taken a significant
equity position in Lumacom Limited.

The latest agreement continues Lumacom's strategy of incorporating
recurring revenue streams (capitalising on the long term income from
advertiser contracts on Lumacom signs installed at high profile
locations) with the manufacture and sale of Lumacom signs in large
format signage applications. The company owns the internationally
patented intellectual property rights to the unique range of LumaSign
technology developed by co-founders Oscar and Mickey Sala.

FOR FURTHER INFORMATION, refer to www.lumacom.com.au

Authorised by: Rodd Sala
Managing Director - Lumacom Ltd