Major Shareholder:

• Mr. Yasukawa Yoshihiro ¡V38.15% interest
• Mr. Yeung Kwok Fan ¡V 19.25% interest

Company Subsidiaries:

• Cyclone (HK) (100%): Trading and manufacturing of digital AV products
• Speedweight Technology (100%): Research and development of digital of AV products

The Group is principally engaged in the development, design, and sale of digital AV products, which include IC Recorders, MP3 players, and DVD players for the mid-price segment of the market. The Group is responsible for the marketing, design, development, quality control, and the supervision of the production process of its products as the Group did not manufacture its own products during the Track Record Period due to limited financial and management resources.

The Group's products are sold to importers, exporters, and distributors based in Japan and Hong Kong. During the Track Record Period, sales to the Japanese market accounted for approximately 49.2% and 61%, respectively, of the Group's total turnover and sales to the Hong Kong market accounted for the remaining percentages. The products sold by the Group to its customers in Hong Kong are usually redistributed by these customers to other markets such as the PRC, Taiwan, Singapore, Malaysia, and Indonesia, while the products sold to Japan are redistributed in Tokyo, Yokohama, Osaka, Nagoya, and Hiroshima.

The Group subcontracts the production of its products to two OEM manufacturers with factories in the PRC. These OEM manufacturers are principally engaged in manufacturing and trading in consumer products such as AV products ¡V namely MP3 players, hi-fis, DVD players, and IC Recorders ¡V and electronic products such as integrated circuit chips. These OEM manufacturers are Independent Third Parties and have manufacturing facilities in Guangdong Province.

The Directors believe that the Group has the following competitive advantages:

• In-depth knowledge of the Group's principal market, Japan
• Long-term relationships, business and personal, with customers and suppliers
• Strong research and development team with the ability to keep the Group's products abreast of market changes and demand
• Established and wide ranging distribution (and subsequent redistribution) networks in the Asian Region

• The Group has a limited operating history;
• Reliance on key executives and personnel;
• Reliance on the Japanese market;
• Expansion may strain management and resources of the Group;
• The Group may not have sufficient funds implement the Business Plan;

The Group intends to vertically integrate its operations by commencing the setting up of its own manufacturing facilities for all of its products in Guangdong Province before the year ending March 31, 2003. The Group intends to acquire plant, machinery, and production facilities to achieve this goal.

In order to expand the geographical coverage of the Group's distribution network, the Directors will continue to approach potential distributors in new markets, such as the PRC, the United States, Europe (including the United Kingdom and France), and other countries in Asia (including Singapore and Taiwan). Although the Group had not, as at the Latest Practicable Date, established any representative office in Japan or elsewhere outside of Hong Kong, the Group intends to set up representative offices in the PRC and Japan to serve its customers more effectively. In addition, the Group plans to set up its branch offices in Shenzhen and Tokyo by mid-2003.

As an integral part of the Group's business strategy, the Group will continue to undertake the development and sale of digital AV products. It is the Group's strategy to closely monitor current technological trends and market requirements for digital AV products. The Group will continue to expand its product range to include digital cameras and innovate and incorporate new features into its products, such as compression memory and built-in memory sticks.

The Group plans to sell its products under its own trademarks by January 2004. As part of its effort to promote greater market awareness of its products, the Group intends to advertise through the press and the Internet. The Group will continue to actively participate in trade exhibitions and conduct seminars to increase the public awareness of its products in the market. It will also conduct marketing campaigns with some of its business partners to promote its products. The Group intends to carry out the various brand building and marketing activities during the two years ending March 31, 2005.

The net proceeds from the Placing, after deducting the related expenses, are estimated to amount to approximately HK$13.0 million (based on the offer price HK$0.25 per share). The Group at present intends to apply the net proceeds as follows: