In order to disengage the clutch, the clutch arm will need to be pulled in towards the engine.
I'd like to recommend the following site for additional information and assistance on assembly for this clutch system :
http://www.motoredbikes.com/showthread.php?t=5124
There is a particular point on the clutch arm where the clutch disengages the motor and it is usually when the arm is at a 6 'o clock position facing the back of the motor. You would need to have someone help you when tightening the position of the clutch cable lock.
To get it to the right position, the clutch arm should be very slightly disengaged, and pushed in a very small amount by one person. First, they would need to push the arm to the point where it stops with no pressure. Then, they will need to apply just a bit of pressure to get it passed this point.
The other person will then need to push the locking pin and have the tip fit into the hole in the arm. They will then need to tighten the screw into place.
This should get the arm in the perfect position so that it is fully disengaged when the clutch handle is pulled down. Remember that if the clutch cable pin is not tightened well, this may loosen up and move down the cable over time so you may need to readjust this later on.
I hope these suggestions help !