AV Concept Limited, a whollyowned subsidiary of the Company, is pleased to announce that on
February 2^nd 2010, AV entered into a letter of intent (LOI) with Ledman Optoelectronic Co., Ltd., a company incorporated in the People’s Republic of China. It is the intention of the parties that the LOI is non-legally binding.

Under the LOI, AV Concept has conditionally agreed to form a joint venture company (“JV Company”) with LEDMAN in the PRC, which will be principally engaged in the research and development, the sale, the quality control and brand management of high brightness high-power LED products. The JV Company will be jointly managed by AV Concept and LEDMAN.

It is estimated that the capital investment of each of AV Concept and LEDMAN will not be more than US$2 million (or an equivalent amount of Renminbi) and the capital to be invested will be mainly used for research and development of LED products. Upon the establishment of the JV Company, LEDMAN will own 51% equity interest of the JV Company and will be entitled to 51% of its profits while AV Concept will own 49% equity interest of the JV Company and will be entitled to 49% of its profits. The JV Company, upon establishment, will not become a subsidiary of AV Concept.

AV Concept intends to finance its investment in the JV Company by its internal resources. LEDMAN is one of the leading manufacturers in the LED industry and it has a sale network of over 50 countries and regions in the world. AV Concept Directors consider that the proposed formation of the JV Company with LEDMAN demonstrates the continuance of the growth of LED business of the Group and enable the Group to increase its competitiveness in the LED industry, also believe that AV Concept can benefit from the proposed formation of the JV Company with LEDMAN.