Questions Relating to Our Proposed Hong Kong IPO and Subsequent Decision to List in the USInvestors have raised questions regarding our decision to abort our proposed Hong Kong IPO in 2008, and our subsequent decision to list instead in the U.S. through an RTO SPAC transaction. We began the HK IPO process with high hopes, having secured Goldman Sachs as our lead underwriter, and Ernst & Young as our auditor. The support from these two industry leaders is itself a strong testament to our healthy financial and operational position at the time. However, the IPO market in Hong Kong was severely affected by the economic downturn in the second half 2008 and many IPOs were withdrawn. We were one of them. One of our competitors, Xtep, was listed on the HKEX in May 2008. However, the share price of Xtep dropped approximately 30% within one month after its listing. This clearly had a negative impact on investor confidence in the PRC sportswear market at that time. In fact, the HK IPO window was essentially closed for Chinese sportswear companies during the period we had considered our listing. As noted, Xtep listed in May 2008, and the next sportswear company listing was not until July 2009, with the IPO of 361. In the interim, with limited visibility into when the market conditions in Hong Kong would be more conducive to a listing, we made the decision to list in the U.S. In June 2008, our expected P/E for the proposed HKEX listing was adjusted to 8-12 times our estimated 2008 earnings. Goldman Sachs, our underwriters, also commented that it was very likely that we would not obtain full subscription even though the IPO share price was set at the low end of the range. In addition, our underwriters advised us that the Hong Kong IPO market might not recover in the year ahead (2008-2009). We therefore took the advice from our underwriters and decided to suspend the HK IPO. Subsequent to our decision to suspend our HK IPO, in late 2008, 2020 ChinaCap Acquirco ("2020"), proposed a US listing opportunity to EDS through a SPAC merger and the proposed valuation for the entire shareholding in EDS would be 6 times our estimated 2008 earnings. EDS considered that the US capital market was, and continues to be, the most prominent market in the world, and the valuation for EDS was only moderately lower than that for the proposed Hong Kong IPO. As a result, EDS decided to undertake the SPAC merger with 2020. Furthermore, we understand that SPAC owner 2020 had conducted comprehensive due diligence on EDS including financial analysis, site visits of our production facility and retail stores, meetings with distributors and suppliers and communication with the professionals engaged during our HK IPO process.