Nio Security expands into Internet auctions

Nio Security, Inc. is expanding its business into 
auctions on the Internet. Nio has entered into an 
agreement to acquire Flamingo Intervest Ltd, the 
owner of the Ziinga.com Internet auction site. 
Flamingo is free of debt, and the acquisition 
provides Nio with a strong cash flow.

Through the acquisition Nio establishes a second 
business area, alongside its sophisticated video 
surveillance business. Nio's strategy is to expand 
the Company into dynamic areas with a strong cash 
flow.

Ziinga.com is an Internet auction service currently 
serving 875,000 users in 17 countries, and the 
membership base is expanding rapidly. Ziinga is an 
entertainment shopping website, with a concept 
different from traditional Internet auctions. Ziinga 
subscribers buy pre-purchased bids in order to bid 
for consumer brand products and the successful bidder 
of the auction is the last person to bid before the 
auction ends. The successful bidder may end up paying 
a fraction of the product's retail price.

The Ziinga site generated an EBITDA of NOK 15 million 
in 2010 and the Ziinga owners expect a 2011 EBITDA of 
NOK 25 million and further growth in 2012.

Nio Security will acquire Flamingo Intervest Ltd., a 
company incorporated under the laws of British Virgin 
Islands ("Flamingo"), which is the 100% owner of the 
Ziinga site. Upon closing of the transaction, Nio 
will issue 60 million new Nio shares as consideration 
for all shares in Flamingo. The number of outstanding 
shares in Nio Security after the transaction will be 
105,634,309. 

In addition, up to a maximum of 40 million shares 
will be issued in 2012, pending Flamingo's 2011 
performance. If Flamingo reaches an EBITDA of NOK 25 
million or more, this will result in the maximum 
payment of 40 million shares, and if the 2011 EBITDA 
is lower than NOK 25 million, the second payment will 
be reduced by three shares for each NOK 1.00 
reduction in EBITDA. 

As part of the transaction, 25,800,000 of the 
outstanding warrants in Nio will be cancelled, 
whereof 10,800,000 have a strike price of NOK 2.50 
and 15,000,000 have a strike price of NOK 5.00.

The agreement is subject to due diligence and 
approval by Nio Security's Board of Directors. Nio 
Security will obtain necessary company resolutions in 
accordance with applicable law. 

The acquisition is expected to be completed by the 
end of 
November 2011. 

An Information Memorandum will be issued as required 
by the Oslo Stock Exchange.

For further information please contact Tore Formo, 
CEO, +47 91 668 678.


Nio Security, Inc. helps protect life and property 
through the development and sales of sophisticated 
video surveillance solutions. The Company's 
technology is unrivalled and the main products, the 
CloseView dynamic surveillance system and the 
SteadyEye sophisticated video stabilising system, are 
considered the most advanced video surveillance 
systems available. Nio Security Inc is headquartered 
in the United States and listed on the Oslo Stock 
Exchange (ticker: NIO).
The information is subject of the disclosure 
requirements pursuant to section 5-12 of the 
Norwegian Securities Trading Act.