BUSINESS CREDIT REPORT ===========================================================

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1 Subject: Shanghai Dalong Zhiheng Technology Development Co., Ltd. SBD No.: Printing Time: Report Type: Business Credit Report Currency in this report is Renminbi unless otherwise stated. "--" in this report indicates "unavailable" due to insufficient information or "no comments". Registered Address: No.1688 Huqingping Rd., Shanghai Post Code: Telephone: (021) Facsimile: (021) Business Address: Suite B, 24/F, No. 88 Hengshan Rd., Shanghai Post Code: Telephone: (021) Facsimile: (021) Website: SIC Code (China): 6270 «mechanical & electrical equipment wholesale»

2 IMPORTANT EVENTS Subject changed its name from Shanghai Zhiheng Technology Development Co., Ltd. into the current name in April SUMMARY Starting Time: May 18, 1997 Legal Status: Limited Liability Company Registered Capital: 10,000,000 Turnover: 178,258,000 (2002) Total Assets: 27,972,000 ( ) Net Worth: 17,106,000 ( ) Total Staff: 56 Business Line: computer equipment wholesale and retail CREDIT RATING Credit Limit: 1,500,000 Credit Status: CR3 The credit limit we recommend here does not take into consideration your specific transaction with Subject and is only for your reference in making your credit decisions. For the purpose of credit rating, we take into consideration the subject company's size, history and background, its financial and operational status against the average level in its line, its credit history as well as other relevant information. The implications of our credit rating are as follows: Rating Level of Risk Credit Suggestion CR1 Very small risk Credit is highly recommended. CR2 Small risk Credit terms can be flexible. CR3 Below normal risk Credit terms should be on normal basis. CR4 Normal risk Credit should be on monitoring basis. CR5 Above normal risk Credit should better be avoided. CR6 High risk Credit should be on secured basis. CR7 Very high risk Transactions should be on COD basis.

3 OVERVIEW The computer equipment wholesale and retail industry that Subject is engaged in is developing at a fast pace. Subject is a fairly large company in its line and enjoys considerably high reputation locally. The products Subject deals in are all famous brands. Having been in the trade for a long period of time, it enjoys rather stable relationships with its suppliers. Subject's sales growth has been above average in its line. However, due to fierce market competition, its gross sales profits have been decreasing. Its assets structure and efficiency are above average in its line. FIELD VISIT Our credit analyst visited Subject's office at Suite B, 24th Floor, Zhengshen Plaza, on Dec. 10*2003. The plaza is in a busy and convenient commercial section of Xuhai District, Shanghai. According to an employee of the plaza's property management office, the plaza is a Class A office building with a pretty high rental of RMB/m2/month. Subject moved here in Oct and has no detrimental rental payment record. Subject rents an office area of about 400 m2, with standard internal layout and busy working atmosphere. MAIN ACTIVITIES Main Business: Computer equipment wholesale and retail Subject is the general agent of Huari displays in East China. It is also engaged in agency for the distribution of Hongda memories, Kunpeng hard disks, Quanshun CD-ROMs, keyboards, mice,etc.

4 SALES INFORMATION Subject is based in Shanghai, with offices in Nanjing, Hangzhou, Hefei and Nanchang. Our credit analyst met with Mr. Li Jun, General Manager, when visiting the subject company on Mar. 10, According to him, their gross sales profits keep falling due to fierce competition in East China, especially in terms of computer displays, their main commodities. However, he further advised that they will focus on medium and small-sized cities where the sales margin is higher. Currently, their market is centered round Shanghai and Jiangsu Province, accounting for 70% of their total sales. Their sales terms are usually COD or 30 days credit. PURCHASE INFORMATION As a general agent of Huari displays. Subject directly purchases computer displays from Nanjing Huari Display Co., Ltd. on terms of 30-day credit. Other commodities, such as memories, hard disks, CD-ROMs, are purchased from its upstream dealers, who are selected on the basis of the prices offered and the payment terms granted. Its main suppliers include Shanghai Qianzheng Technology Co., Ltd. and Suzhou Zhongji Electronic Co., Ltd. Its normal payment terms are COD or 30-day credit. CREDIT RECORD Our credit analyst contacted Miss Yan ( ) of the Finance Department of its supplier, Nanjing Huari Display Co., Ltd. and was advised that Subject is its general agent in East China, and that Subject normally makes prompt payments. Our credit analyst also contacted Suzhou Zhongji Electronic Co., Ltd. ( ), another supplier of Subject, via the telephone. According to Mr Wang, Sales Manager of the supplier, there have been no arrears in their business dealings. Check with local courts revealed nothing detrimental against Subject. STAFF Total: 56 Headquarters: 18

5 FINANCE Balance Sheet (Unit: 1,000) Total assets 14,641 27,972 Including: Total cur.assets 14,080 27,081 Including: Cash & banks 2,950 4,183 Account receivable 3,119 6,267 Inventory 5,262 8,291 Other cur. assets 2,749 8,340 Total fixed assets Including: Fixed assets, net Total liab. & shareholder s equity 14,641 27,972 Total liab. 8,107 10,866 Including: Total cur. liab. 8,107 10,866 Including: ST loans 1,000 2,000 Account payable 6,915 8,213 Other cur. liab Total shareholder s equity 6,534 17,106 Income Statement (Unit: 1,000) Principal.operating revenues 130, ,528 Cost of Goods 123, ,418 Sales tax and additional Sales gross profit 6,156 7,013 Selling expenses 1,677 1,998 General administration expenses 2,424 2,829 Financial expenses 2 82 Principal operating profit 2,057 2,268 Other operating profit 11 (328) Operating profit 2,046 1,940 Non-operating profit Non-operating expenses 3 -- Total profit 2,246 1,940 Less: Income tax Net profit 2,184 1,886

6 Important Ratios Return on net assets ratio (%) Return on total assets ratio (%) Profit margin after tax (%) Turnover of total assets Turnover of current assets Turnover of accounts receivable Liabilities/assets ratio Current ratio Quick ratio Source of Financial Statements: Government. FINANCIAL NOTES Our credit analyst conducted a phone interview with the finance manager of Subject, Miss BaiXue on March 11, 2003 and asked why its net worth increased so much. She advised that the reason is that Subject increased its registered capital by 9,000,000 in April In response to the question why the inventory and accounts receivable were so big as of the end,of the year 2002, she explained that was the result of aggressive credit sales in order to take bigger market share. BANK RELATIONS A/C Bank: Xuhai District Branch of Shanghai Bank A/C Number: This report is furnished at your request for your exclusive use in business decision making and for no other use. Information contained herein shall not be released to any third party unless otherwise agreed by SINOTRUST. SINOTRUST does not warrant the accuracy of any information herein and shall not be liable for any loss or damage arising out of the use of

7 FINANCIAL RATIO COMPARISON SIC Code: 6270 mechanical & electrical equipment wholesale INDEX 2002 SUBJECT INDUSTRIAL AVERAGE Return on net assets ratio (%) Return on total assets ratio (%) Profit margin after tax (%) Turnover of total assets Turnover of current assets Turnover of accounts receivable (days) Liabilities/assets ratio Current ratio Quick ratio INDEX 2001 SUBJECT INDUSTRIAL AVERAGE Return on net assets ratio (%) Return on total assets ratio (%) Profit margin after tax (%) Turnover of total assets Turnover of current assets Turnover of accounts receivable (days) Liabilities/assets ratio Current ratio Quick ratio *Industrial Average is the average of the financial rations of the businesses within the industry that are in SINOTRUST database. This report is furnished at your request for your exclusive use in business decision making and for no other use. Information contained herein shall not be released to any third party unless otherwise agreed by SINOTRUST. SINOTRUST does not warrant the accuracy of any information herein and shall not be liable for any loss or damage arising out of the use of

8 REGISTRATION Starting Time: Registration Date: Registry: Shanghai Municipal Administration for Industry & Commerce Legal Representative: Wang Tao File Number: Legal Status: Limited Liability Company Registered Capital: 10,000,000 Business Line: Computer equipment, office automation equipment, communication and electromechanical equipment (wholesale, retail, agent purchase and sales) Duration: Import Permit: Export Permit: Capital Alteration: 20 years No No Changed from 1,000,000 to the current amount in April 2002 History: Subject's predecessor was Shanghai Zhiheng Technology Development Co., Ltd., established on May 18, It was purchased by Shanghai Dalong (Group) Co., Ltd. and changed to the current name in Apr. 2002, but its business scope remains unchanged. SHAREHOLDERS AND SHARES Shareholders Shanghai Dalong (Group) Co., Ltd. Mr. Li Jun Mr. Fu Bin Capital 5,100,000 4,000, ,000 Shares 51% 40% 9% This report is furnished at your request for your exclusive use in business decision making and for no other use. Information contained herein shall not be released to any third party unless otherwise agreed by SINOTRUST. SINOTRUST does not warrant the accuracy of any information herein and shall not be liable for any loss or damage arising out of the use of

9 INFORMATION ON MAIN SHAREHOLDERS Shanghai Dalong (Group) Co., Ltd. Address: No. 300 Dalian Rd., Shanghai Telephone: (021) Major business activities are industrial investment and real estate development. Main projects they invested in are the Beach Garden, Xinxin Garden, etc. MAIN EXECUTIVES Name WANG TAO Position Gender Chairman of the Board Male Age 36 Education Working experience Master degree Previously employed in Chinese Academy of Science Now General Manager of Shanghai Dalong (Group) Co., Ltd. Board Chairman of the Subject from April Name LI JUN Position Gender General manager Male Age 40 Education Working experience Master degree 1983, researcher in Shanghai Chemical Fiber Research Institute; 1985, section manager in Shanghai Foreign Trade Corporation; manager in Shanghai Honglong Electronic Co., Ltd.; general manager in Shanghai Data Industry Co., Ltd. ; 1997, General manager of Subject This report is furnished at your request for your exclusive use in business decision making and for no other use. Information contained herein shall not be released to any third party unless otherwise agreed by SINOTRUST. SINOTRUST does not warrant the accuracy of any information herein and shall not be liable for any loss or damage arising out of the use of

10 AFFILIATES Name: The First Business Department Address: 1 st Floor No 2000 Quyang Rd, Shanghai Telephone: (021) Facsimile (021) Subject s Shares: 100% Address: The Second Business Department Telephone: No 218 Dongfang Rd, Pudong, Shanghai Facsimile (021) Subject s Shares: (021) END OF THE REPORT