Press Releases

Sydney, Jan 31, 2008 (ABN Newswire) - Zylotech Limited (ASX: ZYL) is pleased to announce a ground-breaking milestone in its business development program. The company has signed a major bilateral, evergreen distribution agreement with VIVOTEK Inc, a leading Asian hardware manufacturer of IP surveillance cameras and the name behind brands such as D-Link, LevelOne and other multinational IT Distribution products. The Board considers the after tax Net Present Value over the first 2.5-year phase of this significant agreement to be A$11,000,000.

VIVOTEK Inc. (TAIEX: 3454), with over 13.2% total production market share, is one of Asia's rising IP surveillance camera manufacturing megastars, second only to Japan's PANASONIC (27.3%) and well ahead of other well-known brands such as SONY, CANON and AXIS (IMS-ASIA Research CCTV report 2007 edition). Using sophisticated compression technologies, VIVOTEK's innovative hardware R&D has developed a product range sold to over 50 countries through a wide network of distributors and system integrators.

Zylotech, Australia's own world-leading surveillance software and Video Management Systems developer, has been using VIVOTEK's IP cameras as the hardware backbone of its world-class surveillance system. Zylotech has secured important surveillance projects with AFP, QANTAS, VODAFONE, NGA, RMIT, NEC etc. VIVOTEK has recognised these achievements and has now appointed Zylotech as its Exclusive Master Distributor.

Under this new Zylotech/VIVOTEK bilateral distribution agreement, Zylotech will exclusively distribute their COTS products in Australia and NZ. Conversely, needing to complement their products with counter-terrorism capabilities for government agencies and critical infrastructure operators, VIVOTEK has elected to solely distribute Zylotech's award winning Smart-G Enterprise Protection TM suite of software as an integral part of their range in Asia, Europe and the U.S, where Zylotech is not represented. Zylotech will provide the application knowledge and expert training as the support hub for VIVOTEK sub-distributors, resellers and end-users throughout the South Pacific.

The regular recurring revenue streams to be instantly generated from the VIVOTEK branded product distribution, is incremental to Zylotech's predominantly project based business model and will have a major growth impact beyond its 2009/10 revenues. Mr. Eddy Lan, President of VIVOTEK Inc.: "Zylotech has been Vivotek's very first customer. We may have grown exponentially, but we have long memories.

Having worked together with Zylotech in developing our mutual offerings for many years, we have now jointly reached a totally new global stage, based on trust and respect". Mr. Lan added: "We have partnered with Zylotech after a thorough investigation and evaluation of the world's best-of-breed software, simply because Zylotech fully exploits the unique features of our hardware."

Zylotech is extremely proud of this new long-term partnership with VIVOTEK. I want to congratulate the CEO, Nick Sikiotis in securing this bilateral Distributorship. It has come about as a result of his personal long friendship, loyalty and support for VIVOTEK.

Contact

John Wayland TEL: +61-2-9427-2134 FAX: +61-2-9427-2788 EMAIL: sales@zylotech.com.au