Yihe Precision Hardware (Shenzhen) Co., Ltd.

Production Management Capability (Manufacturing of Precision Metal Products)

Status of System and Operational Standardization
The Company has comprehensive production systems and has established and perfected various operational and execution procedures in respect of each production process. The Company places strong emphasis on the standardization of each procedure and follows the principles of standardized operations and systematic production.

Status of Equipment and Manufacturing Capability
The Company purchased approximately 180 sets of advanced stamping machines from renowned brand names such as AIDA., of which approximately 70% are equipment of medium and large scale. In addition, the Company has an individual division for high speed progressive stamping and has a strong capability for the production of stamping products.

Production Management Capability (Secondary Precision Processing)

Secondary Precision Processing
The Company is equipped with a large number of precision secondary processing equipment which include laser welding machines, robot welding machines, ion water cleaning machines, riveting machines, tapping machines and butt welding machines which enable the Company to provide comprehensive supplemental processing services.

Solid Quality Assurance Capability

The Company has formulated detailed quality assurance standards and has employed experienced quality assurance personnel. The Company applies numerous quality assurance methodologies throughout the entire production cycle from the purchases of raw materials to the delivery of components with a view to ensuring that the customers' products are of the highest quality.

Smooth Logistics and Delivery on Time

The Company has established a distribution centre which is managed by distribution areas. The Company's vehicle teams have more than 10 vehicles including wagons and container trucks which are effectively utilized at an utilization rate of more than 90%. The Company has strong logistic capability and products can generally be delivered to destinations in Southern and Eastern China within one to three hours depending on the delivery distance (Delivery within the region).